ADVANCES IN STRATEGIC MANAGEMENT

Advances in Strategic Management

Advances in Strategic Management

Definition

The textbook definition of strategic management is a set of decisions and actions that result in the formulation and implementation of plans designed to achieve a company's objectives (Pearce II & Robinson Jr., 2009). Strategic planning as it refers to Strategic management is a process of determining long -term goals and identifying the best approach for achieving the goals (Strategic Planning, 2009).

Four Functions of Management

The four functions of management relative to creating and implementing a strategic plan are planning, directing, organizing, and controlling (Pearce II & Robinson Jr., 2009). Planning is the first function of the management process, without effective planning management cannot effectively organize, control or lead. Planning is used as a tool to help identify potential opportunities and threats as well as effectively establishes goals and objectives for long-term success. Planning also ensures that the business will use all resources toward achieving the goals that will guide the business toward obtainable success.

Case Study

What drove Intel? Craig Barrett, appointed executive vice president in January 1990, believes that "the world changes and the centre of gravity shifts. We need to shift with it.” Intel recognises the need for continually analysing and reviewing its strategies in order to meet the changes and challenges that come from the external environments so as to meet the stakeholders' expectations. Intel strives for business renewal and revitalisation as a way of dealing effectively with the impact of the information society on today's dynamic industry. Therefore, Intel is an innovation-driven organization that strongly believes that competitive advantage can be achieved by choosing the right option at the right time so as to create value to Intel's key stakeholders: its customers. To achieve this Intel uses the following key drivers (which are discussed in detail in Question 2):

Market leadership and Innovation

Research and Development

Strategic Alliances

Good Human Resource Management

Benchmarking

Branding

Key Innovations

Innovation has always been a key feature in Intel's history. In this section we summarize the major innovations brought out by Intel:

1969 SRAM (bipolar static random access memory);

1971 EPROM 1702 (erasable programmable memory device);

Intel launches its first microprocessor (the 4-bit 4004);

1974 Intel launches its first general-purpose microprocessor (the 8-bit 8080);

1981 The revolutionary 432 32-bit microprocessor is launched;

1985 The 32-bit 386 microprocessor is introduced (the 486 will replace the 386 in 1989);

1993 The first generation of Pentium processors is introduced;

As one can see, Intel has continually introduced breakthrough market creating products, highlighting the importance of innovation as a key driver to this company.

Key Strategic Initiatives

1984 Copyright protection (i.e. lawsuit against NEC) and dramatic changes in the company's licensing strategy (only IBM was granted a license);

1985 Intel exits the DRAM business (and by the end of 1986 also the SRAM business);

Mid 80'sIntel decided to minimize layoffs and instead accelerate product introductions.

With the "386" Intel mainly focused on microprocessors and other business initiatives generating high margins (e.g. supercomputers);

Late 80's

The SEMATECH alliance did not match expectations and faded away; in 1988 Intel teamed up with Siemens but, once again did not succeed, like many others both ...