Making Strategic Decisions | My Assignment Tutor

Food Service ManagementMaking Strategic DecisionsLecture Aims• ƒIdentifying the components of strategic planning as asystematic process• ƒDeveloping skills in the application of a range ofperformance measures and appraisal• techniques• ƒIdentifying and applying approaches to businessanalysis and evaluation, and• ƒSelecting and applying strategic planning models andapproaches appropriate to foodservice operations.Origins of strategy• Vision• Mission• Policy• Goals/aims• Strategy• Objectives• TacticsThe three levels of strategyAssessing current performance• Same three levels can be used when assessing theperformance of the current operation:1. Operational• includes day-to-day sales and the way the product is providedand promoted2. Business• the performance of the enterprise in terms of profitability,competitiveness and other business measures3. Corporate• the strategic direction of the operation and how this is beingachievedAssessing current performance• Quantitative analysis• Business environment analysis• Qualitative evaluationQuantitative analysis• Essential part of appraisal• Considered over time• Evaluation is more important than the dataitselfBusiness environment appraisal• Macro environment– PESTLE• Industry environment– Five forcesThe Business Environment• P Political• E Economic• S Socio-cultural• T Technological• L Legal• E EcologicalThe micro-environmentPorter’s Five ForcesAdapted from Porter 2004Qualitative Evaluation• Making informed evaluation of the business• Allowing for external comparison• Asking the right questionsThe foodservice cycleThe foodservice cycle• Can be used to as an analysis tool for theoperation:– Difficulties in one element of the cycle will causedifficulties in the elements of the cycle that follow– Difficulties experienced under one element of thecycle will have their causes in preceding elementsThe foodservice cycleAssessing organisational capability• Resource analysis– How well do we do what we do?– Existing capacity for change– Identifying changes in resources• Value chain analysis– Examine all stages of the foodservice cycleSWOT MatrixThe need for constant monitoring• Business generally is going through a period ofrapid change– In this situation, it is not enough simply to monitor periodically the factorsthat in the past have indicated opportunities and threats• Foodservice organisations need to be constantlyon the lookout for new issues and newdevelopments, which may have a radical effect onthe business environment, and on the actions ofcompetitors both of which may have an affect onthe business that the foodservice organisation isinThe need for constant monitoring• Stagey is a continuous process• Strategic capability needs to be assessed, notjust for now but also for the future.• As time passes the current strategy will havedeveloped and been modified and also theexternal business environment is likely to havechanged.• This in turn will lead to the need to modifystrategies in the light of these changes.Basics of strategy• Cost leadership• Differentiation• Focus based on cost• Focus based on differentiationPorter’s (1980) matrixCompetitive advantageLow cost DifferentiationBroadTarget 1Costleadership2DifferentiationCompetitivescopeNarrowTarget3ACost focus3BDifferentiationfocusPorters Strategy ClockStrategy ClockDetermining strategic choices• Various approaches can assist, including:– Growth Share (BCG) Matrix– Ansoff’s growth matrix– Life cycle analysisAnsoff’s growth matrixAdapted from Ansoff 1988Life Cycle Analysis• Stages– Embryonic – Growth – Mature – Aging• Market position– Dominant – Strong – Favourable – Tenable – Weak• Variants– Fad life cycle– Extended life cycleStrategic means and assessing options• Internal development• Mergers and acquisitions• Joint developmentStrategic means and assessing options• Assessing options•Suitability•Feasibility•AcceptabilityReality of strategic management• Organic not linear• Affected by organisation and culture• Complex and judgmental• Continuous process• Combines a variety of approaches• A management job• Needs to be flexible to cope with uncertaintySummary• Strategic planning as a systematic process s bothcomplex and requires extensive attention to arange of performance measures and appraisaltechniques• Identifying and applying approaches to businessanalysis and evaluation, and Selecting andapplying strategic planning models andapproaches appropriate to foodserviceoperations, is crucial to the future sustainabilityof organisations.The Exam• (Please insert any relevant information youwish to share with the students about possibletopics for consideration and relevant to yourorganstion)Reading List and References• Ansoff, I. (1988) New Corporate Strategy, NewYork: Wiley• Cousins, J., Foskett, D., and Pennington, A.(2011) Food & Beverage Management, 3rdEdition, Goodfellow Publishers, Harlow, 263-290• Porter, M.E. (1980) Competitive Strategy, FreePress, New York

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