Strategic Management complete Notes
Short Description
Download Strategic Management complete Notes...
Description
Unit-1 ESHWARI.S---LORAA BUSINESS ACADEMY Page 1
Definition: Te te!" #t!ategi$ "anage"ent i# %#e& to !efe! to te enti!e #$o'e of #t!ategi$-&e$i#ion "a(ing a$ti)it* in an o!gani+ation. Te fo,,oing #tate"ent# #e!)e a# a n%"e! of o!(a,e &efinition# of #t!ategi$ "anage"ent: St!ategi$ "anage"ent i# te '!o$e## of "anaging te &ete$tion of o!gani+ationa, "i##ion i,e "anaging te !e,ation#i' of te o!gani+ation to it# en)i!on"ent /0a"e# M. Higgin#. St!ategi$ "anage"ent i# &efine& a# te #et of &e$i#ion# an& a$tion# !e#%,ting in te fo!"%,ation an& i"',e"entation of #t!ategie# &e#igne& to a$ie)e te o2e$ti)e# of te o!gani+ation. Wat i# #t!ateg*3 O)e!a,, Definition: 4St!ateg* i# te &i!e$tion an& #$o'e of an o!gani+ation o)e! te ,ong-te!": St!ateg*5 a o!& of "i,ita!* o!igin5 !efe!# to a ',an of a$tion &e#igne& to a$ie)e a 'a!ti$%,a! goa,. In "i,ita!* %#age #t!ateg* i# &i#tin$t f!o" ta$ti$#5 i$ a!e $on$e!ne& it te $on&%$t of an engage"ent5 i,e #t!ateg* i# $on$e!ne& it o &iffe!ent engage"ent# a!e ,in(e&. St!ateg* at Diffe!ent Le)e,# of a B%#ine## St!ategie# e6i#t at #e)e!a, ,e)e,# in an* o!gani+ation - !anging f!o" te o)e!a,, %#ine## /o! g!o%' of %#ine##e# t!o%g to in&i)i&%a,# o!(ing in it. Co!'o!ate St!ateg* - i# $on$e!ne& it te o)e!a,, '%!'o#e an& #$o'e of te %#ine## to "eet #ta(eo,&e! e6'e$tation#. Ti# i# a $!%$ia, ,e)e, #in$e it i# ea)i,* inf,%en$e& * in)e#to!# in te %#ine## an& a$t# to g%i&e #t!ategi$ &e$i#ion-"a(ing t!o%go%t te %#ine##. Co!'o!ate #t!ateg* i# often #tate& $,ea!,* in a 4"i##ion #tate"ent4. B%#ine## Unit St!ateg* - i# $on$e!ne& "o!e it o a %#ine## $o"'ete# #%$$e##f%,,* in a 'a!ti$%,a! "a!(et. It $on$e!n# #t!ategi$ &e$i#ion# ao%t $oi$e of '!o&%$t#5 "eeting nee&# of $%#to"e!#5 gaining a&)antage o)e! $o"'etito!#5 e6',oiting o! $!eating ne o''o!t%nitie# et$. O'e!ationa, St!ateg* - i# $on$e!ne& it o ea$ 'a!t of te %#ine## i# o!gani#e& to &e,i)e! te $o!'o!ate an& %#ine##-%nit ,e)e, #t!ategi$ &i!e$tion. O'e!ationa, #t!ateg* te!efo!e fo$%#e# on i##%e# of !e#o%!$e#5 '!o$e##e#5 'eo',e et$. Ho St!ateg* i# Manage& - St!ategi$ Manage"ent ESHWARI.S---LORAA BUSINESS ACADEMY Page 7
In it# !oa&e#t #en#e5 #t!ategi$ "anage"ent i# ao%t ta(ing 4#t!ategi$ &e$i#ion#4 &e$i#ion# tat an#e! te 8%e#tion# ao)e. In '!a$ti$e5 a to!o%g #t!ategi$ "anage"ent '!o$e## a# t!ee "ain $o"'onent#5 #on in te fig%!e e,o: St!ategi$ Ana,*#i# Ti# i# a,, ao%t te ana,*#ing te #t!engt of %#ine##e#9 'o#ition an& %n&e!#tan&ing te i"'o!tant e6te!na, fa$to!# tat "a* inf,%en$e tat 'o#ition. Te '!o$e## of St!ategi$ Ana,*#i# $an e a##i#te& * a n%"e! of too,#5 in$,%&ing: PEST Ana,*#i# - a te$ni8%e fo! %n&e!