SM Notes For IPCC

SHORTEST TRICK FOR GETTING GOOD MARKS IN IT-SM
Summary Notes
CA-IPCC
Please read your book first and after go through
these notes, it is writing in a summarizing manner,
when you read this at the time of revision, this will
help you. Best of luck for your exams. Yogesh
Gupta

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H T T P : / / Y O G E S H G U P T A R O H T A K . B L O G S P O T . C O M

Dedicate to:
My family, My Teachers & my friends

Yogesh Gupta (Author)

While every effort has been taken avoid errors, the author and other his teachers,
knowledge partners, mentors, Gurus are not responsible for the consequences of
any action taken on the basis of this notes/book, because Im also a student. Any
suggestion, improvement, complaint are requested from you.
Mail me: info.yogeshgupta@gmail.com

ALL THE BEST
HAPPY READING

YOGESH GUPTA
yogeshguptarohtak.blogspot.com
Fb.com/CAYogeshGuptaa

Mail me your review at:
info.yogeshgupta@gmail.com
Y OGESH GUPTA

Student CA-Final, CS-Executive
Bachelor in Buss. Admn.

Visit me at: yogeshguptarohtak.blogspot.com
Write me at: info.yogeshgupta@gmail.com

Prepared by: Yogesh Gupta -Page No: 1- http://facebook.com/mr.yogeshgupta
For more notes: notes4cacs.yg@gmail.com visit me at: http:// yogeshguptarohtak.blogspot.com
CHAPTER-1 ( Business Environment)

ELEMENT OF BUSINESS ENVIRONMENT PORTERS MODEL OF COMPETITION
MICRO MACRO a. Threatness of new entrance,
b. Threatness of new substitute,
c. Bargaining power of Buyers,
d. bargaining power of Suppliers, Rivalry among
current players
a. Customer
b. Suppliers
c. Organizational employees
d. Competitors
e. Market
f. Intermediaries
1. Government
2. Economic conditions
3. Legal setup
4. Political setups
5. Technological changes
6. Social
7. Culture
8. Global

CHAPTER-2 ( Business Policy & SM)
STRATEGY VISION MISSION
An analysis of situation & then
planning and implementation of
activities to achieve desired goals
or objectives.

Road map to future, indicate the kind of
company management, also specify the
company intentions and capabilities.
Include Mission Statement; define who we
are and where are we now?
(DEFINE PRESENTLY)
Element of company vision and future
position & growth ambition, provide
foundation to the future aim of
Organization.
(WHERE COMPANY WANT TO BE IN
FUTURE)

OBJECTIVE OF BUSINESS
[PGSES]
RELATIONSHIP BETWEEN
ORGANISATION & ENVIRONMENT
COOPERATION IN COMPETITIVE
ENVIRONMENT
a. Profitability,
b. Growth,
c. Stability,
d. Efficiency,
e. Survival
a. Exchange of Information
b. Exchange of resources
c. Exchange of Power & influence
a. Cartelization,
b. Kieretsu,
c. Internal cooperation/Family owned
competition
PROCESS & FRAMEWORK OF SM
STRATEGIC LEVELS
IN ORGANIZATION
GENERAL STRATEGIC ALTERNATIVES
a. Forming vision & setting objectives
b. Development strategy to achieve
vision & objectives.
c. Implement & execution of strategy
d. Feedback/making adjustments
overtime.

a. Corporate level
b. Business level
c. Function level

a. Stability
b. Expansion
c. Retrenchment
d. Combination

GSA DECISION MAKING
1. Top mgmt involvement
2. Allocation of large resources
3. Impact on long run
4. Future oriented
5. Multifunctional
6. Internal & External

SUPER NOTES FOR IPCC

CHAPTER-3 ( Strategic Analysis)

STRATEGIC ANALYSIS
ISSUES SHOULD BE CONSIDERS
STRATEGIC ANALYSIS
After formulating vision, mission & objectives of the org., it is necessary
to dissect the external and internal environment of the org. to formulate
a long term strategy to achieve these mission & objectives. This is not
only a talking event of managers, where managers can get some
creative & innovative thinking & opinions only, but also takes decisions
about the pursuing of strategy in external & internal environment.
Two most important analysis of external & internal environment are:
Industry and competitive analysis
Analysis of org. SWOT, capabilities, internal resources.
Timeline (Result of small decisions)
Balance (between internal potentials&
opportunities)
Risk (which is included in business i.e.
Short term or long term and Internal or
external)
SITUATION ANALYSIS
ANALYSIS OF EXTERNAL & INTERNAL ENVIRONMENT
MEANING ELEMENTS IN SA
Situation
analysis tries to
identify the risk
& access their
consequences.
Product
Analysis
Competition
Analysis
Distribution
Analysis
Environment
Analysis
Opportunities &
Issues

