Course Introduction and Syllabus - STRATEGIC MANAGEMENT - UniBG
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LUCIO CASSIA
Professor of Strategic Management and Entrepreneurship
Chairman of the Center for Young and Family Enterprise (CYFE)
University of Bergamo
TOMMASO MINOLA
Professor of Entrepreneurship and Strategic Management
Director of the Center for Young and Family Enterprise (CYFE)
University of Bergamo
STRATEGIC MANAGEMENT
Course Introduction and Syllabus
Lesson STR T00 - Course Number 37176 ENG – Fall 2018 / Spring 2019
Details and contents
• Course name Strategic Management (ENG code 37176)
• Course terms 1st term Theory (6 ECTS) Sep,20 2018 – Nov,11 2018
2nd term Practice (6 ECTS) Feb,28 2019 – June,6 2019
• e-learning http://elearning8.unibg.it/moodle25/
• Social Strategic Management & Entrepreneurship @UniBG
• Web www.unibg.it/struttura/struttura.asp?corso=37176
Strategic Management (Theory and Practice) 3
Lucio Cassia Università degli Studi di Bergamo
Course modules: Theory and Practice
Lectures
(9 classes)
Theory
Conference Lab
(1 class)
Sep,20 – Nov,11 2018
Methods and Tools
(2 classes)
Case Analysis Labs
(4 classes)
Practice
Conference Labs
(3 classes)
Feb,28 – June,6 2019
Project Work Labs
(3 classes)
Strategic Management (Theory and Practice) 4
Lucio Cassia Università degli Studi di Bergamo
Course topics (Theory, 9 classes)
Class 0. Course Introduction & Syllabus (20 September 2018)
• Details and contents
• Faculty
• Resources
• Exams
Course introduction:
• A strategic perspective
Strategic Management (Theory and Practice) 5
Lucio Cassia Università degli Studi di Bergamo
Course topics (Theory, 9 classes)
Class 1. Understanding strategy (26 September 2018)
• Theory
Definitions and key concepts. Schools of strategic management. Strategy foundations. Business
modeling.
• Case
The Electrode Gamble (VBS Case)
Discussion points:
1. What factors created an opportunity in the electrode market?
2. What mistakes were made to provoke the crisis?
3. What was so bad about the crisis situation? What was still good?
4. What risks can you recognize in strategy implementations and how they were dealt with?
• Readings
1. Henry Mintzberg. Strategy Safari (Chapter 1)
2. Michael Porter. What is strategy?
3. Sun Tzu. Art of War (Chapter 1)
Strategic Management (Theory and Practice) 6
Lucio Cassia Università degli Studi di Bergamo
Course topics (Theory, 9 classes)
Class 2. Designing a business model(27 September 2018)
• Theory
Business model canvass. Value proposition. Target client definition. Communication channels.
Distribution channels. Revenue streams. Key activities. Potential business partners. Resources
allocation. Cost structure.
• Case
R&R (HBS Case 9-386-019)
Discussion points:
1. What factors created an opportunity for Bob Reiss and the “TV Guide Game?”
2. What risks and obstacles had to be overcome in order to pursue the opportunity
successfully? How did Bob Reiss accomplish this?
3. Would this approach have worked for Parker Bros., or Milton Bradley?
4. As a result of this success, what should Reiss do now?
• Readings
1. Osterwalder A., Pigneur I. Business Model Generation (preview)
Strategic Management (Theory and Practice) 7
Lucio Cassia Università degli Studi di Bergamo
Course topics (Theory, 9 classes)
Class 3. Analyzing external business environment (3 October 2018)
• Theory
PESTEL-analysis. Industry analysis. 5 competitive forces. Competition analysis.
• Case
Matching Dell (HBS Case 9-799-158)
Discussion points:
1. How and why did the personal computer industry come to have such low average
profitability?
2. Why has Dell been so successful despite the low average profitability in the PC industry?
3. Prior to the recent efforts by competitors to match Dell (1997-1998), how big was Dell’s
competitive advantage? Specifically, calculate Dell’s advantage over the team of Compaq
and a reseller in serving a corporate customer.
4. How effective have competitors been in responding to the challenge posed by Dell’s
advantage? How big is Dell’s remaining advantage?
5. What should each of Dell’s major rivals (IBM, Compaq, HP, and Gateway) do now?
• Readings
1. Michael Porter. The five competitive forces that shape the strategy.
2. Michael Porter. Understanding industry structure.
Strategic Management (Theory and Practice) 8
Lucio Cassia Università degli Studi di Bergamo
Course topics (Theory, 9 classes)
Class 4. Analyzing internal business environment (4 October 2018)
• Theory
Organizational diagnosis. Functions analysis. Organizational structure analysis. Strategic
readiness.
