Notes for “Master of Science”

Students
Level: [Link]. (Administrative Sciences)
Semester: (3rd) spring 2021
University: Allama Iqbal Open University
(AIOU)
Study Notes Course: (5013) Strategic management
for public sector
Prepared By: Sardar Umer Chaudhary
Department: Dept. Of Business Administration,
Islamabad main campus of AIOU.
Block-1: Introduction to Strategic Management of Public
Sector
 The Importance of Strategy Management
Strategic management is the process of setting goals, procedures,
and objectives in order to make a company or organization more
competitive.
Stages:
Assessment
Formulation
Implementation
Evaluation
Importance:
 IDENTIFY OPPORTUNITIES
Strategic management is necessary to identify opportunities. Tap
into opportunities and identify strengths and weaknesses by
studying the internal structure of your organization. Within every
team, there’s unrealized potential that needs your attention. You
may even discover new ways to implement existing strategies.

 PREPARE FOR THE FUTURE

Strategic management helps you prepare for the future.
Organizations can benefit from understanding the importance of
strategic management because it can help you prepare for
contingencies. A business environment is dynamic and fast-
paced. Evolve and adapt your strategies to keep abreast of vital
changes in the business sphere.
 BE ACTION-ORIENTED
Don’t become complacent in your management style. If you’re
driven by action and purpose, you can easily alter policies and
business plans to drive the organization forward. A sound action
plan is sustainable and important for the growth and survival of
your company.

 STRENGTHEN ORGANIZATIONAL STRUCTURE

Working in a team is important to achieve shared goals. Each
member is dependent on another for guidance, especially in a
stressful situation. This gives rise to the need for strategic
management. You can reflect on your organization’s internal
structure and make changes wherever you feel necessary. Only
a strong organizational structure can endure testing times.

 SUSTAINED COMPETITIVE ADVANTAGE

It’s necessary to have a sustained competitive advantage in
today’s market. To do well compared to other players in the
market and avoid failure when faced with setbacks, build a plan
that’s viable and long-lasting.
 The importance of strategic management lies at the intersection of
your company’s internal and external environments. Constructing a
strategic vision with long-term objectives in mind is useful for
achieving organizational goals.

 The Need for Strategic Management of Public Sector of Pakistan

The main reason of failure of strategy in pakistani public sector is
wrong strategy formulation & implementation. They need to make
vision and mission and make a strong plan and do good execution
and make strategy for employees give reward bonuses promotion
for increasing their efficiency and effectiveness. Public sector
organizations have best strategic policies but results of all
organization are not rewarding in accordance to long term
objectives. Implementation of the strategic plan is more important
than formulation; otherwise it is nothing except well documented
pieces of paper in the organization. The purpose of study is to
explore and confirm the effective factors of failure of the strategic
plan implementation in public sector organizations in Pakistan. The
study has been conducted on purely public sector organizations of
the Twin City (Islamabad and Rawalpindi). Background Strategic
Management is combination of the set of decisions and actions
which are viewed in the form of strategy formulation,
implementation and control of plans designed to achieve a
corporation's vision, mission and long term performance of the
organization. Strategy is most important concept in management
context. Strategy was introduced in first time by chandler et al.
(1975) in second half of twentieth century in the management
sciences course outline. In earlier days, after the study of chandler
et al. all the researchers focused the successful strategy
formulation. However, in the recent years' studies, attention has
shifted toward the successful strategic plan implementation.
 Block-2: Strategic Management:
 Why Strategic Management Is Different in Public and Third
Sector Organizations

Strategic management of Public & third sector

organization/Non for profit organization:

Strategic management in nonprofit organizations is the process of

selecting an organization’s goals, determining the strategic
programs necessary to achieve specific objectives in route to the
goals, and establishing the methods necessary to assure that the
policies and strategic programs are implemented. Strategic
management is the process of planning strategies for achieving an
organization’s goals and objectives.

Strategic management is the application of management

procedures to provide long-term direction to an organization’s
overall activities.

Strategic management is the carrying out of organizational policies

and procedures and is the purposeful process of achieving a
predetermined and desired objective.

Major Features

Strategic management for nonprofit organizations encompasses

five basic objectives, including:

1. Formulate plans and goals for the organization

2. Implement the organization’s plans and goals
3. Review and evaluate the organization’s performance
4. Analyze the organization’s effectiveness and efficiency
5. Project the organization’s future position
 The main difference in public and third sector organization is their
stages to work public sector organization and third sector
organization and another main difference is third sector ngo collect
charities and donation to give poor and needy peoples and public
like government organization collect tax to run government country
and other dept of gov they work for public. Strategic management
is public and third sector organization is different government make
plan and strategirs for long term and third sector organization make
plan for short term respective to their project. Third sector
organization hire the main power for specific project and trained
and make plan and strategies and do execution and when project
completed think about next project. But government do strategic
management his pre build dept and make plan and vision mission
and trained their employees for achieving goals for longterm it is
ling process.

