Master of Business Administration

Cover Sheet

Student Information

Full Name Zay Yar Phyo Grade / Marks

Email address phyo.zayyar@gmail.com

Module Information

Module Name Strategic Management

Intake February 2022 (ODL-2)

Lecturer Name Dr. Hla Nyunt

Mark

Submission Date 28th 05.2022

Q 1. What are the strategic tools applied for “Environment Scanning and Industry

Analysis”? Explain one of the business enterprises which apply the

strategic tools for business development

Answer

Environmental Scanning is a procedure that thoroughly surveys and interprets applicable data to identify

external opportunities and threats that could influence future decisions. Each organization must identify the

most impactful external factors to make the environmental image a helpful tool. Examples of logical methods

used in strategic analysis include SWOT (strengths, weaknesses, opportunities, threats) analysis. PESTLE

(political, economic, social, legal, and environmental) analysis, Porter's five forces framework, value chain

analysis, and STEEP analysis.

Components of external Scanning could include:

 Trends: What trends are happening in the market that could positively or negatively affect the

organization?

 Competition: What is the business competition doing that provides them an advantage? Where can

we achieve our competition's weaknesses? 

 Technology: What progress in technology may influence our business in the future? Are there new

technologies that can make our organization more efficient?

 Customers: How is our customer base moving? What is impacting our skill to deliver top-notch

customer service?

 Economy: What is occurring in the economy that could affect upcoming business? 

 Labor supply: What is the labor market like in terms of the characteristics of our operation? How can

we confirm ready access to high-demand labor?

  Political/legislative arena: What impact will selection outcomes have on our business? Is there

awaiting legislation that will upset our operations?

Environmental Scanning

Environmental Scanning is the continuing following trends and occurrences in an organization's internal and

external environment that accept its current and future success. The results are extremely useful in

influencing objectives and strategies. The changing environment can help as well as offend the company.

Many original companies have gone out of business because they failed to adapt to environmental change.

After all, they failed to produce change. The societal environment is manhood's social system that contains

general services that do not directly touch on the short-run of the organization that can, and often do, affect

its long-run decisions.

Natural Environment

The natural environment includes physical resources, nature, and climate that are an essential part of its

presence on Earth. These factors form an ecological system of interconnected life. These externalities were

recognized by governments, which passed rules to force business corporations to deal with the side effects of

their actions. A business corporation must thus scan the natural environment for factors that might before

have been taken for arranged, such as the availability of fresh water and clean air. However, global warnings

mean that aspects of the natural environment, such as the sea level, weather, and climate, are becoming

indefinite and hard to forecast.

Social Environment

The number of possible strategic factors in the social environment is very extraordinary. The number

becomes huge when we understand that, friendly speaking, each country in the world can be signified by its

own unique set of social forces, some of which are very similar to those bordering countries and some of

which are very different. The STEEP analysis is observing trends in the social and natural environments. STEEP

Analysis, the Scanning of sociocultural, Technological, Economic, Ecological, and political-legal environmental
forces (It may also be defined as PESTEL analysis for Political, Economic, Sociocultural, Technological,

Ecological, and legal forces. Trends in any area may be very significant to firms in one Industry but for lesser

essential to firms in other industries. Trends in the economic part of the social environment can have a

noticeable influence on the business movement. Changes in the price of oil and energy availability and cost

have a similar impact on multiple industries, such as production, automobiles, hospitality, and shipping. GDP,

interest rates, inflation rates, unemployment levels, energy availability and cost, and currency markets are

essential variables of the economy in the societal environment. Total industry spending for R&D, the focus of

technological efforts, internet availability, and telecommunication infrastructure are essential variables of the

technology in the societal environment. Antitrust regulations, tax laws, foreign trade regulations, and

government stability are the main variables of the political-legal in the societal environment. Lifestyle

changes, career expectations, growth rates of population, birth rates, level of education, and a living wage

are important variables of the economy in the societal environment.

