Situational Analysis: SWOT Analysis <ul><li>What is SWOT? </li></ul><ul><li>SA=O/(S-W) </li></ul><ul><li>SA= strategic alt...
SWOT Analysis: Criticisms <ul><li>Generates lengthy lists </li></ul><ul><li>Uses no weights to reflect priorities </li></u...
Generating Alternative Strategies: TOWS Matrix <ul><li>SWOT can be used to generate a no of possible alternative strategie...
TOWS Matrix  WT  Strategies   ST Strategies   Threats List 5-10 WO   Strategies   SO Strategies   Opportunities List 5-10 ...
Porter’s Competitive Strategies <ul><li>Corporate strategy </li></ul><ul><li>what industry the firm should be in </li></ul...
Porter’s Competitive Strategies <ul><li>Lower cost Strategy </li></ul><ul><li>ability of a firm to design, produce & marke...
  Porter’s Generic Strategies Focused differentiation Cost focus Narrow Target Differentiation Differentiation Lower Cost ...
Which is the best Generic Strategy? <ul><li>Before selecting one of Porter’s generic competitive  strategies, the manageme...
Requirement for Generic Competitive  Strategies: Overall Cost Leadership  <ul><li>Sustained capital investment </li></ul><...
Requirement for Generic Competitive  Strategies: Differentiation <ul><li>Strong marketing abilities </li></ul><ul><li>Prod...
Market Location Tactics: Where to compete <ul><li>Offensive Tactics </li></ul><ul><li>Frontal Assault </li></ul><ul><li>Fl...
 
Market Location Tactics: Where to compete <ul><li>Defensive Tactics </li></ul><ul><li>Collusion </li></ul><ul><li>Strategi...
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Str Mgt Lesson 5 Str Formulation Situation Analysis & Business Str

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Str Mgt Lesson 5 Str Formulation Situation Analysis & Business Str

  1. 1. Situational Analysis: SWOT Analysis <ul><li>What is SWOT? </li></ul><ul><li>SA=O/(S-W) </li></ul><ul><li>SA= strategic alternative </li></ul><ul><li>O= opportunities </li></ul><ul><li>S= strengths </li></ul><ul><li>W= weakness </li></ul>
  2. 2. SWOT Analysis: Criticisms <ul><li>Generates lengthy lists </li></ul><ul><li>Uses no weights to reflect priorities </li></ul><ul><li>Same factor can be placed in 2 categories </li></ul><ul><li>Requires only a single level of analysis </li></ul><ul><li>No logical link to strategy implementation </li></ul>
  3. 3. Generating Alternative Strategies: TOWS Matrix <ul><li>SWOT can be used to generate a no of possible alternative strategies </li></ul><ul><li>TOWS is just another way of saying SWOT </li></ul><ul><li>Illustrates how external opportunities & threats can be matched with firm’s internal strengths & weaknesses to result in 4-sets of possible strategies alternative </li></ul>
  4. 4. TOWS Matrix WT Strategies ST Strategies Threats List 5-10 WO Strategies SO Strategies Opportunities List 5-10 (IFAS) Weakness List 5-10 Internal Factors Strength List 5-10 External factors-EFAS
  5. 5. Porter’s Competitive Strategies <ul><li>Corporate strategy </li></ul><ul><li>what industry the firm should be in </li></ul><ul><li>Business strategy </li></ul><ul><li>How the firm should compete or cooperate in each strategy </li></ul><ul><li>2-generic Strategies </li></ul><ul><li>Can be pursued by any type or size of business firm, even by not-for-profit organizations </li></ul>
  6. 6. Porter’s Competitive Strategies <ul><li>Lower cost Strategy </li></ul><ul><li>ability of a firm to design, produce & market a comparable product more efficiently than its competitors </li></ul><ul><li>Differentiation Strategy </li></ul><ul><li>ability of a firm to provide unique & superior value to the buyer in terms of product quality, special features, or after-sale service </li></ul><ul><li>4-variations of 2-generic Strategies </li></ul>
  7. 7. Porter’s Generic Strategies Focused differentiation Cost focus Narrow Target Differentiation Differentiation Lower Cost Cost leadership Broad Target
  8. 8. Which is the best Generic Strategy? <ul><li>Before selecting one of Porter’s generic competitive strategies, the management should assess its feasibility in terms of resources & capabilities </li></ul><ul><li>Porter lists the following requirement for generic competitive strategies </li></ul>
  9. 9. Requirement for Generic Competitive Strategies: Overall Cost Leadership <ul><li>Sustained capital investment </li></ul><ul><li>Process engineering skills </li></ul><ul><li>Low cost distribution systems </li></ul><ul><li>Tight cost control </li></ul><ul><li>Structured organization & responsibilities </li></ul><ul><li>Incentives based on meeting targets </li></ul>
  10. 10. Requirement for Generic Competitive Strategies: Differentiation <ul><li>Strong marketing abilities </li></ul><ul><li>Product engineering </li></ul><ul><li>Strong cooperation from channels </li></ul><ul><li>Long tradition in industry </li></ul><ul><li>R&D, product development, marketing- all well coordinated </li></ul><ul><li>Ability to attract highly skilled labor </li></ul>
  11. 11. Market Location Tactics: Where to compete <ul><li>Offensive Tactics </li></ul><ul><li>Frontal Assault </li></ul><ul><li>Flanking Maneuver </li></ul><ul><li>Bypass Attack </li></ul><ul><li>Encirclement </li></ul><ul><li>Guerrilla Warfare </li></ul>
  12. 13. Market Location Tactics: Where to compete <ul><li>Defensive Tactics </li></ul><ul><li>Collusion </li></ul><ul><li>Strategic Alliance </li></ul><ul><li>Mutual Service Consortia </li></ul><ul><li>Joint Venture </li></ul><ul><li>Licensing Agreement </li></ul><ul><li>Value-Chain Partnership </li></ul>

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