• Case
//no case preparation required for this class
• Readings
1. Weisbord M. Productive workplaces (chapter 11)
Strategic Management (Theory and Practice) 9
Lucio Cassia Università degli Studi di Bergamo
Course topics (Theory, 9 classes)
Class 5. Creating strategic vision (1/2) (10 October 2018)
• Theory
Strategic opportunities. Client value analysis. Ansoff matrix. Product-market-channel matrix.
Vision statement. Vision propagation instruments.
• Case
IKEA invades America (HBS Case 9-799-158)
Discussion points:
1. What factors account for the success of IKEA?
2. What do you think of the company’s product strategy and product range? Do you agree
with the matrix approach described in Figure B of the case?
3. Despite its success, there are many downsides to shopping at IKEA. What are some of
these downsides? IKEA’s Vision Statement (in Figure C of the case) describes how the
company seeks to build a “partnership” with its customers. What do you think of this
vision statement?
4. The fact that IKEA hopes to have fifty stores in operation in the Unites States by 2013 is an
indication of how optimistic the company is about the viability of its value proposition in
this country. Do you think IKEA is being overly optimistic in its growth plans? How would
you improve IKEA’s value proposition to make it even more attractive to American
consumers?
Strategic Management (Theory and Practice) 10
Lucio Cassia Università degli Studi di BergamoCourse topics (Theory, 9 classes)
Class 5. Creating strategic vision (2/2) (10 October 2018)
5. To achieve the kind of growth that IKEA is hoping for, should the company change its
product strategy? If so, in what way(s)? What about its product range—are there
limitations to the matrix approach? Should the company expand its product lineup to
include a greater number of styles and price points? In what other ways should the
company consider changing its product lineup?
6. If you had to predict, what do you think IKEA’s value proposition and product lineup will
look like in ten years?
7. Some industry observers have suggested that IKEA should open a number of smaller,
satellite stores across the United States (e.g., in shopping malls, strip malls, etc.). By
offering a limited range of IKEA products, these “IKEA Lite” shops would presumably give
consumers who do not otherwise have access to a full-size IKEA the opportunity to
experience the brand. In addition, consumers who do live near a full-size IKEA would be
able to use these mini-outlets to make minor purchases (e.g., purchase a set of mugs, as
opposed to an entire living room set). Do you agree with this idea? Why or why not?
• Readings
1. George Yip. Market Selection and Direction: Role of Product Portfolio Planning.
2. Youngme Moon. Rethinking positioning.
3. James C. Collins & Jerry I. Porras. Building Your Company’s Vision.
4. James M. Kouzes and Barry Z. Posner. To Lead, Create a Shared Vision.
Strategic Management (Theory and Practice) 11
Lucio Cassia Università degli Studi di BergamoCourse topics (Theory, 9 classes)
Class 6. Choosing and supporting functional strategies (11 October 2018)
• Theory
Functional strategies. Balanced Score Card. Financial strategies. Marketing strategies. Corporate
architecture. HR strategies.
• Case
Lack of Oxygen (VBS Case 2-002-016)
Discussion points:
1. What are the major factors that change the business environment for the company?
2. What business strategy should the management of Kislorod Group choose? Why?
3. What do you think to be the optimal set of functional strategies for Kislorod Group? Why?
• Readings
1. Trond Randøy et al. Corporate Financial Strategies for Global Competitiveness.
2. Ritika Tanwar. Porter’s Generic Competitive Strategies.
3. Roger T. Burlton. Delivering Business Strategy Through Process Management.
4. Randall S. Schuler & James W. Walker. Human Resources Strategy: Focusing on Issues and
Actions.
Strategic Management (Theory and Practice) 12
Lucio Cassia Università degli Studi di BergamoCourse topics (Theory, 9 classes)
Class 7. Managing the strategic process (1/2) (17 October 2018)
• Theory
Strategic diagnosing. Gap analysis. SWOT analysis. Scenario planning. Action planning.
• Case
Strategic planning at United Parcel Service (HBS Case 9-306-002)
Discussion points:
1. What are the strengths and weaknesses of scenario planning?
2. What is your evaluation of UPS’s 1997 scenario planning exercise? Its Horizon 2017
planning exercise? How do the two efforts compare?
3. What are the other key elements of UPS’s approach to strategic planning? In particular,
what is your evaluation of:
• the UPS charter?
• the Centennial Plan?
• the Strategy Road Map?
4. Why was John McDevitt put in charge of “strategic integration?” Should he remain in that
role?
5. How does UPS’s strategic planning process compare with the approach at your
organization?
Strategic Management (Theory and Practice) 13
Lucio Cassia Università degli Studi di BergamoCourse topics (Theory, 9 classes)
Class 7. Managing the strategic process (2/2) (17 October 2018)
• Readings
1. Ian Wilson. From Scenario Thinking to Strategic Action.
2. Clayton M. Christensen and Tara Donovan. The process of strategy development and
implementation.
