FinalProject StrategeicManagement 63H 2021

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STRATEGIC MANAGEMENT FINAL PROJECT
Preprint · July 2021

DOI: 10.13140/RG.2.2.20768.71681
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2021
STRATEGIC MANAGEMENT
FINAL PROJECT
STRUCT DESIGN STUDIO

Full Strategy Analysis
STRATEGIC MANAGEMENT
Group: ESLSCA-63H STRATEGIC MANAGEMENT FINAL PROJECT
Acknowledgement
The authors wish to express their special thanks to Prof. Dr. Mohsen El-Shamaa
Professor of Strategic Management, ESLSCA Business School, ESLSCA University,
for his valuable suggestions, helpful advices, and constructive criticism during the full
semester and helping us to apply the course to real life firms.
Project Supervised by
Prof. Dr. Mohsen El-Shamaa
Team Work
Ahmed Nabil Abdelaziz Mohamed Moawad Ahmed Abdelaziz Ahmed kamel Gomaa
Eng.Ahmed.Nabil1985@ Shaaban Meligy Akwadood@gmail.co
Gmail.Com Mohamedmoawad35@g Ahmedmeligy89.am@ m
01069396880 mail.com gmail.com 01111790720
01006384421 01010960389
ESLSCA BUSINESS SCHOOL 1

Table of Contents
Title Page
Acknowledgement 1
Table of Content 2
1. Founder 4
2. Who We Are 5
3. Vision 5
4. Mission 5
5. Core Values 5
6. What We Do 6
7. Our Projects 7
8. Our Team 7
9. Corporate Social Responsibility 8
10. Internship 8
11.Careers 8
12.Contact Us 9
13. SWOT Analysis 10
14. PESTEL Analysis 14
15. Porter Five Forces Analysis 18
16. Competitive Profile Matrix 20
17. Purpose of EFAS and IFAS 21

18. Application of Value Chain Analysis 26
19. Competitive Advantage Types 28
20. Corporate Objectives 32
21. Applying The Business Strategy 34
22. Corporate Strategy 35
23. Implementation Phase 37
24. Evaluation Phase 42
25. Conclusions 45
26. Case Study 49
27. References 55

1. FOUNDER
Dr. Ahmed Nabil

Dr. Nabil started his journey in engineering design
firm 14 years ago. He has been exposed to different
types and scales of projects inside and outside
Egypt during his journey. He got his master degree
in structural engineering in 2012 from Menoufia
University, and then he obtained his PhD in
structural engineering through a joint supervision
program between Menoufia University and
University of Illinois at Urbana Champaign at the
United States in 2017. And he is currently enrolled
in MBA program at ESLSCA University in Egypt.
Besides working in the engineering firm; he is
doing a research in the field of using innovative materials and techniques in
structural engineering. He supervises a number of master and PhD students.

2. WHO WE ARE
Struct Design Studio is a leading multi-disciplinary design and construction firm
based in Egypt, offering comprehensive and professional services in architecture,
interior design, structural design and landscape design for different types, scales
of projects and clients. Struct has been launched in 2018 in Egypt and has been
formed to respond to clients' needs and offering them professional services. The
firm started small and as time goes by, it started to gain trust and experience in
the market and continued to grow. Today, Struct Design Studio is a group of
professional structural engineers and architects offering a full range of designs
and construction services.
3. Vision
Our vision is to be one of the premier
engineering solutions providers in
Egypt offering complex projects from
vision to reality.
4. Mission
We are committed to deliver high
value,smart, professional engineering
solutions that have a bold and unique
fingerprint in the national and
international market.
5. CORE VALUES
We are aligned to a number of core

values that draw our path with our
clients which are:
 Quality
It is our top priority to deliver
competitive edge designs
fulfilling our clients' needs and
desires complying with the
highest specification, regulations,
and standards.

 Integrity
We have upstanding character traits & work ethics which formulate our
code of conduct including sound judgment, respect, honesty,
dependability, and loyalty .
 Reliability
We are conscientious, self-committed, professional, responsible, and
dependable in our dealing with each other and our communities .
 Innovation
We adopt new ways of thinking converting creativity into innovation
from scratch to reality.
6. What We DO
We are offering a vast range of consultancy services depending on the nature of

the projects, clients’ needs and requirements including, but not limited to:
 Architectural designs
 Interior designs
 Landscape design
 Structural designs
 Value engineering
 Construction engineering solutions
 Repair and strengthening of structures
 Full engineering supervision
 Cost estimations
 Feasibility studies
 Project management
 MEP Design Services

7. Our Projects
We take on projects with the intention of finding smart, new solutions to

problems. Our clients vary in size and scope inside and outside Egypt. These
clients ask for our technical expertise, practical experience, multi-disciplinary
capabilities, and the global reach needed to analyze their problems, and develop
and implement the most appropriate, cost-effective solutions. Our diverse project
list includes commercial buildings, manufacturing structures, medical facilities,
schools, mosques, malls, and more. We are proud of the projects we have safely
and expertly delivered for our clients and are proud of our current roster of
dynamic projects.
8. Our Team
We do believe in passion, talent and knowledge, not in just age, we pick talented
work colleagues regardless of their age. They are professional, creative,
knowledgeable, loyal, and committed to drive our vision forward.

9. Corporate Social Responsibility
We do believe that organization should have social roles; we try to extend our
services to enrich the surrounding community through free of charge unique
designs projects for charities and provide instructional and educational seminars
for engineering students and graduates.
10. Internship
We provide annual internship for engineering students to be involved in real

world projects.
11. Careers
"Our people are our biggest asset, so we’re extremely selective about whom we
hire"
We want Struct to be an attractive place to join, a great place to work, and a home
that you’ll have happy memories about long after you’ve left. We work hard, we
push ourselves to be better and we’re always in search of excellence, but we also
work to create a fun, relaxed environment where everyone can be themselves and
reach their potential.
Every Struct employee has a personal development plan and training program,
and we commit to spend around 2,000 EGP on training each team member every
year with members who has already spent at least one year with Struct. We offer
a compelling mix of benefits and rewards including 15+ days holiday as standard,
an extra day off or for your birthday, and another for your Struct anniversary.
Struct also provides the team with (complimentary!) snacks every day, which are
re-stocked each week. We provide free of charge cell phone sim card to every
team member.
We encourage a flat, open structure where all levels of the agency from the
newest members of the Struct team to the leadership, engage, work together, and
are heard.
If Struct appeals to you and you think you have what it takes, we want to hear
from you – email us at structdesignstudio@gmail.com
12. Contact Us
Facebook : https://www.facebook.com/structdesignstudio
Instagram : https://www.instagram.com/struct_design_studio/
LinkedIn : https://eg.linkedin.com/company/struct-design-studio
Website:
Email : structdesignstudio@gmail.com
Telephone : 01069396880
13. SWOT Analysis
SWOT Analysis (also known as SWOT Matrix) is a business framework that

helps assessing a wide variety of factors that may have a profound impact on a
business’s performance. These factors may either be internal to a company or
external. Furthermore, these factors may either be favorable/helpful or
unfavorable/harmful to a company. By combining these two dimensions one can
draw a 2×2-matrix consisting of four quadrants: Strengths, Weaknesses,
Opportunities and Threats. This section will cover each of these four quadrants
of the SWOT analysis and will help us choosing the right tools to assess the most
important factors that may affect our business.
A. Strengths (SWOT Analysis)

Company’s strengths are its characteristics that give it an advantage
over others (competitors). Sometimes these strengths are also
referred to as unique selling points, firm-specific advantages
or competitive advantage. The source of these strengths are
resources and capabilities that are valuable, rare, hard-to-imitate and
organization-wide supported. Examples of valuable company
resources are patents, a strong brand reputation, a new innovative
product, a talented workforce, historically developed know-how
and large financial reserves. The strengths of our firm could by
summarized as following:

 Combined strong academic and professional background of the founders.

