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Dynamic Strategic Alignment

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Dynamic Strategic Alignment

This reference note was prepared by Professor Steven White to introduce basic concepts and a framework for discussing strategic management. Copyright © 2009 by CEIBS (China Europe International Business School). No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means – electronic, mechanical, photocopying, recording or otherwise – without the permission of CEIBS
The CEIBS Case Centre is sponsored by McKinsey & Company.

Dynamic Strategic Alignment

CC-307-017

Dynamic Strategic Alignment
This note introduces the concepts and frameworks that are commonly used in strategic analysis, integrating them within an on-going process of creating and improving strategic alignment. 1. FUNDAMENTALS The objective of strategic management is to create alignments—within the firm and between the firm and its environment—that give the firm competitive advantage and enable it to achieve its goals. Strategic change, therefore, is fundamentally a decision about what changes to make in order to create or improve alignment that moves the firm closer to its goals. Managers may increase alignment and performance by a) changing elements of the firm, b) changing features of the environment in which operate, or c) shifting to another environment. There will usually be multiple options, and managers must decide which changes are necessary, possible and worth the effort required. When making a change of any type, there will usually be a temporary period of adjustment during which performance may actually drop. If the change was appropriate, however, this should be followed by an increase in competitiveness and performance. Managers may intentionally create mis-alignments as they pursue growth, whether expanding their current activities or diversifying vertically along the value

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