3. Eric M. Olson et al. The importance of structure and process to strategy implementation.
Strategic Management (Theory and Practice) 14
Lucio Cassia Università degli Studi di BergamoCourse topics (Theory, 9 classes)
Class 8. Strategic mistakes and failures (18 October 2018)
• Theory
Change management concepts. Strategic team. Leadership challenges. Strategic mistakes.
• Case
Apple inc. in 2015 (HBS Case 9-715-456)
Discussion points:
[to be given as the in-class assignment]
• Readings
1. Victoria Crittenden. Building a capable organization: The eight levers of strategy
implementation.
2. Robert Kaplan & David Norton. How to implement a new strategy without disrupting your
organization?
3. Yang Li et al. Making Strategy Work: A Literature Review on the Factors influencing
Strategy Implementation.
Strategic Management (Theory and Practice) 15
Lucio Cassia Università degli Studi di BergamoMethods and tools topics (Theory, 2 classes)
• Introduction to techniques, methods and tools for information search (8 November 2018)
The class aims to introduce students to the foundamentals of Business Intelligence. The key
questions of the lesson are:
– How can I properly analyze (web) resources to find the “right” data?
– How can I prepare data in order to analyze them?
– What are the main software dedicated to data analysis?
– How can I visualize the results of my analysis?
During the lesson, some basic software for business intelligence will be used (e.g., MS Excel,
MS Power BI, …).
• Project works presentation and assignment (22 November 2018)
The class aims to give an overview on the topics of the course’s project works available.
Special focus will be dedicated to video podcast, namely output required for the final
presentation of the project work, and the tool useful for its development (e.g., audio editing
software).
Strategic Management (Theory and Practice) 16
Lucio Cassia Università degli Studi di BergamoConference Lab (Theory, 1 class)
Start Cup Bergamo Final Event (October,16 2018)
• Start Cup Bergamo is the entrepreneurial training program of the University of
Bergamo. It includes the Start Cup School, where business ideas are crafted, and the
Business Plan Competition, where the investors meet the aspiring entrepreneurs.
• During the final event the business ideas will be presented to academics, investors
and entrepreneurs.
• Students will be involved in the final event, where the nascent entrepreneurs will
present their business ideas by discussing the underlying embedded strategies.
Strategic Management (Theory and Practice) 17
Lucio Cassia Università degli Studi di BergamoCase Analysis Labs (Practice, 4 classes)
• Some business case studies will be discussed during the classes in the 2nd term
(Practice Module).
• By encouraging to understand, analyze and work through complex real world
problems, the analysis of case studies stimulates students’ critical thinking and helps
them to bridge the gap between theory and practice through the application of
theoretical concepts to business challenges.
• Students will learn how to apply theoretical concepts to analyze the competitive
position of a firm, evaluate business strategies, and critically compare alternative
strategic decisions. These skills will be evaluated in the Theory exam.
• Students are strongly encouraged to read the case material provided in the
classroom and engage in a very proactive and interactive discussion.
Strategic Management (Theory and Practice) 18
Lucio Cassia Università degli Studi di BergamoConference Labs (Practice, 3 classes)
• The Trends in the Age of Globalization (TAG) Conferences are an opportunity to
understand the changes of the global scenario from the experience of eminent
keynotes. Global strategy, innovation, digital transformation will be among the topics
of the conferences.
• The keynote speakers will be academics, global management consulting partners,
top managers, entrepreneurs, i.e. people who understand the global trends to
successfully face the rapidly changing global context. Corporations, small firms,
startups and communities are central in identifying key values in modern changes.
• The aim of the TAG Conferences is to inspire students’ critical thinking skills and
debate on the impact and scenarios of the global changes.
Strategic Management (Theory and Practice) 19
Lucio Cassia Università degli Studi di BergamoProject Works Labs (Practice, 3 classes)
• During the second term, two classes will be allocated as class labs for the planning
and the development of each project work. The groups will work on the assigned
topic with the assistance of the Faculty.
• The aim is to help students throughout the preparation of the project work and to
give support to find the right direction to decide structure, contents and sources.
• Project Works Labs will be scheduled in the following periods:
– At the beginning of March 2019
– At the beginning of April 2019
– At the beginning of May 2019
Strategic Management (Theory and Practice) 20
Lucio Cassia Università degli Studi di BergamoProactive participation
• The course is structured to be interactive. Therefore attending the course is
recommended and students are encouraged to participate to every class.
• Informed and engaged participation is of paramount importance and welcome from
everyone. Students are also invited to debate about topics, experiment new ideas
and share links to real cases.
• Contributions to discussion (in class and through social networks) and ideas from the
students are encouraged. Proactive participation is appreciated and graded.