SWOT ANANLYSIS
INDUSTRY AND COMPETITIVE
ANALYSIS FACTORS:
Strength-Inherent Capabilities
Weakness-Inherent weakness
Opportunities-favorable situation
Threats- unfavorable situation

Significant of SWOT Analysis:
Logical framework
Relationship/comparative
analysis
Strategy Identification.
Dominant economic feature of
industry.
Nature & strength of competition
Trigger of change
Identifying strongest & weakest
positioned cos
Likely strategic moves of rivals.
Key factors for competitive success.
Financial attractiveness of industry
TOWS Matrix PORTFOLIO ANALYSIS
Developed by: Heinz Weihrich
Its a comparison of SW of an
org. with T.O. of org.

External
Opportunities (O)
External Threats
(T)
Internal Strength
(S)
SO
Maxi-maxi
strategy
ST
Maxi- Mini
strategy
Internal
Weakness (W)
WO
Mini-maxi
strategy
WT
Mini- Mini
strategy

TOWS Matrix
Meaning:
Manage set of product, business units & companies.

Concepts:
a. Strategic Business Unit- (SBU is a unit of the company that has a separate
mission & objectives, which can be planned independently from other cos
business)
b. Experience cycle- (EC also known learning curve is based on the commonly
observed phenomenon that avg. cost per unit decrease at the cumulative
production)
c. Product life cycle-(every product passes through a life cycle from Introduction
to Decline stage. PLZ is an S shaped curve.)These are:
i) Introduction ii) Growth
iii) Maturity iv) Decline

SUPER SUMMARY NOTES

For more notes: notes4cacs.yg@gmail.com visit me at: http://bit.ly/yogeshgupta

PORTFOLIO ANALYSIS MODEL
Boston Growth Share
Matrix- BCG Matrix
Ansoffs Product market
Growth Matrix
ADL Matrix GE/McKinsey Model
Display the various business
units on a graph of the market
growth rate vs. market share
relative to competitors.
Relative Market Share
---> (cash generation)
High Low
High
Star
Question
mark
Low
Cash
Cows
Dogs
(^cash usage)

Existing
Product
New
Product
Existing
market
Market
Penetration
Product
Development
New
market
Market
Development
Diversification
Attempt to growth matrix suggest a
businesss attempts to grow depend on
whether it market new or existing with as
well new or existing product.

Developed by Arthur D. Little.
ADL analyzes portfolio on two
dimensions first on industry
measurement is an identification of
PLC of industry.
Industry VS FIRM

FIRM INDUSTRY
Introduction Dominant
Growth Strong
Maturity Favorable
Decline Tenable
Weak
High Medium Low
H
i
g
h

Invest Invest Protect
M
e
d
i
u
m

Invest Protect
Harves
t
L
o
w

Protect Harvest Divest

Market
Growth

CHAPTER-4 ( Testing-General & Automated control)

Grand Strategy
Stability Expansion
Intensification
Market
Penetration
Market
Development
Product
Development
Diversification
Verticle Integration
Forward Backward
Concentric
Diversification
Conglomerate
Diversification
Retrenchment Combination
CORPORATE
STRATEGY (CS)
STAGES OF
CORPORATE STRATEGY
FORMULATION-
IMPLEMENTATION
PROCESS
STRATEGIC ALTERNATIVES
REASON FOR ADOPTING
GRAND STRATEGY
Every company/
corporate form a
strategy known
as CS.
It is a consist of
competitive
moves and
approaches to
achieve
successful
performance of
co. (Choice of
business, market,
product)
Mix of pro-active
and re-active
strategy.
1. Developing strategic
vision.
2. Setting objective: Used
balance card approach.
3. Crafting & Designing a
strategy: Firstly check
SW of org, secondly
competitors, thirdly
determine the customer
needs.
4. Strategy
Implementation &
Execution: Its like a
management process.
5. Monitoring Evaluation
review.
A. Cost Leadership- Produce at
low cost for consumers, who is
price sensitive. Implement
then, when consumers do not
care brand to brand or large
number of buyers with
bargaining power.
B. Differentiation- Provide
unique and different goods
from competitors. Charge from
customers for differentiation
and gain customers loyalty.
C. Focus- Focus on the special
group of customers or
geographical market or
product line segment.
1) Stability-Less Risky, people feel
comfortable, environment faced
is relatively stable & expansion
may be being threatening.
2) Expansion- when environment
demands increasing in pace of
activity, psychology & strategist
feels that in expansion is more
growth, control over the market.
3) Retrenchment-Environment
threatening, management has no
longer wishes to remain in
business, either partly or wholly
due to continuous losses.