Task Environment

Any corporate or customer connected with an organization may be part of the task environment. Examples of

task environment sectors include suppliers, competitors, suppliers, creditors, employee unions, special-

interest groups, and trade associations. The task environment benefits from recognizing the environmental

factors that account for the company's success. Tasks elements directly affect the company's operations, as it

covers the natural environment that positions the company. The influences are slightly controllable.

Current sociocultural Trend

Bath towels, plastic bottles, and plastic bags are avoided using is a critical fact of increasing environmental

awareness. Start composting and recycling, which will support cutting down our waste production by buying

organic and insect killer-free food. Physical idleness is often significantly linked with adverse health effects

such as heart disease and depression. With growing health consciousness developments, clients typically

become more motivated to involve physical movement and growing demand for industry products.

Millennials invent huge impacts on the business world with their technological understanding and gratitude.
They manipulate older generations to increase their digital presence and generate a millennial culture

distributed to other generations. Declining mass markets are markets that have left a development where

there are reducing sales for multiple periods. A new situation that approaches after another situation that

has continued for a long time is called changing the pace and location of life. We can use portable

information devices and electronic networking, alternative energy sources, precision farming, virtual

personal assistants, genetically altered organisms, and intelligent mobile robots to break through with

technology. If the climate changes, regulatory, supply chain, product, and technology, litigation, reputational

and physical will have happened to risks.

Forces Driving Industry Competition

1. Accumulation of demand may give the buyer more leverage, decrease the variety of solutions to the

same need, or decrease the number of contracted suppliers called forces driving industry

competition.

2. A substitute product is a product from another manufacturer that compromises similar benefits to

the consumer as the merchandise created by the firms within the Industry.

3. Competition among existing companies can limit profits and lead to competitive changes, including

price cutting, improved advertising expenditures, or costs on service/product progresses and

innovation.

4. Openness to new competitors means that if new competitors enter into an industry offering the

same products or services, a company's competitive position will be at risk. So, new competitor's

entrants refer to the ability of new companies to enter an industry. If new entrants come to the

Industry, we need specialized knowledge or high investment requirements. New entrants to the

Industry take new capacity to gain market share and essential resources. A barrier that makes it

challenging for a company to enter an industry. Probable barriers to entry are economies of scale,

product differentiation, capital requirements, swapping costs, access to supply channels, cost

disadvantages independent of size, and government policies. 

 5. Perception, motivation, learning, beliefs, and attitudes are four major influences on customer

behavior.

The relative bargaining power between an company's competitors and its dealers helps shape its profit

potential. In most industries, corporations are mutually dependent. A competitive change by one firm can be

expected to have a noticeable effect on its competitors and thus may cause retaliation among existing firms.

According to Porter, intense rivalry is related to several factors, including the number of competitors, rate of

industry growth, product or service characteristics, amount of fixed costs, capacity, the height of exit barriers,

and variety of rivals. The Substitute product appears to be different but can satisfy the same need as another

product. The documentation of possible temporary products means searching for products that can perform

the same function, even though they have a different appearance. 

Bargaining power of buyers

The bargaining power of buyers is that buyers affect an industry through their ability to force down prices,

bargain for higher quality or more services, and play competitors against each other. Bargaining power of

buyers is large purchases, backward integration, alternative suppliers, low cost to change suppliers, and the

product represents a high percentage of buyer's cost: incented to shop around, buyer earn low profits:

cost/service sensitive and the product is unimportant to the buyer. Suppliers can affect an industry through

their capability to raise prices or reduce the quality of purchased goods and services. The industry is subject

by a few companies, unique products or services, substitutes are not readily available, ability to forward

integrate, and the unimportance of product or service to the Industry have been decisive for a buyer or a

group of buyers. The relative power of other stakeholders in government, local communities, creditors, trade

associations, special-interest groups, unions, and shareholders. 

Industry Evolution

 Fragmented Industry: no firm has a significant market share, and each firm only helps a small part of

the total marketplace in struggle with other business.

  Consolidated Industry: control by a few large business, each struggles to distinguish products from its

struggle.

 Multi-domestic industries: specific to each country or group of countries

 Global industries operate worldwide, with international companies making only minor adjustments

for country-specific situations.

