Page 34 - DCOM506_DMGT502_STRATEGIC_MANAGEMENT

Strategic Management

Notes

Caselet Microsoft Broadens Vision Statement Beyond PCs

esponding to what Microsoft perceives as serious threats, the company changed
its "PCcentric" vision statement to one that embraces the impact of the Internet on
Rtechnology. Specifically the shift is from "a computer on every desk and in every
home" to "empower people through great software any time, any place and on any device".
The most serious threat is the decreased need for windows' software and PCs as developers
create programmes accessible via web browsers. While the number of developers writing
for Windows is currently stable, the percentage targeting the web have increased from
21% to 38% in the past year.

Microsoft has also introduced a pop-up notes feature in their online MSN, that is compatible
with and competes with AOl:s instant messaging (IM) feature (Wall Street Journal, July 29,
19990). AOL has blocked Microsoft's "hacking" into their IM feature, as this technology is
currently" closed". Microsoft and other Internet service providers such as Yahoo and Prodigy
are pursuing AOL to work with them and create interoperable systems (Wall Street Joumal,
July 26, 1999b). However, Microsoft continues to adapt its software to enable its Hotmail
subscribers to continue instant communication over the Internet-in line with its new
vision.

The new corporate vision also indicates Microsoft's intentions to take advantage of new
opportunities. Consumers are using their PCs and the Internet to share photography and
sample new music. The Windows operating system will integrate digital photography
and music, technology, and online services into Windows (Wall Street Journal, July 26,
1999c.) While the company is still under anti-trust scrutiny, they hope to position product
integration as a competitive response to changing industries and markets. Clearly, their
new vision demands such actions.

Source: Adapted from WallStreet Journal, July 26, 1999

2.3 Summary

Strategic management is the set of managerial decisions and action that determines the
way for the long-range performance of the company.
It includes environmental scanning, strategy formulation, strategy implementation,
evaluation and control.
Strategy formulation is the development of long range plans for the effective management
of environmental opportunities and threats in light of corporate strengths and weaknesses.
It includes defining the corporate mission, specifying achievable objectives, developing
strategies and setting policy guidelines.

Corporate strategy is one, which decides what business the organisation should be in, and
how the overall group of activities should be structured and managed.

Competitive Strategy is concerned with creating and maintaining a competitive advantage
in each and every area of business.
Strategy that is related to each functional area of business such as production, marketing
and personnel is called functional strategy.

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