SUPER SUMMARY NOTES

CHAPTER-5 ( Formulation Of Functional Strategy)

KEY FUNCTION STRATEGY
MARKETING FINANCE PRODUCTION LOGISTIC R&D HUMAN RESOURCES
This function
satisfies the need of
org. for which org.
is formed i.e.
serving customer.
Mktg. always looks
for long term profits
and growth rather
than immediate
profit.

Key Marketing
Strategic Elements:
Expanded
Marketing Mix-
Addition to
traditional 4Ps
new are: people,
physical evidence,
process
Marketing
Analysis-Identify
environment O&T,
analyze co. SW to
determine the best
opportunities.
Market Planning-
involve deciding
that will help the
co. attains its
strategic obj.
Dealing with
marketing
environment-must
carefully analysis
for avoiding the
threats and gain
opportunities.
Acquiring capital or
source of funds,
projected financial
statement and
Budget, mgmt &
uses of funds,
evaluate worth of
business.

Three approaches
for Evaluation of
Net Worth of
Business:
Determine Net
worth/
Stockholder
equity, after that,
add/less the value
of goodwill and
overvalued &
undervalued of
assets.
Future Benefits,
(Rule of Thumb)-
5to 10 times of
firms current year
profits.
Based on 3
methods-
1. Base selling price
of similar co. per unit
of its capacity.
2. price earning ratio
method:
X 5
3. Outstanding Share
method:
No of share O/S X
MP per share +
Premium.
Production system
concerned with
capacity, location,
design, and
sequence of
working.
Production
What to produce?
How to produce?
For whom to produce?

Production Strategy
related to operation
planning and
controls are
concerned with
aggregate
production planning,
material supply,
inventory, cost &
quality management
and maintenance of
plant & equipment.
Flow of goods &
material from source
to destination i.e.
suppliers to
customer. Right
materials are
available at right
place at a right time
at right quality at
right cost to the
customers.

Logistic Strategy
helps in saving the
cost. Effective
logistic strategy can
help business in:
Cost saving
Reduced
inventory
holding time
Improve
delivery time
Customer
satisfaction
Competitive
advantage

Developing
new
products
Improve old
products
Designing
technology
Proper
technique to
use Raw
Material.

Three
approaches to
applying R&D
strategy:

First firm to
market new
technology
products
Innovative
imitator of
successful
products.
Low cost
produced by
mass
producing
products.
Biggest challenge is to
control Human
alteration. The approx
quarter of the profit
consume for employee
satisfaction and
assurance or motivating
them.

HR Strategy cant be
executed if there:
Social & analytical
problems,
Attitude problem,
Non-supportive
approach of top
mgmt.

Following points are to
be considered :
Selection &
recruitment,
training,
appraisal of
performance,
compensation

Strategic role of HR
Manager:
Providing purposed
directions, creating
competitive atmosphere,
facilitation of change,
diversification of
workforce, building core
competency,
development of work
culture & ethics.

CHAPTER-6 ( Strategic Implementation & Control)

INTER RELATIONSHIP BETWEEN
STRATEGY FORMULATION &
IMPLEMENTATION
PRINCIPAL COMBINATION OF
EFFICIENCY AND EFFECTIVENESS
FORWARD &
BACKWARD
LINKAGE

F
O
R
M
U
L
A
T
I
O
N

Sound A
B
Flawed C D
Weak Excellent
IMPLEMENTATION

A: lack of experience, lack of leadership
B: Best
C: Business Model redesigning and implement
readjustment
D: have to do redesign their strategy before
readjusting their implementation skills.

O
P
E
R
A
T
I
O
N

M
A
N
A
G
E
M
E
N
T

Efficient
1
2
Inefficient 3 4
Effective Ineffective
STRATEGIC MANAGEMENT

A: Thrives and succeed
B: Die Slowly
C: Survive
D: Die Quickly.