 Regional Industries: international companies primarily coordinate their activities within regions.

Strategic group

The concept is used in strategic groups of companies within an industry with similar business models or

similar combinations of strategies. Defenders mean to focus on improving efficiency,

prospectors mean to focus on product innovation and market opportunities, analyzers mean to focus on at

least two different product-market areas, and reactors mean lack a consistent strategy- structure-cultural

relationship

Hyper competition

Short product life cycles, product design cycles, new technologies, frequent entry by unexpected outsiders,

repositioning by incumbents, and tactical redefinitions of market boundaries as diverse industries merge are

threatened by market stability in the hyper-competition.

Variables that can suggestively affect the overall competitive positions of companies within any particular

industry are critical success factors in creating a particular industry matrix.

Competitive intelligence is a formal program of gathering information on a company's competitors. Sources

of competitive intelligence are information brokers, internet and industrial espionage, and investigatory

services. The practical forecasting techniques are extrapolation, brainstorming, expert opinion, Delphi

technique, statistical modeling, prediction markets, and cross-impact analysis (CIA).

Tourism is hard to express in just a few words. It has many unlike sectors and may not be

recognized world-widely the same. A brief description of tourism is that tourism is what travelers
visit. Tourism is definite as the doings of persons traveling to and going in places outside their usual

environment for not more than one following year for leisure, business and other purposes not

associated to the exercise of an activity rewarded from within the place visited.” This is the official

definition given by the United Nations World Tourism Organization Hotel enterprises have an

essential role in the service industry, making their business capacity more significant day by day.

The main business idea of the hotel is to provide accommodation to the customers but it also has an

inclusive range of services restaurants, a fitness center, spa, sports, entertainment, and conference

facilities. I will only focus on the strategy of this particular branch not on the chain in general Hotel

Organizations' preference for strategic management tools separate from the industry sector because

of the human-based structure of the service sector. Customer Relation Management is the most

popular tool for all kinds of hotels. The second is the vision and mission statement for five-star hotels

and three-star hotels using outsourcing methods. Four and five-star hotels own sufficient space for

cars. Three-star hotels own small areas and leave other areas to the trained concerning cost problems.

Four and star hotels also try to keep their brand image with vision/mission statements. Service

quality is an essential factor for hotels that are the main ones responsible for customers' potential.

Hotel managers who are unwilling to use BCG growth-share matrix tools are not well known.

Benchmarking is the second strategic management tool by hotel managers. Vision/Mission statement

and total quality management tools are still practical tools for the hotel. Sometimes, hotel managers

use supply chain management, SWOT analysis, a balanced scorecard, and strategic alliances.
Q2.Explain about “Business Strategies and Types of Alliance” and what are the

competitive strategic tools apply in business world?

Answer

Strategy formulation is concerned with increasing a corporation’s mission, objectives,

strategies, and policies. Situation analysis is called the process of conclusion of a strategic fit

between external opportunities and internal strengths while working around external and internal

weaknesses. A framework for examining business strategy is SWOT; an abbreviation used to

describe the detailed strengths, weaknesses, opportunities, and threats that are possible intentional

factors for a specific company. Strategy is equal to opportunity divided by capacity. The opportunity

has no real value unless a company can take advantage of that opportunity. It is simply the opinions

of those satisfying out the boxes. Nearly everything that is a strength is also a weakness. Practically

everything that is an opportunity is also a threat. Adding layers of effort does not improve the

validity of the list. SFAS (Strategic Factors Analysis Summary) Matrix is called summarizes an

organization's strategic factors by combining the external factors from the EFAS Table with the

internal factors from the IFAS Table. It uses a single point-in-time approach. There is no link to the

view from the customer. There is no legalized assessment method. End method. 

Finding a Propitious Niche

• Propitious niche is called so well suited to the firm's internal and external environment that other

corporations are not likely to challenge or dislodge it.

• Strategic window is a unique market opportunity that is available for a particular time.
The mission statement must allow a common thread to highlight and focus the energy of everyone

in the organization on the track that the top management team trusts are best for the business. 

