Strategic Planning Presentation to MBA students

1. Strategic Planning
Dr. Hema Krishnan
Professor of Strategy & Global Business
Presented at the GRG School of Management Studies
Coimbatore
August 1, 2018

2. Where does Strategic Planning
fit in Your Course?
uExecutive Summary
uIntroduction; Mission, Strategic issue
uExternal Environment Analysis
uInternal Analysis
uRecommendations
uImplementation and Monitoring
uConclusion

3. External Environment Analysis
(Macro Analysis)
Major tools and frameworks:
Stakeholder analysis
PESTEL analysis
Porter’s five forces
Strategic Group Map or
Competitive Strength Assessment

4. Stakeholder Mapping
Special
Interest
groups
Government
Government
Institutions
Firms in
Natural
Resources
Neighboring
Countries
Shareholders
Owners
Systems-
Cloud, AI
Social
Groups Customers
Employees
Suppliers Rivals
Distributors Banks, Finance
Firm
Identify:
Goals
Objectives
Strengths
Weaknesses
Opportunities
Threats
Mission-
Congruence
for each

5. Macro-Environment-PESTEL
3–5
(c) 2016 by McGraw-Hill Education. This is proprietary material solely for
authorized instructor use.

6. PESTEL
For each PESTEL factor; Analyze and assign weights for
relative importance, at various levels as listed below:
Geographic scope: Technology Penetration:
Regional Emerging
Domestic Growth
Global Developed
Market segments: Type of Industry:
Millennials Manufacturing
High Income Service
Middle Income Online
Base of the income
Elderly

7. Competitor Analysis-
Porter’s Five Forces analysis
• Key analytical tool
• Five Forces Model
of Competition

8. Competitor Analysis-
Porter’s Five Forces analysis
For each Porter’s force, analyze impact at multiple levels
* Global, Domestic, Regional
* Types of suppliers, and where they fit in industry value
chain
* Human Resource/labor as key supplier in all industries
* Types of customers/buyers, and where they fit in
industry value chain
* Impact of E-commerce and Artificial Intelligence on
each force

9. Strategic Group Mapping
• One technique to reveal
different competitive positions
of industry rivals is
strategic group mapping
• A strategic group is a
cluster of firms in an industry
with similar competitive
approaches and market positions
2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use.

10. ILLUSTRATION
CAPSULE 3.1
Footnote: Circles are drawn roughly proportional to the sizes of the chains, based on revenues.
(c) 2016 by McGraw-Hill Education. This is proprietary material solely for
authorized instructor use.
3–
10
Comparative Market Positions of Producers
in the U.S. Beer Industry: A Strategic Group
Map Example

11. Why is External Analysis
important in Strategic Planning?
uExternal Environment Analysis
(Macro Analysis)
Once you complete this analysis,
you will be able to determine the
Opportunities, Threats and
Uncertainties, in the Industry in
which your company functions.

12. Internal Environment Analysis
(Company Analysis)
Major tools and frameworks:
Value Chain analysis
SWOT analysis
Financial Analysis
Activity Based Cost Accounting

13. Why the Value Chain is a great tool
for business professionals
1. The next four slides outline the steps for performing a
comprehensive value chain analysis (integrated with
SWOT) for any organization.
2. It is a tool with great practical implications, and is far
superior to a traditional SWOT analysis, because of
its depth and breadth of functional area coverage.

14. Why Value Chain is a great tool for
business professionals
2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use.

15. How to analyze the Value Chain
1. Separate each value chain function into relevant
dimensions and perform a SWOT on each.
2. SCM: What are the company’s S and W in: Purchasing,
inbound logistics, inventory management, storage and
quality control?
3. Marketing: What are the company’s S and W in: target
and product segmenting, pricing, promotion, positioning,
Market Research, etc.?
4. R&D and technology: What are the company’s S and W
in: process R&D, product R&D, systems R&D, CAD,
design, engineering, data analytics?
5. HRM: Company’s S and W in recruitment, hiring, training,
motivation, compensation, assessment?

16. Separate out each Value Chain
function into dimensions
1. Develop a S and W for each value chain function as
described earlier.
2.Examine other resource competencies of the firm
and develop S and W. Example: The financial
condition of the firm.. Where are the S and W? You
need to perform a comprehensive financial analysis
to complete this step. Leadership, Culture, System,
Reputation, Global position & know-how, Strategic
partnerships, etc. Where are the S and W in each of
these dimensions?

17. Match Strengths and Weaknesses
with Opportunities and Threats from
the macro environment
1. Now match the S and W obtained from the
dimensions described in the previous slides with
the O and T from the macro environment and the O
and T inside the company.
2. This is a better SWOT (more dynamic) than the
traditional SWOT analysis.

18. Why is Internal Analysis
important in Strategic Planning?
Once you complete this analysis,
you will have a fair idea of the
strengths and weaknesses of your
company including its financial
health, and the opportunities and
threats in its value chain.

19. We are ready to plan for the
company’s future business strategy
uGeneric Business Strategies; (Low-cost, Best-cost,
Differentiation, Focus)
uThe company’s corporate strategies (Restructuring,
Diversification, M&A, JV, Top Management teams,
Downsizing, etc) must be in place to support the
business strategy
uResource allocation plans

20. Monitoring Company Performance
Balanced Scorecard

21. • LIST OF TEAM (6) EXERCISES FOR THIS SESSION
• NETFLIX in India: Entertainment Industry
• https://www.hindustantimes.com/business-news/why-netflix-isn-t-keen-to-
expand-to-regional-languages-in-india/story-
15BlUoXJJ1hZ8pAx5E8WQJ.html
• IKEA in India: Retail Industry
• https://www.entrepreneur.com/article/309911
• ADANI Renewables: Energy Industry
• https://www.ft.com/content/b2ff29a2-18d5-11e7-a53d-df09f373be87
• Dr. Reddy Lab: Pharmaceutical Industry
• https://www.financialexpress.com/industry/prescription-for-growth-dr-reddys-
tweaks-strategy-with-eye-on-us-market/124414/
• Jet Airways: Airline Industry
• https://www.theweek.in/theweek/business/2018/06/01/jet-airways-one-brand-
strategy.html
• TTK Prestige: Home Appliances Industry
• https://www.thehindubusinessline.com/companies/how-ttk-prestiges-growth-
gathered-steam/article20617003.ece1

22. Thank you!