Strategy formulation
changes in the org. for
implementation in form
of:
org. structure
style of leadership
flexibility to adapt
new tech. etc.
STRATEGIC BUSINESS UNIT ( SBU)
THE VALUE CHAIN
ANALYSIS (VCA)
Grouping of businesses which are related.
Purpose is to provide effective strategic planning treatment to each one of its
product/services. Concept is relevant to multi-product, multi-business enterprises.
Characteristics:
Single business or collection of related business which offer scope for independent
planning & which might feasibility stand alone from the rest of org.
He has own set of competition.
Has a manager who is responsible for strategic planning & profit performance.
Resource allocation
The company can gain
competitive advantages
not just beating its
competitors, but
discovering what the
customers want and
exceeding customer
expectations. This is done
by VCA.
Orgnaisational Structure
Functional
Structure
CEO
General
Manger -
Accounts
General
Manger-
Marketing
General
Manger- HR
Multi divisonal
CEO
Division-1
Manager
Manager
Division-2
SBU
President
Corporate
R&D
Corporate
HR
SBU 1
D1
D2
SBU 2 SBU 3

SUPER SUMMARY NOTES


CHAPTER-7 ( Reaching Strategic Edge)

BUSINESS PROCESSING
REENGINEERING (BPR)
BENCHMARKING
TOTAL QUALITY
MANAGEMENT (TQM)
SIX SIGMA
BPR is redesigning of business
process to achieve dramatic
changes in the processes, in
term of cost, time,
performance quality and
responsiveness to customers.

Principle of BPR:
Single point
responsibility
If work is paralleled
then, there should be
perfect co-ordination &
common database.

Need of BPR:
Because of
Outdated process
Time & cost
Need of IT
Sub System view

Process/Steps in BPR:
1. Determine Obj.
2. Identifying customers
need
3. Study the existing
process
4. Formulate & redesign
of process
5. Implement to
redesigned process.
Benchmarking is an
approach of setting
goal & measuring
productivity based on
the best industry
practice. Its provides
standards against
which performance can
be measured.

Process/Steps:
1. Planning
2. Data compilation
3. Analysis
4. Comparison
5. Reporting
6. Review
Include three terms:
Total, Quality & Management

TQM is mgmt approach for the
org., centered on quality,
based on the participation of
all its members and aiming at
long-term success through
customer-satisfaction, and
benefits to all members of org.
and to society.

Principle in TQM:
1. Commitment
2. Culture
3. Continuous
Improvement
4. Co-Operation
5. Customer-focus
6. Control
7. Cross-functional
8. Cause analysis
9. Change
10. Concept of team.
Six Sigma provides the highest
standard for the quality control of
products and processes. Six sigma is
a thorough and disciplined
methodology that uses data &
statistical analysis to measure &
improve a companys products
quality by identifying & eliminating
DEFECTS in mfg. & service related
process. Commonly defined six
sigma standard 3.4 defects per
million parts or 99.99966% of
products manufactured are defect
free.

SS efforts target 3 main areas:
1. Improve Customer satisfaction
2. Reducing process cycle time
3. Reducing defects.

Two methodology of Six sigma:
1. DMAIC (for existing products)
Define, Measure, Analyze,
Improve, Control
2. DMADV (for new products)
Define, Measure, Analyze,
Design, Verify.

About the Author:
Heyfriends, myself Yogesh Gupta, pursuingChartered Accountancy
and companysecretaryCourse. Imnot somuch minded assomeother people;
I just sharemynoteswhich helpmein crackingmyexams. I passed senior
secondaryin 2008 in first division, after I passed Graduation Degreein
BusinessAdministration (BBA) in June2011.
Therearesomedifficultiesin mylifethatswhyI CA after
senior secondary. But Jo bhi hota hai, achekeliyehi hota hai, to mujheis
baat ki koi tensions nahi hai. In December, 2010 in passed CA-CPT & CS-
Foundation in first attempt, In November 2011; I gaveboth groupsfor CA-
IPCC, but onlyonegroup wascleared. So, I wrotepapersin May2012 for
Group-2, and cleared alsosecond group. In December 2012, alsoclear theCS-
Executivein first sitting. Now, turn of crack inter stageof CShopefor the
best.
I alsofeel happyin preparingnotesfor myfriends& studymates. Im
alwaysworkingon mymottosirf apneliyehi to sabjeetehmdifferent
so, kuch dusro keliyebkru!
Imalsoa student, and Imalwayswaitingfor yoursreviews. If you
haveanycomplaint or suggestion about it, sopleasefeel freetowriteme.
info.yogeshgupta@gmail.com http://fb.com/mr.yogeshgupta
http://fb.com/CAYogeshGuptaa http://yogeshguptarohtak.blogspot.com

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