The first is the SO Strategies; it uses a firm’s internal strengths to take advantage of external opportunities. The WOO strategy. This strategy aims at improving internal weaknesses by taking advantage of external opportunities. SST Strategies uses a firm’s internal strengths to avoid or reduce the impact of external threats. The last strategy to use is the WET strategy. Defensive tactics directed at reducing internal weaknesses and avoiding external threats is used in this strategy.
Examples: 1)Comparing chase has a strong brand name and financial position(Strength). They could use that to expand into other countries. 2) Another Comparing chase example would be if they decided to SE their assets to acquire a competitor and take control of a major percentage of the industry. 3) Strong R&D expertise (internal Strength) and decreasing number of younger adults (external threat)= develop new products for elderly 2. Each one; x-axis CAP + IP; y-axis SP + UP 3. P to the right, Size of circle is revenue, inside coloring is profit (example 59%) (make sure to average), FIFE scores top, FEE on side 4. First, structure largely dictates how objectives and policies will be established. For example, objectives and policies established under a geographic organizational structure are couched in geographical terms. Second reason is that structure dictates how resources will be allocated. If an organization’s structure is set up along functional lines, then functional areas allocate resources.
Unless revised strategies place emphasis in the same area as old strategies, structural reorientation commonly becomes a part of strategy implementation. 5. Strategists should strive to preserve, emphasize, and build on aspects of an existing culture that supports new strategies. There are ways to modify an organizational culture to support new strategies. This can be through recruiting, training restructuring, role modeling, positive enforcement and even revising the mission and vision statement.
There are 10 important elements in linking culture to strategy: 1) formal statements of organizational philosophy, charters, creeds, materials used for recruitment and selection, and colonization 2) Designing of physical spaces, facades, buildings 3) deliberate role modeling, teaching, and coaching by leaders 4) explicit reward and status system, promotion criteria 5) stories, legends, myths, and parables about key people and events 6) what leaders pay attentions to, measure and control 7)leader reaction to critical incidents and organizational crises 8) how the organization is designed and structured 9)organizational systems and procedures 10) criteria used for recruitment, selection, promotion, leveling off, retirement, and “excommunication” of people. Patty McCoy, HER of Nettling, spent 14 years helping lead the company through its early days to current streaming and built a hugely influential corporate culture. Her influence epitomized by the company to this day.
She included points about hiring and common sense working better than formal policies. This huge change in the organization eventually led to a brand new eve of doing business and is the envy of the streaming world today. 6. Two variables are of central importance to strategy implementation: MS & UP. Market segmentation is defined as the subdividing of a market into distinct subset of customers according the needs and buying habits. MS is an important variable in strategy development for 3 reasons. First, strategies such as market development, product development, market penetration and diversification require increased sales through new markets and products.
New and improved market segmentation approaches are required if the trainees are going to be implemented successfully. Next, mass production, mass distribution, and mass advertising are not required because market segmentation allows a firm to operate with limited resources. Small firms are able to compete with large firms by maximizing per-unit profits and per- segment sales through market segmentation. Third, market segmentation decisions directly affect marketing mix variables: product, place, promotion, and price. One of the newest MS strategies is the targeting of regional taste, which is having the same company sell a product geared towards a certain egging, but not in another based off of cultural differences.
An example of this is would be McDonald’s offering seasonal seafood meals, including crab and lobster, in places such as New England (Northwest). These same meals wouldn’t be served in the Midwest because seafood simply isn’t that popular in that particular area. Once markets have been segmented and the firm can now target particular groups, the next step is to find what a customer wants and wishes. This is where product positioning steps in. Product positioning entails developing schematic representations that reflect how products or reviser compare to competitors’ on dimensions most important to success in the industry. In order to go about implementing a strategy via product positioning, there are perceptual maps that can be used to aid the process.
You can even look at more than one area simultaneously. However, there are some rules. You must first look for and find the hole or vacant niche. The best strategic opportunity might be an unseeded segment. Rule 2, DO NOT serve TV’0 segments with the same strategy. Usually, a strategy successful with one segment cannot be directly transferred to another segment. Third, not position yourself in the middle of the map(obvious reasons). An effective product positioning strategy meets two criteria: 1) it uniquely distinguishes a company from the competition and 2) it leads customers to expect slightly less seen/ice than a company can deliver. Cataracts is a great example of product positioning.
CEO Howard Schultz franchised premium coffee, upgraded the coffee shop experience and created one of the worlds most powerful brands. 7-JP=Uncoil for non cola drinkers 7. Interest-? Interest rate * amount of capital needed (does not apply to stock) BET = BIT Interest = BET * Tax Rate -? EAT = BET – Taxes – Shares = amount of capital needed in stock/# of shares —PEPS = EAT/# of shares For the chart 8. The most commonly used criteria to evaluate strategies are both qualitative and quantitative data. It doesn’t stop there, however, there are various factors that goes into evaluating strategies with the data. It depends on a particular organization’s size, industry, strategies, and management philosophy.
Financial ratios are quantitative criteria used to evaluate strategies. Strategists use ratios to make three critical comparisons 1) comparing the firm’s performance over different time periods 2)comparing he firm’s performance to competitors 3)comparing the firm’s performance to industry averages. Using qualitative criteria, human factors are considered such as high absenteeism and turnover rates, production quality and quantity rates, or employee satisfaction. Looking at high risk and low risk projects, long-term and short-term projects, firm’s balance of investments among different divisions. 9. Consonance and advantage are two of Runlet’s criteria that could be used to evaluate strategy.
Both of the two criteria aforementioned in the previous sentence are mostly based on a firm’s external assessment. When comparing the two, they both have to evaluate the current market a firm is in to make a strategic decision in regards to moving forward. Consonance refers to the need for strategists to examine a set of trends, as well as individual trends, in evaluating strategies. A strategy must represent an adaptive response to the external environment and to the critical changes occurring within it. Advantage, although alike, is a bit different. A strategy must provide for the certain creation of a competitive advantage in a selected area of activity.
CA results in superiority of 3: resources, skills, position. 10. The answer to why good ethics is important in strategic management is simple. “Good ethics is Good business. ” No company wants to do business with someone unethical. Good ethics in the workplace is not only a great way to establish trust throughout an entire culture, but it makes business with others outside of the firm enjoyable and proactive. Customers are becoming less and less tolerant of those who abuse their power and perform unethically, which only benefits those who play by the rules.