#tan&ing te 4en)i!on"ent4 in i$ a %#ine## o'e!ate# S$ena!io P,anning - a te$ni8%e tat %i,&# )a!io%# e,ie)a,e )ie# of 'o##i,e f%t%!e# fo! a %#ine## i)e o!$e# Ana,*#i# - a te$ni8%e fo! i&entif*ing i$ affe$t teto ,e)e, of $o"'etition in an& an in&%#t!* Ma!(et Seg"entationte - afo!$e# te$ni8%e i$ #ee(# i&entif* #i"i,a!itie# &iffe!en$e# eteen g!o%'# of $%#to"e!# o! %#e!# Di!e$tiona, Po,i$* Mat!i6 - a te$ni8%e i$ #%""a!i#e# te $o"'etiti)e #t!engt of a %#ine##;# o'e!ation# in #'e$ifi$ "a!(et# Co"'etito! Ana,*#i# - a i&e !ange of te$ni8%e# an& ana,*#i# tat #ee(# to #%""a!i#e a ESHWARI.S---LORAA BUSINESS ACADEMY Page <
%#ine##e#9 o)e!a,, $o"'etiti)e 'o#ition C!iti$a, S%$$e## a$to! Ana,*#i# - a te$ni8%e to i&entif* to#e a!ea# in i$ a %#ine## "%#t o%t'e!fo!" te $o"'etition in o!&e! to #%$$ee& SWOT Ana,*#i# - a %#ef%, #%""a!* te$ni8%e fo! #%""a!i#ing te (e* i##%e# a!i#ing f!o" an a##e##"ent of a %#ine##e# 4inte!na,4 'o#ition an& 4e6te!na,4 en)i!on"enta, inf,%en$e#. St!ategi$ Coi$e Ti# '!o$e## in)o,)e# %n&e!#tan&ing te nat%!e of #ta(eo,&e! e6'e$tation# /te 4g!o%n& !%,e#45 i&entif*ing #t!ategi$ o'tion#5 an& ten e)a,%ating an& #e,e$ting #t!ategi$ o'tion#. St!ateg* I"',e"entation Often te a!&e#t 'a!t. Wen a #t!ateg* a# een ana,*#e& an& #e,e$te&5 te ta#( i# ten to t!an#,ate it into o!gani#ationa, a$tion. Te Nat%!e of= St!ategi$ Define&: A!t #$ien$e o Manage"ent: f fo! "% ,ating5 i"' ,e "ent ing5 an& e )a ,% at ing5 $! o # #- f% n$t io na , & e$ i# io n# t at e na ,e a n o ! ga n i+ at io n t o a$ie )e it # o 2e $t i)e #. ESHWARI.S---LORAA BUSINESS ACADEMY Page >
A$ie)ing S%#taine& Co"'etiti)e A&)antage: 1. A&a'ting to $ange in e6te!na, t!en inte!na, $a'ai,itie# an& !e#o%!$e# 7. Effe$ti)e,* fo!"%,ating5 i"',e"enting = e)a,%ating #t!ategie# A&a'ting to Cange ?e* St!ategi$ Manage"ent @%e#tion#: Wat (in& of %#ine## #o%,& e e$o"e3 A!e e in te !igt fie,&# A!e te!e ne $o"'etito!# Wat #t!ategie# #o%,& e '%!#%e3 Ho a!e o%! $%#to"e!# $anging3 ESHWARI.S---LORAA BUSINESS ACADEMY Page
?e* Te!"#: i#ion State"ent Wat &o e ant to e$o"e3 Mi##ion State"ent Wat i# o%! %#ine##3 O''o!t%nitie# = T!eat# /E6te!na, Ana,*#i# of T!en&#: E$ono"i$ So$ia, C%,t%!a, De"og!a'i$En)i!on"enta, Po,iti$a,5 Lega,5 o)e!n"enta, Te$no,ogi$a, Co"'etito!# St!engt# = Wea(ne##e# /Inte!na,: T*'i$a,,* ,o$ate& in f%n$tiona, a!ea# of te fi!" Manage"ent Ma!(eting inan$eA$$o%nting P!o&%$tionO'e!ation# Re#ea!$ = De)e,o'"ent Co"'%te! Info!"ation S*#te"# ESHWARI.S---LORAA BUSINESS ACADEMY Page
