Sanjivani College of Engineering, Kopargaon

GC301 –”Strategic Management”

Unit-2 ; Session # 2

Presented By:
Prof. Vivek Vinayakrao Wankhede
Assistant Professor in Dept. Of MBA
MBA(Marketing + HR), MA (Psychology-p), BE(Bio-Medical), B.Ed
Dept. of www.sanjivanimba.org.in
MBA, Sanjivani COE, Kopargaon 1
 Core Competence
• Core competencies are the defining characteristics that make
a business or an individual stand out from the competition.
• Identifying and exploiting core competencies is seen as
important for a new business making its mark or an established
company trying to stay competitive.
• A company's people, physical assets, patents, brand equity,
and capital can all make a contribution to a company's core
competencies.
• The idea of core competencies was first proposed in the 1990s as
a new way to judge business managers compared to how they
were judged in the 1980s.
By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon
 Core Competence
• McDonald's has standardization. It serves nine million
pounds of French fries every day, and every one of them has
precisely the same taste and texture.2
• Apple has style. The beauty of its devices and their interfaces
gives them an edge over its many competitors.
• Walmart has buying power. The sheer size of its buying
operation gives it the ability to buy cheap and undersell retail
competitors.

https://www.investopedia.com/terms/c/core_competencies.asp
https://leadershipfreak.blog/2019/05/07/7-universal-competencies-for-success-in-any-role/

By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon

 Distinctive Competence

• An organization's core competencies -- sometimes called core 

capabilities or distinctive competencies -- explain what it can
do better than any other company, and why. These capabilities
provide a strong foundation from which the business will
deliver value to customers and stakeholders, seize new
opportunities and grow. They set the company apart from its
peers and help create a sustained competitive advantage in its
industry or sector.
• A company can have one or more organization-wide core
competencies
By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon
 Distinctive Competence

•product quality
•buying power
•customer-centric omnichannel support
•design or innovation capabilities
•sales and marketing ecosystem
•automated workflows and processes
•size

By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon

 Core Vs Distinctive
•The term competency relates to anything that a firm does
well.
•A core competency relates to anything that is central to the
core of the business.
•A distinctive competency is a quality that differentiates a
company from its competitors
•a core competency can only be considered as a distinctive
competency only if a competitive advantage is achieved.

A core competency is not a distinctive competency always

https://www.differencebetween.com/difference-between-core-competencies-and-vs-distinctive-competencies/

By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon

 Benchmarking(https://asq.org/quality-resources/benchmarking )
• Process of measuring products, services, and processes against
those of organizations known to be leaders in one or more
aspects of their operations.
• Benchmarking provides necessary insights to help you
understand how your organization compares with similar
organizations, even if they are in a different business or have a
different group of customers.
• Benchmarking can also help organizations identify areas,
systems, or processes for improvements—either incremental
(continuous) improvements or dramatic (business process re-
engineering) improvements.
By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon
 Value Chain Analysis
means of evaluating each of the activities in a company's
value chain to understand where opportunities for
improvement lie
Conducting a value chain analysis prompts you to consider
how each step adds or subtracts value from your final product
or service
For example, if your company develops apps, you can gain
cost leadership by cutting contracting costs, or gain
competitive differentiation by creating more value in your
product to demand a higher price tag. Both value chain
models lead to a boost in profit margin.
By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon
 https://blog.hubspot.com/sales/value-chain-analysis

By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon

 Organizational Capability Profile

describes the skills, knowledge and resources

that enable your company to provide quality
products or services to customers. The profile
provides useful background information for
your marketing and corporate communications.

Drawn in form of a chart

Various functions assign Scores between -5 to +5
By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon
 Stretch, Leverage & Fit
• Stretch is a misfit between resources and aspirations.
• Leverage refers to concentrating, accumulating,
complementing, conserving, and recovering resources in
such a manner that meager resource base is stretched to
meet the aspirations that an organization dares to have.
• Fit means positioning the firm by matching its
organizational resources to its environment.
•https://mmhapu.ac.in/doc/eContent/Management/RaisAhmadKhan/Oct20
20/Fit%20&%20Stretch%20Concept.pdf

By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon

By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon
 Resource Leveraging

Refers to systematically assessing the use of existing

resources, identifying the need for additional resources,
or creating new resources in community and State
systems to address identified needs (e.g., leveraging
existing funding streams or newly identified funding
from agencies or organizations not previously accessed,
and leveraging new opportunities, such as those available
through the Affordable Care Act).

By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon

 Resource Leveraging

•Concentrating
•Accumulating
•Complementing
•Conserving
•Recovering

By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon

 Portfolio Analysis
Portfolio Analysis is the process of reviewing or assessing
the elements of the entire portfolio of securities or
products in a business. The review is done for careful
analysis of risk and return. Portfolio analysis conducted
at regular intervals helps the investor to make changes in
the portfolio allocation and change them according to
the changing market and different circumstances. The
analysis also helps in proper resource / asset allocation
to different elements in the portfolio.

