INTRODUCTION Strategic Management is all about identification and description of the strategies that managers can carry so as to achieve

better performance and a competitive advantage for their organization. An organization is said to have competitive advantage if its profitability is higher than the average profitability for all companies in its industry.

Strategic management can also be defined as a bundle of decisions and acts which a manager undertakes and which decides the result of the firms performance. The manager must have a thorough knowledge and analysis of the general and competitive organizational environment so as to take right decisions. They should conduct a SWOT Analysis (Strengths, Weaknesses, Opportunities, and Threats), i.e., they should make best possible utilization of strengths, minimize the organizational weaknesses, make use of arising opportunities from the business environment and shouldnt ignore the threats. Strategic management is nothing but planning for both predictable as well as unfeasible contingencies. It is applicable to both small as well as large organizations as even the smallest organization face competition and, by formulating and implementing appropriate strategies, they can attain sustainable competitive advantage.

Strategic Management is a way in which strategists set the objectives and proceed about attaining them. It deals with making and implementing decisions about future direction of an organization. It helps us to identify the direction in which an organization is moving.

Strategic management is a continuous process that evaluates and controls the business and the industries in which an organization is involved; evaluates its competitors and sets goals and

strategies to meet all existing and potential competitors; and then reevaluates strategies on a regular basis to determine how it has been implemented and whether it was successful or does it needs replacement.

Strategic Management gives a broader perspective to the employees of an organization and they can better understand how their job fits into the entire organizational plan and how it is corelated to other organizational members. It is nothing but the art of managing employees in a manner which maximizes the ability of achieving business objectives. The employees become more trustworthy, more committed and more satisfied as they can co-relate themselves very well with each organizational task. They can understand the reaction of environmental changes on the organization and the probable response of the organization with the help of strategic management. Thus the employees can judge the impact of such changes on their own job and can effectively face the changes. The managers and employees must do appropriate things in appropriate manner. They need to be both effective as well as efficient.

One of the major role of strategic management is to incorporate various functional areas of the organization completely, as well as, to ensure these functional areas harmonize and get together well. Another role of strategic management is to keep a continuous eye on the goals and objectives of the organization.

STRATEGY - DEFINITION AND FEATURES The word strategy is derived from the Greek word stratgos; stratus (meaning army) and ago (meaning leading/moving). Strategy is an action that managers take to attain one or more of the organizations goals. Strategy can also be defined as A general direction set for the company and its various components to achieve a desired state in the future. Strategy results from the detailed strategic planning process.

A strategy is all about integrating organizational activities and utilizing and allocating the scarce resources within the organizational environment so as to meet the present objectives. While planning a strategy it is essential to consider that decisions are not taken in a vacuum and that any act taken by a firm is likely to be met by a reaction from those affected, competitors, customers, employees or suppliers.

Strategy can also be defined as knowledge of the goals, the uncertainty of events and the need to take into consideration the likely or actual behavior of others. Strategy is the blueprint of decisions in an organization that shows its objectives and goals, reduces the key policies, and plans for achieving these goals, and defines the business the company is to carry on, the type of economic and human organization it wants to be, and the contribution it plans to make to its shareholders, customers and society at large.

FEATURES OF STRATEGY

1. Strategy is Significant because it is not possible to foresee the future. Without a perfect foresight, the firms must be ready to deal with the uncertain events which constitute the business environment. 2. Strategy deals with long term developments rather than routine operations, i.e. it deals with probability of innovations or new products, new methods of productions, or new markets to be developed in future. 3. Strategy is created to take into account the probable behavior of customers and competitors. Strategies dealing with employees will predict the employee behavior.

Strategy is a well defined roadmap of an organization. It defines the overall mission, vision and direction of an organization. The objective of a strategy is to maximize an organizations strengths and to minimize the strengths of the competitors. Strategy, in short, bridges the gap between where we are and where we want to be.

COMPONENTS OF A STRATEGY STATEMENT The strategy statement of a firm sets the firms long-term strategic direction and broad policy directions. It gives the firm a clear sense of direction and a blueprint for the firms activities for the upcoming years. The main constituents of a strategic statement are as follows:

1. Strategic Intent An organizations strategic intent is the purpose that it exists and why it will continue to exist, providing it maintains a competitive advantage. Strategic intent gives a picture about what an organization must get into immediately in order to achieve the companys vision. It motivates the people. It clarifies the vision of the vision of the company. Strategic intent helps management to emphasize and concentrate on the priorities. Strategic intent is, nothing but, the influencing of an organizations resource potential and core competencies to achieve what at first may seem to be unachievable goals in the competitive environment. A well expressed strategic intent should guide/steer the development of strategic intent or the setting of goals and objectives that require that all of organizations competencies be controlled to maximum value. Strategic intent includes directing organizations attention on the need of winning; inspiring people by telling them that the targets are valuable; encouraging individual and team participation as well as contribution; and utilizing intent to direct allocation of resources. Strategic intent differs from strategic fit in a way that while strategic fit deals with harmonizing available resources and potentials to the external environment, strategic intent emphasizes on building new resources and potentials so as to create and exploit future opportunities.
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2. Mission Statement

Mission statement is the statement of the role by which an organization intends to serve its stakeholders. It describes why an organization is operating and thus provi des a framework within which strategies are formulated. It describes what the organization does (i.e., present capabilities), who all it serves (i.e., stakeholders) and what makes an organization unique (i.e., reason for existence). A mission statement differentiates an organization from others by explaining its broad scope of activities, its products, and technologies it uses to achieve its goals and objectives. It talks about an organizations present (i.e., about where we are). For instance, Microsofts mission is to help people and businesses throughout the world to realize their full potential. Wal-Marts mission is To give ordinary folk the chance to buy the same thing as rich people. Mission statements always exist at top level of an organization, but may also be made for various organizational levels. Chief executive plays a significant role in formulation of mission statement. Once the mission statement is formulated, it serves the organization in long run, but it may become ambiguous with organizational growth and innovations. In todays dynamic and competitive environment, mission may need to be redefined. However, care must be taken that the redefined mission statement should have original fundamentals/components. Mission statement has three main components-a statement of mission or vision of the company, a statement of the core values that shape the acts and behaviour of the employees, and a statement of the goals and objectives.