 Young professionals with high experience in different types of projects in
Egypt and Gulf area.
 Application of cutting edge technology in our work.
 Good reputation of the founders and team work.
 Providing unusual and innovative solutions to engineering problems.
B. Weaknesses (SWOT Analysis)
Similarly, these tools are very helpful in assessing a company’s

weaknesses. These weaknesses are company characteristics that
place a company at a disadvantage relative to others. In other words:
they are harmful to a company.
Weaknesses could for example be a lack of patent protection, poor

reputation among customers, a small working capital, bad leadership
and an inefficient production process. Weaknesses are best
discovered by having enough feedback loops in place, both internally
and externally.
Think about sending out customer surveys and organizing monthly employee
gatherings. Together, the strengths and weaknesses form the internal side of the
organization and the SWOT analysis. The weakness of our office could be drawn
as the following:
 The firm is new, the wages and salaries of the employees is not so high.
 Number of office branches is only one till now.
 Office location a bit far away from the capital.
 Founder has large number of responsibilities as he hold a position in
academia in addition to working in industry.
 High turnover of employees.
 Relying on few number of clients
 Lack of MEP design and technical expertise

C. Opportunities (SWOT Analysis)
 Opportunities are the external factors of the SWOT analysis

that may affect a company’s performance positively. To
assess the opportunities, a company should look for
elements in the environment that could be exploited to its
own advantage. The best way to assess the external factors
is by using PESTEL analysis for the macro-environment
and Porter’s Five Forces for the industry dynamics. PESTEL
looks at political, economic, social, technological,
environmental and legal trends in the macro-environment.
Examples are the increasing purchasing power of customers,
governmental subsidies, more favorable international trade
policies, and general lifestyle changes among the population. Porter’s Five
Forces on the other hand looks more specifically at industry factors like
the current competition, upstream supplier power, downstream buyer
power, potential new entrants and substitute products or services. The
opportunities of our office may be drawn as the following:
 Working in multidisplinary engineering fields provides number of

opportunities in introducing different services to clients.
 Having experience in Egypt and Gulf opens new markets to the
office.
 Egypt is opening new construction markets inside and outside Egypt
which creates a lot of opportunities to engineering fields.
 Floating of currency enables the office to compete outside Egypt.
 Low overhead costs enables us giving competitive prices for
projects.

D. Threats (SWOT Analysis)
 The threats on the other hand are the external factors that
could cause trouble for the company in the
future. Similarly to the opportunities, one could use a
PESTEL analysis and a Porter’s Five Forces model to
assess the elements in the environment that could harm the
organization. Examples of harmful macro-environmental
developments could be an increasing unemployment rate,
disruptive technologies, protests from NGO’s and
increasing government corruption levels. In terms of
industry specific threats, one could think about new
competitors entering the arena, the availability of
substitute products and increasing bargaining power from
suppliers. Together, the opportunities and threats make up the external part
of the SWOT analysis. The threats for our office may be drawn as the
following:
 New Egyptian regulations in construction industry affected the

market directly and forms recession for big engineering sector.
 Large number of non-engineering firms enters the market without
any opposition from the government which makes the completion
unfair.
 Raw materials price increase decreases the wheel of construction
industry.
 Army intervention in the industry
 Economic conditions fluctuations in Egypt.
 COVID-19 pandemic

14. PESTEL Analysis

PESTLE analysis sometimes referred to as PEST analysis, is a concept in
marketing principles. This concept is used as a tool by organizations to keep a
track of the external factors impacting the organization. PESTLE is a mnemonic
which in its expanded form denotes P for Political, E for Economic, S for Social,
T for Technological, L for Legal, and E for Environmental. On the basis of the
organization, it can be reduced to PEST or additional areas can be added (such
as Ethical).
PESTLE analysis forms a much more comprehensive version of the SWOT

analysis. This form of analysis is then compared with the company’s internal
strengths and weaknesses via a SWOT analysis. This aids in determining the
future scope of action and in developing measures for strategic management.
Each of the factors mentioned above, from Political, Economic, Social,

Technological, Legal to Environmental, have an impact on an organization. Yet
the significance of each of these factors may differ based on the different kinds
of industries.
A. Political Factors
Political factors include tax policy, environmental regulations, trade restrictions

and reform, tariffs, and also political stability. These factors determine the extent

to which a government may influence an industry or a company. For example,

the government may bring new tax reforms that might change the whole revenue-
generating system of a company. Some tariff trade barriers that can prove to be
a hindrance in the way we run our business operations include customs policy
and export subsidies. Non-tariff trade barriers meanwhile include determining
minimum import prices as well as bans and restrictions on exports. The political
factors affecting our firms may be summarized in the following points:
 Government housing projects and mega projects pushes the construction
industry to new limits.
 Government new projects goes directly to number of large firms only
which affect the small firms
B. Environmental Factors
These factors are mainly concerned with the effect of the surrounding
environment and the influence of ecological aspects. These include waste
disposal laws, environmental protection laws, and energy consumption
regulation. The environmental factors affecting our firms may be summarized in
the following points:
 Using good structural designs will save a lot of raw materials which
consequently save tonnage of Co2 emissions.
 Using recycled construction materials will be very sustainable.
 Introducing nice façade designs will provide very comfortable
environment for inhabitants.
 Applying smart architectural design and interior design will help people
living comfortable and healthy life.
 Using new sustainable construction materials will save the environment
C. Social Factors
Social factors include cultural norms and expectations, health consciousness,

population growth rates, age distribution, career attitudes, health, and safety.
These factors are helpful for our company to better plan our marketing analytics
and strategy. The social factors affecting our firms may be summarized in the
following points:

 Young couples tend to ask for the help of interior designers to establish
their new homes.
 Properties new owners is wishing to have very nice facades for their new
homes.
 Society untruly think that hiring interior designers is so expensive.
 Properties owners untruly think that hiring engineers to design and
implement their projects will cost them a lot of money.
D. Technological Factors
Technological factors mean the innovations and developments in technologies.

These factors impact an organization’s operations. Several new developments
like Artificial Intelligence, IoT, Machine Learning, Deep Learning, are being
made in the technology field and if a company fails to match up the trend it may
lose its position in the market .A few of the technological factors which are
included in the PESTLE analysis include the rate of technological change, the
evolution of infrastructure, and any government or institutional research. The
technological factors affecting our firms may be summarized in the following
points:
 Applying BIM technology facilitate coordination between all engineering

aspects like architectural, structural, MEP.
 New technology help customers to imagine their new homes before
implementation to save time and money and end up with satisfying results.
 Using new software and hardware help engineers to compress the time
needed for designs and increase accuracy.
 New machinery in construction industry helps engineers to reach higher
results in less time.
 Using smart home technology provide customers with very pleasant
experience.
E. Economic Factors
Economic factors include economic growth/decline, interest, exchange, inflation

and wage rates, minimum wage, working hours, unemployment (local and
national), credit availability, and cost of living. These factors are determinants to
an economy’s performance that directly impacts a company and also have
resonating long term effects. The economic factors affecting our firms may be
summarized in the following points:

Currency floating affected directly the construction and real estate market.
Price increase in construction materials decrease directly the investment
in that sector.
F. Legal Factor
Legal factors include changes to legislation impacting employment, access to

materials, quotas, resources, imports/exports, and taxation. These factors have
both external and internal sides. Certain laws have an impact on the business
environment in a country. The legal factors affecting our firms may be
summarized in the following points:
 Government new laws regarding building permits freezes the construction

market completely for more than one year.
 New high taxation rates on construction projects will freeze the market.

15. Porter Five Forces Analysis

 Porter five forces model is used for identifying and analyzing the five
competitive forces which shapes the industry. It helps in determining the
weaknesses and strengths of the industry. Many companies used the model
to identify the structure of the industry and determines the corporate level
strategies suitable for the situation. The model is flexible and used in
different segment for searching the attractiveness and profitability of the
company. We use Porter Five Forces to understand how the five
competitive forces influence profitability and develop a strategy for
enhancing Struct Design Studio, competitive advantage and long term
profitability in Construction industry. Michael Porter observed five forces
that have significant impact on a firm's profitability in its industry. These
five forces analysis today in business world is also known as -Porter Five
Forces Analysis. The Porter Five (5) Forces are -
 Threat of New Entrants

 Bargaining Power of Suppliers
 Bargaining Power of Buyers
 Threat from Substitute Products
 Rivalry among the existing players.

