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Chapter 4:Strategic Planning (Task 2: Diagnose Threats and Opportunities…
Chapter 4:Strategic Planning
Levels of Strategy
Business Level
Pertains to each business unit or product line
Functional Level
Pertains to the major functional departments within business unit
Corporate Level
Pertains to the organisation as a whole
Task 1: Develop Mission and Goals
Who are we?
What business are we in?
What do we want to become?
Developed through task 2 & 3
Task 2: Diagnose Threats and Opportunities
Bargaining power of suppliers
Threat of new entrants
Competitors can enter the same product or service markets
Bargaining power of customers
Threat of substitute products or services
Other industries offer substitute products
Rivalry among Existing Firms
Competitors continually compete for business
Task 3: Asses Strengths and Weaknesses
Assessing internal strengths and weaknesses enables managers to identify an organisation's capabilities and competencies relative to its competitors.
TASK 2 AND 3 MAKE UP THE SWOT ANALYSIS
Task 4: Generate Alternative Strategies
Porter's Competitive Strategies Model
Differentiation Strategy
Involves attempting to develop products or services that are viewed as unique in the industry
Cost-Leadership Strategy
Involves emphasising internal organisational efficiency so that the overall costs of providing goods or services are lower than those of competitors
Focus Strategy
Involves competing in a specific industry niche by offering either a unique product or a low-cost product
Growth Strategies
Market Development Strategy
Seeks new markets for current products
Market Penetration Strategy
Seeks growth in current markets with current products
Product Development Strategy
Developing new or improved goods or services for current markets
Task 5: Developing Strategic Plan
Specify actions to be taken
Addresses how resources will be allocated
And how organisation and management capabilities will be utilised
Task 6:Develop Tactical Plan
Purpose of tactical plans is to help implement strategies
Task 7:Correct and Assess Results
Task 8: Repeat Planning Process
In order to respond to changing environmental forces