 A well-crafted mission statement has five common Elements

1. It must be short.

2. The design must be simple.

3. It has to provide direction.

4. It should enable employees to know precisely what the company does and what it does not do.

5. It should be measurable.

Business strategy

– focuses on refining the excellent position of a company's or business unit's products or

services within the detailed industry or market segment that the company or business unit serve

– Competitive, cooperative

The competitive strategy increases the following questions:

• Should we participate based on lower cost (and thus price), or should we distinguish our

products or services on some original other than should we compete head-to-head with our

significant participants for the main but most desirable for the main but most desirable

share of the market, or should we pay attention to a niche in which we can fulfill a less sought-after

but also the gainful segment of the market?

Cost leadership

is the ability of a company or a business unit to design, produce, and market a comparable

product more efficiently than its competitors

• Differentiation

– the ability of a company to provide unique and superior value to the buyer in terms of product

quality, special features, or after-sale service

Focus
– the ability of a company to provide unique and superior value to a particular buyer group,

The segment of the market line, or geographic market.

Porter proposed that a firm's good advantage in an industry is determined by its competitive scope—

that is, the variety of the company's or business unit's target market.

Cost leadership

– a lower-cost competitive strategy that aims at the broad mass market and requires "aggressive

construction of efficient-scale facilities, the dynamic chase of cost decreases from experience,

constricted cost and overhead control, evading of bordering customer accounts, and cost

minimization

– provides a defense against rivals

– provides a barrier to entry

– generates increased market share

Porter's Competitive Strategies

• Differentiation

Involves creating a product or service that is perceived throughout its industry as having passed

through the elements of VRIO.

• Lowers customer's sensitivity to price

• Increases buyer loyalty

• Can generate higher profits

Cost focus

–a reasonable low-cost strategy that efforts on a particular buyer group or geographic market

and goes to serve only this niche to the elimination of others

• Differentiation focus

– concentrates on a specific buyer group, product line segment, or geographic market to assist 

the needs of a slight strategic market more successfully than its competitors
Risks in Competitive Strategies

• A company following a differentiation strategy must ensure that the higher price it charges for its

higher quality is not too far above the competition's price. Otherwise, customers will not see the

extra quality as worth the extra cost.

Stuck in the middle

– when a company has no competitive advantage and is doomed to below-average performance

Issues in Competitive Strategies

• Successful entrepreneurial ventures follow focus strategies.

• They differentiate their product or service from others by focusing on customer wants in a segment

of the market, thereby achieving a dominant share of that part of the market.

Fragmented industry

– many small and medium-sized companies compete for comparatively small shares of the total

market

• Products are typically in the primary stages of the product life cycle.

• Emphasis strategies are used.

Consolidated industry

– domination by a few large companies

– premium on a firm's ability to achieve cost leadership

Strategic rollup

– developed in the mid-1990s as an efficient way to quickly consolidate a fragmented industry

• Rollups differ from mergers/acquisitions in three ways:

1. They involve large numbers of firms.

2. The acquired firms are typically owner-operated.

3. The objective is to reinvent an entire industry. 

Advantage Sustainability
• According to D'Aveni:

– "In a hypercompetitive environment, market stability is threatened by short product life cycles,

short product design cycles, new technologies, frequent entry by unexpected outsiders,

repositioning by incumbents, and tactical redefinitions of market boundaries as diverse

industries merge."

• A company or business unit must constantly work to improve its competitive advantage.

Sustained competitive advantage is increasingly a matter not of a single advantage maintained over

time but more of sequencing advantages over time.