Co"'!een#i)e #t!ategi$ "anage"ent "o&e,: Benefit# of St!ategi$ Manage"ent: inan$ia, Benefit#: * * * I"'!o)e"ent in #a,e# I"'!o)e"ent in '!ofitai,it* P!o&%$ti)it* i"'!o)e"ent Non-inan$ia, Benefit#: I"'!o)e& %n&e!#tan&ing of $o"'etito!# #t!ategie# Enan$e& aa!ene## of t!eat# Re&%$e& !e#i#tan$e to $ange Enan$e& '!o,e"'!e)ention $a'ai,itie# A&)antage# of Inte!nationa, O'e!ation#: F F F F A#o! e6$e## $a'a$it* Re&%$e %nit $o#t# S'!ea& !i#( o)e! i&e! "a!(et# Lo-$o#t '!o&%$tion fa$i,itie# ESHWARI.S---LORAA BUSINESS ACADEMY Page G
Di#a&)antage# of Inte!nationa, O'e!ation# F F F F Diffi$%,t $o""%ni$ation# Un&e!e#ti"ate fo!eign $o"'etition C%,t%!a, a!!ie!# to effe$ti)e "anage"ent Co"',i$ation# a!i#ing f!o" $%!!en$* &iffe!en$e# S$o'e of #t!ategi$ "anage"ent: 2. Con#ta,e a# &efine& te a!ea a&&!e##e& * #t!ategi$ "anage"ent a# 4te "anage"ent '!o$e##e# an& &e$i#ion# i$ &ete!"ine te ,ong-te!" #t!%$t%!e an& a$ti)itie# of te o!gani+ation4. Ti# &efinition in$o!'o!ate# fi)e (e* te"e#: Manage"ent '!o$e##. Manage"ent '!o$e## a# !e,ate to o #t!ategie# a!e $!eate& an& $ange&. Manage"ent &e$i#ion#. Te &e$i#ion# "%#t !e,ate $,ea!,* to a #o,%tion of 'e!$ei)e& '!o,e"# /o to a)oi& a t!eat toHoe)e!5 $a'ita,i+e o''o!t%nit*. Ti"e #$a,e#. Te #t!ategi$ ti"e o!i+on i# o ,ong. it on fo!an $o"'an* in !ea, t!o%,e $an e )e!* #o!t. St!%$t%!e of te o!gani+ation. An o!gani+ation i# "anage& * 'eo',e itin a #t!%$t%!e. Te &e$i#ion# i$ !e#%,t f!o" te a* tat "anage!# o!( togete! itin te #t!%$t%!e $an !e#%,t in #t!ategi$ $ange. A$ti)itie# of te o!gani+ation. Ti# i# a 'otentia,,* ,i"it,e## a!ea of #t%&* an& e no!"a,,* #a,, $ent!e %'on a,, a$ti)itie# i$ affe$t te o!gani+ation. Co"'onent# of a St!ateg* State"ent Te #t!ateg* #tate"ent of a fi!" #et# te fi!";# ,ong-te!" #t!ategi$ &i!e$tion an& !oa& 'o,i$* &i!e$tion#. It gi)e# te fi!" a $,ea! #en#e of &i!e$tion an& a ,%e'!int fo! te fi!";# a$ti)itie# fo! te %'$o"ing *ea!#. Te "ain $on#tit%ent# of a #t!ategi$ #tate"ent a!e a# fo,,o#: 1. St!ategi$ Intent An o!gani+ation;# #t!ategi$ intent i# te '%!'o#e tat it e6i#t# an& * it i,, $ontin%e to e6i#t5 '!o)i&ing it "aintain# a $o"'etiti)e a&)antage. St!ategi$ intent gi)e# a 'i$t%!e ao%t at an o!gani+ation "%#t get into i""e&iate,* in o!&e! to a$ie)e te $o"'an*;# )i#ion. It "oti)ate# te 'eo',e. It $,a!ifie# te )i#ion of te $o"'an*. St!ategi$ intent e,'# "anage"ent to e"'a#i+e an& $on$ent!ate on te '!io!itie#. St!ategi$ intent i#5 ESHWARI.S---LORAA BUSINESS ACADEMY Page J
noting %t5 te inf,%en$ing of an o!gani+ation;# !e#o%!$e 'otentia, an& $o!e $o"'eten$ie# to a$ie)e at at fi!#t "a* #ee" to e %na$ie)a,e goa,# in te $o"'etiti)e en)i!on"ent. A e,, e6'!e##e& #t!ategi$ intent #o%,& g%i&e#tee! te &e)e,o'"ent of #t!ategi$ intent o! te #etting of goa,# an& o2e$ti)e# tat !e8%i!e tat a,, of o!gani+ation;# $o"'eten$ie# e $ont!o,,e& to "a6i"%" )a,%e. St!ategi$ intent in$,%&e# &i!e$ting o!gani+ation;# attention on te nee& of inning in#'i!ing 'eo',e * te,,ing te" tat te ta!get# a!e )a,%a,e en$o%!aging in&i)i&%a, an& tea" 'a!ti$i'ation a# e,, a# $ont!i%tion an& %ti,i+ing intent to &i!e$t a,,o$ation of !e#o%!