2.Features of a Mission

a. Mission must be feasible and attainable. It should be possible to achieve it.

b. Mission should be clear enough so that any action can be taken. c. It should be inspiring for the management, staff and society at large. d. It should be precise enough, i.e., it should be neither too broad nor too narrow. e. It should be unique and distinctive to leave an impact in everyones mind. f. It should be analytical,i.e., it should analyze the key components of the strategy. g. It should be credible, i.e., all stakeholders should be able to believe it. 3. Vision

A vision statement identifies where the organization wants or intends to be in future or where it should be to best meet the needs of the stakeholders. It describes dreams and aspirations for future. For instance, Microsofts vision is to empower people through great software, any time, any place, or any device. Wal-Marts vision is to become worldwide leader in retailing. A vision is the potential to view things ahead of themselves. It answers the question where we want to be. It gives us a reminder abou t what we attempt to develop. A vision statement is for the organization and its members, unlike the mission statement which is for the customers/clients. It contributes in effective decision making as well as effective business planning. It incorporates a shared understanding about the nature and aim of the organization and utilizes this understanding to direct and guide the organization towards a better purpose. It describes that on achieving the mission, how the organizational future would appear to be.

An effective vision statement must have following features-

a. It must be unambiguous. b. It must be clear.

c. It must harmonize with organizations culture and values. d. The dreams and aspirations must be rational/realistic. e. Vision statements should be shorter so that they are easier to memorize.

In order to realize the vision, it must be deeply instilled in the organization, being owned and shared by everyone involved in the organization.

4. Goals and objectives

A goal is a desired future state or objective that an organization tries to achieve. Goals specify in particular what must be done if an organization is to attain mission or vision. Goals make mission more prominent and concrete. They co-ordinate and integrate various functional and departmental areas in an organization. Well made goals have following features-

a. These are precise and measurable. b. These look after critical and significant issues. c. These are realistic and challenging. d. These must be achieved within a specific time frame. e. These include both financial as well as non-financial components.

Objectives are defined as goals that organization wants to achieve over a period of time. These are the foundation of planning. Policies are developed in an organization so as to achieve these objectives. Formulation of objectives is the task of top level management. Effective objectives have following features-

f. These are not single for an organization, but multiple.

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g. Objectives should be both short-term as well as long-term. h. Objectives must respond and react to changes in environment, i.e., they must be flexible. i. These must be feasible, realistic and operational.

STRATEGIC MANAGEMENT PROCESS The strategic management process means defining the organizations strategy. It is also defined as the process by which managers make a choice of a set of strategies for the organization that will enable it to achieve better performance. Strategic management is a continuous process that appraises the business and industries in which the organization is involved; appraises its competitors; and fixes goals to meet all the present and future competitors and then reassesses each strategy.

Strategic management process has following four steps:

1. Environmental Scanning- Environmental scanning refers to a process of collecting, scrutinizing and providing information for strategic purposes. It helps in analyzing the internal and external factors influencing an organization. After executing the environmental analysis process, management should evaluate it on a continuous basis and strive to improve it. 2. Strategy formulation :Strategy formulation is the process of deciding best course of action for accomplishing organizational objectives and hence achieving

organizational purpose. After conducting environment scanning, managers formulate corporate, business and functional strategies. 3. Strategy implementation :Strategy implementation implies making the strategy work as intended or putting the organizations chosen strategy into action. Strategy implementation includes designing the organizations structure, distributing resources, developing decision making process, and managing human resources. 4. Strategy evaluation :Strategy evaluation is the final step of strategy management

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process. The key strategy evaluation activities are: appraising internal and external factors that are the root of present strategies, measuring performance, and taking remedial / corrective actions. Evaluation makes sure that the organizational strategy as well as its implementation meets the organizational objectives.

These components are steps that are carried, in chronological order, when creating a new strategic management plan. Present businesses that have already created a strategic management plan will revert to these steps as per the situations requirement, so as to make essential changes.

Components of Strategic Management Process

Strategic management is an ongoing process. Therefore, it must be realized that each component interacts with the other components and that this interaction often happens in chorus.

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BCG Matrix Boston Consulting Group (BCG) Matrix is a four celled matrix (a 2 * 2 matrix) developed by BCG, USA. It is the most renowned corporate portfolio analysis tool. It provides a graphic representation for an organization to examine different businesses in its portfolio on the basis of their related market share and industry growth rates. It is a two dimensional analysis on management of SBUs (Strategic Business Units). In other words, it is a comparative analysis of business potential and the evaluation of environment.

According to this matrix, business could be classified as high or low according to their industry growth rate and relative market share.

Relative Market Share = SBU Sales this year leading competitors sales this year.

Market Growth Rate = Industry sales this year - Industry Sales last year.

The analysis requires that both measures be calculated for each SBU. The dimension of business strength, relative market share, will measure comparative advantage indicated by market dominance. The key theory underlying this is existence of an experience curve and that market share is achieved due to overall cost leadership.

BCG matrix has four cells, with the horizontal axis representing relative market share and the vertical axis denoting market growth rate. The mid-point of relative market share is set at 1.0. if all the SBUs are in same industry, the average growth rate of the industry is used. While, if all the SBUs are located in different industries, then the mid-point is set at the growth rate for the economy.

