Instructor’s Manual – Strategic Management, 7th Edition
Chapter 1 Strategic management and strategic competitiveness Learning Objectives 1. Analyse the components of the strategic management process. 2. Describe the competitive landscape and explain how globalisation and technological changes shape it. 3. Use the industrial organisation (I/O) model to explain how organisations can earn above-average returns. 4. Use the resource-based model to explain how organisations can earn aboveaverage returns. 5. Describe vision and mission and discuss their value. 6. Define and classify the four major stakeholder groups and describe their ability to influence organisations. 7. Describe the work of strategic leaders.
Lecture Notes Chapter Introduction: You may want to begin this lecture with a general comment that Chapter 1 provides an overview of the strategic management process. This chapter introduces a number of key terms and models that students will study in more detail in Chapters 2 to 13. Stress the importance of students paying careful attention to the concepts introduced in this chapter so that they are well grounded in strategic management concepts before proceeding further.
OPENING CASE McDonald’s and brand recognition McDonald’s, a well-known global brand, has achieved international success over the years. For example, in 2018 it had 37,855 restaurants around the globe. This has resulted in very strong brand recognition. For example, a recent survey found that 88% of people were able to identify the iconic McDonald’s Golden Arches logo. A key factor influencing McDonald’s international growth is its strategic competitiveness. The case demonstrates that McDonald’s has different competitive positions in different countries, some stronger and some weaker than competitors. For example, it is facing stiff competition with KFC in China. In India, it is still relatively a small brand but expanding strategically by alliances with local organisations, sourcing almost all products locally. Hence, it has complex country-specific challenges which necessitate a country-specific response. For example, McDonald’s is responding to local consumer needs very well. In Australia, McDonald’s offers a flexible menu, such as ‘gourmet coffee’ and fresh-food bars. Similarly, it is responding to consumer demand in the UK by offering details on what goes into their food.