$e#. St!ategi$ intent &iffe!# f!o" #t!ategi$ fit in a a* tat i,e #t!ategi$ fit &ea,# it a!"oni+ing a)ai,a,e !e#o%!$e# an& 'otentia,# to te e6te!na, intent e"'a#i+e# on %i,&ing ne !e#o%!$e# an& 'otentia,# #oen)i!on"ent5 a# to $!eate#t!ategi$ an& e6',oit f%t%!e o''o!t%nitie#. 7. Mi##ion State"ent Mi##ion #tate"ent i# te #tate"ent of te !o,e * i$ an o!gani+ation inten&# to #e!)e it;# #ta(eo,&e!#. It &e#$!ie# * an o!gani+ation i# o'e!ating an& t%# '!o)i&e# a f!a"eo!( itin i$ #t!ategie# a!e fo!"%,ate&. It &e#$!ie# at te o!gani+ation &oe# /i.e.5 '!e#ent $a'ai,itie#5 o a,, it #e!)e# /i.e.5 #ta(eo,&e!# an& at "a(e# an o!gani+ation %ni8%e /i.e.5 !ea#on fo! e6i#ten$e. A "i##ion #tate"ent &iffe!entiate# an o!gani+ation f!o" ote!# * e6',aining it# !oa& #$o'e of a$ti)itie#5 it# '!o&%$t#5 an& te$no,ogie# it %#e# to a$ie)e it# goa,# an& o2e$ti)e#. It ta,(# ao%t an o!gani+ation;# '!e#ent /i.e.5 Kao%t e!e e a!e.o! in#tan$e5 Mi$!o#oft;# "i##ion i# to e,' 'eo',e an& %#ine##e# t!o%go%t te o!,& to !ea,i+e tei! f%,, 'otentia,. Wa,-Ma!t;# "i##ion i# KTo gi)e o!&ina!* fo,( te $an$e to %* te #a"e ting a# !i$ 'eo',e. Mi##ion #tate"ent# a,a*# e6i#t at to' ,e)e, of an o!gani+ation5 %t "a* a,#o e "a&e fo! )a!io%# o!gani+ationa, ,e)e,#. Cief e6e$%ti)e ',a*# a #ignifi$ant !o,e in fo!"%,ation of "i##ion #tate"ent. On$e te "i##ion #tate"ent i# fo!"%,ate&5 it #e!)e# te o!gani+ation in ,ong !%n5 %t it "a* e$o"e a"ig%o%# it o!gani+ationa, g!ot an& inno)ation#. In to&a*;# &*na"i$ an& $o"'etiti)e en)i!on"ent5 "i##ion "a* nee& to e !e&efine&. Hoe)e!5 $a!e "%#t e ta(en tat te !e&efine& "i##ion #tate"ent #o%,& a)e o!igina, f%n&a"enta,#$o"'onent#. Mi##ion #tate"ent a# t!ee "ain $o"'onent#-a #tate"ent of "i##ion o! )i#ion of te $o"'an*5 a #tate"ent of te $o!e )a,%e# tat #a'e te a$t# an& ea)io%! of te e"',o*ee#5 an& a #tate"ent of te goa,# an& o2e$ti)e#. eat%!e# of a Mi##ion a. . $. &. e. f. g. Mi##ion "%#t e fea#i,e an& attaina,e. It #o%,& e 'o##i,e to a$ie)e it. Mi##ion #o%,& e $,ea! eno%g #o tat an* a$tion $an e ta(en. It #o%,& e in#'i!ing fo! te "anage"ent5 #taff an& #o$iet* at ,a!ge. It #o%,& e '!e$i#e eno%g5 i.e.5 it #o%,& e neite! too !oa& no! too na!!o. It #o%,& e %ni8%e an& &i#tin$ti)e to ,ea)e an i"'a$t in e)e!*one;# "in&. It #o%,& e ana,*ti$a,5i.e.5 it #o%,& ana,*+e te (e* $o"'onent# of te #t!ateg*. It #o%,& e $!e&i,e5 i.e.5 a,, #ta(eo,&e!# #o%,& e a,e to e,ie)e it. ESHWARI.S---LORAA BUSINESS ACADEMY Page