A. Degree of Rivalry
In the construction and engineering design industry, there’s high competition and
Struct Design Studio competes with different competitors such as Alassema and
Fekra Group who both tend to offer lower prices compared to Struct. On the
bright side, those competitors are different in size and capacity and Struct is
known for its ability to perform complicated projects with high quality which
differentiate it from competition.
B. The Threat of New Entrants

The construction industry has a high entry level due to the large amount of
investment required which decreases the chance of competition and at the same
time the buyer’s switching costs are high because most projects last for a long
period of time. At the same time Struct needs to constantly work on offering more
efficient and effective solutions and stay on top of the latest construction trends.
C. Bargaining Power of Buyers

Since buyers threaten an industry by forcing down prices, bargaining for higher
quality or more services, in our case Struct has a market reputation for offering
highest qualities so this doesn’t represent a big problem but the problem appears
when Struct is asked to work on military or governmental projects with a specific
budget which leads to profit loss. Struct can overcome this challenge by
expanding our loyal customer base and gaining their loyalty in order to get a
number of direct order projects, and at the same working in parallel with
providing new products or services that can always attract new categories of
clients.
D. Bargaining Power of Suppliers

Powerful suppliers in the Industrial sector use their negotiating power to extract
higher prices from the firms in the construction field. The overall impact of
higher supplier bargaining power is that it lowers the overall profitability of
construction. This threat can be dealt with by building strong supply chains with
multiple and different suppliers, experimenting with different product materials
so in case prices increase there will be a replacement, and aid dedicated suppliers
and make their business depend on the firm.

E. Threat of Substitute Products or Services

Whenever another provider serves the same customer needs in similar or
different ways, this represents a threat to the company. Struct can overcome this
threat by applying constant updates of our operational methods by using the latest
techniques, focus on being service-oriented rather than just product-oriented,
understand the core needs of the customer and finally increase switching cost for
suppliers so they become discouraged to switch between providers.
As the resulting score is 64 and between the minimum score which is 5 (very
attractive) and the maximum score which is 125 (very unattractive), then the
organization and the industry are both attractive prospects.
16. Competitive Profile Matrix

After evaluating all of the elements of the competitive matrix for our company,
Struct Design Studio had the highest degree compared to competitors. However,
the real competitor is Alassema and we should keep an eye on them, while at the
same time improve our cost-leadership.
Competitive Profile Matrix Chart
4
3.7
3.25
TOTAL POINTS
Struct Alassema Fekra
17. Purpose of EFAS and the IFAS

The EFSA and the IFSA was designed to be used with the SWOT analysis. When
they are combined, they are a powerful analysis tool that is used to form business
strategies for the success of the company. The purpose of both the EFSA and the
IFSA is to identify the external and internal factors that are strategically
important to a company. This strategic management tool will show the company
how important each factor is through the weight that is assigned to that factor.
The rate will show the company the quality of their response to both the external
and internal factors that they face. The weighted score, the total score and the
rating shows how responsive the company is to the external and internal factors.
These factors simply show how good or bad the company responds to both the
external and internal factors that they face. This tool shows the company their
present responses as well as the areas of the business that need to be improved
upon. This helps the company identify the areas that they need to focus on as
well as help them develop a strategic plan. These tables can be used by a
company to identify opportunities with in the market as well as identify lucrative
niches and generate alternatives. One of the most important aspects of these
analysis is that they can alert the company that there is a need for change.

A. STRUCT-EFAS
External factors Weight Rating Weighte Comments
d Score
Opportunities
1. Working in multidisplinary 0.20 5 1.0 Providing different
engineering fields. services to clients
2. Having experience in Egypt 0.10 4 0.40 Joint ventures with
and Gulf. international firms
3. Egypt is opening new 0.05 2 0.10 Number of
construction markets inside and opportunities in large
outside Egypt. scale projects
4. Floating of currency. 0.05 3 0.15 Competitive prices
globally
5. Low overhead costs. 0.10 4 0.40 Competitive prices
domestically
Threats
1. New Egyptian regulations 0.15 5 0.75 Affected the market
directly and forms
recession for big
engineering sector.
2. Large number of non- 0.15 4 0.60 Unfair competition
engineering firms
3. Raw materials price increase 0.1 5 0.50 Recession in
construction market
4. Army intervention in the 0.05 3 0.15 Monopoly of big
industry construction projects
5. Economic conditions 0.05 2 0.10 High risk in
fluctuations construction sector
Total 1.00 4.15
Since the total weighted score isn’t less than 3 that mean that business is
doing well.

B. Internal Analysis
 Resources
The organization uses resources to provide products or services to its customers.
A resource is any asset, process, skill or item of knowledge that is controlled by
them, including but not limited to.
Human Resources
All employees inside the organization with their soft and technical skills.
As a company in the construction sector, there are employees, casual and
permanent all over the projects and the head office premises, ranging from
office boys to engineers, , accountants, marketers, finance, HR, IT, etc...
Physical Resources
These are the tangible assets of the organization, and include property,
plant and equipment.
Technological Resources
These are information, tools or devices that the organization possesses.
Financial Resources
These are the financial assets, and the ability to acquire additional finance
if this is required.
Intellectual Capital
It includes the acquired knowledge and ‘know-how’ of the organization.
The brand name is well- known in the region as one of the leading designers
in the construction sector.
 Capabilities
These capabilities, the collective skills, abilities, and expertise of an
organization are the outcome of investments in staffing, training, compensation,
communication, and other human resources management areas. They represent
the way that people and resources are brought together to result in value. They’re
responsible for the identity and personality of the organization by defining what
we are good at doing and, in the end, what it is. They are stable over time and

more difficult for competitors to copy than capital market access, product
strategy, or technology.
 Competency
A broader definition of organizational competencies focuses on the first word
that is “organizational”. It is the organization as a whole that must perform and
not just an individual employee. Generally, but not always, the organization will
have more than one competency, but not many of them. Competency can be
defined as the combination of required skills, capabilities, necessary information,
appropriate performance measures and the right corporate culture that the
company requires to achieve its mission. Competencies are not just skills;
however, they include the information, performance, and culture. The cross
functional integration and coordination of capabilities across the division to
achieve the goal. Our competencies include;
 Technical competencies – the people are demonstrating knowledge in
codes, regulations and standards, materials, design constraints and
analyzing risks.
 Team effectiveness – teams work respectfully and work to resolve
differences.
 Communication - orally, the team communicates in a simple and concise
manner, providing presentations to technical and non-technical groups and
expressing both technical and nontechnical issues to anyone, presentations
to the public. In writing, they tailor communications to the intended
audience, use drawings and sketches to clarify, demonstrate using written
reports, and take training in technical reports writings. Moreover, they take
reading and comprehension training to have the ability to review technical
documents and understand the implications and summarize key points.
 Project and financial management – team is well aware of the project
management principles, increased level of responsibility, managing
expectations in light of the available resources and understanding the
financial aspects of work and always asking for and seeking feedback from
clients.
 Professional accountability and ethics – people work with integrity,
ethically and within professional standards, understand how their practice
conflict of interests affect, understand their own scope and limitations, and
are well aware of professional accountability.
 Social, Economic, Environmental and Sustainability

Understanding the relationship between the engineering activities

and the public, demonstrate understanding of the safeguards required to
protect the public and the methods of mitigating adverse impacts.
 Professional continuity and development
People always demonstrate awareness that there are gaps in

knowledge and areas requiring further development, and thus develop a
professional development plan to address those gaps and maintain the
position in the field of practice as market leaders.
C. STRUCT- IFAS
Internal factors Weight Rating Weighted Comments
Score
Strengths
1. Combined strong academic 0.20 5 1.0 High experience
and professional background
2. Application of cutting edge 0.10 5 0.50 Unique service
technology provider
3. Good reputation 0.10 4 0.40 High trust in the firm
4. Providing unusual and 0.05 4 0.20 Competitive services
innovative solutions
5. Low overhead costs. 0.05 3 0.15 Competitive prices
domestically
Weaknesses
1. low number of office 0.1 2 0.20 Demographic
branches deficiency
2. High turnover of employees 0.15 5 0.75 Increase salaries

3. Relying on few number of 0.15 5 0.75 Recession in
clients construction market
4. Lack of MEP design and 0.05 3 0.15 Need to have

technical expertise experienced MEP
engineers
5. Bad time management 0.05 4 0.20 Lost number of
projects
Total 1.00 4.30
Since the total weighted score isn’t less than 3 that mean that business is
doing well.

18. Application of Value Chain Analysis

1. Definition of Value Chain
Value chain analysis (VCA)
It is a process where a firm identifies its primary and support activities

that add value to its final product and then analyze these activities to
reduce costs or increase differentiation.
Value chain
Represents the internal activities a firm engages in when transforming

inputs into outputs.
Value chain analysis is a strategy procedure used to analyze internal firm

activities. Its goal is to recognize, which activities are the most valuable (which
what are the source of cost or differentiation advantage) to the firm and which
ones could be improved to provide competitive advantage. In other words, by
looking into internal activities, the analysis reveals where a firm’s competitive
advantages or disadvantages are. The firm that competes through differentiation
advantage will try to perform its activities better than competitors would do. If it
competes through cost advantage, it will try to perform internal activities at lower
costs than competitors would do. When a company is capable of producing goods
at lower costs than the market price or to provide superior products, it earns
profits.
M. Porter introduced the generic value chain model in 1985. Value chain
represents all the internal activities a firm engages in to produce goods and
services. VC is formed of primary activities that add value to the final product
directly and support activities that add value indirectly.

