1. IS 1005 - INTRODUCTION TO MANAGEMENT
Supplementary Lecture

2. WHY DO WE HAVE AN ORGANIZATION (NOT FOR
PROFIT /FOR PROFIT) ?
Tuesday, July 16, 2013IS 1005 - Supplementary Lecture

3. MISSION & OBJECTIVES
 Mission & objectives – Purpose of the
company?
 Profit making org – To make your money grow
(increase profits for share holders/investors)
 Not for profit - Social welfare (to provide a
service to society)
Tuesday, July 16, 2013IS 1005 - Supplementary Lecture

4. MISSION & OBJECTIVES
 Whether profit making or not for profit, it is
necessary to clarify the purpose the
organization exists (reason why it is there).
 Mission - shows the purpose of the
organization
 Objectives are derived from the mission
(things you need to achieve in reaching your
purpose)
 Vision – an ideal state/status the company
wishes to achieve at a particular date.
Tuesday, July 16, 2013IS 1005 - Supplementary Lecture

5. SOME EXAMPLES OF MISSIONS AND VISIONS
(PROFIT MAKING OR NOT FOR PROFIT)
Missions
 Ford - “To be relevant and profitable for the
future”
 World Wildlife Fund - “to conserve nature and
reduce the most pressing threats to the diversity of
life on Earth.”
Vision
 Ford - “To become the world's leading consumer
company for automotive products and services”
 World Wildlife Fund - “to build a future where people
live in harmony with nature.”
Tuesday, July 16, 2013IS 1005 - Supplementary Lecture

6. STRATEGY
 Strategy – “A course of action undertaken to
meet a specific objective”
 It is the plan the company follows in order to perform
its mission.
 A company may look at several plans, evaluate
them, and decide on one.
 To make plans and decide the plan to
implement, a company needs to evaluate the
 Industry
 External situation
 Internal situation
 For this purpose, some tools can be used
Tuesday, July 16, 2013IS 1005 - Supplementary Lecture

7. ASSES INTERNAL AND EXTERNAL SITUATION
 Some tools that maybe used for this
assessment
 Industry analysis - Five Force Model
(M.Porter)
 External Env. Analysis - PESTEL Model
 Internal situ. Analysis - SWOT Analysis
Tuesday, July 16, 2013IS 1005 - Supplementary Lecture

8. FIVE FORCE THEORY - (INDUSTRY ANALYSIS)
What is its purpose?
 Before entering any industry, the company can
evaluate the industry/industries they plan to enter
before deciding whether to enter.
 A theory to analyze the industry
 Is it profitable?
 Worth putting you money?
 Risky (Risk - possibility of failure)?
 Easy to survive in industry?
 What if the investment fails?
 An existing company can also asses the env. to
identify forces that act on industry to develop strategy
Tuesday, July 16, 2013IS 1005 - Supplementary Lecture

9. FIVE FORCE THEORY - (INDUSTRY ANALYSIS)
 Intensity of competitive rivalry
 Bargaining power of suppliers
(labour/material)
 Bargaining power of customers (buyers)
 Threat of substitute products or services
 Threat of new entrants
 Refer note uploaded in group for explanation
in detail
Tuesday, July 16, 2013IS 1005 - Supplementary Lecture

10. PESTEL - (EXTERNAL ENV. ANALYSIS)
 A PESTEL analysis is an acronym for internal
and external environmental factors that
include issues from the
(P)olitical, (E)conomic, (S)ocial, (T)echnical, (
E)nvironment and (L)egislative areas of
business.
 Companies typically create a framework for
their organization that allows them to review
factors from each group and how they impact
the business, whether positively or
negatively.
Tuesday, July 16, 2013IS 1005 - Supplementary Lecture

11. PESTEL - (EXTERNAL ENV. ANALYSIS)
 P - Political
 E - Economic
 S - Social
 T - Technological
 E - Ecological
 L - Legal
 Please refer note uploaded in group for
explanation in detail
Tuesday, July 16, 2013IS 1005 - Supplementary Lecture

12. INTERNAL APPRAISAL – SWOT ANALYSIS
 S - Strengths
 W - Weaknesses
 O - Opportunities
 T - Threats
Tuesday, July 16, 2013IS 1005 - Supplementary Lecture

13. SWOT (INTERNAL APPRAISAL)
Internal factors
 Strengths - are strong points the company has that gives
it an advantage over others; it can emphasize on strengths when
developing strategy. Strengths help the company reach its
objectives.
 Weaknesses - are weak points of the organization that limit
the ability of the company to reach its objective. The company
should try to mitigate weaknesses and its strategy should
facilitate (help) it.
External Factors
 Opportunities - are elements that the project could exploit to
its advantage. It can be utilized to help the company to reach its
objectives.
 Threats - elements in the environment that could
cause trouble for the business or project
Tuesday, July 16, 2013IS 1005 - Supplementary Lecture

14. INTERNAL FACTORS THAT AFFECT THE
COMPANY - MCKINSAY 7S
Tuesday, July 16, 2013IS 1005 - Supplementary Lecture

15. INTERNAL FACTORS THAT AFFECT THE
COMPANY - MCKINSAY 7S
 Strategy – The organization’s alignment of resources and
capabilities to “win” in its market.
 Structure – Describes how the organization is organized. This
includes roles, responsibilities and accountability
relationships.
 Systems – The business and technical infrastructure that employees
use on a day to day basis to accomplish their aims and
goals.
 Shared Values – A set of traits, behaviors, and characteristics that the
organization believes in. This would include the
organization’s mission and vision.
 Style – The behavioral elements the organizational
leadership uses and culture of interaction.
 Staff – The employee base, staffing plans and talent
management.
 Skills – The ability to do the organization’s work. It
reflects in the performance of the organization.
Tuesday, July 16, 2013IS 1005 - Supplementary Lecture

16. Tuesday, July 16, 2013IS 1005 - Supplementary Lecture