After going through chapter 1 and Michael Porter’s article, the term Strategy derives from the Greek word Strategia, meaning generalship. Strategy is combination of thoughts of individuals that give consistency to the actions and decisions of an individual or an organization. It’s about intuition and one’s ability to foresee. It’s about achieving success. It’s about choosing what to do, what not to do. Without tradeoffs there would be no need for choice and thus no need for strategy.
There are following four elements of a strategy:
1. Goals that are consistent and long term.-
2. Profound understanding of the competitive environment.( Firm’s relationship with competitors, customers and suppliers)
3. Objective appraisal of resources
4. Effective implementation
The task of business strategy is to find out a way about deploying firm’s resources within its environment, satisfying firm’s long term goal and organizing firm in order to implement that strategy.
“Strategic fit” refers to the consistency of a firm’s strategy with the firm’s external environment and with its internal environment especially with its goals and values and resources and capabilities. Following are types of fits:
-First order Fit (consistency between each activity and the overall strategy).
-Second Order Fit (activities are re-in forcing).
-Third Order Fit (Goes beyond activity re-in forcement to what call Optimization of effort)
According to porter, strategy is the creation of a unique and differentiated position involving set of activities. There are three types of positioning
-Variety based positioning
-Needs based positioning
-Access based positioning
Military strategy and business strategy share a number of common concepts and principles. There are three common characteristics of both strategies, they are important, they involve a significant commitment of resource, and they are not easily reversible. Tactics are concerned with maneuvers necessary to win battles whereas strategy is concerned with winning the war.
Company needs strategy due to uncertain external environment. Strategy of a company evolves as the external and internal environment changes.

-Strategy provides decision support by pooling and integrating the acceptable solutions to a decision problem.
-Strategy act as communicating device and it can communicate the identity, goals, and positioning of the company to all organization members.
-Strategy as target, Strategy is forward looking and its key purpose is not only establishing a direction for the firm development but also to set aspiration that can motivate and inspire members of organization.
A company strategy can be found in heads of managers, in their articulations of strategy in speeches and written documents and in the decisions through which strategy is implemented.There are two major areas of a firm’s strategy:
1. Corporate strategy:
It defines the scope of the firm in terms of industries and markets in which it competes. Corporate strategy decision includes choice over diversification, vertical integration, acquisition, and new ventures, and the allocation of resources between different businesses of the