Guy Harley Bachelor of Law (University of Adelaide – 1978)

1. Guy Harley • Bachelor of Law (University of Adelaide – 1978) • Barrister and Solicitor in Adelaide for 18 years • Master of Business (eBusiness) (University of SA 2001) • Contact Information • (02) 4570 1116 • guy@harley.net.au

2. Dates for 2nd Semester • Classes start 14 July • Tutorials start – 21 July • Classes finish – 29 September • Exams – 9 to 16 October

3. Course Assessment • Exam 70% • Internal assessment 30% • Essay plan 18th August 2004 - 5% • Essay 8th September 2004- 25% • To pass subject, students must • 40% or more in exam, and • 50% or more overall

4. Course Assessment (cont.) • Penalty for late submission of assessments is 5% per day off maximum possible mark • Extension are only granted for serious medical or personal events. • Requests for an extension must be made in advance and must be accompanied with medical or other evidence. • Students who miss assessments because of illness must provide a medical certificate within 72 hours. • Students must complete an assessment cover sheet (lecturer must sign it).

5. Plagiarism • Copying the work of someone else and passing it off as your own • Failing to acknowledge the source of information you have used • Plagiarism is STEALING • You will receive a mark of zero for a substantially plagiarised assignment • If you plagiarise more than twice you may have your enrolment cancelled

6. Text Book • Hanson & Dowling, 2003, “Strategic Management Competitiveness & Globalisation: A Pacific Rim Focus”, Thomas Nelson, Australia

7. Resources • www.harley.net.au • Lecture slides • Tutorial exercises • Notices • Course outline including assessment • Links • Writing guides

10. Resources (cont.) • La Trobe IT web site • http://ironbark.bendigo.latrobe.edu.au/courses/subjects/Subjects.html • A.C.N. Website • http://resource.auscampus.net • Libraries • LaTrobe Online • UTS

11. Academic Support • Thursdays 12.00pm –2.00pm – help with planning assignments, study skills, reading & writing • Essay writing for examsMon 29 March & 5 April, 4.30pm – 6.30pm • Answering multiple choice questions Mon 3 May 4.30pm – 6.30pm • Answering short answer questionsMon 17 May 4.30pm – 6.30pm

12. What is required of you? • Spend the same amount of time in private study as you do in class • Read textbook and notes every week • Attend lectures and TAKE NOTES • Prepare for tutorials in advance • Be prepared to ask and answer questions • Complete all assessments on time • Participate fully in all group activities

13. Do you want to pass this subject? • In an Australian university learning is YOUR responsibility. It is up to you to be self- disciplined and keep up to date • Begin reading your textbook TODAY • Attend free classes on essay writing • Ask your lecturer to explain if you don’t understand something. • Give priority to your study over part time work

14. Strategic Management & Competitiveness Hanson & Dowling Chapter 1

15. Strategic Competitiveness Where a firm formulates and implements a value creating strategy • Sustainable Competitive Advantage A value creating strategy that other firms cannot easily duplicate • Strategic Management Process The set of commitments, decisions and actions required for a firm to achieve strategic competitiveness

16. External Environment Internal Environment Strategic Intent Strategic Mission Strategy Implementation Strategy Formulation Strategic Competitiveness Above Average Returns Feedback Loop

17. Strategy - A Continual Challenge • 30% of companies in Australia’s top 100 drop off every 10 years. • Andrew Grove - Intel’s former CEO • Only paranoid companies survive • Anticipate the unexpected

18. 21st Century Competitive Landscape • Convergence • The Global Economy • Globalisation • Technology

19. Convergence • Industries • Technologies The Global Economy • Goods, services, people, skills & ideas move freely across geographical borders • Europe has replaced USA as world’s largest single market • Countries pursue a national competitive advantage

20. Globalisation • The spread of economic innovations, together with political & cultural adjustments, around the world • Encourages international integration • Global corporations • Global standards • Emerging economies • Challenges • Managing diversified operations • New skill sets for foreign environments • Maintaining concentration on domestic market