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Resources are allocated to the business units according to their situation on the grid. The four cells of this matrix have been called as stars, cash cows, question marks and dogs. Each of these cells represents a particular type of business.

10 x

1x Figure: BCG Matrix

0.1 x

1. Stars- Stars represent business units having large market share in a fast growing industry. They may generate cash but because of fast growing market, stars require huge investments to maintain their lead. Net cash flow is usually modest. SBUs located in this cell are attractive as they are located in a robust industry and these business units are highly competitive in the industry. If successful, a star will become a cash cow when the industry matures. 2. Cash Cows- Cash Cows represents business units having a large market share in a mature, slow growing industry. Cash cows require little investment and generate cash that can be utilized for investment in other business units. These SBUs are the corporations key source of cash, and are specifically the core business. They are the base of an

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organization. These businesses usually follow stability strategies. When cash cows loose their appeal and move towards deterioration, then a retrenchment policy may be pursued. 3. Question Marks- Question marks represent business units having low relative market share and located in a high growth industry. They require huge amount of cash to maintain or gain market share. They require attention to determine if the venture can be viable. Question marks are generally new goods and services which have a good commercial prospective. There is no specific strategy which can be adopted. If the firm thinks it has dominant market share, then it can adopt expansion strategy, else retrenchment strategy can be adopted. Most businesses start as question marks as the company tries to enter a high growth market in which there is already a market-share. If ignored, then question marks may become dogs, while if huge investment is made, then they have potential of becoming stars. 4. Dogs- Dogs represent businesses having weak market shares in low-growth markets. They neither generate cash nor require huge amount of cash. Due to low market share, these business units face cost disadvantages. Generally retrenchment strategies are adopted because these firms can gain market share only at the expense of competitors/rival firms. These business firms have weak market share because of high costs, poor quality, ineffective marketing, etc. Unless a dog has some other strategic aim, it should be liquidated if there is fewer prospects for it to gain market share. Number of dogs should be avoided and minimized in an organization.

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Limitations of BCG Matrix

The BCG Matrix produces a framework for allocating resources among different business units and makes it possible to compare many business units at a glance. But BCG Matrix is not free from limitations, such as-

1. BCG matrix classifies businesses as low and high, but generally businesses can be medium also. Thus, the true nature of business may not be reflected. 2. Market is not clearly defined in this model. 3. High market share does not always leads to high profits. There are high costs also involved with high market share. 4. Growth rate and relative market share are not the only indicators of profitability. This model ignores and overlooks other indicators of profitability. 5. At times, dogs may help other businesses in gaining competitive advantage. They can earn even more than cash cows sometimes. 6. This four-celled approach is considered as to be too simplistic.

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SWOT ANALYSIS

SWOT is an acronym for Strengths, Weaknesses, Opportunities and Threats . By definition, Strengths (S) and Weaknesses (W) are considered to be internal factors over which you have some measure of control. Also, by definition, Opportunities (O) and Threats (T) are considered to be external factors over which you have essentially no control.

SWOT Analysis is the most renowned tool for audit and analysis of the overall strategic position of the business and its environment. Its key purpose is to identify the strategies that will create a firm specific business model that will best align an organizations resources and capabilities to the requirements of the environment in which the firm operates. In other words, it is the foundation for evaluating the internal potential and limitations and the probable/likely opportunities and threats from the external environment. It views all positive and negative factors inside and outside the firm that affect the success. A consistent study of the environment in which the firm operates helps in forecasting/predicting the changing trends and also helps in including them in the decision-making process of the organization.

An overview of the four factors (Strengths, Weaknesses, Opportunities and Threats) is given below1. Strengths - Strengths are the qualities that enable us to accomplish the organizations mission. These are the basis on which continued success can be made and continued/sustained. Strengths can be either tangible or intangible. These are what you are well-versed in or what you have expertise in, the traits and qualities your employees possess (individually and as a team) and the distinct features that give your organization its consistency. Strengths are the beneficial aspects of the organization or the capabilities
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of an organization, which includes human competencies, process capabilities, financial resources, products and services, customer goodwill and brand loyalty. Examples of organizational strengths are huge financial resources, broad product line, no debt, committed employees, etc. 2. Weaknesses - Weaknesses are the qualities that prevent us from accomplishing our mission and achieving our full potential. These weaknesses deteriorate influences on the organizational success and growth. Weaknesses are the factors which do not meet the standards we feel they should meet. Weaknesses in an organization may be depreciating machinery, insufficient research and development facilities, narrow product range, poor decision-making, etc. Weaknesses are controllable. They must be minimized and eliminated. For instance - to overcome obsolete machinery, new machinery can be purchased. Other examples of organizational weaknesses are huge debts, high employee turnover, complex decision making process, narrow product range, large wastage of raw materials, etc. 3. Opportunities - Opportunities are presented by the environment within which our organization operates. These arise when an organization can take benefit of conditions in its environment to plan and execute strategies that enable it to become more profitable. Organizations can gain competitive advantage by making use of opportunities. Organization should be careful and recognize the opportunities and grasp them whenever they arise. Selecting the targets that will best serve the clients while getting desired results is a difficult task. Opportunities may arise from market, competition, industry/government and technology. Increasing demand for telecommunications accompanied by deregulation is a great opportunity for new firms to enter telecom sector and compete with existing firms for revenue.
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4. Threats - Threats arise when conditions in external environment jeopardize the reliability and profitability of the organizations business. They compound the vulnerability when they relate to the weaknesses. Threats are uncontrollable. When a threat comes, the stability and survival can be at stake. Examples of threats are - unrest among employees; ever changing technology; increasing competition leading to excess capacity, price wars and reducing industry profits; etc.

