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1. Def Strategic management?

It is defined as the set of decisions and actions resulting in the formulation and
implementation of strategies designed to achieve the objectives of the organization (John A.
Pearce II and Richard B. Robinson, Jr.)
2. Types of strategy?
1. Corporate strategy
2. Business strategy
3. Functional strategy
3. Wt is Business strategy?
Business strategy is primarily concerned with how a company will approach the
marketplace - where to play and how to win. Where to play answers questions like, which
customer segments will we target, which geographies will we cover, and what products and
services will we bring to market. How to win answers questions like, how will we position
ourselves against our competitors, what capabilities will we employ to differentiate us from the
competition, and what unique approaches will we apply to create new markets.
Senior managers typically create business strategy. After it is created, business architects
play an important role in clarifying the strategy, creating tighter alignment among different
strategies, and communicating the business strategy across and down the organization in a clear
and consistent fashion. Executives are just beginning to bring advanced, highly credible business
architecture practices into the strategy discussions early to provide tools, models, and facilitation
that enable better strategy development.
4. short note on shareholder?
A shareholder or stockholder is an individual or institution (including a corporation)
that legally owns a share of stock in a public or private corporation. Shareholders are the
owners of a limited company. They buy shares which represent part ownership of a company.
Stockholders are granted special privileges depending on the class of stock. These rights may
The right to sell their shares.
The right to vote on the directors nominated by the board.
The right to nominate directors (although this is very difficult in practice because of minority
protections) and propose shareholder resolutions.
The right to dividends if they are declared.
The right to purchase new shares issued by the company.
The right to what assets remain after a liquidation.

5. Shareholder vs Stakeholder?
Shareholders are stakeholders in a corporation, but stakeholders are not always
shareholders. A shareholder owns part of a company through stock ownership, while a
stakeholder is interested in the performance of a company for reasons other than just stock
6. Trickle down of Vision and Mission?
Draw triangle inside write this step by step in hierarchy manner
1. Value who we are?
2. Vision Why we are here?
3. Mission what we intend to do?
4. Strategy goal when do we do it?
5. Tactics- how we do it?

Goal Objective
Meaning The purpose toward which an endeavor is
Something that one's efforts or actions are
intended to attain or accomplish; purpose;
Example I want to achieve success in the field of
genetic research and do what no one has
ever done.
I want to complete this thesis on genetic
research by the end of this month.
Action Generic action, or better still, an outcome
towards which we strive.
Specific action - the objective supports
attainment of the associated goal.
Measure Goals may not be strictly measurable or
Must be measurable and tangible.
Time Longer term Mid to short term

8. Who are all Stakeholder?

9. Purpose of Vision And Mission?
VMS help an organization:
Guide strategic planning and implementation
Define performance standards and expectations
Establish a more productive, goal-oriented corporate culture
Communicate its purpose and goals to outside stakeholders
10. Generic building blocks of competitive advantage?

Part B

1. Michael Porters approach to industry analysis
Michael Porter, an authority on competitive strategy, contends that a corporation is most
concerned with the intensity of competition within its industry. Basic competitive forces
determine the intensity level. The stronger each of these forces is, the more companies are
limited in their ability to raise prices and earned greater profits.

Threat of new entrants
New entrants are newcomers to an existing industry. They typically bring new capacity, a
desire to gain market share and substantial resources. Therefore they are threats to an established
corporation. Some of the possible barriers to entry are the following.
1. Economies of scale
2. Product differentiation
3. Capital requirements
4. Switching costs
5. Access to distribution channels
6. Cost disadvantages independent of size
7. Government policy

Rivalry among existing firms
Rivalry is the amount of direct competition in an industry. In most industries corporations
are mutually dependent. A competitive move by one firm can be expected to have a noticeable
effect on its competitors and thus make us retaliation or counter efforts. According to Porter,
intense rivalry is related to the presence of the following factors.
1. Number of competitors
2. Rate of industry growth
3. product or service characteristics
4. amount of fixed costs
5. capacity
6. height of exit barriers
7. diversity of rivals
Treat of substitute product or services
Substitute products are those products that appear to be different but can satisfy the same
need as another product. According to Porter, Substitute limit the potential returns of an
industry by placing a ceiling on the prices firms in the industry can profitably charge. To the
extent that switching costs are low, substitutes may have a strong effect on the industry.
Bargaining power of buyers
Buyers affect the industry through their ability to force down prices, bargain for higher
quality or more services, and play competitors against each other.
Bargaining power of supplier
Suppliers can affect the industry through their ability to raise prices or reduce the quality
of purchased goods and services.

2. Strategy formulation process?

Strategy Formulation
The stage of strategic management that involves the planning and decision making that lead
to the establishment of the organizations goals and of a specific strategic plan.
Strategy Implementation
The stage of strategic management that involves the use of managerial and organizational
tools to direct resources toward achieving strategic outcomes.
3. Corporate governance?
Set of mechanism that influence the decisions made by managers when there is a
separation of Ownership and Control.
Evolution of public ownership creates this separation(because of shareholder).
Two-Tier Corporate Hierarchy
On first- Tier Board of Director
On second- Upper Management
The corporate governance practice in the Company is built in conformity with the best
international standards and recommendations set in the Code of Corporate Behavior of the
Federal Financial Markets Service, as well as the provisions of the Code of Corporate
Governance of OJSC Enel Russia ratified by the Company in 2006.
Corporate governance in the Company is based on the following principles:
The Code of Corporate Governance envisages accountability of the Board of Directors of the
Company before all shareholders in accordance with the legislation in force, and is the
governing document for the Board of Directors in issues related to strategy planning,
administration and control over the Companys executive bodies.
The Company undertakes to protect the rights of its shareholders and treat all shareholders on
an equal basis. The Board of Directors enables its shareholders to receive efficient protection
if their rights are violated.
The Company shall provide timely disclosure of credible information on all the important
facts related to its activities, including information on its financial condition, social and
environmental measures, results of activities, ownership and management structures; the
Company shall provide free access to such information for all interested parties.
The Company acknowledges the rights of all interested parties envisaged by the legislation in
force, and aims at cooperation with such parties in order to provide steady development and
ensure financial stability of the Company.
An effective board should head each company. The Board should steer the company to
meet its business purpose in both the short and long term.
The Board should have an appropriate mix of skills, experience and independence to
enable its members to discharge their duties and responsibilities effectively.
The Board should guide the business to create value and allocate it fairly and sustainably
to reinvestment and distributions to stakeholders, including shareholders, directors,
employees and customers.
The Board should lead the company to conduct its business in a fair and transparent
manner that can withstand scrutiny by stakeholders.