Strategic framework

Strategy – influencing factors

Global
Global Considerations
Considerations Impact
Impact Virtually
Virtually All
All
Strategic
Strategic Decisions
Decisions

Should
Should we
we
Should
Should we
we have
have aa foreign
foreign
import?
import? associate
associate

Will
Will GATT
GATT Should
Should we
we
affect
affect our
our firm?
firm? export?
export?

2
Strategy – influencing factors

Information
Information Technology
Technology Has
Has Become
Become A
A Vital
Vital
Strategic
Strategic Management
Management Tool
Tool
Should
Should we
we
Should
Should we
we set
set Automate
Automate our
our
up
up aa Web
Web site?
site? process
process

Should
Should we
we
Should
Should we
we increase
increase
outsource
outsource MIS?
MIS? Electronic
Electronic
advertisement
advertisement

3
Strategy – influencing factors

Preserving
Preserving the
the Natural
Natural Environment
Environment isis an
an
Important
Important Strategic
Strategic Issue
Issue

Is
Is our
our firm
firm Should
Should we
we
environmentally
environmentally Change
Change our
our
friendly?
friendly? process?
process?

Should Will
Will government
government
Should we
we
recycle? pass
pass tougher
tougher
recycle?
laws?
laws?

4
Strategy – External factors

Competitive

Economic Technological

Social Governmental

Cultural Political

Demographic Environmental
Legal

5
Strategy – internal factors

Management

Marketing Manufacturing

Research & Production/

Development Operations

Purchasing Distribution

6
Strategy – internal factors

Finance/Accounting

Packaging Promotion

Human Employee/
Resource Manager
Management Relations

Computer
Vendor Information
Relations Systems

7
Strategic management process

STRATEGY
EVALUATION

8
Strategic management process
Strategic management process

Stages Activities

Strategy Conduct Integrate Make

formulation research intuition with decisions
analysis

Strategy Establish Devise policies Allocate

implementation annual resources
objectives

Review internal and Measure Take

Strategy external factors performance corrective
evaluation
action

10
 Strategic analysis
PEST Analysis - a technique for understanding the "environment" in which a business
operates
Scenario Planning - a technique that builds various plausible views of possible futures
for a business
Five Forces Analysis - a technique for identifying the forces which affect the level of
competition in an industry
Market Segmentation - a technique which seeks to identify similarities and
differences between groups of customers or users
Directional Policy Matrix - a technique which summarises the competitive strength of
a businesses operations in specific markets
Competitor Analysis - a wide range of techniques and analysis that seeks to
summarise a businesses' overall competitive position
Critical Success Factor Analysis - a technique to identify those areas in which a
business must outperform the competition in order to succeed
SWOT Analysis - a useful summary technique for summarising the key issues arising
from an assessment of a businesses "internal" position and "external" environmental
influences.
 Levels of Strategy
CORPORTATE-LEVEL STRATEGY: Identifies the portfolio of businesses
that will comprise the corporation and the ways in which these
businesses will relate to one another.
BUSINESS-LEVEL STRATEGY: Identifies how to build and strengthen
long-term competitive advantage.
FUNCTIONAL-LEVEL STRATEGY: Identifies the core competencies
that must exist within the company to create and maintain the
basis for competitive advantage.
OPERATIONAL-LEVEL STRATEGY: Identifies the specific ways of
managing the day to day operations