21. Technology • Increasing rate of Change & Diffusion • Shorter product life cycles • Promotes first mover advantage • Reduces protection from patents • Information Age • Speed & Reach of dissemination • Networking • eBusiness

22. Technology (cont.) • Knowledge Management • Capture • Transform • Distribute • Exploit

23. Strategic Agility • Ability to respond quickly to changes in the environment • Requires organisational learning

24. Strategic Models • Industrial Organisation Model • Emphasises influence of external environment • Resource Based Model • Emphasises firm’s internal resources • Research • 20% of profitability comes from industry • 36% from firm’s characteristics & actions • Use both together

25. Industrial Organisation Model • Challenges firms to • find most attractive industry in which to compete • then develop internal skills

26. Industrial Organisation Model (cont.) • 4 underlying assumptions • External environment imposes pressures & constraints that determine strategy • Firms in an industry have similar resources & strategies • Resources used to implement strategies are mobile across firms • Organisational decision makers are rational

27. The Industrial Organisation Model of Above Average Returns Feedback Loop Study External Environment Above Average Returns Select Attractive Industry Strategy Implementation Strategy Formulation Acquire Assets & Skills

28. Industrial Organisation Model (cont.) • Promotes strategies of: • Cost-leadership • Differentiation • Focus-differentiation • Uses 5 forces model to analyse external environment

29. Porter’s 5 forces Substitute Products New Entrants Traditional Competitors The firm Suppliers Customers

30. Resource Based Model • Assumes • Each organisation is a collection of unique resources and capabilities • Differences in firm’s performance are driven by differences in firm’s resources and capabilities • Over time firms develop different resources and capabilities • Not all firms in an industry possess the same resources and capabilities • Resources may not be highly mobile across a firm

31. The Resource Based Model of Above Average Returns Feedback Loop Resources Above Average Returns Capabilities Strategy Competitive Advantage Attractive Industry

32. Resources • 3 types • Physical • Human • Organisational Capability • The capacity for a set of resources to integratively perform a task

33. Dimensions Task Technology People Structure

34. Competitive Advantage • Occurs when resources and capabilities are: • Valuable, • Rare, • Costly to imitate, and • Non-substitutable • They are valuable when they take advantage of opportunities or neutralise threats • When all 4 criteria are met they become core competencies

35. Strategic Intent • The leveraging of a firm’s internal resources, capabilities and core competencies to accomplish the firm’s goals in a competitive environment • Exists only when all levels of the firm are committed to a specific and significant performance criterion • A firm must also identify its competitors strategic intent

36. Strategic Mission • A statement of a firm’s unique purpose and scope of operations in product and market terms • Flows from Strategic Intent • It is externally focused

37. Stakeholders • Individuals and groups that • Affect or are affected by the strategic outcomes achieved, and • Have enforceable claims on a firm’s performance • Firm’s depend on stakeholders • Stakeholders can influence a firm’s operations

38. Classification of Stakeholders • Capital Market Stakeholders • Shareholders • Suppliers of capital (e.g. banks) • Product Market Stakeholders • Customers • Suppliers • Host communities • Unions • Organisational Stakeholders • Employees • Managers

39. Managing Stakeholders • Firm must manage and prioritise competing stakeholder demands • Society’s standards influence the weightings allocated amongst the 3 stakeholder groups • Different cultures have different weightings • A Transnational firm must have a global mind-set

40. Strategy Success Factors • Hard work • Thorough analysis • Brutally honest • Common sense • Speed & Flexibility • Acceptance of change & innovation • A desire for the firm and its people to accomplish more • Encourage others to think and enquire what firm is doing and why

41. Strategy Pitfalls • Changes in strategic assumptions • Strategic mission may become a strategic blinder • Operational routines create strategic inertia • Established relationships prevent change • Shared beliefs become dogmas that prevent a change in organisational culture

42. Organisational Culture • Definition: • The complex set of ideologies, symbols and core values • Shared throughout the firm • That influences the way it conducts business • Includes organisational ethics