Although, primary activities add value directly to the production process, they
are not necessarily more important than support activities. Nowadays,
competitive advantage mainly derives from technological improvements or
innovations in business models or processes. Therefore, such support activities
as ‘information systems’, ‘R&D’ or ‘general management’ are usually the most
important source of differentiation advantage. On the other hand, primary
activities are usually the source of cost advantage, where costs can be easily
identified for each activity and properly managed.
Firm’s VC is a part of a larger industry's VC. The more activities a company

undertakes compared to industry's VC, the more vertically integrated it is. Below
you can find an industry's value chain and its relation to a firm level VC.

There are two different approaches on how to perform the analysis, which depend
on what type of competitive advantage a company wants to create (cost or
differentiation advantage). The table below lists all the steps needed to achieve
cost or differentiation advantage using VCA.
19. Competitive Advantage Types
Cost advantage Differentiation advantage
This approach is used when The firms that strive to create superior
organizations try to compete on products or services use differentiation
costs and want to understand the advantage approach. (good
sources of their cost advantage or examples: Apple, Google, Samsung
disadvantage and what factors drive Electronics, Starbucks)
those costs.(good
examples: Amazon.com, Wal-
Mart, McDonald's, Ford, Toyota)
 
 
 Step 1. Identify the firm’s primary  Step 1. Identify the customers’ value-
and support activities. creating activities.
 Step 2. Establish the relative Step 2. Evaluate the differentiation
importance of each activity in the strategies for improving customer value.
total cost of the product.  Step 3. Identify the best sustainable
 Step 3. Identify cost drivers for each differentiation.
activity.
 Step 4. Identify links between
activities.
 Step 5. Identify opportunities for
reducing costs.

In STRUCT DESIGN STUDIO we are focusing on value engineering concept

which is considered as cost advantage. And to gain cost advantage we have to go
through 5 analysis steps which are:
Step 1. Identify our primary and support activities. All the activities (from
receiving and storing materials to marketing, selling and after sales support) that
are undertaken to produce goods or services have to be clearly identified and
separated from each other. This requires an adequate knowledge of company’s
operations because value chain activities are not organized in the same way as
the company itself. The managers who identify value chain activities have to look
into how work is done to deliver customer value.
Step 2. Establish the relative importance of each activity in the total cost of
the project. The total costs must be broken down and assigned to each activity.
Activity based costing is used to calculate costs for each process. Activities that
are the major sources of cost or done inefficiently (when benchmarked against
competitors) must be addressed first.
Step 3. Identify cost drivers for each activity. Only by understanding what
factors drive the costs, our managers can focus on improving them. Costs for
labor-intensive activities will be driven by work hours, work speed, wage rate,
etc. Different activities will have different cost drivers.
Step 4. Identify links between activities. Reduction of costs in one activity may
lead to further cost reductions in subsequent activities. For example, fewer
components in the design may lead to lower service costs. Therefore identifying
the links between activities will lead to better understanding how cost
improvements would affect he whole value chain. Sometimes, cost reductions in
one activity lead to higher costs for other activities.

Step 5. Identify opportunities for reducing costs. When we know our

inefficient activities and cost drivers, we can plan on how to improve them. Too
high wage rates can be dealt with by increasing production speed, outsourcing
jobs to low wage countries or installing more automated processes.
Value Chain Example on Value Engineering Project(120 Million Egyptian

Pounds)
Step 1 - Firm's primary activities
Design and Raw Formwork Labor Sales and Distributio

engineering Materials marketing n and
dealer
support
(Concrete-
steel-
blocks)
Step 2 - Total cost and importance
15 Million 80 Million 10 Million 10 3 Million 2 Million

except the cost very important important Less Not
is not high but important important important
it is very
important
cost driver
Step 3 - Cost drivers
 -Number 
of -Material  -Speed 
of -Skills 
of -Size 
of -Number of
design concepts quantities implementatio labor advertising dealers
and alternatives n budget
  -Average  -Formwork  
-Number of 
-Strength of -Sales per
value of type labor existing dealer
purchases  -Application reputation  -Frequency
per supplier technique  of defects

Step 4 - Links between activities

1. High-quality design process reduces defects and costs in
2. Locating suppliers near the projects reduces purchasing and distribution costs.
3. Skilled workers reduced labor costs
4. Effective designs reduces materials quantities and costs
Step 5 - Opportunities for reducing costs

1. New bold engineering designs
2. Using innovative construction techniques
3. Using skilled workers
4. Using new high quality materials reduce costs

20. Corporate Objectives

The proposed strategic management model started with defining the mission and
vision, followed by our external analysis of the opportunities, threats and
analyzing the competitors and marketplace, then the internal analysis of the
organization to define the strengths and weaknesses and defining the resources,
capabilities, competencies, core competencies to develop the distinctive
competency has now reached establishing the long term objectives of the
organization and what benefits they will achieve from the objective. Once a
strategic analysis has been completed, the next step in the strategy process is to
establish strategic objectives. At this point, we decided why the company exists
and how it will try to fulfill its mission. Strategic analysis has provided
information about customer preferences, competitors, and the firm’s resources
and capabilities and now it is time to start planning for success. Strategic
objectives are the big-picture goals for the company: they are usually some sort
of performance goal such as to launch a new product, increase profitability, or
grow market share for the company’s product, expand, diversify, etc...
In that context, Peter Drucker suggested that corporate objectives should cover
eight key areas:
Eight Key Areas
Market standing Increase market share locally and
internationally, customer satisfaction,
product range
Innovation New products, better processes, using
technology, Improving Quality of
executing activities
Productivity Optimum use of resources, focus on core
activities
Physical & financial resources business locations, finance, supplies, cost
reduction
Profitability Level of profit, rates of return on investment
Management Management structure; promotion &
development
Employees Organizational structure, gain employees
satisfaction, and improve their skills
Public responsibility Compliance with laws; social and ethical
behavior

Furthermore, objectives have got to be S.M.A.R.T, SMART objectives are:
• Specific, targeting a specific area for improvement.

• Measurable, quantifiable, or suggesting an indicator for progress.
• Assignable, specifying who will do what.
• Realistic, stating what results can realistically be achieved, given
available resources.
• Time-bound, specifying when the results can be achieved.
Our main goal now is to assign a corporate objective for the organization and
specify what will be the benefits for the organization from that objective. After
specifying the vision & mission, specifying the threats and opportunities and
internal processes of the organization, we’d say that the long-term Objective of
the organization as the leader in its industry in the Middle East is to expand
globally into international markets and increase market share. Expansion into
foreign markets will really benefit our organization with various benefits
including but not limited to:
A. Revenue Growth
A core general goal during business expansion is to experience dramatic revenue

growth. According to a recent report, 45% of middle market companies make
more than half of their revenue overseas. Since business is doing well
domestically, they are already a step ahead to succeed globally. With a new
customer base, they can identify and create unique opportunities in local markets
for the business to fill in the gaps.
B. Gaining a Competitive Advantage
Thinking globally is becoming less of an option and more of a requirement when

it comes to outpacing the competition. In fact, taking the business international
presents growth opportunities by expanding options for talent, customers, and
creating cost-savings for imports and manufacturing.
C. New Customers
We have been in the local market for a while, it is tough to find new customers.
They are used to the products that they’re offering and the competitors, and new
sales can be a battle hard-fought. An international expansion opens new doors

and gives access to a whole new set of customers who have never seen their
product or service before.
D. Expansion & Diversify
Keeping business in the home market is limiting their potential for profit. One of
the downsides of operating only in one country is the exposure to market
changes. Taking business international gives the opportunity to diversify
markets, so revenue is more stable. If the domestic market is slowing down,
having the advantage of a global market will help cushion the company during
slower economic times.
E. Improve Company’s Image
One of the reasons why our objective is to expand globally is to be able to
provide a reliable service to the international clients. A good global reputation
will attract new customers. Expanding abroad allows to build name brand
recognition and establish credibility internationally.
21. Applying The Business Strategy

The office is operating in a broad market, and has huge overheads, is far
away from being a cost leadership in the construction industry. The Organization
strategy pursuing is differentiation and low cost, offering services with a high-
end quality, high customer service, and rapid product innovation, advanced
technological features.
Differentiation involves making products or services different from the other
competitors and more attractive. In the low-cost strategy, the office must have a
thorough understanding of costs and how to continually reduce them. Struct
must be willing to standardize its offerings in order to manage the costs.
To make a success of a Low-cost/Differentiation strategy, everyone needs to stay
agile with the new product development processes. In order to implement this
strategy, the following have to be developed:
• Good research, development and innovation.
• The ability to deliver high-quality designs or services with competitive prices.
• Effective marketing, so that the market understands the benefits offered by the
differentiated offerings and Low-cost/Differentiation offerings.