Strategic Management (Theory and Practice) 21
Lucio Cassia Università degli Studi di BergamoFaculty
Strategic Management Course Faculty
ENG 37176 Theory (1st term)
Lucio Cassia
Professor of Strategic Management & Entrepreneurship
Chairman of the Center for Young and Family Enterprise (CYFE)
University of Bergamo
lucio.cassia@unibg.it
Mikhail Plotnikov
Higher School of Economics Campus in Nizhny Novgorod
Department of General and Strategic Management)
plotnikovm@gmail.com
Davide Gamba
Teaching fellow
Center for Young and Family Enterprise (CYFE)
University of Bergamo
davide.gamba@unibg.it
Strategic Management (Theory and Practice) 23
Lucio Cassia Università degli Studi di BergamoStrategic Management Course Faculty
ENG 37176 Practice (2nd term)
Tommaso Minola
Professor of Strategic Management & Entrepreneurship
Director of the Center for Young and Family Enterprise (CYFE)
University of Bergamo
tommaso.minola@unibg.it
Giovanna Campopiano
Faculty of Economics
WIFU Chair of Business Administration and family entrepreneurship
Witten/Herdecke University (Germany)
giovanna.campopiano@uni-wh.de
Mara Brumana
Assistant professor of Strategic Management & Entrepreneurship
Research fellow of the Center for Young and Family Enterprise (CYFE)
University of Bergamo
mara.brumana@unibg.it
Strategic Management (Theory and Practice) 24
Lucio Cassia Università degli Studi di BergamoCourses Assistant
Paolo Pressiani
Research fellow of the Knowledge Transfer Office (KTO)
Project manager of Start Cup Bergamo
University of Bergamo
paolo.pressiani@unibg.it
• Course organization
• Teamwork management
• e-learning Moodle platform
• Class communication
Strategic Management (Theory and Practice) 25
Lucio Cassia Università degli Studi di BergamoResources
Online resources
• Online resources are available to students through the Moodle platform
– Lessons
– Case studies
– Reference material (scientific papers, reports, podcasts, interviews, etc.)
– Keynotes by visiting executives (entrepreneurs, managers, etc.)
– Information about lectures, conferences, events, etc.
– http://elearning8.unibg.it/moodle25/
• Students are invited to join the Facebook Group “Strategic Management &
Entrepreneurship @UniBG” to share information and posts about the main topics of
the course
– www.facebook.com/groups/strategicmanagementunibg/
Strategic Management (Theory and Practice) 27
Lucio Cassia Università degli Studi di BergamoReference texts
Reference textbook
• Contemporary Strategy Analysis
Robert M. Grant
John Wiley & Sons
ISBN: 978-1-119-12497-9
Additional textbooks
• Strategic Management: Concepts
Frank T. Rothaermel
McGraw-Hill College
ISBN 978-1260141863
• Entrepreneurial Strategy
Lucio Cassia, Michael Fattore, Stefano Paleari
Edward Elgar Pub
ISBN 978-1845421977
Strategic Management (Theory and Practice) 28
Lucio Cassia Università degli Studi di BergamoExams and course policies
Exam
• The exam covers both Theory and Practice modules and requires to demonstrate the
mastery of the topics, tools and frameworks covered during the course.
• Grading plan
a. Theory module : 40%
b. Practice module (project work) : 60%
c. Classes participation (Lectures and Labs) : additional 0-3 marks
• The project works are assigned by the Faculty:
– for attending students, on a four-student group basis
– for non-attending students, on individual basis
• Theory assessment and project work can be separately obtained in different
sessions. Grades are kept valid for the exam sessions June to September. For the
following sessions, students will be required to take both parts within the same
session.
• For attending students an early exam session will be available in May 2019.
Strategic Management (Theory and Practice) 30
Lucio Cassia Università degli Studi di Bergamoa. Theory module
• The theory exam aims to assess students’ understanding and ability to apply
theories, frameworks and methods taught throughout the course, including every
lecture and lab. To prepare for the exam students can also take advantage of the
reference text (Contemporary Strategy Analysis, Grant) as well as the online
resources (lectured materials, labs, discussions).
• The exam consists of multiple-choice questions, open answer questions and short
analysis of cases, following learning experience in both semesters.
• The exam will be performed in written form on an individual basis.
Strategic Management (Theory and Practice) 31
Lucio Cassia Università degli Studi di Bergamob. Practice module (project work)
• The project work analyzes an industry, a company or a set of companies, a strategic
initiative (e.g., a merger or an acquisition), a strategic opportunity faced by a firm or
industry (e.g., a change in market demand or technology) or a global trend (e.g., a
competition shift).
• Students are required to apply strategic tools and knowledge learned along the
course, to the real economic environment.