Cooperative Strategies

– used to gain a competitive advantage within an industry by working with other firms

– collusion, strategic alliances

Collusion

– the active cooperation of firms within an industry to reduce output and raise prices to

avoid the economic law of supply and demand

Strategic Alliances

– a long-term cooperative arrangement between two or more independent firms or business

units that inhabit business activities for mutual economic improvement

Reasons to Form an Alliance

• Obtain or learn new capabilities

• Obtain access to specific markets

• Reduce financial risk

• Reduce political risk

Mutual service consortium

– a partnership of like companies in similar industries that pool their resources to gain a

a benefit that is too exclusive to mature alone, such as access to advanced technology
Joint venture

– cooperative business activity, designed by two or more separate organizations for strategic

purposes that goods an independent business entity and allocate ownership, operational tasks, and

financial risks and rewards to each member while preserving

their separate identity/autonomy

Licensing arrangement

– an agreement in which the certifying firm allowances rights to another business in another country

or marketplace to produce and sell a product

Value-chain partnership

– a solid and close association in which one company or unit forms a long-term preparation with a

critical supplier or distributor for the common advantage

Strategic alliance Success Factors

 Have a strong strategic purpose, and incorporate the alliance with each partner’s strategy.

Confirm mutual value is created for all partners.

 Find an appropriate partner with compatible aims and complementary abilities.

 Classify likely associating risks and deal with them when the alliance is designed.

 Allocate tasks and accountabilities so that each partner can specialize in what it does best.

 Create motivations for cooperation to reduce differences in corporate culture or organization

fitting.

 Minimize struggles among the partners by descriptive objectives and avoiding direct rivalry

in the market.

 In an international alliance, confirm that those managing it have complete cross-cultural

knowledge.

 Exchange human resources to maintain announcement and trust. Don’t allow individual egos

to control.
  Operate with long-term time prospects. The expectation of future progress can minimize

short-term engagements.

 Progress multiple joint projects so that any disappointments are balanced by success.

 Agree on a watching process. Share information to build belief and keep projects on the

objective. Monitor customer responses and service objections.

 Be flexible in terms of enthusiasm to renegotiate the connection in terms of environmental

changes and new chances.

 Settle on an exit strategy for when the partners’ objectives are attained or the alliance has

tried a failure.

Strategy refers to the models used to make the right decisions that help organizations achieve set

targets in the business world. Corporate people must invest inconsiderate the various strategy

development tools, profits, and limits. Having considered knowledge about strategy and how to

select the correct strategy tools can help businesses develop more effectively and creatively. There

are several strategy development tools for usage in the business world; what is essential is to

recognize which strategy tool to use in an assumed situation. The primary purpose of using business

strategy tools is successful strategic plans in companies and to help create economic fosses. Some of

the usual strategy growth tools are; PESTEL, Five Forces, Resource-Based

View, Cross Impact Analysis, and SWOT Analysis. In this item, only three crucial strategy growth

tools will have conversed. These strategy tools include; PESTEL, Five Forces, and SWOT Analysis.

PESTEL analysis supports clearly Businesses recognize the external macro-environment improved.

Companies. Can escape losses by financing in unappealing countries with the correct information

and insights. Porter’s Five Forces Analysis supports businesses in understanding their industries

better by analyzing the critical essential in supporting firms in understanding the internal and

external factors; that affect their business activities and 

We are adopting the best strategies to increase profits and attain process efficiency.
1. PESTEL Analysis

Companies use PESTEL analysis to understand the external factors that affect their operations. It

analyzes the political, economic, social, technological, environmental, and legal considerations

and their effect on an organization’s operations and performance. PESTEL analysis is a valuable

tool for leading situation analysis for companies that want to gain external macro-environment

forces that can know their activities. These external forces current opportunities and threats for

companies, hence the need to use this strategy development tool to evaluate the business

environment before capitalizing or making decisions.

 Therefore, PESTEL analysis supports companies in controlling the current external factors that

affect them, finding external factors that are disposed to changes, and choosing which

opportunities to achieve. Companies also use PESTEL analysis to measure the potential of a new

market. Corporations that want to venture into a new foreign market trust the understandings

drawn from a PESTEL analysis. The general rule when expending this strategy tool is that if

there are more undesirable forces moving a market. It is difficult for businesses to excel. This

insight is because opposing forces present difficulties that companies in the environment will

have to deal with, reducing the Profit possible for organizations. This situation makes the

environment unattractive for organizations.