Tools and Techniques of Strategic management
- 1. Tools for Strategic Management JYOTI MAURYA
- 2. Strategic Analysis • The process of developing strategy for a business by researching the business and the environment in which it operates. • Strategic analysis helps you to explore your growth options, addresses challenges within your industry, and makes better corporate decisions.
- 3. Tools For Strategic Management CRITICAL QUESTION ANALYSISALYSIS BCG MATRIX SWOT ANALYSIS BALANCED SCORECARD FOUR CORNER'S ANALYSIS PEST ANALYSIS FIVE FORCES ANALYSIS VALUE CHAIN ANALYSIS VRIO ANALYSIS
- 4. CRITICAL QUESTION ANALYSIS What are the purposes and objectives of the Organization? Formulating appropriate organizational strategy is a process of critical question analysis. The 4 critical questions to be answered here are: In what kind of environment does the organization now exist? Where is the Organization presently going? What can be done to better achieve organizational objectives in the future?
- 5. Boston Consulting Group(BCG) Matrix The Boston Consulting Group Matrix is the most common tool for performing a portfolio analysis. According to the BCG Matrix, products and services with high growth and high market share are the most desirable, while those with low growth and low market share are undesirable. Considers products and services according to two dimensions: market growth and relative market share.
- 7. SWOT Analysis A useful technique for analyzing a firm's position in the market. This can allow a firm to exploit opportunities using its strengths , while at the same time improving upon its weaknesses in orde r to avoid external threats. Considers the firm's internal strengths and weaknesses against external opportunities and threats.
- 9. BALANCED SCORECARD Developed by Robert S. Kaplan and David P. Norton. Used by organizati on to measure its performance. Includes various non-financial measures like customer, business process and learning measures. Includes both financial and non-financial metrics of the organization’s performance.
- 10. Customer/ Stakeholder “Satisfaction” Financial/ Stewardship “Financial Performance” “learning and growth” Vision and Strategy Internal Business Process “Efficiency” Strategic Objectives Strategy Map Performance Measures & Targets Strategic Initiatives
- 11. FOUR CORNER'S ANALYSIS developed by Michael Porter, is a mo del well designed to help company st rategists assess a competitor's intent and objectives, and the strengths it is using to achieve them. It examine competitor's current strategy, future goals, assumptions about the market, and core capabilities. It's evaluate competitors and generate insights concerning likely competitor strategy changes and determine competitor reaction to environmental changes and industry shifts.
- 13. PEST ANALYSIS PEST analysis is a scan of the external micro-environment in which anorganisaion exists. It can be used for evaluating marketgrowth, potenti l and direction for a business. PEST is an acronym for Political, Economic, Social and Technological factors, which are used to assess the market for a business or organizational unit.
- 14. Political factors: These include government regulations such as employment laws, environmental regulations and tax policy. Other political factors are trade restrictions and political stability. Social factors: These impact on the consumer’s need and the potential market size for an organisation’s goods and services. Social factors include population growth, age demographics and attitudes towards health.. Economic factors: These affect the cost of capital and purchasing power of an organisation. Economic factors include economic growth, interest rates, inflation and currency exchange rates. Technological factors: These influence barriers to entry, make or buy decisions and investment in innovation, such as automation, investment incentives and the rate of technological change.
- 15. FIVE FORCES ANALYSIS Michael Porter developed the Five Forces Model in 1980. It is a powerful competitive analysis tool to determine the principal competitive influence in a market. Five Forces analysis helps you stay competitive by: Knowing the strength of these five forces,you can develop strategies that help their businesses be more competitive and profitable. Looking at opportunities, you can to strengthen their organization's position compared to the other players for reducing the competitive pressure as well as generate competitive advantage.
- 17. VALUE CHAIN ANALYSIS Value chain analysis is a way to visually analyze a company's business activities to see how the company can create competitive advantage for itself. It can help organisation to gain better understanding of key capabilities and identify areas for improvement. It is based on the principle that orgnisation exist to create value for their customers
- 18. VRIO ANALYSIS VRIO Analysis It was developed by Barney, J.B (1991). Used to analyze firm’s internal resources and capabilities to find out if they can be a source of sustained competitive advantage. VRIO is an acronym for the four questions- the question of Value, the question of Rarity, the question of Imitability, and question of Organization..
- 19. Firms' resources and capabilities are valuable if they enable a firm to implement strategies that improve their efficiency and effectiveness VALUABLE A valuable resorces is considered rare as long as the number of firms that possess the resource is less than needed to genrate perfect competition dynamics RARE Valuable and rare resources are imperfectly imitable due to unique historical condition, social complexity or casual ambiguity IMPERFECTLY IMITABLE A firm's resources are organization specific if these are no strategically equivalent, valuable and rare resources ORGANISATION SPECIFIC
- 20. CASE STUDY TOOLS: SWOT ANALYSIS PEST ANALYSIS VALUE CHAIN ANALYSIS FIVE FACTOR ANALYSIS
- 22. • Digital India : The initiative includes plans to connect 250,000 villages with high- speed internet networks. • • Google has so far installed free Wi-Fi in more than 52 railway stations. • • Google station will provide free Wi-Fi in public places. • • Demonetization. • India is one of the fastest economically growing countries in the world. • • Per capita income has increased from $ 729 to $ 1581 in last 15 years. • • Affordable smart phones are available in market. • Increase in number of children going to school from 102 crore to 121 crores in last 10 years (2005 to 2015) . • Age of 65% India’s of total population is below 35 yrs • There are total 331.66 million internet users in India. • 93.82% of total internet users use internet on mobile • Internet penetration is 27% . It is expected to increase to 34.8%
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