Advantages of SWOT Analysis

SWOT Analysis is instrumental in strategy formulation and selection. It is a strong tool, but it involves a great subjective element. It is best when used as a guide, and not as a prescription. Successful businesses build on their strengths, correct their weakness and protect against internal weaknesses and external threats. They also keep a watch on their overall business environment and recognize and exploit new opportunities faster than its competitors.

SWOT Analysis helps in strategic planning in following manner-

a. It is a source of information for strategic planning. b. Builds organizations strengths. c. Reverse its weaknesses. d. Maximize its response to opportunities. e. Overcome organizations threats. f. It helps in identifying core competencies of the firm. g. It helps in setting of objectives for strategic planning. h. It helps in knowing past, present and future so that by using past and current data, future plans can be chalked out.
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SWOT Analysis provide information that helps in synchronizing the firms resources and capabilities with the competitive environment in which the firm operates.

SWOT ANALYSIS FRAMEWORK

Limitations of SWOT Analysis

SWOT Analysis is not free from its limitations. It may cause organizations to view circumstances as very simple because of which the organizations might overlook certain key strategic contact which may occur. Moreover, categorizing aspects as strengths, weaknesses, opportunities and threats might be very subjective as there is great degree of uncertainty in market. SWOT Analysis does stress upon the significance of these four aspects, but it does not tell how an organization can identify these aspects for itself.

There are certain limitations of SWOT Analysis which are not in control of management. These include-

a. Price increase; b. Inputs/raw materials;

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c. Government legislation; d. Economic environment; e. Searching a new market for the product which is not having overseas market due to import restrictions; etc.

Internal limitations may include-

a. Insufficient research and development facilities; b. Faulty products due to poor quality control; c. Poor industrial relations; d. Lack of skilled and efficient labour; etc

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PORTERS FIVE FORCES MODEL OF COMPETITION

Michael Porter (Harvard Business School Management Researcher) designed various vital frameworks for developing an organizations strategy. One of the most renowned among managers making strategic decisions is the five competitive forces model that determines industry structure. According to Porter, the nature of competition in any industry is personified in the following five forces:

i. ii. iii. iv. v.

Threat of new potential entrants Threat of substitute product/services Bargaining power of suppliers Bargaining power of buyers Rivalry among current competitors

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FIGURE: Porters Five Forces model

The five forces mentioned above are very significant from point of view of strategy formulation. The potential of these forces differs from industry to industry. These forces jointly determine the profitability of industry because they shape the prices which can be charged, the costs which can be borne, and the investment required to compete in the industry. Before making strategic decisions, the managers should use the five forces framework to determine the competitive structure of industry. Lets discuss the five factors of Porters model in detail:

1. Risk of entry by potential competitors: Potential competitors refer to the firms which are not currently competing in the industry but have the potential to do so if given a choice. Entry of new players increases the industry capacity, begins a competition for market share and lowers the current costs. The threat of entry by potential competitors is partially a function of extent of barriers to entry. The various barriers to entry are

Economies of scale Brand loyalty Government Regulation Customer Switching Costs Absolute Cost Advantage Ease in distribution Strong Capital base

2. Rivalry among current competitors: Rivalry refers to the competitive struggle for market share between firms in an industry. Extreme rivalry among established firms

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poses a strong threat to profitability. The strength of rivalry among established firms within an industry is a function of following factors:

Extent of exit barriers Amount of fixed cost Competitive structure of industry Presence of global customers Absence of switching costs Growth Rate of industry Demand conditions

3. Bargaining Power of Buyers: Buyers refer to the customers who finally consume the product or the firms who distribute the industrys product to the final consumers. Bargaining power of buyers refer to the potential of buyers to bargain down the prices charged by the firms in the industry or to increase the firms cost in the industry by demanding better quality and service of product. Strong buyers can extract profits out of an industry by lowering the prices and increasing the costs. They purchase in large quantities. They have full information about the product and the market. They emphasize upon quality products. They pose credible threat of backward integration. In this way, they are regarded as a threat. 4. Bargaining Power of Suppliers: Suppliers refer to the firms that provide inputs to the industry. Bargaining power of the suppliers refer to the potential of the suppliers to increase the prices of inputs( labour, raw materials, services, etc) or the costs of industry in other ways. Strong suppliers can extract profits out of an industry by increasing costs of firms in the industry. Suppliers products have a few substitutes. Strong suppliers products are unique. They have high switching cost. Their product is an important input
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to buyers product. They pose credible threat of forward integration. Buyers are not significant to strong suppliers. In this way, they are regarded as a threat. 5. Threat of Substitute products: Substitute products refer to the products having ability of satisfying customers needs effectively. Substitutes pose a ceiling (upper limit) on the potential returns of an industry by putting a setting a limit on the price that firms can charge for their product in an industry. Lesser the number of close substitutes a product has, greater is the opportunity for the firms in industry to raise their product prices and earn greater profits (other things being equal). The power of Porters five forces varies from industry to industry. Whatever be the industry, these five forces influence the profitability as they affect the prices, the costs, and the capital investment essential for survival and competition in industry. This five forces model also help in making strategic decisions as it is used by the managers to determine industrys competitive structure.

Porter ignored, however, a sixth significant factor- complementaries. This term refers to the reliance that develops between the companies whose products work is in combination with each other. Strong complementors might have a strong positive effect on the industry. Also, the five forces model overlooks the role of innovation as well as the significance of individual firm differences. It presents a stagnant view of competition.

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NIKON Nikon technologies contribute to peoples lives and future dreams.