• The goal of the project work is “to know more” about the assigned topic. Students
have to deal with the issue in depth, with a scientific and critical approach. This
includes careful selection of the most reputed sources.
• The project consists of a final presentation, eventually supplemented by written
notes. Innovative ways of presentation, original ideas, clarity, focus on the topic are
encouraged and graded.
• A comprehensive “project work package” includes presentation, sources, references,
papers, documents, videos and material in electronic form.
• The project works will be assigned by the Faculty on the first Practice Module
lecture.
• Non-attending students are required to contact Faculty well in advance of the exam
session.
Strategic Management (Theory and Practice) 32
Lucio Cassia Università degli Studi di BergamoProject work rules
• The project work must be original text. Students are expected not to use others’ text
or work and present it as their own. References shall always be cited. In case of
plagiarism the entire exam will be failed.
• Each student of the group will put their own effort to make sure that their
contribution and presentation will be comparable among the members. Each team
member will be selected by the Faculty to present different parts. Each student may
be assigned a different grade.
• Based on the project work topics, the Faculty may pose questions to each student
within the group. The answers will influence the final evaluation individually.
• The Faculty will evaluate the project work considering originality, internal
consistency, relevance to the assigned theme, methodological rigor, quality and
variety of sources, accuracy of report and presentation, clarity of in-class
presentation, efficient teamwork.
• The comprehensive package of the project work will be sent to the Faculty one week
before the exam through uploading on the Moodle platform.
Strategic Management (Theory and Practice) 33
Lucio Cassia Università degli Studi di Bergamoc. Class and Lab participation
• The Faculty will evaluate the proactive participation (single student and groups) both
during classes and labs.
• Students are strongly encouraged to read the suggested material for a very proactive
in-class discussion.
• Students are invited to review the guest’s profile in advance and the main topic of
each TAG Conference. Groups are required to prepare (not trivial) questions before
and during the TAG Conference to foster the discussion.
Strategic Management (Theory and Practice) 34
Lucio Cassia Università degli Studi di BergamoErasmus and Extra-EU Programme Students
We encourage students to apply for an Erasmus or an Extra-EU programme.
Upon request, students involved in an Erasmus Program during 1st or 2nd term of the
current year may be eligible for the attending student status (additional early exam
session; project work on a four-student group basis).
Furthermore, students can apply for any equivalence of the modules (Theory and
Practice, 6 ECTS each) under prior approval by prof. Maria Sole Brioschi
(maria-sole.brioschi@unibg.it). The equivalence may be granted for one or both
modules. On student’s request and responsibility, the remaining module will be carried
out in Italy. For these students the grading plan will be 50% for each module
(Theory/Practice) if they have passed and registered one of the two modules abroad as
an equivalent exam.
The same rules apply to foreign students at the University of Bergamo participating in
an Erasmus or Extra-EU Program, as well as to Italian students
undertaking recognized internships.
Strategic Management (Theory and Practice) 35
Lucio Cassia Università degli Studi di BergamoCourse policies
• Attendance
– All the students are members of a learning community, so a professional
behavior is expected. Please be on time for the class and be respectful of others’
viewpoints even if in disagreement with them.
• Academic integrity
– The university policies regarding plagiarism, cheating and similar activities will be
pursued as appropriate. Downloading or use of material obtained from an on-
line site without proper citation is plagiarism. Citing sources properly is
necessary to demonstrate where your information is coming from.
• Grade disputes
– Although generally it doesn’t happen, grade disputes are handled in writing.
Students are invited to submit a memo the the Course Assistant describing why
they feel the grade was incorrect. Grading errors are possible, but please be
aware that errors can be overly generous as well as overly harsh. Accordingly,
the grade may stay the same, be increased, or be decreased. There are no extra
credit assignments for improving a course grade.
Source: Adaptation from the Syllabus, Strategic Management & Business Policy, prof. Jing Sun, Wayne State University
Strategic Management (Theory and Practice) 36
Lucio Cassia Università degli Studi di BergamoA strategic perspective
Strategic Management (Theory and Practice) 37
Lucio Cassia Università degli Studi di BergamoStrategy
The success of a company over time is described by its strategy.
The future stands on the ability to find the direction to recreate the conditions for
growth, even under great uncertainty and a very fast global changing environment.
The future is full of tremendous opportunities, but also tremendous uncertainty. With
the current pace of innovation and shorter innovation cycles, new technologies will
continue to transform every aspect of how we live and work. Change is the new normal.
“Old world” concepts, models, paradigms and ideas will no longer be relevant.
So uncertainty and complexity are the main issues of the current global scenarios to be
exploited through increasing strategic management capabilities(*).
