Definition and Explanation

• The term strategy is derived from the Greek word strategies that means general.
• Strategy is the process of determination of organization's mission (purpose), vision, values and (long term) objectives of an enterprise.
• It is also adoption of courses of action and allocation of resources necessary to achieve these aims.
• It is needed to unify and give direction to plans.
• It consists of competitive moves and business approaches to produce successful performance.
• It is management's game plan to: 1. run the business, 2. strengthen firm's competitive position, 3. satisfy the customers and 4. achieve performance targets.

General Understandingof Strategy (as per Henry Mintzberg)

• Strategy as plan- a direction, guide, course of action- intention rather than actual.
• Strategy as ploy- a maneuver intended to outwit a competitor.
• Strategy as pattern- a consistent pattern of past behaviour- realized rather than intended
• Strategy as position- locating of brands, products or companies within the conceptual framework of consumers or other stakeholders- strategy determined primarily by factors outside the firm.
• Strategy as perspective- strategy determined primarily by a master strategist.

Three Main StrategicQuestions

1. Where are we now?
2. Where do we want to go in terms of business positions, financial outcomes and strategic outcomes?
3. How will we get there?

Principle of StrategyFramework

• The more strategies and policies are clearly understood and implemented in practice, the more consistent and effective will be the framework for enterprise plans.
• Example: If a company has a major strategy of developing only those new products that fit its marketing organization, it will avoid wasting it's energy and resources on new products that do not meet this test.

Need for OperationPlanning i.e. Tactics

• To be effective, strategies must be put into practice by means of plans, increasing in detail until they get down to the nuts and bolts of operations.
• Tactics, then, are the action plans through which strategies are executed. Strategies must be supported by effective tactics.
• Since strategies affect planning, they also greatly affect all the areas of managing.