Nikon is contributing to technology in numerous fields, from manufacturing ICs With nanometer-rule circuit patterns and advancing bioscience, to furthering the Possibilities of imaging and capturing views of stars that are billions of light years Away. What makes this possible? Our opto-electronics and precision technologies that we have nurtured throughout our history and used to create an extensive range of products, services and even more new technologies. Nikon will continue to enrich lives around the world, support cutting-edge industries that are shaping the future, and confront the challenges facing societies around the world.

Precision Equipment Business Modern society reaps great benefits from the electronics fabricated in industrial sectors, including areas such as home appliances, personal computers and automobiles. Nikon is continuously advancing the production of steppers and scanners that are used to manufacture ICs the very core of electronics as well as liquid crystal panels and organic electroluminescence panels that are indispensable to LCD TVs, computers, and smartphones. In these and many other ways, Nikon is fostering and innovating our electronics-based society.\

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HISTORY 1917 Three of Japans leading optical manufacturers merge to form a comprehensive, fully integrated optical company known as Nippon Kogaku K.K. 1918 Ohi Dai-ichi Plant (now Ohi Plant) is Completed. 1925 JOICO microscope is marketed. 1932 NIKKOR is adopted as the brand name for camera lenses. 1946 Pointal ophthalmic lens is marketed. Nikon brand name is adopted for small-sized cameras. 1952 nikkor club is established to promote photography culture. 1959 Nikon F, Nikons first SLR camera, is Marketed. 1967 Ohi Plants Ofuna site (now Yokohama Plant) is built. 1968 Photo gallery Ginza Nikon Salon is opened. Nikon Europe N.V. (now Nikon Europe B.V.) is established in the Netherlands.

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1985 Total Station DTM-1 surveying instrument is marketed. 1992 Nikon Instech Co., Ltd. is established. 1999 D1 digital SLR camera is marketed. In-house company system is Inaugurated. 2000 Nikon-Essilor Co., Ltd., joint venture with Essilor International of France, is established. 2003 Nikon-Trimble Co., Ltd., a joint venture with Trimble Navigation Ltd. of the U.S., is established. 2004 Yokohama Plants Yokosuka Branch (now Yokosuka Plant) is built. Nikon F6 SLR camera is marketed.

2009 FX-101S LCD scanner is marketed. Metris NV became Nikon Metrology NV, a wholly owned subsidiary of Nikon Corporation. 2010 Nikon Head Office is relocated to Shin-Yurakucho Bldg. D3S and D3X digital SLR cameras, and NIKKOR lenses are used in the International Space Station (ISS).

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2011 Nikon 1 J1 and V1 advanced cameras with interchangeable lenses are marketed. 2012 NSR-S621D ArF immersion scanner is marketed. Nikon Plaza Sendai is opened. D4 digital SLR camera is marketed.

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NIKONS PHILOSOPHY

Nikon has maintained an unwavering commitment to the study of light with the corporate philosophy, Trustworthiness and Creativity. But today, as we become ever more global, what is the true value that we have to offer? To answer this all-important question, in 2007, we enacted Our Aspirations Meeting needs. Exceeding expectations. as the new vision to create a new Nikon.

Our Philosophy Trustworthiness and Creativity Our corporate philosophy of Trustworthiness & Creativity simple words that are not easily put into practice. These important words represent unchanging principles to which we will always be dedicated.

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Our Aspiration Meeting needs. Exceeding expectations Our Aspirations mean not only to meet the needs of customers but also to provide customers with new value that exceeds their expectations. Meeting needs. Exceeding expectations. is our vision for the future.

Providing customers with new value that exceeds their expectations. Sustaining growth through a break with the past and a passionate commitment by one and all.

Maximizing our understanding of light to lead the way towards transformation and a new future.

Maintaining integrity in order to contribute to social prosperity.

Our Commitments

We are therefore implementing a policy for realizing our aspirations that consists of making four key commitments.

Be broad-minded and well-informed in order to act quickly and resolutely.

Pioneer new potential through self-study and insatiable curiosity.

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Harmonize diverse skills by thinking out of the box and communicating effectively with others.

Work with diligence and sincerity as a responsible individual.

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PESTLE ANALYSIS Referring to CIPD (2010), PESTLE analysis is an assessment of the companys environmental forces that will guide it to be placed strategically above its competitors. These external forces are:

Political forces

In terms of government policies and legislation, a new geographical market in digital camera will be beneficial as it will attract new investors in these locations. Regions where political stability is not appropriate, there will be greater risks to enter new market places. On the other hand, wellestablished political legislation enhances the standard of living in these countries. According to Datamonitor (2010), social responsibility in these countries is developing very fast, enhancing the education of the population. Hence, new digital camera can be considered as a commodity. Therefore, Nikon should consider countries with good government policies, prior entering into these geographic regions. Actually, Nikon is present in Europe, America and Japan. This is because of the political stability of these countries.

Economical forces

During the past years, the world incurred an economic slowdown due to the U.S financial crisis. However, it has been reported that many countries has recovered from this crisis. To counteract this crisis, Nikon had to redo a branding to re-boost the sales. Furthermore, markets for low income consumers were looked into such that these consumers could afford a trustworthy camera.
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Social/Cultural forces

The social needs for a camera are becoming more and more important. However, Nikon has the disadvantage of producing professional cameras with high prices. In order to integrate the social/cultural external forces, Nikon has started manufacturing cameras which are more affordable to the mass population. Additionally, in terms of social awareness, Nikon is already working on CSR to promote its brand.

Technological forces

With rapidly changing technology, Nikon has to keep pace with new technology in order to be competitive in the market. This has been witnessed by the elimination of traditional film camera to the latest SLDR camera. Furthermore, Nikon has invested massively in research and development in order to have a competitive advantage in the imaging industry.

