1Write an introduction which tells the reader about the company; its past and present – this is a brief summary of no more than one page.
2. General External Environment – Scan the overall environment in which the firm exists. Situational analysis- focus on the trends in the six areas- you are scanning these external areas- to be able to predict the segments that you expect to have the most significant influence on your focal firm- -over the next several years- three to five years- (see chapter two of your text for details)
Technological trends
Demographic trends
Economictrends
Political-legal trends
Sociocultural trends
Global trends
3. Industry analysis- see Porters Five Force model. You must use Porters five factors to evaluate your firm’s position in the industry
In addition, address the following questions:
What are the dominant economic & marketing features of the industry? Growth rate, scale required, resource requirements?
Distribution channels and who has them?
Differentiated or commodity?
What are the drivers of change in the industry?
Level of innovation required?
Level of technology required – speed of change? Changes in cost and efficiency?
4. Competitor analysis-analysis of the primary competitors – current strategies- intent- mission-capabilities.
What are the key success factors needed to compete – future KSF Three questions to ask regarding KSF:
1. Onwhatbasisdocustomerschoose?
2. What resources and capabilities are needed to compete?
3. What core competencies are needed to have a sustainable competitive advantage?
Primary competitor’s goals and strategy – Strategic Competitive Analysis What is the depth and breadth of competitor’s product line?
What is their basic strategic approach – what will they try next?
Are there any emerging competitors?
5. Internal Analysis- the assessment of the firm’s strengths and weaknesses through a value chain. Doing a value chain analysis is very important to the Strategic Management Analysis.
Finding and understanding Resources; Capabilities; and Core Competencies is part 2 of the internal analysis.
For the purpose of preparing a written presentation- it is important to note that strengths are internal resources and capabilities that have the potential to be core competencies.
Weakness is the internal resources and capabilities that have the potential to place a firm at a competitive disadvantage with its rivals.
When evaluating the internal characteristics of the firm, your analysis of the functional activities emphasized is critical; for example, if the strategy of the firm is primarily technology driven, then you have to evaluate the firm’s research and development. If the strategy is market driven, you have to look at the marketing activities.
6. Identification of Environmental opportunities and threats and firm’s strengths and weaknesses
– What we know as a SWOT analysis.
The outcome of the situation analysis is the identification of firm’s strengths and weaknesses and its environmental threats and opportunities.
The key objective of conducting a SWOT analysis is to determine how to position the firm so it can take advantage of opportunities while avoiding or minimizing environmental threats.
7. Strategy Formulation-Strategic Alternatives- (Two or three alternative strategies are the norm). This may well be one of the most important parts of this process. Alternatives are courses of action that you suggest for the firm for the future. Each Alternative that you develop for the firm must show the potential advantages and disadvantages of that alternative
8. Strategic alternative implementation action items and action plan –
Issues that you might consider are structural changes necessary to implement the new strategy – developing new capabilities – leadership changes – new controls or incentives, etc. In this part of the analysis you will show which alternative from (6) your work above that you are recommending for this firm.
You must also show an implementation plan for affecting the recommendations that you have decided upon.