7. i#ion A )i#ion #tate"ent i&entifie# e!e te o!gani+ation ant# o! inten&# to e in f%t%!e o! e!e it #o%,& e to e#t "eet te nee&# of te #ta(eo,&e!#. It &e#$!ie# &!ea"# an& a#'i!ation# fo! f%t%!e. o! in#tan$e5 Mi$!o#oft;# )i#ion i# Kto e"'oe! 'eo',e t!o%g g!eat #ofta!e5 an* ti"e5 an* ',a$e5 o! an* &e)i$e. Wa,-Ma!t;# )i#ion i# to e$o"e o!,&i&e ,ea&e! in !etai,ing. A )i#ion i# te 'otentia, to )ie ting# aea& of te"#e,)e#. It an#e!# te 8%e#tion Ke!e e ant to e. It gi)e# %# a !e"in&e! ao%t at e atte"'t to &e)e,o'. A )i#ion #tate"ent i# fo! te o!gani+ation an& it;# "e"e!#5 %n,i(e te "i##ion #tate"ent i$ i# fo! te $%#to"e!#$,ient#. It $ont!i%te# in effe$ti)e &e$i#ion "a(ing a# e,, a# effe$ti)e %#ine## ',anning. It in$o!'o!ate# a #a!e& %n&e!#tan&ing ao%t te an&o!gani+ation ai" of te o!gani+ation an& %ti,i+e# %n&e!#tan&ing an& nat%!e g%i&e te toa!&# a ette! '%!'o#e.ti# It &e#$!ie# tat to on &i!e$t a$ie)ing te "i##ion5 o te o!gani+ationa, f%t%!e o%,& a''ea! to e. An effe$ti)e )i#ion #tate"ent "%#t a)e fo,,oing feat%!e#a. . $. &. e. It "%#t e %na"ig%o%#. It "%#t e $,ea!. It "%#t a!"oni+e it o!gani+ation;# $%,t%!e an& )a,%e#. Te &!ea"# an& a#'i!ation# "%#t e !ationa,!ea,i#ti$. i#ion #tate"ent# #o%,& e #o!te! #o tat te* a!e ea#ie! to "e"o!i+e. In o!&e! to !ea,i+e te )i#ion5 it "%#t e &ee',* in#ti,,e& in te o!gani+ation5 eing one& an& #a!e& * e)e!*one in)o,)e& in te o!gani+ation.
$o"'en#ation ',an#5 $o"'etiti)ene## an& '!o&%$ti)it*. A $o%!#e in #t!ategi$ "anage"ent i# a 'a!t of "an* MBA '!og!a"#. 7. o Long-Te!" I##%e# St!ategi$ "anage"ent &ea,# '!i"a!i,* it ,ong-te!" i##%e# tat "a* o! "a* not a)e an i""e&iate effe$t. o! e6a"',e5 in)e#ting in te e&%$ation of te $o"'an*9# o!( fo!$e "a* *ie,& no i""e&iate effe$t in te!"# of ige! '!o&%$ti)it*. Sti,,5 in te ,ong !%n5 '!ofit#. tei! e&%$ation i,, !e#%,t in ige! '!o&%$ti)it*5 an& te!efo!e enan$e& Co"'etiti)e A&)antage o St!ategi$ "anage"ent e,'# "anage!# fin& ne #o%!$e# of #%#taina,e $o"'etiti)e a&)antage. E6e$%ti)e# tat a'',* te '!in$i',e# of #t!ategi$ "anage"ent in tei! o!( $ontin%o%#,* t!* to &e,i)e! '!o&%$t# o! #e!)i$e# $ea'e!5 '!o&%$e g!eate! $%#to"e! #ati#fa$tion an& "a(e e"',o*ee# "o!e #ati#fie& it tei! 2o#. Effe$t on O'e!ation# o oo& #t!ategi$ "anage"ent a,a*# a# a #i+a,e effe$t on o'e!ationa, i##%e#. o! e6a"',e5 a &e$i#ion to ,in( 'a* to 'e!fo!"an$e i,, !e#%,t in o'e!ationa, &e$i#ion# eing "o!e effe$ti)e a# e"',o*ee# t!* a!&e! at tei! 2o#. O'e!ationa, &e$i#ion# in$,%&e &e$i#ion# tat &ea, it 8%e#tion# #%$ a# o to #e,, to $e!tain $%#to"e!# o! ete! to o'en a $!e&it ,ine to te". O'e!ationa, &e$i#ion# a!e "a&e in te ,oe! e$e,on# of te o!gani+ationa, ie!a!$*. Sa!eo,&e!# o Managing te o!gani+ation in a #t!ategi$ fa#ion !e8%i!e# tat te inte!e#t# of #a!eo,&e!# e '%t at te ea!t of a,, i##%e#. Wete! te 8%e#tion at an& i# e6'an#ion into a ne "a!(et o! negotiating "e!ge!