Legal forces

There is no legal requirement regarding purchase of a digital camera on the worldwide market. This relieved the customers of any special permits that they might need for buying a camera. However, photography is banned in certain regions for security and cultural purposes. For Nikon, this does not constitute a problem as most of its users are professional photographers.

Environmental forces

With alarming concern of climate change, Nikon is working on using recyclable materials to reduce the effect of carbon dioxide emissions. As one of their strategy, Nikon is aiming at green

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marketing which is considered as one of the developing trends in modern business. (Kassaye, 2001). Hence in the manufacture of its products, health and safety procedures are adhered to.

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CORE COMPETENCIES OF NIKON

The core competencies usually relate to the capabilities of the firm, enhancing its competitiveness in the market it serves. According to Johnson and Scholes (2002), the core competences create and sustain the ability to meet the critical success factors of particular customer groups better than the providers in ways that are difficult to imitate.

Hence the strategic marketing of Nikon is based on core competences of the company. This highlights the companys distinctive capability. Nikon, being leader in manufacturing of lenses, has four product segments:

i. ii. iii. iv.

Imaging products Precision equipment Instruments Others

The figure below shows the missions of Nikon:

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The marketing strategy is in line with the corporate strategy of the company as it is currently making its brand image identified with high quality, reliability, and integrity. Since it is aiming to be the market leaders in all its business areas, they have included fun and spirit of innovation as part of their image. Nikons vision has been changed recently to become Meeting needs. Exceeding expectations. Furthermore, Nikon is improving on processes that will keep their survival in a constantly changing market. MEtA and CSR are also two options that have been considered by Nikon to strengthen this relationship of trust with all their stakeholders. From the above, Nikons core competencies drives it towards a more efficient company and offers advantages to the market places it occupies.

According to Drucker (1973), the corporate objectives of an organisation should include the following eight items:

i. ii. iii. iv. v. vi. vii. viii.

Market Standing Innovation Productivity Resources Profitability Management performance Employee performance and development Public responsibility

Regarding Nikon, the corporate objectives are in line to that specified by Drucker (1973) as it covers all the eight items. However, using the core competencies approach, it can be deduced

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that Nikon has organisational capability for developing lenses use for cameras and other precision equipment. Their employees have the required core skills and each department has the competencies. The company also invests a lot in research and development to remain in the constantly changing market needs.

Wherever, the skills needed do not form part of their competencies, Nikon make acquisitions and merges with other leading companies as well as leveraging of synergy is used to strengthen its core competencies and organisational capabilities.

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COMPETITIVE ANALYSIS

Direct competitors for Nikon in the imaging products are Sony, Canon, Panasonic, Samsung, Olympus and Kodak.

The table below shows the strengths, weaknesses,

Sony Strength Strong brand awareness and image Good after sales service Variety of products Economy of sales in terms of promotional campaigns

Canon Know how in lens High brand awareness in camera industry Good image Good quality products at affordable prices

Indirect competitors are:

Film cameras Cell phones with high resolution cameras Video cameras

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SWOT ANALYSIS For Nikon, the SWOT analysis is tabulated below: SWOT Analysis Strength Opportunities

High market occupancy Major advancement in R&D and new technology

Increasing market trend in LCD and DSLR cameras

Healthcare products are becoming more demanding

Healthy monetary situation High brand name

Weaknesses

Threats

High stock levels of products Lack of scale Usually high price of cameras

Increasing cameraphones on the market Reducing semiconductor capital market spending

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STRENGTHS High market occupancy

Considering the asian market, Nikon is the leader in most of the markets it operates. In the digital camera market, it accounted for 40% of unit batched for digital single-lens reflex (DSLR) cameras. According to Datamonitor (2008), the company also accounted for 25% of the

instrument products sales and 27% in the precision equipment sector. The companys high market occupancy is therefore a competitive advantage, allowing it to capture more market grounds. Major advancement in R&D and new technology

Nikon has invested massively in R&D activities. It has also made collaboration with HP for the development of new technological digital imaging system since 2005. In 2008, it entered a cross licensing agreement with Microsoft for the development of its products. With these

collaborations between different companies, Nikon is working on deriving synergies between different businesses. Non-core activities are thus being divested as they do not provide any competitive advantage to Nikon. Nikons percentage of expenditure in R&D rose from 5.1% to 6.1% in 2008. Therefore it can be deduced that the companys major advancement in R&D has allowed it to enter strategic relationship with other leading companies.

Healthy monetary situation

Nikon has shown strong monetary performances during the previous years. Data from their annual report indicates increasing cash and declining debt. This means that the company is in a

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strong liquidity status, allowing financial growth plans like market expansion to occur. This good financial position also creates confidence in its potential investors. WEAKNESSES High level of stock of products

With comparison to its competitors, Nikon had high level of inventory. These were in the turnover ration of 3%, 3.4% and 3.7% in the years 2006, 2007 and 2008 respectively. Accordingly, having hign inventories in a market where the trend of price is declining will affect Nikons operating performance.

Lack of Scale

As reported by Datamonitor (2008), Nikon has reported revenues of JPY 955,792 millions in 2008, compared to its competitors Canon and Fujifilm where revenues of JPY 4,481,346 million and JPY 2,846,828 millions were reported during the same period. This is because of the lack of scale.

OPPORTUNITIES

Long term growth prospects for LCD displays and SDLR cameras

The demand for LCD screens is expected to grow in the long term. As a developer of LCD steppers and scanners, the company will be in a situation where manufacturing of multi-lens projection optical system, requiring an adaptor for larger glass plates, will not be a problem.

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In the camera market, the quality of Nikon lenses helped the company to stand good among its competitors. The digital SLR camera was initiated by Nikon in 1999. Today, the company offers a range of DSLR cameras. According to GfK (2010), market for DSLR cameras recorded steady growth of 22% in the first six months of 2010. This opportunity shall be important for Nikon to remain as market leader in this product segment.

