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Strategic Management

Strategic Analysis

Strategic Development

Strategy Implementation
Evaluating the
External Environment
Environmental Analysis
Degree of Turbulence
Strategic Environment – Market Dynamics
PESTEL Analysis and Scenarios
Five Forces Analysis
Industry Life Cycle Analysis
Key Factors for Success Analysis
Competitor Analysis
Customer Analysis
Opportunities and Threats (SWOT)
Key Success Factors

Key factors for success in an industry are
those resources, skills and attributes of the
organisations in an industry that are
essential to deliver success in the market
place (Ohmae, 1983)
Key Success Factors
Ohmae's 3 Cs

Customers
What do they really want?

Competition
S,W. How can the organization beat or at least survive against the
competition?

Corporation
How does the organization's resources compare with the competition?
Key Success Factors

A KSF in the elevator industry in the US.

Most building owners and maintenance departments
cannot provide specialized service for their
building’s elevators. Therefore, elevator companies
provide 24/7 repair service.
It’s expensive, but it is necessary to support
customers. No one wants to wait for a broken
elevator or be stuck in a broken elevator.

What are the KSFs for your chosen industry?
Blue Ocean Strategy
Blue Ocean Strategy
Kim and Mauborgne (2005)
Red Oceans are all the industries in existence
today—the known market space.
In the red oceans, industry boundaries are defined
and accepted, and the competitive rules of the
game are known. Here companies try to outperform
their rivals to grab a greater share of product or
service demand.
As the market space gets crowded, prospects for
profits and growth are reduced. Products become
commodities or niche, and cutthroat competition
turns the ocean bloody.
Kim and Mauborgne (2005)
Blue oceans, in contrast, denote all the industries not in existence today—the unknown market
space, untainted by competition. In blue oceans, demand is created rather than fought over.
There is ample opportunity for growth that is both profitable and rapid. In blue oceans,
competition is irrelevant because the rules of the game are waiting to be set. Blue ocean is an
analogy to describe the wider, deeper potential of market space that is not yet explored.

Emphasis is on Value Innovation

Kim and Mauborgne (2005)
Competitor Analysis
Profiling of Immediate Competitors
(NFP – Internal Competitors)

Conduct Analysis considering environmental issues.
Competitor Analysis
Analyze Competitor VMOST
Determine competitor objectives
Determine competitor resources
Determine capabilities and advantages (brands etc.)
Determine vulnerabilities
Determine past performance (market share etc.)
Analyse product and service portfolio (and marketing mix)
Determine competitor strategic relationships
Determine present strategies
Conduct a SWOT analysis on key rivals
Determine overall strategic positioning (strong, tenable, weak)
Competitor Analysis

Predictions:

Likely future strategy

Reaction to your organizational strategy.
Competitor Analysis

Create a Competitor Analysis Matrix

•Determination of competitor strategic positioning

•Consideration of options
Customer Analysis
Market Dynamics
Customer segmentation (Consumer, Industrial, Demo, Porter Generic,
B2B, B2C, C2C, intensity of rivalry)

Concentration of customer base
Buyer behaviour
How do they buy?
When do they buy?
Where do they buy?
Why do they buy?
(50% of purchases of women’s perfume are actually made by men)

Extract OT
Igor Ansoff

(December 12, 1918 – July 14, 2002)

Applied mathematician and business manager.

He is known as the father of Strategic Management.
Assessing the Dynamics of the Environment
Spectrum of turbulence

Ansoff, I. and McDonald, E. (1990), Implanting Strategic Management, Prentice-Hall.
Degree of Turbulence

Low
- future may be possibly predicted

High
- hypercompetition (D'Aveni, 1994)
- difficult to predict future
Plot key OT elements from external analysis into SWOT matrix.
TOWS Matrix

Weihrich, H., (1982) The TOWS Matrix - A Tool for Situational Analysis. LONG RANGE PLANNING, Vol. 15, No. 2, 1982, pp. 54-6