# an& a$8%i#ition#5 #a!eo,&e! )a,%e #o%,& e at te $o!e at a,, ti"e#. Co"'an*;# #t!ateg* an& it# %#ine## "o&e,: Peo',e i,, a,a*# #t!e## tat a)ing a e,, !e#ea!$e& %#ine## ',an i# (e* efo!e *o% #ta!t *o%! %#ine##. A,to%g $!eating a %#ine## ',an i# often an i"'o!tant #te' in te e)o,%tion of a %#ine##5 'a!ti$%,a!,* if *o% nee& finan$ing o! *o% a!e not e6'e!ien$e& at !%nning a %#ine##5 it i# not ne$e##a!i,* te e##entia, fi!#t #te'. Te!e a!e to (e* e,e"ent# tat #o%,& e $o"',ete& '!io! to te %#ine## ',an: * * Te %#ine## "o&e, Te #t!ateg* Wat i# a B%#ine## Mo&e,3 Wi,e te o!& "o&e, often #ti!# %' i"age# of "ate"ati$a, fo!"%,a#5 a %#ine## "o&e, i# in fa$t a #to!* of o a %#ine## o!(#. In gene!a, te!"#5 a %#ine## "o&e, i# te "eto& of &oing %#ine## * i$ a $o"'an* $an gene!ate !e)en%e. Bot #ta!t-%' )ent%!e# an& e#ta,i#e& $o"'anie# ta(e ne '!o&%$t# an& #e!)i$e# to te "a!(et t!o%g a )ent%!e #a'e& * a #'e$ifi$ %#ine## "o&e,. In tei! 'a'e!5 Te Ro,e of te B%#ine## Mo&e, in Ca't%!ing a,%e f!o" Inno)ation5 ESHWARI.S---LORAA BUSINESS ACADEMY Page 1
Hen!* Ce#!o%g an& Ri$a!& S. Ro#en,oo" o%t,ine& te #i6 a#i$ e,e"ent# of a %#ine## "o&e,: 1. A!ti$%,ate te )a,%e '!o'o#ition te )a,%e $!eate& to %#e!# * %#ing te '!o&%$t 7. I&entif* te "a!(et #eg"ent to o" an& fo! at '%!'o#e i# te '!o&%$t %#ef%, #'e$if* o !e)en%e i# gene!ate& * te fi!".
I# te 'o!tfo,io of SBU9# an& it# !e,ati)e !i#(g!ot 'otentia, $on#i#tent it te #t!ategi$ goa,#3 Do te $o!e %#ine##e# gene!ate &e'en&a,e '!ofit# an&o! $a# f,o3 A!e te!e eno%g $a#-'!o&%$ing %#ine##e# to finan$e to#e nee&ing $a# I# te 'o!tfo,io o)e!,* )%,ne!a,e to #ea#ona, o! !e$e##iona!* inf,%en$e#3 Doe# te 'o!tfo,io '%t te $o!'o!ation in goo& 'o#ition fo! te f%t%!e3 It i# i"'o!tant to $on#i&e! &i)e!#ifi$ation )#. $on$ent!ation i,e o!(ing on 'o!tfo,io #t!ateg*5 i.e.5 o !oa& o! na!!o #o%,& e te #$o'e of te $o"'an*. It i# not a,a*# &e#i!a,e to a)e a !oa& #$o'e. Sing,e-%#ine## #t!ategie# $an e )e!* #%$$e##f%, /e.g.5 ea!,* #t!ategie# of M$Dona,&9#5 Co$a-Co,a5 an& BIC Pen. So"e of te a&)antage# of a na!!o #$o'e of %#ine## a!e: /a ,e## a"ig%it* ao%t o e a!e at e te" &o / $on$ent!ate# te of /$ te t!o%g tota, o!gani+ation5 !ate! tanan& #t!et$ing a$!o## "an* ,ine# ofeffo!t# %#ine## e6ten#i)e an&#-on e6'e!ien$e5 te $o"'an* i# "o!e ,i(e,* to &e)e,o' &i#tin$ti)e $o"'eten$e an& /& fo$%#e# on ,ong-te!" '!ofit#. Hoe)e!5 a)ing a #ing,e %#ine## '%t# 4a,, te egg# in one a#(et54 i$ i# &ange!o%# en te in&%#t!* an&o! te$no,og* "a* $ange. Di)e!#ifi$ation e$o"e# "o!e i"'o!tant en "a!(et g!ot !ate #,o#. B%i,&ing #ta,e #a!eo,&e! )a,%e i# te %,ti"ate 2%#tifi$ation fo! &i)e!#if*ing -- o! an* #t!ateg*. Wat So%,& Be O%! Pa!enting St!ateg*3 Ti# ti!& $o"'onent of $o!'o!ate ,e)e, #t!ateg*5 !e,e)ant fo! a "%,ti-%#ine## $o"'an* /it i# "oot fo! a #ing,e%#ine## $o"'an*5 i# $on$e!ne& it o to a,,o$ate !e#o%!