Professional Documents
Culture Documents
Environmental Analysis
Organizational Analysis
Setting objectives and Goals Reset if required Identifying alternatives and Goals Reformulate if required
Choice of Strategy
Reimplement if required
Implementation of Strategy
Feedback
Intent
Setting of organizational vision, mission and objectives in the starting point of strategy formulation It makes it clear what an organization stands for Vision-what an organization wishes to achieve in long run Mission -Reason for existence Business Definition- Defines kind of functions the business perform and differentiation Objectives represents desired results which the organization wishes to attain.
Analysis
which influence environment directly including suppliers, customers, and competitors Factors which influence the firm indirectly including social, technological, political, legal, economic factors etc.
Analysis
Analysis
of strategic Alternatives
same product, same market, existing technology, improved customer service Expansion- broadens customer group, customer functions and technology Retrenchment- reduce scope in terms of customer group, customer function or alternative technology Combination- all above taken together
Modernization
technology as a strategic tool to increase production, productivity or reduced cost, competitive strength Integration- Vertical integration- forward or backword, Horizontal integration- ownership over competitors Diversification-change in business definition either in terms of customer functions, customer groups or alternative technology. To minimize risk, threat, weaknesses, avoid current instability in profit and sales, higher utilization of resources, capitalizing organization strength
Joint Ventures temp. partnership for synergetic advantage to share risk, to diversify, expand, distinctive competence, manage political and cultural difficulty, technological advantage, and to explore unexplored market Strategic Alliance- companies remain independent but unite to pursue set agreed goals. Mergers- Companies merge to become larger, competitive advantage, tax benefits, overcome weakness Acquisition- Orgn which acquire another , it is acquisition and for organization which is acquired is merger.
Strategy-
Choice of Strategy
While
Quantified
Corporate
Curve PLC Concept BCG Matrix GE Nine cell Matrix nine positions are defined in terms of business strength factorsmarket share, profit margin, ability to compete, market knowledge, competitive positiion, technology, management caliber and industry attractiveness factors- market size, growth rate, profit, competition, economies of scale, technology, other environmental factors
Space Diagram- The strategic position and action evaluation-extension of two dimensional portfolio analysis which helps an organization to hammer out an appropriate strategic posture. Dimensions like orgs competitive advantage, financial strength, environmental stability Hofers Product Market evaluation matrix- 15 cell matrix taking competitive position and stages of product/market evolution dimensions Directional Policy Matrix Developed by Shells uses two dimensions business sector prospects and companys competitive capabilities
Implementation of Strategy
Project
Implementation Procedural Implementation Resource Allocation Structural Implementation Functional Implementation Behavioral Implementation leadership. Organizational culture, values and ethics, corporate governance, organizational politics
Performance standards Measuring actual performance Analyzing variance Taking corrective actions