22. Corporate Strategy

It is a perfect time for the leadership to operationally define each critical area of
the plan to ensure agreement and commitment.
Key stakeholders should be included within the process. Soliciting their input is
typically a valuable aide in implementation. A powerful and effective corporate
strategy is going to be successful in accelerating the growth of Struct, increasing
profits, and achieving all the office objectives and goals.
The directional strategy dictates how the business will operate and coordinate
activities to achieve the organization goals and objectives. Struct will follow a
growth strategy to develop new services, and find new ways for income sources.
Our strategy direction is growth through alternative ways like simply step-up
existing operations through increased efficiencies to make business expansion.
A. Vertical Growth Strategy
Vertical growth is a compelling strategy for organizations that have a strong
competitive position within a popular industry. They are able to improve their
competitive position by expanding along the value chain
 Final assembly
 Marketing for our designs.
 Technical support after completing designs.
 Strong Design capabilities.
 Updated technologies.
B. Horizontal Growth Strategy
Struct can grow horizontally through internal development or externally through
acquisitions or strategic alliances with other firms in the construction designs.
 Adding new locations - expansion into new regions, locations,
cities, or countries.
 Growth in employee headcount.
C. International Entry Strategy
Joint Venture - Forming a JV between a foreign corporation and a domestic
organization is the most popular strategy used to enter a new country.
Acquisitions - purchasing another office already operating within the same area.
BOO - Management Contracts - A large corporation operating throughout the

world is likely to have a large amount of management talent at its disposal.
D. Proposed Corporate Strategy
 Flatten Hierarchy with Open Communication Channels
Struct to adopt the flat organizational structure instead of the hierarchal
structure. With this type of structure in place, communication is clearer and less
susceptible to degradation, innovation can happen informally and more quickly,
employees often have more responsibility and are more involved in important
decisions.
Transparency is also a big advantage when using a flat organizational structure
thanks to the limited bureaucracy. Having fewer levels of management also
simplifies internal communication and enables fast decision-making, and
because the layers of middle management are removed, power and responsibility
are divided evenly throughout the organization.
 Global Strategy for Expansion
Struct planning to expand their presence in our core markets in Egypt and the
UAE through several avenues, namely strengthening activities in their key
engineers’ international trainings, searching for smart projects that make
revolutionary changes in architecture.
Struct inclines to be part of the future of the global construction industry through
different opportunities in residential, non-residential, projects specially in the
fastest-growing regions in the construction market in Middle East, and Arabian
region. This can be done through merging or acquisition by 2026.
 Innovation and Technologies
Digital and advanced technologies can generate value.
Using autonomous construction vehicles, adopting green construction
techniques, using digital technologies to improve quality of designs, and using
advanced building materials such as fiber concrete, nanomaterial it will enables
our organization to have a competitive edge.
The technological innovation can be applied to improve the processes and
operations.

 Digital Engineering
Building Information Modelling (BIM), it involves binding truth potential of the
construction designs. This state-of-the-art digital technology enables us to
integrate data related to building’s design, construction and in-use functions into
the project plan to make sure that most efficient delivery methods are used. BIM
also allows us for an early-stage multi-disciplinary clash detection, ensuring a
seamless site execution and handover.
23. Implementation Phase
Once strategies are agreed on, the next step is the implementation phase. Top
management is important to the effective implementation of strategic change
since during this stage of the strategy, top management will concentrate on
efficiency to make sure that we’re doing things right with minimal resources and
also concentrate on the operational process, internal processes, hence, the
organization performance.
Strategic implementation, or as some might call it strategic execution, is the
phase where the preparation and planning stop to let the action begin. Best plans
won’t compensate you for chaotic implementation. Everyone within the
organization should bear in mind his or her particular responsibilities,
assignments and authority. Management should provide additional employee
training to fulfill plan objectives during this stage, as well. It should also allocate
resources, including funding. Success during this stage depends upon employees
being given the tools needed to implement the plan and being motivated to ensure
it works.
In the strategic management process, the strategy team must have honest
analytical skills, leadership skills and special motivation. After formulating the
strategy with the top management and therefore the managerial level, all other
employees within the organization should be involved in the strategy
implementation.
The next step is to break down that overall goal down into functional areas or
core strategies. Typically, this may include HR, operations, marketing,
management, R&D, business development, finance, and accounting. Each
department will identify how they will contribute to achieving the overall
strategic plan as shown below:

A. Top Management’s Strategy

The role of the top management here is very important to take strategic decisions
with support from other departments as shown below:
• Develop a new design department to compete or join foreign offices and offer
superior services to the clients.
• Looking for new strategies to ease the effect of the pandemic on the
headquarter employees and investing in safety equipment on sites to avoid
shutdown and all following specific processes that everyone has to stand by with
support from the HR department.
• Developing IT tools to flatten the organization to allow for a better chance to
form JV with foreign companies and learn more from them with support from
the IT department.
• Acquiring a strong workforce through experienced human resources staff with
support from the HR department.
• Utilizing equipment and using experience in the local market and being a
process organized organization to acquire foreign investments with support from
sales and finance.
• Forming Joint Ventures with foreign companies, using experience in the local
market and reputation as a process-driven organization.
B. Marketing Department’s Strategy
Marketing management plays a vital role in the success of a business and directly
influences profitability and customer satisfaction. Similarly, Struct can achieve
several benefits from effective marketing, including an increase in profits, sales,
and client satisfaction, developing a brand identity, creating, improving customer
loyalty, status, and overall quality. Developing a strong comprehensive
marketing plan for our business is probably the right place to start.
We will begin with conducting a marketing research in order to understand more
the target segment and their demands, study the latest best practices and study
competitors to know how their services differ from Struct. The main messages
behind the campaigns will focus on highlighting the unique selling points and
communicating them across different channels. The entire marketing team will
work together to excel the below tactics:

• Develop a traditional and digital marketing campaign that highlights the unique
selling points, the strong status and history of Struct in shining complicated
projects over the years.
• Partner with the sales team by setting complementary goals to achieve and set
realistic lead generation strategies along with customer relationship management
ones.
C. Finance Department’s Strategy
Construction firms should standard their performance against industry standards
to ensure that job costs are aligned with the competition. Finance department
should study regional and national data, as well as indices compiled by credible
sources on performance by craft, project size, type, location and other major
project influences to achieve the below tactics:
• Lower overheads costs to compete with other offices.
• Using the strong financial position to win offers by the Army, since no one can
stand their payment terms.
• Utilizing equipment and using experience in the local market and being a
process organized organization to acquire foreign investments
• Reduce operation cost operating costs by 15% over the next two years through
improvement in the efficiency of the operational process.
D. R&D Department’s Strategy
R&D will help to both deliver and shape the corporate’s strategy, so that it
develops distinguished donations for the organization priority markets and
exposes strategic options, highlighting promising ways to relocate the business
through new stages and unsettling revolutions.
Artificial intelligence can be used at the discovery phase to identify emerging

market needs or new uses of existing technology and we can use university
researches or private sector researches to achieve the below tactics:
• Reduce costs to compete efficiently with other local companies and avoid
working only with the Army.

• Strengthening the research and development department to always seek new

methods and technologies, human resources to hire experienced designers to
capitalize on the increased revenue and take projects as EPC.
• Direct the sales team to always look for new projects, to support the financial
position even more to resist the economic fluctuations in Egypt.
E. HR Department’s Strategy
In the construction designs, people are the most expensive. The roles and
responsibilities of HR within the best international architecture offices focus on
the happiness of its people. HR helps each worker to realize their potential while
conducive to the company’s success. Following best practices to attract, develop,
reward, and retain skilled workers is the surest way the HR team can help the
organization to become known as a place where the best workers prefer to work.
Also, accenting on the importance of healthcare, HR departments should ensure
employees understand their health benefits and encourage workers to never
ignore signs of injury or illness especially in Covid-19 pandemic.
Implementing HR best practices tailored to construction needs to achieve the
below tactics:
• Looking for new strategies to ease the effect of the pandemic on the headquarter
employees and investing in safety equipment on sites to avoid shutdown and all
following specific processes that everyone has to abide by.
• Acquiring a strong workforce through the experienced human resources staff.
• Gain employee’s satisfaction and build communication channels between
employees and managers and apply an open-door policy.
• HR department should create events and activities helps to improve the
organization’s work environment.
• Applying Training policy program in the next 12 months to improve
employees’ skills.
• Overcome workload fluctuations by creating a flexible work schedule that
allows some employees to work extended hours during the peak, provide
additional training to a fixed number of employees who can shoulder part of the
increased load and use temporary staff during hiring freezes when the workload
has suddenly increased.