$e# an& "anage $a'ai,itie# an& a$ti)itie# a$!o## te 'o!tfo,io of %#ine##e#. It in$,%&e# e)a,%ating an& "a(ing &e$i#ion# on te fo,,oing: P!io!itie# in a,,o$ating !e#o%!$e# /i$ %#ine## %nit# i,, e #t!e##e& Wat a!e $!iti$a, #%$$e## fa$to!# in ea$ %#ine## %nit5 an& o $an te $o"'an* &o e,, on te" Coo!&ination of a$ti)itie# /e.g.5 o!i+onta, #t!ategie# an& t!an#fe! of $a'ai,itie# a"ong %#ine## %nit# Ho "%$ integ!ation of %#ine## %nit# i# &e#i!a,e. COMPETITIE /BUSINESS LEEL STRATEY In ti# #e$on& a#'e$t of a $o"'an*9# #t!ateg*5 te fo$%# i# on o to $o"'ete #%$$e##f%,,* in ea$ of te ,ine# of %#ine## te $o"'an* a# $o#en to engage in. Te $ent!a, t!%#t i# o to %i,& an& i"'!o)e te $o"'an*9# $o"'etiti)e 'o#ition fo! ea$ of it# ,ine# of %#ine##. A ESHWARI.S---LORAA BUSINESS ACADEMY Page 7
$o"'an* a# $o"'etiti)e a&)antage ene)e! it $an att!a$t $%#to"e!# an& &efen& again#t $o"'etiti)e fo!$e# ette! tan it# !i)a,#. Co"'anie# ant to &e)e,o' $o"'etiti)e a&)antage# tat a)e #o"e #%#tainai,it* /a,to%g te t*'i$a, te!" 4#%#taina,e $o"'etiti)e a&)antage4 i# %#%a,,* on,* t!%e &*na"i$a,,*5 a# a fi!" o!(# to $ontin%e it. S%$$e##f%, $o"'etiti)e #t!ategie# %#%a,,* in)o,)e %i,&ing %ni8%e,* #t!ong o! &i#tin$ti)e $o"'eten$ie# in one o! #e)e!a, a!ea# $!%$ia, to #%$$e## an& %#ing te" to "aintain a $o"'etiti)e e&ge o)e! !i)a,#. So"e e6a"',e# of &i#tin$ti)e $o"'eten$ie# a!e #%'e!io! te$no,og* an&o! '!o&%$t feat%!e#5 ette! "an%fa$t%!ing te$no,og* an& #(i,,#5 #%'e!io! #a,e# an& &i#t!i%tion $a'ai,itie#5 an& ette! $%#to"e! #e!)i$e an& $on)enien$e. Co"'etiti)e #t!ateg* i# ao%t eing &iffe!ent. It "ean# &e,ie!ate,* to&e,i)e! 'e!fo!"aa$ti)itie# o! to 'e!fo!" &iffe!ent a$ti)itie# tan$oo#ing !i)a,# to %ni8%e "i6&iffe!ent,* of )a,%e. /Mi$ae, E. Po!te! Te e##en$e of #t!ateg* ,ie# in $!eating to"o!!o9# $o"'etiti)e a&)antage# fa#te! tan $o"'etito!# "i"i$ te one# *o% 'o##e## to&a*. /a!* Ha"e, = C. ?. P!aa,a& We i,, $on#i&e! $o"'etiti)e #t!ateg* * %#ing Po!te!9# fo%! gene!i$ #t!ategie# /Po!te! 1J5 1J a# te f%n&a"enta, $oi$e#5 an& ten a&&ing )a!io%# $o"'etiti)e ta$ti$#. Po!te!9# o%! ene!i$ Co"'etiti)e St!ategie# He a!g%e# tat a %#ine## nee&# to "a(e to f%n&a"enta, &e$i#ion# in e#ta,i#ing it# $o"'etiti)e a&)antage: /a ete! to $o"'ete '!i"a!i,* on '!i$e /e #a*# 4$o#t54 i$ i# ne$e##a!* to #%#tain $o"'etiti)e '!i$e#5 %t '!i$e i# at te $%#to"e! !e#'on&# to o! to $o"'ete t!o%g '!o)i&ing #o"e &i#tin$ti)e 'oint# of &iffe!entiation tat 2%#tif* ige! '!i$e#5 an& / o !oa& a "a!(et ta!get it i,, ai" at /it# $o"'etiti)e #$o'e. Te#e to $oi$e# &efine te fo,,oing fo%! gene!i$ $o"'etiti)e #t!ategie#. i$ e a!g%e# $o)e! te f%n&a"enta, !ange of $oi$e#. A fift #t!ateg* a,te!nati)e /e#t-$o#t '!o)i&e! i# a&&e& * #o"e #o%!