(*): The course deals with businesses, not with politics. Nevertheless, replacing the word “company” with “Country” and the word
“management” with “leadership” you’ll discover how strategy is increasingly paramount nowadays (e.g. the case of Brexit)
Strategic Management (Theory and Practice) 38
Lucio Cassia Università degli Studi di BergamoBuilding skills to make decisions under extreme uncertainty
• Creative Thinking
Being able to think fast and “out of the box”
• Entrepreneurship
Finding ways to become more productive and self-motivating, i.e., how to operate
without a boss/supervisor telling what to do
• Teamwork
More open organizations mean having to work in teams of strangers, often from
diverse national or disciplinary backgrounds
• Interdisciplinary learning
Being open to interdisciplinary and multidisciplinary study, however strange it might
initially seem
• Ethics
Many of the problems of the future will be ethically complex. This seems particularly
true in the context of robotics and artificial intelligence.
Source: “Education in a Digital Age”, E.P.M. Vermeulen, University of Oxford (2017)
Strategic Management (Theory and Practice) 39
Lucio Cassia Università degli Studi di BergamoApple 2000-2010: Recreating the conditions for growth even under great uncertainty
Source: Apple, The New York Times
Strategic Management (Theory and Practice) 40
Lucio Cassia Università degli Studi di BergamoApple 2000-2010: Recreating the conditions for growth even under great uncertainty
• By the end of 1996 Apple had lost $867 million and the total value of its shares was
less than $3 billion (now (Sep 2018) it is more than $1 trillion, 300 times more). So
Steve Jobs had been called back to the company he had founded. Steve slashed 70
percent of Apple’s product plans focusing on few products. At the same time he
commissioned the famous iconic company’s “Think Different” marketing campaign
• This video is about an internal meeting on Sep,23 1997. Steve said: “We’re trying to
get back to the basics” and “The question now is not: Can we turn around Apple? I
think it’s: Can we make Apple really great again?” (actually Steve is the owner of the
original and less aggressive #MAGA : "Make Apple Great Again")
Source: Apple (Sep,23 1997)
Strategic Management (Theory and Practice) 41
Lucio Cassia Università degli Studi di Bergamo1,4 billion iPhone sold
Cumulative Apple iPhone sales from June 2007 to Mar 2018 account for more than 1,4
billion units sold (approx. $900 billion in revenue and $120 billion in net profit). And 2.0
million iOS devices have been sold (including iPad and Apple Watch sales).
Source: Apple (Sep 2018), Statista (Jun 2018)
Strategic Management (Theory and Practice) 42
Lucio Cassia Università degli Studi di BergamoApple Special Event Sep,12 2018
Apple introduces new iPhone X models and a new version of the Apple Watch.
In your opinion, what’s the announcement with the greatest strategic impact?
Source: Apple (Sep,12 2018)
Strategic Management (Theory and Practice) 43
Lucio Cassia Università degli Studi di BergamoStrategic Management and Change
The course introduces the concept of Strategic Management and deals with the basic
directions and goals of organizations, industries, market structures and the impact of the
new digital technologies.
Strategic change and complexity management are the main issues of the new
millennium both for economics and business.
Companies should act as learning organizations skilled at creating, acquiring, and
transferring knowledge by modifying their behavior to meet new knowledge and
insights. Learning organizations avoid stability through continuous self-assessment and
change.
Strategic Management (Theory and Practice) 44
Lucio Cassia Università degli Studi di BergamoStrategic Change
Strategy is related to Change and therefore to the time (t)
COMPANY
+
Organization
- & action (t)
Measure
& feedback
GLOBAL MARKET
Global Global
Demand (t) Supply (t)
Strategic Management (Theory and Practice) 45
Lucio Cassia Università degli Studi di BergamoDigital Strategy: Innovation and Disruption
Great emphasis is put on the strategic evolution through the unceasing digital
transformation, a pervasive disruptive innovation undermining the strategic plans in a
matter of months or even days, and creating great opportunities provided that new
paradigm shifts are perceived and realized.
Industries and business case studies on digital transformation and strategy are discussed.
• App Economy evolution and strategies (WhatsApp)
• Artificial Intelligence and Machine Learning (Amazon Echo)
• Virtual reality and augmented reality (remote surgery)
• Carmakers strategies facing electric cars and driverless vehicles (Google Car)
• Creating value with Big Data (Potholes app, Roomba)
• Intellectual jobs automation (online banking)
• Internet of Things (everywhere)
• Newspapers digital disruption (BuzzFeed)
• Ride-hailing disruptive business model (Uber)
• Impact of mobile technologies (Google Maps)
• The rise of the sharing economy (Airbnb)
• e-democracy?
Strategic Management (Theory and Practice) 46
Lucio Cassia Università degli Studi di BergamoToday every business is a digital business
”Three main issues.
The first: the identity of a global company depends on the strength of its rules.
The second point is the generational change [...].