Healthcare products are becoming in demand

With a global healthcare market growth of 4.5% during 2007, the market is expected to reach a value of $ 170.5 billion by the end of 2012. Asian, European and American countries are the customers for these product. In this application, Nikon manufactures microscopes and other products for use in the biomedical field.

THREATS

Reducing semi-conductor market capital spending

The market capital for semi conductors is expected to decrease by 22%. Nikon being a dependent on semi-conductor market, can be affected by this reduced capital spending of semi conductor market.

Increase camera phones on the market

According to ABL Research (2007), nearly 70% of all handset globally are expected to be equipped with cameras with high resolutions. Therefore this could create a threat to Nikon, reducing the growth of its share in camera market.

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SEGMENTATION OF MARKET People who who pay for professional photo portraits are generally status-conscious professionals who have children, and so we've segmented the Eugene-Springfield metropolitan area according to the social status of families. We've used education as a measure of social status. Families of College Graduates Professionals are, almost by definition, college graduates. They are the ones most likely to have a need for professional photo portraits for career purposes. They are also most likely to have the means and taste to want professional photos for their families, as well. Families of High School Graduates People who have not completed college are assumed to be more likely to be employees or be in a trade. While many of them may have the means for professional photos, relatively few will use them. They are more likely to use home-made photographs, except for rare occasions, such as a high school photo or wedding. Families of Non-High-School Graduates These are families who are generally without the means to hire professional photographers on a regular basis. Demographics The Eugene-Springfield metropolitan area has a total population of 330,527. There are 74,836 families.

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Some 25.5 percent of the adult population in the metropolitan area is composed of college graduates, which we will here define as professionals. Some 62 percent of the population is made up of high-school graduates. The Eugene-Springfield metropolitan area closely conforms to the boundaries of Lane County, Oregon. The office will be located in Eugene, but clients are accessible throughout Lane County through physicians offices. Most Lane County residents are accustomed to doing occasional business in Eugene. The following table and graph give the breakdown in demographic terms.

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Year 1 Potential Customers Families of College 1% Graduates Families of High 1% School Graduates Families of NonHigh-School Graduates Total 1.40% 74,836 1% 9,355 46,398 19,083 Growth

Year 2

Year 3

Year 4

Year 5 CAGR

19,350

19,621

19,896

20,175

1.40%

47,048

47,707

48,375

49,052

1.40%

9,486

9,619

9,754

9,891

1.40%

75,884

76,947

78,025

79,118

1.40%

Target Market Segment Strategy Our target market is families of college-educated people who are most likely to be professionals. This is the population most likely to order professional photos on a regular basis, having both the means and the desire for professional quality photographs. Since women make most of the purchasing decisions in families, our specific target market is middle-aged professional women in the Eugene-Springfield metropolitan area, roughly 19,554 people.

Market Trends Photography has gone digital. Digital cameras are replacing conventional cameras faster than DVDs are replacing VHS in video stores. Even cell phones have digital cameras on them. The

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uses of photography have expanded as well because of Web pages on the Internet and email. Digital images are needed for printing uses as well, for such uses as brochures and business cards. Photo studios have mostly switched to digital format because it also allows for easy processing and manipulation. They have been less amenable to making digital files affordably available to clients, and this is a trend on which we intend to capitalize.

Market Growth The growth rate used in the table is based on the 1.4 percent growth rate experienced by the Eugene-Springfield area over the past year. This growth is reflected in the accompanying chart and graph.

Market Needs Families have photos taken to preserve memories. Most photos are taken by consumers with their own cameras, which are increasingly digital and are even part of their cell phones. Most of these photos are low quality but no one cares because only the family views them. Consumers generally engage professional portrait photographers when the photos will be viewed outside the family and when quality matters. Professionals, such as those in our target market, often have business needs for quality photos and have acquired a taste for them. These professionals have families, too. They have the budget and the need to use them for their families because they often entertain at home and their family photos will be on display. Just as they appoint their homes with fine furniture and decorations, the photos on their walls need to exhibit quality. Specifically, some of their needs include:
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baby pictures portraits for home or office senior pictures for the high school yearbook family pictures to send to family members family newsletters family, individual or business websites portraits for business cards, such as for real estate agents portraits for brochures and annual reports

The world has become increasingly digital, but many professional photo studios have made it difficult for people to enter the digital age. The traditional practice of retaining negatives to require clients to return for prints has been carried over to charging high fees for releasing digital files of their portraits. The need to capture memories lasts for people's entire lives, and business portraits require a regular update. But people generally dont look forward to seeing a photographer. In fact, they find it a burdensome expense, have not established a relationship with a photographer and don't think often about going to one. As a result, a lot of memories are lost and ancient portraits of professionals continue to be hung on walls and portrayed in publications. This makes them appear to be trying to preserve their youth instead of embracing their maturity and experience, and doesn't show them in the best light.

Industry Analysis The competition is divided between luxury magazine-quality photographers, moderate professional photographers who mostly pose their subjects, and same-day photo studios.

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Phoebe's Photo Studio is not a luxury, magazine-quality studio, but our service and photo quality is high compared to other moderate professional photographers. Our rates are comparable to theirs, but we add value through personal contact and easy dissemination of digital images.