By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon

 Portfolio Analysis
When a company markets a range of different
product or services it is required to conduct
portfolio analysis periodically. This means to
analyze each product separately in terms of
profitability, contribution to the company’s
income and growth potential. This analysis
facilitates the identification of products that are
not profitable at all or play poorly within the
group.
By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon
 Portfolio Analysis
The products are categorized by pre-defined criteria
such as sales value, market share, gross profitability,
contribution margin and life cycle. The results could
clearly point to products that should be taken out of the
market or simply receive fewer resources. It might also
indicate that the company must increase its investments
and efforts to some star products that have a higher
potential. The analysis is made to improve the global
portfolio’s performance since the ultimate objective is
maximizing profit for shareholders.
By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon
 Portfolio Analysis
Shine Shoes manufactures and markets 55 models of
women shoes. The General Manager realized that
sales increased but profitability steadily decreased
over the past two years. He did not know what
happened and he asked a consultant to conduct a
portfolio analysis. The study provided some
interesting results. The top five models represented
17% of total sales. However, those five were not
profitable at all because production costs were too
high.
By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon
 Portfolio Analysis
At the same time other models were highly
profitable but their sales were negligible within
the overall portfolio. The Manager decided that
higher investment in marketing and sales effort
should be made in the most profitable models
and thus to push the overall profit up. The
results were positive and the company
improved notably its finances thanks to the
insights obtained by the portfolio analysis.
By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon
 BCG Matrix
• The Boston Consulting Group (BCG) growth-share
matrix is a planning tool that uses graphical
representations of a company’s products and
services in an effort to help the company decide
what it should keep, sell, or invest more in.
• The matrix plots a company’s offerings in a four-
square matrix, with the y-axis representing the
rate of market growth and the x-axis representing
market share. It was introduced by the Boston
Consulting Group in 1970
By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon
 BCG Matrix
• The BCG growth-share matrix is a tool used
internally by management to assess the current
state of value of a firm's units or product lines.
• The growth-share matrix aids the company in
deciding which products or units to either keep,
sell, or invest more in.
• The BCG growth-share matrix contains four
distinct categories: "dogs," "cash cows," "stars,"
and “question mark”
By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon
 BCG Matrix

By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon

 BCG Matrix
Each of the four quadrants represents a
specific combination of relative market share,
and growth:
• Low Growth, High Share. Companies should
milk these “cash cows” for cash to reinvest.
• High Growth, High Share. Companies should
significantly invest in these “stars” as they
have high future potential.
By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon
 BCG Matrix
Each of the four quadrants represents a specific combination of
relative market share, and growth:
• High Growth, Low Share. Companies should
invest in or discard these “question marks,”
depending on their chances of becoming
stars.
• Low Share, Low Growth. Companies should
liquidate, divest, or reposition these “pets.”
https://www.investopedia.com/terms/b/bcg.asp
By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon
 BCG Matrix
Each of the four quadrants represents a specific combination of
relative market share, and growth:
• High Growth, Low Share. Companies should
invest in or discard these “question marks,”
depending on their chances of becoming
stars.
• Low Share, Low Growth. Companies should
liquidate, divest, or reposition these “pets.”

By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon

 GE 9 Cell Model

The GE matrix was developed by Mckinsey and

Company consultancy group in the 1970s. The nine
cell grid measures business unit strength against
industry attractiveness and this is the key difference.
Whereas BCG is limited to products, business units
can be products, whole product lines, a service or
even a brand. You can plot these chosen units on the
grid and this will help you to determine which
strategy to apply.
By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon
By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon
By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon
 GE 9 Cell Model

Industry Attractiveness:
Factors you could choose to base this on include:
• Market size
• Market growth
• Pestel factors
• Porters five forces
https://thinkinsights.net/strategy/ge-mckinsey-matrix/
By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon
 GE 9 Cell Model
Business Unit Strength:
Factors to determine how strong a unit is compared to
others in its industry include:
• Market share
• Growth in market share
• Brand equity
• Profit margins compared to competition
• Distribution channel process – the strength of
By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon
 GE 9 Cell Model

• Step 1: Decide on determining factors

• Step 2: Give each factor a weighting number
based on its magnitude (make the total weight of
all factors add up to 1.00 or 10.00 for example)
• Step 3: Rate each business unit against each factor
on a scale. For example 1 – 5 where 1 is extremely
attractive and 5 is extremely unattractive.

By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon

 GE 9 Cell Model

• Step 4: Give each business unit a weighted rating

on each factor by multiplying its rating by the
weight for that factor.
• Step 5: Total up all the weighted ratings for each
business unit.

By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon

 GE 9 Cell Model

Grow/Invest:
• Units that land in this section of the grid
generally have high market share and promise
high returns in the future so should be
invested in.

By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon

 GE 9 Cell Model

Hold/Selectivity:
• Units that land in this section of the grid can
be ambiguous and should only be invested in
if there is money left over after investing in
the profitable units.

By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon

 GE 9 Cell Model

Harvest/Divest:
• Poor performing units in an unattractive
industry end up in this section of the grid.
This should only be invested in if they can
make more money than is put into them.
Otherwise they should be liquidated.
https://strategicmanagementinsight.com/tools/ge-mckinsey-matrix/

By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon

 Internal Factor Analysis Summary

•Concentrating
•Accumulating
•Complementing
•Conserving
•Recovering

By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon

By Prof. Vivek V Wankhede Dept. of MBA, Sanjivani COE, Kopargaon
 Thank You
Presented By:
Prof. Vivek Vinayakrao Wankhede
Assistant Professor in Dept. Of MBA
MBA(Marketing + HR), MA (Psychology-p), BE(Bio-Medical), B.Ed

Dept. of MBA, Sanjivani COE, Kopargaon