The third is the digitization: how to imagine the company in ten years”
Paolo Rocca, CEO of Techint
Techint Group
• Tenaris
• Ternium
• Techint Engineering&Construction
• Tenova
• Techpetrol
• Humanitas
• Tubular steel, oil & gas, industrial machinery,
mining, energy, health services
• Revenue 18.5 B$
• Employees 55.400
Source: The Techint Group, 2017, www.techint.com
Strategic Management (Theory and Practice) 47
Lucio Cassia Università degli Studi di BergamoFive big tech stocks build the market (OTT > Over The Top)
Source: The New York Times (June 2017 )
Strategic Management (Theory and Practice) 48
Lucio Cassia Università degli Studi di BergamoWhatsApp 2009-2013: a digital innovator and disruptor
Founded in 2009 by investing 60 M$
only, in just 4 years WhatsApp
attracted 450 million users and now
(2018) 1,5 billion, plus 65 billion
messages, 5 billion photos and 1
billion videos every single day).
WhatsApp is the fastest-growing
company of all time in terms of users
(Facebook had only 145 million users
after four years).
In just few years WhatsApp destroyed
the text message (SMS) market, giving
up the whole revenues, then sold
itself to Facebook for 19 billion $.
Source: Company announcements, Statista (May 2018)
Strategic Management (Theory and Practice) 49
Lucio Cassia Università degli Studi di BergamoWhatsApp : the fastest-growing company of all time in terms of users
Source: McKinsey & Company (2015)
Strategic Management (Theory and Practice) 50
Lucio Cassia Università degli Studi di BergamoToday every politics is a digital politics
Two people write Trump’s tweets. He writes the angrier ones.
“Recently, political and digital analysts began to suspect that Donald Trump’s tweets are
authored by two different people: Someone on his campaign staff is tweeting from an
iPhone, and the billionaire himself is tweeting from his Samsung Galaxy. […]
The data clearly shows that the Android and iPhone tweets are from different people,
posting at different times of the day, and using hashtags, links and retweets in distinct
ways. What’s more, the Android tweets are angrier and more negative, while the iPhone
tweets tend to be benign announcements and pictures.”
Source: The Washington Post (Aug 2016)
Strategic Management (Theory and Practice) 51
Lucio Cassia Università degli Studi di BergamoDriverless cars: a strategic perspective
Strategic Management (Theory and Practice) 52
Lucio Cassia Università degli Studi di BergamoCars: a very inefficient and dangerous investment
• 95% of the time a car is stopped
• Nearly 1.3 million people die in road crashes each year, on average 3,287 deaths a
day (2013)
• An additional 20-50 million are injured or disabled (2013)
• Human error accounts for 90% of road accidents (estimated)
Strategic Management (Theory and Practice) 53
Lucio Cassia Università degli Studi di BergamoCars: a very inefficient and dangerous investment
• Around 40,000 people
a year die on American
roads, more than all
fatalities caused by
firearms. The death
rate in America is about
12 people per 100,000.
• According to a working
paper by Jessica Lynn
Peck of the CUNY, the
arrival of Uber to New
York City may have
helped reduce alcohol-
related traffic accidents
by 25-35%.
Source: “Ride-hailing apps may help to curb drunk driving”, The Economist, April 4, 2017
and “New York City Drunk Driving After Uber”, Working Paper, Jessica Lynn Peck, City University of New York - CUNY (2017)
Strategic Management (Theory and Practice) 54
Lucio Cassia Università degli Studi di BergamoDriverless cars
• A driverless car (sometimes called a self-driving car, an automated car or an
autonomous vehicle) is a robotic vehicle that is designed to travel between
destinations without a human operator.
• To qualify as fully autonomous, a vehicle must be able to navigate without human
intervention to a predetermined destination over roads that have not been adapted
for its use.
Strategic Management (Theory and Practice) 55
Lucio Cassia Università degli Studi di BergamoLevels of driving automation
Source: Automated Driving, SAE International
Strategic Management (Theory and Practice) 56
Lucio Cassia Università degli Studi di BergamoDriverless cars market scenarios
Source: “Disruptive trends that will transform the auto industry”, McKinsey & Company (2016)
Strategic Management (Theory and Practice) 57
Lucio Cassia Università degli Studi di BergamoDriverless cars: the safety problem
May,7th 2016: The first known fatal accident involving a vehicle being driven by itself
Source: “The social dilemma of autonomous vehicles”, 2016, Jean-François Bonnefon et al., Science, 352:1573-1576
Strategic Management (Theory and Practice) 58
Lucio Cassia Università degli Studi di BergamoDriverless cars: the safety problem
May,7th 2016: The first known fatal accident involving a vehicle being driven by itself
Strategic Management (Theory and Practice) 59
Lucio Cassia Università degli Studi di BergamoDriverless cars: the safety problem
May,7th 2016: The first known fatal accident involving a vehicle being driven by itself
Strategic Management (Theory and Practice) 60
Lucio Cassia Università degli Studi di BergamoDriverless cars: the safety problem
May,7th 2016: The first known fatal accident involving a vehicle being driven by itself
• A Tesla Model S running the Autopilot feature suffered a horrendous crash with a
tractor-trailer, which resulted in the death of the Tesla’s driver.
