The document discusses strategic management concepts including the strategic position of a business in terms of its environment, capabilities, purpose, and culture. It covers frameworks for analyzing the macro environment using PESTEL (political, economic, social, technological, ecological, and legal factors) and Porter's Five Forces model. Key aspects of each factor in PESTEL and the five competitive forces are defined. The document also discusses scenario planning and provides an example scenario for the global fashion industry.

1. Potion, Choices, Action
Environment
Strategic Management
CourseTitle: Strategic Management Course No.: 501
Program: MBA 2.5 EveningSession: 2018-21
Teacher: Liaqat Javed Semester: III, Fall 2019

2. Exploring Strategic Model
• The Strategic Position
• Strategic Choices
• Strategy in Action

3. Position
• Environment
• Capability
• Purpose
• Culture

4. Layers of Business Environment
• Macro Environment
• Industry (Sector
• Competitors and Market

5. Macro Environment
• The PESTEL framework
• Porter’s Five Force Framework

6. The PESTEL framework
• Politics
• Economic
• Social
• Technology
• Ecology
• Legal

7. Politicsin PESTEL
• Role of the state and other political forces
• Customers
• Suppliers
• Owner
• EconomicActor
• Direct State Involvement
• Political Exposure

8. Economicsin PESTEL
• exchange rates, business cycles and
differential economic growth rates around the world

9. Socialin PESTEL
• cultures and demographics
• aging population
• Changing Cultural attitude

10. Technologyin PESTEL
• Innovations
• Products
• Process
• Marketing
• Scale

11. Ecologyin PESTEL
• Physical Environment issues
• Pollution
• Resources and Depletion
• Echo System Balance

12. Legalin PESTEL
• Laws and Regulations
• Taxes
• Labour and Regulatory Laws
• International Laws

13. Change Focus: MegaTrends
• large-scale social, economic, political, ecological or technological changes
that are typically slow to form, but which influence many other activities
and views.
• Influence over decades
• Shape other trends

14. Inflexion Points
• moments when trends shift in direction
• turning sharply upwards or downwards
• Shopping Malls, Branded Clothing, Fast Foods

15. Weak Signals
• advanced signs of future trends
• helpful in identifying inflexion points

16. Building Scenario
• Scenario analyses are carried out to allow for different possibilities and help
prevent managers from closing their minds to alternatives.
• plausible alternative views of future business environment development
•

17. Scenario Planning
• Define scenario Scope
• Identify key drivers for change
• Develop scenario stories
• Identify impacts
• Establishing early warning systems

18. Scenario for Global Fashion Industry

19. Porter’s five forces framework
• Threat of entry
• Threat of substitute
• Power of buyers
• Power of suppliers
• Extent of rivalry between competitors

20. Extent of rivalry between competitors
• centre of five forces
• organisations with similar products and services aimed at the
same customer group
• Competitor balance
• Industry growth rate
• High fixed costs
• High exit barriers
• Low differentiation

21. Threat of entry
• Scale and experience
• Access to supply or distribution channels
• Expected retaliation
• Legislation or government action
• Differentiation

22. Threat of substitute
• The price/performance ratio
• Extra-industry effects

23. Power of buyers
• Concentrated buyers
• Low switching costs
• Buyer competition threat

24. Power of suppliers
• Concentrated Suppliers
• Low switching costs
• Supplier competition threat

25. Types of Industries - Competition
• Monopolistic
• Oligopolistic
• Hypercompetitive
• Perfect Competition

26. Dynamics of Industry Structure
• Size
• No. of Players
• Proportions

27. Industry Life Cycle