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GLOBAL INTERNATIONAL MARKETING AND E-BUSINESS STRATEGIES With the evolution of IT and rapidly changing technologies, Nikon has implemented e-business strategies via the setting up of websites based in USA, Europe and Japan. This will definitely enhance the marketing strategies that Nikon has adopted for the international market. The website provides a platform for users 7 days a week 24 hours a day. Furthermore, Nikon publishes a range of information regarding its products on its website. These include company profiles, company history, company philosophies, corporate and strategies statements and other financial data. Using the marketing mix in the global market with e-business, the 4Ps wwill now become EProduct, E-Pricing, E-Place and E-Promotion. E-Product

The consumers will get information and specification about the new camera instantly online but unlike in a shop where they will not be able to see and touch it physically. For Nikon, products shall be categorized to suit each target markets. In the case of Nikon XD on the international market, it may be wise to investigate the geographical segments requiring this camera prior to launching it in a specific region. E-Price

E-Price will normally bring the price of the new camera more competitive as Nikon will no longer incur costs for stores and staff. E-Place

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Using this strategy, the method of purchasing will be via the internet. Nikon will have to ensure that the product is delivered on time to the right customer. In the global context, Nikon actually possesses 3 main websites. However, as more geographic market segments are being targeted for consumers with different cultures, Nikon will have to expand its servers and security for higher volumes of consumers. For Nikon XD, the effect of E-Place will not be critical since it targets high-end consumers in countries where internet accessibility is available. Moreover Nikon being already in alliance with UPS Supply Chain will continue to focus on global logistics for competitive advantage. E-Promotion

E-Promotion strategy will have to include banner promotions, web public relations and Eleaflets. All these are already being provided by Nikon on their websites. To conclude, it is vital to consider that e-marketing mix should be dependent on each other for an online marketing strategy. In the case of Nikon, embracing in e-business strategy has already started but still the resistance to change needs to be addressed. In this manner, the different risks shall be considered prior to implementing the changes drastically.

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CSR Policy
Beginning with its corporate philosophy of "Trustworthiness and Creativity," the Nikon Group has structured policies to fulfill this philosophy, shares them with all employees, and works to put them into practice.

The Nikon Group's Approach to CSR

For the Nikon Group, fulfilling CSR means embodying its corporate philosophy: "Trustworthiness and Creativity." We are aiming to contribute to sustainable development by living up to the trust we are given by society, and also by creating more value than expected. As a common plan of action for the entire Group we have adopted "Our Aspirations," which were formulated through a project discussion in which both top management and employees participated, and "Our Commitments," which are made to realize those aspirations. We are also

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working to increase CSR awareness among each and every employee through the Nikon CSR Charter, which is Nikon Group's basic policy on social responsibility, and the Nikon Code of Conduct, which is our code for daily business activities. Furthermore, we participate in the UN Global Compact, and support its Ten Principles regarding Human rights, Labour, Environment, and Anti-corruption.

Nikon Corporate Social Responsibility (CSR) Charter

1. Sound corporate activities

The Nikon Group endeavors to comply with international regulations, related laws, and internal rules, exercise sound and fair corporate practices, earn the trust of stakeholders such as customers, shareholders, employees, business partners, and society. The Group will maintain constructive relationships with administrative bodies, remaining politically neutral and complying with laws, and will not engage in relationships with individuals or groups that threaten social order or safety.

2. Provision of valuable goods and services for society

The Nikon Group will provide valuable products and services with superior quality and safety to society, endeavoring to increase the satisfaction and trust of our customers and contributing to the healthy development of society.

3. Respect for human beings

The Nikon Group will respect diversity and individual human rights and provide a healthy and safe working environment in which all persons receive fair treatment without

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discrimination. It will also oppose enforced labor and child labor and respect fundamental human rights as well as workers' rights.

4. Protection of the natural environment

The Nikon Group will proactively engage in environmental efforts and work to protect the natural environment, as these are common issues for all of mankind.

5. Responsibility to society as a corporate citizen

The Nikon Group will carry out corporate activities that take into account the cultures and practices of each country and region and proactively engage in activities that contribute to society as a good corporate citizen.

6. Socially responsible behavior within supply chain

The Nikon Group will encourage socially responsible behavior within its supply chain.

7. Transparent operating activities

The Nikon Group will communicate extensively with customers, shareholders, employees, business partners, and society and disclose business information in a timely and fair manner. It will also conduct reliable financial reporting through accurate accounting processes.

8. Responsibility of top management

Top management and employees in managerial positions within each department must understand that they play an essential role in fulfilling the spirit of this Charter and thus,
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in addition to leading by example, they must ensure that this information is disseminated to everyone in the Group and all related parties. Management must always strive to understand the opinions of those both inside and outside of Nikon to develop a sound internal framework that ensures that the spirit of this Charter is upheld. If any incident occurs that violates this Charter, top management will demonstrate, internally and externally, their determination to solve the problem and strive to identify the cause and prevent its recurrence. Furthermore, they will uphold information disclosure and accountability obligations. They will clarify the authority and responsibility of each manager and employee and deal rigorously and objectively with all people involved in the matter, including top management.

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CONCLUSION
Strategic management is a continuous process. There are three stages in this process: strategy formulation, strategy implementation, and evaluation and control. Strategy management is also viewed as series of steps. Therefore, the strategic- management process can be best be studied and applied using the model. A review of the major strategic management models indicates that they all include the following steps: performing an environmental analysis, establishing organizational direction, formulating organizational strategy, implementing organizational strategy, evaluating and controlling strategy. The strategic management process mostly involves top management, board of directors, and planning staff. In its final form, a strategic decisions is moulded from the streams of inputs, decisions, and actions. All organizations engage in the strategic management process. The success of an organization is generally dependent upon the strategic management and organizational abilities of the managers. Many research studies show both financial and nonfinancial benefits which can be derived from a strategic-management approach to decision making. Moreover, the concept of strategic management is still involving and will continue to undergo change. Therefore, understanding and following and complete process of strategic management can be helpful to practicing managers to gain organizations' objectives.

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