MODULE 3

THE STRATEGIC
ANALYSIS
REPORTER:

KATE VILLALUNA
KAY MARIE MONGOSO
NICO JOHN ALVAREZ
 SETTING THE SCENE

A primary outcome of a good strategy is the

creations of value, be it shareholder value,
economic value, and/or social value. CEO’s in
the 1970’s, 1980’s tended to focus on
shareholder and economic value, but until
recently, most business assumed that being
green ad making money were diametrically
opposed.
 THE COGNITIVE DILEMMA

CEO’s need to lead with vision, manage

resources and provide the inspirations for their
teams. The lack of clarity of purpose can make
if different to make good decisions. As
previously stated and now becoming a core
theme in this textbook, the business world
remains literal with examples of bad strategies.
 BIG DATA

With the geometric expansion of consumer data

the need for management of this data becomes
intense. The corporate narrative has now
moved on from whether is a payoff. Evidence
does show productivity gains (Barton and
Court, 2012).
 EXTERNAL ENVIRONMENT

CEO’s select strategies they hope will allow

organization to deploy its scare resources most
effectively. The selection is reliant on internal
and external analysis. The uncertain
environment makes spotting new opportunities
and anticipating threats that much more difficult.
 MACRO-ENVIRONMENT

The external macro-environment sits outside

the firm’s industry and markets. Changes in the
macro-environment can be cyclical or structural.
The former changes require a temporary
tactical response, and the latter a more
permanent response. The firm is unable to
control the macro-environment, but is seeks to
stay abreast of external shifts.
 SWOT ANALYSIS

A key attribute of the strengths, weaknesses,

opportunities and Threats (SWOTS) analysis is
that it is straightforward and can be effective. It
is also widely taught and used in practice. Its
durability and longevity remains compelling. Its
popularity and case of use can condense a
large number of issues identified into
manageable and important points.
 HOW TO COMPETE

Sources of sustainable competitive advantage

remain the holy grail of business and
management education and practice. We have
considered a range of approaches enabling
business leaders to keep on track during times of
global economic crisis and economic slowdown.
During this chapter we considered a range of
strategy tools and techniques, and use the context
of external and internal analysis.
 BCG GROWTH/SHARE MATRIX

This growth/share matrix (Henderson, 1979)

created by the Boston Consulting Group in the
1970s assists managers in making decisions
about business objective. Despite the blurring
of discrete business units within some
organizations, the analysis focuses some
attention on the cash flow of operations.
 PORTER’S GENERIC STRATEGIES

During the 1980s Porter’s generic strategy, full

range of competitive strategies, gained
prominence. The approach became extremely
fashionable in western business schools and
with executives. Users sought to achieve two
things: in the first instance, generic principles,
and secondly, customized action plans
(Mintzberg, 1992).
 COST LEADERSHIP STRATEGY

FIRMS that are successful tend to be the lowest

cost producer in the industry. This is achieved
by maximising economics of scale and other
cost advantages.
RISKS it may be impossible to reduce cost
base. Think about the budget hotel and airline
sector.
 DIFFERENTATION STRATEGY

Firms that are successful tend to possess a

differentiation strategy. Which offers its
customers something that is unique and
valuable. Customers are willing to pay higher
process.
Risks- the additional costs must be covered by
the higher prices. Imitation can be problem.
 FOCUS STRATEGY

Focus strategy will concentrate on a specific

target segment and seeks to achieve either a cost
advantage or differentiation. Firms pursuing such
as strategy have lower volumes and therefore
gain less bargaining power with their suppliers.
Risks- it is relatively easy for a broad-market cost
leader to adapt its product in order to compete
directly.
 STUCK IN THE MIDDLE

Michael Porter argued that to be successful

over the long-term, the firm must select only
one of his three generic strategies. Otherwise
by pursuing more than one single generic
strategy the firm will be “Stuck in the middle”
and will not achieve a competitive advantage.