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PROJECT OF STRATEGIC MANAGEMENT ON "SITARA CHEMICAL INDUSTRY"
We would like to express our sincere and humble gratitude to Almighty who’s Blessings. We also wish to express our appreciation to our supervisor suggestions and support to prepare this report “Sir SHAHID TUFAIL” who giving us valuable Last but not the least I would like to thank all the management team of Sitara Chemical for their cooperation in providing us the information. 3 . First of all we would like to thank our ALLAH Almighty who really helps us in every problem during the project. We would like to admit that we completed this project due to parents who pray for our success. help and guidance has been a real source of all our achievements in life.Strategic Management ACKNOWLEDGMENT All acclamation to Allah who has empowered and enabled us to accomplish the task successfully.
pk Limitation One of the major limitations while carrying out this research was the lack of cooperation on the part of the management in providing the data regarding the company and its policies.Strategic Management RESEARCH METHODOLOGY The research techniques that are adopted for the purpose of this study are as follows: Primary Data Collection Formal Interview The formal interview include people from management in Sitara Chemical and their name are Ubaid A.sitara. 4 .com. Khan DGM (Marketing) Tariq Mahmood (Manager HR) Questionnaire That is formally filled by Managers Secondary data collection www.
Strategic Management Contents • Introduction & History (stage # 1) • Vision & Mission • SWOT • Formulation Stage Input Stage (stage #2) EFE IFE CPM Matching Stage (stage#3) SWOT IE MATRIX SPACE MATRIX BCG MATRIX GRAND MATRIX Decision Stage (stage #4) QSPM • Implementation 5 .
Strategy Formulation – Input /action stage – Matching stage – Decision stage Strategy Implementation Strategy evaluation 6 .Strategic Management INTRODUCTION Strategic management is all about Formulation Implementation & evaluation of strategies So our project will revolve on these critical parameters.
sodium hypochlorite." • Mission Statement “Continuing growth & diversification for the bottom line result with risks well contained” 7 . The plant’s capacity was gradually increased over years to current level of 545 metric tons a day. caustic soda liquid. hydrochloric acid.Strategic Management STAGE # 1 INTRODUCTION Introduction of Sitara Chemical Sitara Chemical Industries Limited (Sitara Chemical) is a chemical product manufacturing company. These two divisions include Chlor Alkali plants and yarn spinning units. The company is engaged in manufacturing Caustic Soda and Allied Products as well as yarn. Company entered into Textile Spinning Business in 1995. The hallmark of the report is the detailed strategic analysis on the company VISION & MISSION • Vision Statement "Strive to develop and employ innovative technological solutions to add value to business with progressive and proactive approach. initially at a rate of 30 metric tons Caustic a day. Specialty Chemicals. In addition. The report provides a comprehensive insight into the company. SCIL was incorporated in 1981 and began producing caustic soda in 1985. The company’s strengths and weaknesses and areas of development or decline are analyzed as well. The company is headquartered in Faisalabad. including business mission. Polyester Cotton (PC) and Polyester Viscose (PV). caustic soda flakes. Fertilizers. The company operates through its two core divisions namely chemical division and textile division. Its specialty chemicals and export division was established in 2001 and agri chemicals division in 2003. Pakistan and employs 343 people. liquid chlorine. vision and key competitors. Its product line includes caustic soda solid. various by-product facilities have been added and expanded from time to time to cope with growing demand. We present strategic analysis of Sitara Chemical Industries Limited.
Strategic Management SWOT ANALYSIS (Internal-External Factor Evaluation) 8 .
16 0.10 4 3 4 3 4 4 3 0.10 0.52 0.11 0.33 0.14 Total 1.10 0.48 0.30 Weaknesses Need sizeable market to sustain Lack of operations in abroad Relying on permanent customer 0.10 0.07 1 2 2 0.40 0.36 0.Strategic Management STAGE # 2 INPUT STAGE IFE (INTERNAL FACTOR EVALUATION MATRIX) Key Internal factors Weight Rating Weighted Score Strengths Largest manufacturer(caustic soda) Largest shareholder Advance technology Plant infrastructure Strong management Strong brand name Financially strong 0.09 9 .30 0.13 0.09 0.00 3.12 0.08 0.10 0.
20 10 .15 0.60 0.30 Total 1.12 0.Strategic Management EFE (EXTERNAL FACTOR EVALUATION MATRIX) Key External factors Weight Rating Weighted Score Opportunity Increase production capacity Increase product line Taking advantage of geographic position Provide online customer service and ordering system 0.09 3 2 4 3 0.08 0.13 0.00 3.16 0.11 0.36 0.33 0.10 3 3 4 3 3 0.30 0.27 Threat Competitors Economic environment Energy crisis Threat of stakeholders Unstable law and order condition 0.12 0.36 0.52 0.10 0.
Strategic Management CPM (COMPETITIVE PROFILE MATRIX) 11 .
O2) (Add new product line ) & purchase land to build new plant) (S1. Strong Brand name 7.O1. Provide Online Customer Service & Ordering System SO .O3) (Geographic expansion ) (W1.S6. Increase Production Capacity 2.O1.Strategic Management STAGE # 3 MATCHING STAGE TOWS MATRIX TOWS MATRIX Strengths . Plant Infrastructure 5. Increase Product Line 3. Competitors Economic Environment Energy Crises Threat of Stakeholders Unstable law & order situation ST – strategies (S1. Financially Sound Weakness – W 1.S2. 3.strategies (S4. Taking Advantage of Geographic position 4.T 1. 5. Need Sizable Market to Sustain 2. Lack of Operations in Abroad 3.W3.T4) (stable environment & Compete competitors by taking advantage of management & brand name ) (S3. Largest Shareholder 3.S 1. Advance Technology 4. S5. Largest manufacture(caustic soda) 2. S5. T1. 4. Strong Management 6.O2) (Need to improve infrastructure) Threats .T1) (Launch products in other geographical areas) 12 . 2. Relying on Permanent Customers Opportunities – O 1.T3) (Install & update new technology) WT – strategies (W2.O3) (Enter in new market by taking advantage of largest manufacture in industry) WO – strategies (W2.S6.S7.