 An Overview of Strategic Concepts and Issues:

The course of action accepted as the result of the estimate of the str
ategic situation.
It is a statement of what is to be done in broad terms sufficiently flex
ible to permit its use in framing the military, diplomatic, economic, inf
ormational, and other measures which stem from it. See also basic u
ndertakings. Strategy word come from army The word “strategy”
came from the two Greek words i.e. Stratus (Army) and Agein (to
lead).
DEF OF STRATEGY:
.
A plan of action designed to achieve a long-term or overall aim.
Strategic issues: write in this topic

A strategic issue is essentially an issue - an unresolved

question (i.e., a fundamental policy question) or critical
 challenge needing a decision or waiting for some clarifying
future event.

Strategic issues are triggered by any one of a myriad of

organizational issues or events of strategic relevance, such as:

1. Mandates - Issues related to carrying out mandates

successfully.
2. Mission and values - Issues related to successfully
accomplishing the mission.
3. Stakeholders - Issues related to meeting stakeholders'
expectations.
4. Internal strengths and weaknesses - Issues related to
successfully leveraging organizational strengths such
as resources, structure, processes, management, product
offering, financing, or organizational design; or avoiding
weaknesses.
5. Opportunities and threats - Issues related to
capitalizing on opportunities - clients, users or payers, or
mitigating threats to minimize risk of loss.

In order for an issue to be raised and resolved effectively,

the organization must be prepared to deal with the conflicts
associated with the issue. Strategic issues by definition
embody conflicts. These conflicts may be
over ends ("what"); means ("how"); philosophy ("why"); locati
on ("where"); timing ("when"); and who might be helped or
hurt by the different ways of resolving the issue ("who").

Strategy formulation issue identification in last course of

action.

Block-3: Applying Strategic Approaches to Public and

Third Sector Organizations:
 Types of Strategy and Their Uses
 The word strategy mean different thing to different peoples.
Within the domain of well-defined strategy there are uniquely
different strategy types, here are three:

1. Business strategy
2. Operational strategy
3. Transformational strategy

It is worth noting, that a common consideration across different

types of strategy are people, process, and technology. Without
this, strategy is a set of lofty ideas, ungrounded in reality.

1. Business Strategy

The first of the three types of strategy is Business. It is primarily

concerned with how a company will approach the marketplace -
where to play and how to win.

Where to play answers questions like, which customer segments

will we target, which geographies will we cover, and what products
and services will we bring to market. How to architect the strategy
and plans make business managers. A business strategy outlines
the decisions and actions a company plans to tak to reach its
business goals and objectives.

2. Operational Strategy

The second of the three types of strategy is Operational. It is

primarily concerned with accurately translating the business
strategy into a cohesive and actionable implementation plan.
Operational Strategy answers the questions:

 Which capabilities need to be created or enhanced?

 What technologies do we need?
 Which processes need improvement?
 Do we have the people we need?

The role of operations strategy is to provide a plan for the

operations function

3. Transformational Strategy

The third of the three types of strategy is Transformational. It is

seen less often as it represents the wholesale transformation of an
entire business or organization.

This type of strategy goes beyond typical business strategy in that

it requires radical and highly disruptive changes in people, process,
and technology. Transformational strategy is generally the domain
of Human Resources, organizational development, and
consultants. A transformational strategy is a plan of action aimed
at shifting a company's operating course,

Applying Strategic Approaches to Public and Third Sector

Organizations

Business strategy uses in public and 3rd sector:

1. Layout your goals and establish milestones.

2. Better understand your beneficiaries, partners, and other
stakeholders.
3. Assess the feasibility of your nonprofit and document your
fundraising/financing model.
 4. Attract investment and prove that you're serious about your
nonprofit.
For public sector:

Make plan and achieve goals and objective of public organizations.

All strategy help to achieve plans and goals in public and third
sector organization. I you apply these strategy different benefits
come from public and thirsd sector organization. Transformational
strategy help both public and third sector organization to boost or
make some changes to their plan and especiaalu non for profit
organizations need to motivate our emplyees for society benefit
and social welfare.

Block-4: Strategic Management Process & Issues

 Understanding Strategic Issues

A Strategic Issue is, first of all, an issue - an unresolved question

needing a decision or waiting for some clarifying future event.
Secondly, it is strategic and has major impact on the course and
direction of the business. It probably relates directly to one or more
of the fundamental “Three Strategic Questions”:

 What are we going to sell?