• Tractor-trailer made a left turn from the other side of the highway, across the side of
the highway on which the Tesla was traveling.
• At the time of impact, the trailer was basically perpendicular to the highway, and the
Tesla crashed into it broadside.
• Neither Autopilot nor the driver noticed the white side of the tractor trailer against a
brightly lit sky, so the brake was not applied.
• This is the first known fatality in just over 130 million miles where Autopilot was
activated. In the US there is a fatality every 94 million miles. Worldwide, there is a
fatality approximately every 60 million miles.
• US regulators, who are in the midst of writing new guidelines for autonomous
vehicles, need to take this into account before they give blanket approval to partially
self-driving cars.
Strategic Management (Theory and Practice) 61
Lucio Cassia Università degli Studi di BergamoDriverless cars: the safety problem
• ”On March,19 an autonomous car operated by Uber — and with an emergency
backup driver behind the wheel — struck and killed a woman on a street in Tempe,
Ariz. It was believed to be the first pedestrian death associated with self-driving
technology. The company quickly suspended testing in Tempe as well as in
Pittsburgh, San Francisco and Toronto.”
• The accident was a reminder that self-driving technology is still in the experimental
stage, and governments are still trying to figure out how to regulate it.
• Still, most researchers believe self-driving cars will ultimately be more safe than their
human counterparts. In 2016, 37,461 people died in traffic-related accidents in the
United States, according to the National Highway Traffic Safety Administration. That
amounts to 1.18 fatalities per 100 million vehicle miles traveled in 2016.
Source: “Self-Driving Uber Car Kills Pedestrian in Arizona, Where Robots Roam”, The New York Times, Mar 19 2018
Strategic Management (Theory and Practice) 62
Lucio Cassia Università degli Studi di BergamoDriverless cars: the ethical issue
« this moral experiment posits a life and death where taking no action insures the
death of certain people, and taking another action insures the death of several
others.»
Source: “Self Driving Cars Are Not Five Years Away”, John Battelle, NewCoShift (Oct 2016)
Strategic Management (Theory and Practice) 63
Lucio Cassia Università degli Studi di BergamoDriverless cars: moral implications embedded into the software
Three traffic situations involving imminent unavoidable harm: which do you choose?
Source: “The social dilemma of autonomous vehicles”, Jean-François Bonnefon et al., Science (2016)
Strategic Management (Theory and Practice) 64
Lucio Cassia Università degli Studi di BergamoReaction vs Decision
• Reaction : action dictated instinct influenced by panic and different situations
• Decision : action undertaken after some considerations
Strategic Management (Theory and Practice) 65
Lucio Cassia Università degli Studi di BergamoWhat moral decisions should driverless cars make?
Ethical trade-offs that we are willing (or not willing) to make stand at the intersection of
the computer and social sciences. Focusing on collective intelligence, large-scale
cooperation and the social aspects of artificial intelligence will be paramount in the next
years.
Strategic Management (Theory and Practice) 66
Lucio Cassia Università degli Studi di BergamoDriverless cars: the ethical issue and the Moral Machine @MIT
• The car detects that the brakes failed.
• Your are outside the scene. Nothing will happen to you.
• What should the driverless car do?
Strategic Management (Theory and Practice) 67
Lucio Cassia Università degli Studi di BergamoDriverless cars will shake many industries and set new strategies
Driverless cars are a looming disruption and will likely change dynamics in the economy,
company strategies and in our personal lives.
• Automakers
• Auto insurance companies
• Auto financiers
• Car repairs and services
• Rental agencies
• Taxi drivers and companies
• Fleet managers
• Energy companies
• Road construction companies
• Parking operators
• Patrol services
• Houses (garages)
• etc.
Strategic Management (Theory and Practice) 68
Lucio Cassia Università degli Studi di BergamoReadings
• Self-driving cars will require new business models
(The Economist, Mar 1 2018)
Strategic Management (Theory and Practice) 69
Lucio Cassia Università degli Studi di BergamoReadings
• Uber’s Vision of Self-Driving Cars Begins to Blur
(The New York Times, Aug 19, 2018)
• Toyota to invest $500 million in Uber for self-driving cars
(Reuters, Aug 27, 2018)
Strategic Management (Theory and Practice) 70
Lucio Cassia Università degli Studi di BergamoWhat's wrong with Apple's new headquarters?
Strategic Management (Theory and Practice) 71
Lucio Cassia Università degli Studi di BergamoYou can also read