F. MIS Department’s Strategy

A management information system (MIS) supports management by assembling
information from various sources, collecting, operating, and presenting it legibly.
It can give managers necessary information to assist them in making informed
decisions. The ultimate aim of a MIS is to extend a business’s efficiency,
productivity, profitability then value. Information collected by an MIS can cover
technology, people, relationships, processes, purchases, sales and so on and can
be used to monitor the performance of a company, project or program and to
achieve below tactics:
• Provide better communication.
• Developing IT tools to flatten the organization to form JV with foreign offices
and learn more from them.
G. Business Development Department’s Strategy
Direct all marketing and advertising to the target demographic / psychographic
market to achieve below tactics:
• Direct the business development team to use the strong experience within the
local market.
• Using the strong financial position to win offers by the army, since no one can
stand their payment terms.
• Business development team should scan the international markets and the
available opportunities and analyze threats and report founders with results to
capture a bigger market share and expand in the international markets.

24. Evaluation Phase

The main goal for evaluation of business strategy arises out of the fact that a
strategy may fail during implementation and an early corrective action is to be
taken to support the detailed evaluation report.
Decision-makers also are interested about such evaluation reports for the
rewards just in case the strategic plans work well. The strategy evaluation process
involves analyzing our strategic plan and assessing how well you've done against
achieving the goals in our strategy.
A strategy evaluation is an internal analysis tool and will be used as a part of a
broader strategic analysis for the organization when making decisions about the
strategy.
The top management creates an evaluation system that evaluates the strategy at
every stage of the work within the organization on a daily basis.
A fundamental problem facing managers today is the way to effectively control
employees in light of recent organizational demands for greater flexibility,
innovation, creativity, and initiative from employees.
Strategy evaluation includes 3 basic activities:
• Examining the underlying bases of a company's strategy.
• Comparing expected results with actual results.
• Taking corrective actions to make sure that performance conforms to plans.
Strategy Evaluation is becoming gradually difficult today because of the
following reasons:
• A dramatic increase in the environment’s complexity.
• The increasing difficulty of forecasting the longer term with accuracy.
• The increasing number of variables.
• The rapid rate of uselessness of even the simplest plans.
• The rise within the number of both domestic and world events affecting
organizations.

• The decreasing time span that planning will be through with any degree of
certainty.
A. Evaluation and control information
Monitor performance day by day in order to correct any employee activity if
needed. Evaluation & control consists of performance data and reports. If
undesired performance results were observed because the strategic management
processes were inappropriately used, operational managers must be informed so
they can correct the employee's activities.
Each department should prepare their own evaluation of how they think their area
performed against the strategy. There are variety of advantages of doing so:
• You will have the chance to assess your team's understanding of the strategy.
Does it match your own?
• Your team will realize how serious you are in taking the procedures of the
strategy and that you value it more as a part of their day-to-day roles.
• You will gain additional insights that you simply wouldn't have thought of
yourself.
In order to evaluate our strategy, we have answered the following questions
first:
• How have competitors responded to our strategies?
• How have competitors’ strategies changed?
• Have major competitors’ strengths and weaknesses changed?
• Why are competitors making certain strategic changes?
• Are our internal strengths still strengths?
• Have we added other internal strengths?
• Are our internal weaknesses still weaknesses?
• Are our external opportunities still opportunities?
B. Measurement of performance
The standard performance may be a benchmark with which the real performance
is to be compared. The reporting and communication tools & applications help
in measuring the performance. If appropriate means are available for measuring

the performance and if the standards are set within the correct way, strategy
evaluation becomes easier.
But various factors like a manager's influence are difficult to live with. Similarly,
divisional performance is usually difficult to live as compared to individual
performance. Thus, variable objectives must be created against which
measurement of performance will be done.
The measurement must be done at the right time; else evaluation won't meet its
purpose. For measuring the performance, financial statements like the balance
sheet, profit and loss account must be prepared on an annual foundation.
• Use an assessment system in order to sense the employees grading level in
addition to using the Job Evocative Index to measure job satisfaction level to
monitor the progress in the employee holding issues.
• The state of the working capital & current ratio may be normal when compared
with industry standards, since a large portion of the balance sheet assets is
concentrated in fixed assets, ROI, EPS, and ROE.
• The organization information systems are sufficient to evaluate the
performance of the recommended strategy and to separate costs related with the
acquisitions.
• Benchmark a fast-growing market competitor in order to know how much the
company may stay in case of a pause in a safe area.
• Comparing the firm’s performance every quarter or monthly. comparing the
firm’s performance to competitors, comparing the firm’s performance to industry
averages.
C. Criteria for Evaluation
 Return on investment.
 Profit margin.
 Return on equity.
 Market share.
 Asset growth.

D. Using a Balanced Scorecard for Strategic Control

The perfect strategic planning, implementation, and control process is taking
significant effort and thought. It requires a lot of buy-in from the leadership team.
It also requires employees to know why their actions are important and
continuously work toward achievement of goals, even if those goals shift over
time.
A Balanced Scorecard helps to evaluate and monitor the overall strategy to those
day-to-day activities, giving more clarity about the what and why of strategic
implementation to the whole office. We will be able to do both operational and
strategic control within one framework, linking the two processes and getting
everyone on the same page.
25. Conclusion
The strategic management process is a matter of life or death for any organization
given the violent competition in the marketplace nowadays. Having a correct
strategic management process will not only help the organization to survive but
grow and improve its performance as well. Below we will discuss the benefits
Struct will gain by applying the proposed strategic management process.
A. General Benefits
 Struct will become more proactive than reactive in shaping its own
future.
By external and internal scanning Struct becomes more proactive rather than just
waiting for the future to happen Struct will have the opportunity to shape its own
future. Having a continuing strategic management process will help Struct bind
the opportunities and avoid threats. Applying the proposed strategic management
process will help Struct to sustain its place as a market leadership.
 Managers and employees will understand what the organization’s
goals are, why we are doing it and how to achieve it, they become more
committed to assist it.
By communicating to middle management, making sure they understand it and
they will be communicating them to all office’s employees. All employees will
be committed to achieve the office’s goals after knowing that it will help the
company and them to grow as well.

 Struct will have better communications with customers

Employee’s ownership of the strategy will imitate in everyone communicating
with the customers within the organization from Marketing, Finance,
Engineering and all different departments. Customers will start feeling the
difference in the way Struct is providing its services and products which help to
have better communication with our customers.
 More commitment from managers and employees to support the
organization.
As the office’s strategy is communicated to everyone, it will become part of the
office’s DNA. Managers and employees will support the organization to achieve
its goals by becoming a global builder.
The HR department will hold training for managers and employees to ensure
effectiveness and efficiency from all employees each in his/her department is
achieved.
 Empowerment
The HR department will hold training for managers and employees to increase
their decision-making skills each in his/her role. Struct will benefit from this a
lot as this will help to increase office’s efficiency. This will help the organization
to accelerate reaching its goal as a global designer.
 Devolving the Strategic Management Process
Trained and empowered employees will decentralize the strategic management
process as everyone knows the strategy and is empowered to take decisions in
his/her role. This will free senior management to have an ongoing strategic
process instead of consuming their time handling minor issues, thus, focusing on
the organization’s objectives.
 Ownership of Strategies
What can a great strategy do in an organization where its employees don’t own
it? By having everyone in Struct performing towards a unified goal which
is to be a global designer. All the employees will own the strategy and make sure
they are doing their day-to-day job to achieve this goal.