 To whom are we going to sell it?
 How will we beat or avoid our competition?

Strategic issues are triggered by any one of a myriad of

organizational issues or events of strategic relevance, such as:
  Mandates - Issues related to carrying out
mandates successfully.
 Mission and values - Issues related to
successfully accomplishing the mission.
 Stakeholders - Issues related to meeting
stakeholders' expectations.
 Internal strengths and weaknesses - Issues
related to successfully leveraging organizational
strengths such
as resources, structure, processes, management,
product offering, financing, or organizational
design; or avoiding weaknesses.
 Opportunities and threats - Issues related to
capitalizing on opportunities - clients, users or
payers, or mitigating threats to minimize risk of
loss.
 Straegic issues need a good decision making
on the right time . Other issues is compentecies,
culture, organizational change, resource
limitation, aquicition., meger, strategic alliance.
 The Strategic Management Process
The Strategic Management Process defining the organizational
strategy.

Or

Strategic management process is a continuous culture of

appraisal that a business adopts to outdo the competitors.

SM PROCESS:

There are five strategic management process steps that must be

followed in their chronological order.
 1. Goal setting

This is essentially clarifying the organization’s vision. The vision will

include short-term and long-term objectives, the processes by
which they can be accomplished, and the persons responsible for
implementing each task that culminates in the set goals.

2. Analysis

Analysis involves gathering the data and information that is

relevant to accomplishing the set goals. It also covers
understanding the needs of the business in the market and
examining any internal and external data that may affect the
organization’s goals.

3. Strategy Formulation

A business will only succeed if it has the resources required to

reach the goals set in the first step. The process of formulating a
strategy to achieve this may involve identifying which external
resources the business needs to succeed, and which goals must
be prioritized.

4. Strategy Implementation

Since the purpose of strategic management process is to propel an

organization to its objectives, an implementation plan must be put
in place before the process is considered viable. Everyone in the
organization must understand the process and know what their
duties and responsibilities are in order to fit in with the
organization’s overall goal.

5. Evaluation and Control

The evaluation and control actions for the strategic management

process include performance appraisal as well constant review of
both internal and external issues.
 Block-5: Formulating and Implementing Strategy
 Organizing the Process
Organizing, like planning, must be a carefully worked out and
applied process. This process involves determining what work is
needed to accomplish the goal, assigning those tasks to
individuals, and arranging those individuals in a decision‐making
framework (organizational structure).

In general, the organizational process consists of five steps (a

flowchart of these steps is shown in Figure 1):

Job design is the process of establishing employees' roles and responsibilities and the
systems and procedures that they should use or follow.

Departmentalization (or departmentalisation) refers to the process of grouping activities

into departments.

Delegation is commonly defined as the shifting of authority and responsibility for

particular functions, tasks or decisions from one person.

The Span of Management refers to the number of subordinates who can be managed
efficiently by a superior.

A chain of command is an organizational structure that documents how each member of a

company reports to one another.
 Formulating and Implementing Strategy: A Step-by-Step
Approach:

Strategy formulation step:

Vision & mission

Define company profile

Study external environmrnt

Matching all three steps

Decide action

Long term and short term straetegy

Buget and resource allocation

Implementation /review system.

Strategy Implementation step:

1. Define your strategy framework

2. Build your plan
3. Define KPIs (key performance indicators)
4. Establish your strategy rhythm
5. Implement strategy reporting
6. Link performance to strategy.

Block-6: Tailoring the Process for Specific Needs

Tailoring the Process for Specific Needs
Needs Analysis is a formal, systematic process of identifying and
evaluating training that should be done, or specific needs of an individual
or group of employees, customers, suppliers, etc. Needs are often
referred to as “gaps,” or the difference between what is currently done
and what should be performed. Also referred to as Gap Analysis, or
Needs Assessment.

1. Useful Support Techniques

Your business should always feel like a welcoming environment to
be in. ...
2. Ensure that your business is accessible. ...
3. Understand that no disability is the same. ...
4. Be patient. ...
5. Speak normally! ...
6. Communicate at the same level. ...
7. Don't assume. ...
8. Hire employees with disabilities.
More Techniques:

8 Steps to Develop an Effective Customer Service Strategy

1. Make customer happiness the end goal across the company

2. Identify all customer touchpoints
3. Set goals for customer service
4. Identify customer service KPIs to monitor
5. Build a driven customer service team
6. Build a powerful customer service toolkit
7. Give your customer service representatives power
8. Create a consistent feedback loop