Opportunity) Managerial Decision: "Market Development" "Product Development" 13 .Strategic Management INTERPRETATION Critical Region: “WO” (Weakness.
5 External Strategic position Environmental Stability (ES) Technological changes Rate of Inflation Price range of Competing products Competitive pressure Risk involved in business Demand variability Total Average -2 -4 -3 -2 -3 -5 -19 -3.2 Industry Strength (IS) Growth Potential Profit Potential Financial Stability Resource Utilization Capacity utilization Technological know-how Total Average +5 +5 +4 +5 +4 +5 +28 +4.16 Competitive Advantage (CA) Market Share Product Quality Customer Loyalty Technological know-how Control over suppliers and distributors Total Average -1 -2 -3 -2 -3 -11 -2.Strategic Management SPACE (STRATEGIC POSITION & ACTION EVALUATION MATRIX) Internal Strategic Position Financial Strengths (FS) Return on Investment leverage Working Capital Liquidity Cash flow Price earnings ratio Total Average +4 +5 +5 +4 +5 +4 +27 4.67 14 .
Strategic Management 15 .
Strategic Management INTERPRETATION According to the space matrix score SITARA CHEMICAL falls in the “AGGRESSIVE Quadrant”. Their strategies should be one of the following: • • • • • Vertical and horizontal integration Market penetration Market development Product development Diversification 16 .
Strategic Management IE (INTERNAL-EXTERNAL MATRIX) INTERPRETATION Sitara Chemical falls in first region of IE matrix according to this the strategy will be “GROW AND BUILD” and they have to focus on strategies which are: • Market Development • Product Development 17 .
Strategic Management GRAND STRATEGY MATRIX INTERPRETATION Sitara Chemical has rapid market growth and strong competitive position so it falls in first quadrant and the most suitable strategies for Sitara Chemical over here are: • Market Development • Product Development 18 .
30 AS 4 4 3 -3 3 4 TAS 0.11 0.1 0.00 2 2 1 0.30 0.40 Weaknesses Need sizeable market to sustain Lack of operations in abroad Relying on permanent customers 0.1 AS 3 3 4 -2 2 3 TAS 0.39 -0.07 3 3 2 0.12 0.44 0.08 0.20 0.1 0.24 0.27 0.1 0.Strategic Management STAGE # 4 DECISION STAGE QSPM (QUANTITATIVE STRATEGIC PLANNING MATRIX) Key Internal Factors PRODUCT DEVELOPMENT MARKET DEVELOPEMNT Strengths Largest manufacture Largest shareholder Advance technology Plant infrastructure Strong management Strong brand name Financially sound Weight 0.07 1.30 0.52 -0.48 0.16 0.33 0.14 Total weight 19 .20 0.13 0.09 0.36 0.18 0.
39 -- Threats Competitors Economic environment Energy crises Threat of stakeholders Unstable law & order situation 0.10 0.00 3 1 3 3 -- 0.34 5.1 1.12 0.13 0.30 0.36 0.08 0.12 0.09 INTERPRETATION According to the Total Attractive Score of QSPM Sitara Chemical should go for “MARKET DEVELOPMENT” Because the TAS of Market Development is more than TAS of product development 20 .44 0.33 0.08 0.Strategic Management Key External Factors Opportunities Increase production capacity Increase product line Taking advantage of geographic position Provide online customer service & ordering system PRODUCT DEVELOMENT weight 0.45 0.11 0.36 -- 4 2 2 2 -- 0.20 0.09 AS 3 2 2 -TAS 0.15 0.16 0.26 -- MARKET DEVELOMENT AS 4 1 3 -TAS 0.48 0.24 -- Total weight Sum Total Attractive Score 4.1 0.
Strategic Management RECOMMENDATIONS • • • We could not found much discrepancies in the Strategy Analysis of Sitara Chemical industry they are performing pretty well and have strong strategic direction According to our recommendation we suggest them that they could go for “Market Development” because there is opportunity for them to export their product in new markets The reason behind the selection of this strategy is that they have strong management team including Human Resource. They can also increase their production capacity because they have proper infrastructure . Brand name & they are largets manufacture in industry so they could take advantage of all these stenghts to capitalize opportunities and avoid threats. They have stong financial position. advance technology & strong financial position and these all enable them to take advantage to increase the production capacity. this will help them to capture more customers throughout the world. There is another opportunity for Sitara Chemical industry that they have to make segment in their website through which they can provide online customer services in which customer can place order and colud provide Feedback as well. Production & R & D Departments. And HRM plays very important role in all activities so Sitara Chemical industry focuses on its function and scope for the betterment in present and future. 21 . They continue to strive towards its goal of being the leader in a manufacturing of caustic soda & their presence in industry is a big threat for competitors. Finance. Marketing. According to the current position of Sitara Chemical they have strong strategic direction. growing day by day and they have largest market share in industry so they should go for Market Development. • • • CONCLUSION We have learnt a lot from this project because this project provides a real picture that how an organization performs Strategy Analysis and what are the factors that they considering most important while performing the analysis.
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