B. Financial Benefits
Struct will increase its revenue by expanding its market share locally and
globally, better swift management will decrease the operating cost which will
help Struct to increase its net income and profitability. Struct will have a
stronger cash flow statement which will secure new projects even with special
expense conditions.
C. Non-Financial Benefits
 Allow identification, ordering and exploitation of opportunities.
SWOT and TWOS done in the early stage of the proposed strategic management
process will help Struct to prioritize its strengths and weaknesses as well as the
external environment threats and opportunities. This will help Struct to identify
opportunities in the market and harness them as well as avoiding threats in the
market giving Struct an upper hand over its competitors.
 B. Provides an objective view of management problems.
Employees own the strategy and the flow of information in the organization
between all levels horizontally and vertically will help senior management to
have an objective view of the problems. Ideas from everyone in the organization
to solve problems will flow upward which will improve the organization to reach
its goal as a global builder.
 A framework for improved coordination and control of activities.
The future strategic management process will provide a framework to improve
coordination and control of activities with the employees training, empowerment
and flat organization structure. The organization will be moving faster to the
future achieving its goal and creating a competitive edge differentiating it from
their competitors.
 Minimizing the effects of changes.
Lack of communication and fear of changing the status quo are the main two
reasons for change failure in any organization. The proposed strategic
management process will minimize both mentioned reasons as all employees
know where the organization wants to be, and everyone understands the effect of
their role helping the organization to become a global designer.

 Allows major decisions to better support established objectives.

Having a clear objective will allow all major decisions to support it and curative
decisions to be taken whenever nonconformity occurs from those established
objectives. All strategic business units and different departments will start to
formulate their own strategies to support the organization objective and break it
down into small teams and individuals’ goals as well.
 Creates a framework for internal communication among personnel.
Creating a flat organization will make sure that the access to information is
available to everyone in the organization. Developing employees’ skills will help
to create a better framework for internal communication. This will help to
improve the organization's innovation as the information is available for
everyone which will help each employee to innovate in his/her role.
 Encourage forward thinking
The proposed strategic management process will encourage forward thinking in
Struct as everyone knows where the organization wants to be. Employees will
start doing their day-to-day job in different ways keeping in mind how they can
think forward to help Struct to become a global designer. Identifying potential
risks, threats and opportunities by looking beneath the surface, allowing
management to identify risks and threats before they even arise, utilizing data
that are generated internally and externally and help in the identification of the
emerging risks.
 Providing a cooperative, integrated, and excited approach to tackling
problems
Employees will start being more cooperative and approaching problems
differently as they will be training and authorized. Employees will be motivated
to achieve personal and organizational goals as they see the benefit for
themselves. This will help Struct to move faster to the future and to become a
global designer.

 Allowing fewer resources and less time to be enthusiastic to correcting

decisions
The proposed strategic management processes will help Struct to use its
resources more efficiently from personnel, swift management, operating capital,
Curative decisions needed to resolve any problem will take less time as
employees are trained and authorized to make decisions. Having a strategy with
well-defined objectives and goals makes it easier to tackle problems and find the
source of defect.
 Sustainability of Advantage
The main goal of the strategic management is to make sure that the organization
has characteristic capabilities over its competitors and to sustain it. The proposed
strategic management process will sustain Struct’s distinctive competencies as
the internal processes will be improved which will cause the organization to be
more efficient. Safety and construction skills will be improved as well with the
employees training.
26. Case Study

"STRATEGIC MANAGEMENT IN CONSTRUCTION"
The traditional philosophy of management in construction, both in academia and
in industry, places great emphasis on the ability to plan and execute projects. In
contrast, a similar emphasis on strategic management has received less attention
in the construction industry. Although the pressures of project performance can
often obscure the broader social, economic, and professional context in
which strategic management is undertaken, it is these broad contextual areas that
make strategic management an essential issue for construction organizations.
Rapidly changing social and technological issues are creating a professional
environment that will look very different in the coming decades than that
experienced in today’s organizations. This paper introduces a study of the current
strategic management practices of construction organizations. The paper
introduces the concept of strategic management and the areas that organizations
must address to compete in the global marketplace. A summary of an industry
survey is documented together with the background research that prompted the
investigation of these topics.

A. The Current Study

The development of a survey to obtain data from construction organizations on
strategic management processes is an extension of a larger study overseen by the
author. In the larger effort, an attempt is being made to identify the areas of
strategic concern for civil engineering organizations and to develop
an appropriate strategic management process for these organizations to
implement and measure. In response to the first component, a three-year study
was conducted to determine what topics were identified by researchers and
executives as the key strategic elements for the civil engineering industry. In this
process, a content analysis methodology was employed on 574 papers from
management and civil engineering journals to initially identify topics of common
concern. Concurrently, over 50 personal interviews were conducted with civil
engineering executives (vice-president level and above) to correlate the research
data with actual experiences. Combining the input from these studies provided
the basis for the seven strategic management areas identified in the previous
section.
The identification of the strategic management concerns provided a basis on
which to formally survey a segment of the industry. The segment selected for the
initial survey effort was the 1998 ENR Top 400 Contractors. This population was
selected for two reasons; 1) it is an accepted measurement and list within the
construction industry, and 2) the organizations within the list span a significant
revenue span which, it was hypothesized, should be reflected in varied
management practices. The specific individuals within the organizations that
were identified for the survey were executive-level individuals who were
responsible for organization-level concerns.
Once the topics and organizations were identified, the survey illustrated in
Appendix Awes mailed to the 400 organizations. It should be noted at this point
that the intent of this survey is not to characterize the strategic management
practices in the construction industry as a whole. A second survey effort
addressing management practices of smaller organizations will follow shortly to
obtain a broader industry perspective. However, the current study provides a
perspective on the strategic management practices in the top organizations as
ranked by revenue.

B. Response Rate
The response rate for the first 400 questionnaires was 26.5% (106 responses). A
second group of questionnaires was faxed to the organizations that did not
respond to the initial survey. From this second group, an additional 27 responses
were received (9%). Together, the first and second group totaled 133 responses,
or 33% of the ENR Top 400. A summary of the responses and percentages is
provided in Appendix A.
The respondents answering the survey all satisfied the criterion of holding an
executive position. Of these respondents, 22 identified themselves as Vice-
Presidents, 1 as Secretary, and the remaining individuals identified themselves
as President, Chairman, or CEO.
The respondents had an average length of tenure with their current organizations
of 21.3 years and an average length of time as an executive of 17.1 years.
To facilitate the analysis of the survey data, the 400 organizations were divided
into five quintiles of 80 organizations each. This division provided the
opportunity to group organizations with similar revenue streams into a single
category. Once these groupings were created, the five groups could be analyzed
to determine if the size of the organization has statistical significance in terms of
differences in survey response. Table 1 illustrates the survey groups established
for this study and the corresponding response rates obtained in each category.
C. Analysis
The results of the strategic management survey provide a basis for analysis in the
following areas; 1) strategic areas that the industry is addressing in a positive
manner, 2) strategic areas that the industry needs to address with greater
emphasis, and 3) the impact of size on strategic management practices.
D. Positive Strategic Management Areas
The strategic management survey provides positive indications in two areas,
technology and market awareness. In technology, construction organizations in
each of the quintiles indicates that the integration of technology to support
knowledge transfer between members is an area that is receiving significant
attention. With 57% of the respondents indicating that technology integration is
either in the full implementation or measurement stage, technology integration
moves to the forefront of strategic issue awareness. This action-oriented

approach to technology integration is imperative when the impact of the latest

information technology revolution is considered. As discussed at the beginning
of this paper, the new wave of information technology capabilities is
transforming the manner in which construction organizations will conduct
business in the 21st Century. The Internet and virtual office environments will
become an accepted fact for future project environments
Responding to these changes by implementing technology strategies ahead of the
competition provides the opportunity to evaluate the impact of technology and
implement a strategy that has the best potential to result in a positive outcome.
Similar to the positive focus on technology, the construction industry
respondents demonstrate an awareness of the need for market expansion. With
44% of the respondents indicating that market opportunity identification was in
a full implementation or measurement stage, this question reflects the strong
competition that exists in the construction industry. Understanding that a
continued focus on a narrow market creates a scenario where the organization
becomes vulnerable to market shifts (e.g., the nuclear sector), construction
organizations are increasingly focusing on the need to identify and enter
new market segments. As indicated by the lack of statistical significance
attributed to organization size, this market focus is understood by organizations
at every level. However, this result should not be extrapolated to infer that
all organizations are entering appropriate markets. The survey did not inquire as
to the types of markets that organizations were investigating. Rather, the analysis
can state that construction organizations are aware of the need to strategically
position themselves in new markets to respond to market shifts, and actions
are being taken to establish these new positions.
E. Areas for Greater Emphasis
In contrast to the positive results obtained in the strategic management survey for
the technology and market areas, the responses in two areas, education
and competitive positioning, indicate a need for greater strategic emphasis. The
first of these areas, education, demonstrates the broadest need for greater
strategic emphasis. Although it was unanimous among all respondents that some
type of education was taking place in the organization, the majority of
organizations do not incorporate the concept of lifelong learning. With 36% of
the respondents indicating that the concept is unfamiliar or no plan of action is
in development, lifelong learning received the lowest focus of the strategic
management issues. In contrast to the authors’ assumptions prior to the study, the
size of the organization does not factor into this response. Although organizations
in the Group 1 category indicate a greater institutional focus on craft and entry-
level training, the emphasis on lifelong learning received no greater emphasis
than that indicated by organizations in Group 5. This trend is consistent
throughout the respondents. Although the need for craft and field education is
apparent, less attention is being given to continuing the education opportunities
of middle and upper-level employees.
The second area that the survey results indicate a need for greater emphasis is
that of competitive positioning. Although the surveyed organizations appear to
recognize the importance of new markets and opportunities, these same
organizations are having a difficult time identifying ways to protect existing
market positions. While Porter (1979) stresses the need for organizations to
protect against existing competitors and new entrants, this concept requires
emphasis for the strategic planning of construction organizations. Specifically,
construction organizations must acknowledge the fact that very few barriers exist
to prevent new entrants from entering many segments of the market. Similarly,
the same opportunities that exist for one organization to expand market presence
into a new sector also exist for outside organizations to threaten the same
organization. In this manner, market analysis and competitive positioning must
become two halves of a common whole. Unfortunately, the current survey
indicates that 43% of the respondents recognize the need for competitive
positioning, but have not fully implemented a competitive positioning
strategy. This number contrasts with the 44% of the respondents who have fully
implemented the market opportunity segment of their long-term strategy.
F. Conclusions
There were several findings that have been found in this study:
 The process of moving to a strategic management perspective is to
determine where current strengths exist, where gaps exist, and where
the priorities will be set to build upon these answers.
 An organization should not be discouraged if it finds one or more areas
have significant gaps at the present time and Every organization
has room to improve.
 The difference between the organization that is destined to succeed and
the one that is destined to ride the waves of the marketplace is the desire
to fill these gaps. At the same time, the organization needs to be

realistic about its efforts to fill these gaps.
 In some instances, significant investment is required to move forward
toward strategic objectives also in these instances, the organization
must set priorities and balance available resources.
 The balancing of resources on a project, the balancing of resources at in
organization level is required to keep an organization on a continued
path of advancement. Rather than advancing an individual area, leaders
must retain an overall perspective
 Admitting that each of the seven strategic management areas are
equally important to achieving a long-term vision.
 Implementation cannot be undertaken without a focus on where the
actions are ultimately intended to lead. Similarly, strategic goals must
be evaluated on a regular basis and with the same rigor as applied
to project objectives.
 Overlooked by organizations except in the context of market share
or revenue projections, strategic evaluation emphasizes the need to
evaluate the progress of each strategic management component on a
regular basis
 The current emphasis on business development evaluation, strategic
management evaluation is required to determine progress toward
achieving strategic objectives. However, in contrast to the business
development evaluation, strategic management evaluation may not be
quite so clear and well defined.
The strategic management survey illustrated that construction
organizations are taking steps to increase this focus on strategic
management issues. However, progress in several areas is still
required. Undertaking the moves required to achieve this progress may
be painful foursome organizations, but this discomfort should be
tempered by the thought that the organizations setting in place
a roadmap for the future. In contrast to organizations that ride the waves
of the marketplace, the organization that institutes a strategic
management perspective will be setting its own direction and path
through the changing waters of the market. It is through this
independence, aggressiveness, leadership, and vision that
organizations will move to the forefront of the construction industry

and ensure themselves an opportunity to respond to the constant

changes in the global marketplace.
References
1. Jörgensen, Jan J. "Michael Porter’s contribution to strategic management." BASE-Revista de
Administração e Contabilidade da Unisinos (ISSN: 1984-8196) 5.3 (2008): 236-238.
2. Pickton, David W., and Sheila Wright. "What's swot in strategic analysis?." Strategic change 7.2 (1998):
101-109.
3. Houben, Ghislain, Kwan Lenie, and Koen Vanhoof. "A knowledge-based SWOT-analysis system as an
instrument for strategic planning in small and medium sized enterprises." Decision support systems 26.2
(1999): 125-135.
4. Cooper, Arnold C. "Strategic management: New ventures and small business." Long range planning 14.5
(1981): 39-45.
5. Weihrich, Heinz. "The TOWS matrix—A tool for situational analysis." Long range planning 15.2
(1982): 54-66.
6. Ravanavar, Gomatesh M., And Poornima M. Charantimath. "Strategic formulation using tows matrix–
A Case Study." International Journal of Research and Development 1.1 (2012): 87-90.
7. Blahová, Michaela, and Adriana Knápková. "Effective strategic action: from formulation to
implementation." Economics, Business and Management 2 (2011): 61-65.
8. Dayan, Rony, Peter Heisig, and Florinda Matos. "Knowledge management as a factor for the formulation
and implementation of organization strategy." Journal of Knowledge Management (2017).
9. Oghojafor, Ben E. Akpoyomare, et al. "Enhancing Organization's Performance through Effective Vision
and Mission." Chinese Business Review 10.11 (2011).
10. Verma, Harsh V. "MISSION STATEMENTS-A STUDY OF INTENT AND INFLUENCE." Journal of
Services Research 9.2 (2009).
11. PORTER’S, VALUE CHAIN MODEL. "WHAT IS VALUE CHAIN?" (1985).
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strategic cost management." Handbooks of Management Accounting Research 2 (2006): 481-506.
13. Chinowsky, Paul S., and James E. Meredith. "Strategic management in construction." Journal of
Construction Engineering and Management 126.1 (2000): 1-9.
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STRATEGIC MANAGEMENT FINAL PROJECT

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STRUCT DESIGN STUDIO

ESLSCA BUSINESS SCHOOL 1

9. Corporate Social Responsibility 8

13. SWOT Analysis 10

14. PESTEL Analysis 14

15. Porter Five Forces Analysis 18

16. Competitive Profile Matrix 20

17. Purpose of EFAS and IFAS 21

ESLSCA BUSINESS SCHOOL 2

18. Application of Value Chain Analysis 26

19. Competitive Advantage Types 28

20. Corporate Objectives 32

21. Applying The Business Strategy 34

22. Corporate Strategy 35

23. Implementation Phase 37

24. Evaluation Phase 42

26. Case Study 49

ESLSCA BUSINESS SCHOOL 3

Dr. Ahmed Nabil

ESLSCA BUSINESS SCHOOL 4

We are aligned to a number of core

ESLSCA BUSINESS SCHOOL 5

We are offering a vast range of consultancy services depending on the nature of

ESLSCA BUSINESS SCHOOL 6

We take on projects with the intention of finding smart, new solutions to

ESLSCA BUSINESS SCHOOL 7

9. Corporate Social Responsibility

We provide annual internship for engineering students to be involved in real

13. SWOT Analysis

SWOT Analysis (also known as SWOT Matrix) is a business framework that

A. Strengths (SWOT Analysis)

ESLSCA BUSINESS SCHOOL 11

 Combined strong academic and professional background of the founders.

B. Weaknesses (SWOT Analysis)

Similarly, these tools are very helpful in assessing a company’s

Weaknesses could for example be a lack of patent protection, poor

ESLSCA BUSINESS SCHOOL 11

C. Opportunities (SWOT Analysis)

 Opportunities are the external factors of the SWOT analysis

 Working in multidisplinary engineering fields provides number of

ESLSCA BUSINESS SCHOOL 12

D. Threats (SWOT Analysis)

 New Egyptian regulations in construction industry affected the

ESLSCA BUSINESS SCHOOL 13

14. PESTEL Analysis

PESTLE analysis forms a much more comprehensive version of the SWOT

Each of the factors mentioned above, from Political, Economic, Social,

Political factors include tax policy, environmental regulations, trade restrictions

ESLSCA BUSINESS SCHOOL 14

to which a government may influence an industry or a company. For example,

Social factors include cultural norms and expectations, health consciousness,

ESLSCA BUSINESS SCHOOL 15

Technological factors mean the innovations and developments in technologies.

 Applying BIM technology facilitate coordination between all engineering

Economic factors include economic growth/decline, interest, exchange, inflation

ESLSCA BUSINESS SCHOOL 16

Legal factors include changes to legislation impacting employment, access to

 Government new laws regarding building permits freezes the construction