$e#5 a,to%g not * Po!te!5 an& i# in$,%&e& e,o: 1. O)e!a,, P!i$e /Co#t Lea&e!#i': a''ea,ing to a !oa& $!o##-#e$tion of te "a!(et * '!o)i&ing '!o&%$t# o! #e!)i$e# at te ,oe#t '!i$e. Ti# !e8%i!e# eing te o)e!a,, ,o-$o#t '!o)i&e! of te '!o&%$t# o! #e!)i$e# /e.g.5 Co#t$o5 a"ong !etai, #to!e#5 an& H*%n&ai5 a"ong a%to"oi,e "an%fa$t%!e!#. I"',e"enting ti# #t!ateg* #%$$e##f%,,* !e8%i!e# $ontin%a,5 e6$e'tiona, effo!t# to !e&%$e $o#t# -- ito%t e6$,%&ing '!o&%$t feat%!e# an& #e!)i$e# tat %*e!# $on#i&e! e##entia,. It a,#o !e8%i!e# a$ie)ing $o#t a&)antage# in a*# tat a!e a!& fo! $o"'etito!# to $o'* o! "at$. So"e $on&ition# tat ten& to "a(e ti# #t!ateg* an att!a$ti)e $oi$e a!e: Te in&%#t!*9# '!o&%$t i# "%$ te #a"e f!o" #e,,e! to #e,,e! Te "a!(et',a$e i# &o"inate& * '!i$e $o"'etition5 it ig,* '!i$e-#en#iti)e %*e!# ESHWARI.S---LORAA BUSINESS ACADEMY Page 7
Te!e a!e fe a*# to a$ie)e '!o&%$t &iffe!entiation tat a)e "%$ )a,%e to %*e!# Mo#t %*e!# %#e '!o&%$t in #a"e a*# -- $o""on %#e! !e8%i!e"ent# Sit$ing $o#t# fo! %*e!# a!e ,o B%*e!# a!e ,a!ge an& a)e #ignifi$ant a!gaining 'oe! 7. Diffe!entiation: a''ea,ing to a !oa& $!o##-#e$tion of te "a!(et t!o%g offe!ing &iffe!entiating feat%!e# tat "a(e $%#to"e!# i,,ing to 'a* '!e"i%" '!i$e#5 e.g.5 #%'e!io! te$no,og*5 8%a,it*5 '!e#tige5 #'e$ia, feat%!e#5 #e!)i$e5 $on)enien$e /e6a"',e# a!e No!&#t!o" an& Le6%#. S%$$e## it ti# t*'e of #t!ateg* !e8%i!e# &iffe!entiation feat%!e# tat a!e a!& o! e6'en#i)e fo! $o"'etito!# to &%',i$ate. S%#taina,e &iffe!entiation %#%a,,* $o"e# f!o" a&)antage# in $o!e $o"'eten$ie#5 %ni8%e $o"'an* !e#o%!$e# o! $a'ai,itie#5 an& #%'e!io! "anage"ent of )a,%e $ain a$ti)itie#. So"e tatto ten& to fa)o! &iffe!entiation #t!ategie# a!e: Te!e a!e$on&ition# "%,ti',e a*# &iffe!entiate te '!o&%$t#e!)i$e tat %*e!# tin( a)e #%#tantia, )a,%e B%*e!# a)e &iffe!ent nee&# o! %#e# of te '!o&%$t#e!)i$e P!o&%$t inno)ation# an& te$no,ogi$a, $ange a!e !a'i& an& $o"'etition e"'a#i+e# te ,ate#t '!o&%$t feat%!e# Not "an* !i)a,# a!e fo,,oing a #i"i,a! &iffe!entiation #t!ateg* Ca,$%,ate te !ea(-e)en 'oint Wit a (no,e&ge of te $ont!i%tion "a!gin / to #a,e#5 *o% $an fin& te %#ine##9# !ea(-e)en 'oint5 te ,e)e, at i$ in$o"e e8%a,# e6'en#e# /&i!e$t $o#t# an& o)e!ea&# o! e6'en#e#5 #o tat neite! a '!ofit o! a ,o## i# "a&e /in te net '!ofit ,ine of *o%! '!ofit an& ,o## !e'o!t. See a,#o #a,e# !ea( e)en 'oint. inan$ia, o!e$a#t# #a,e# Sa,e# fo!e$a#t# #o%,& e te fi!#t fo!e$a#t# "a&e en ',anning '!ofit an& o)e!a,, finan$ia, o2e$ti)e#. Te #a,e# fo!e$a#t i# of '!i"e i"'o!tan$e e$a%#e it inf,%en$e# "an* of te $o#t fo!e$a#t# fo! *o%! %#ine##. o!e$a#t '!ofit #tate"ent# P!e'a!e a fo!e$a#t '!ofit #tate"ent #oing te ann%a, net '!ofit ta!get fo! te %#ine## fo! ea$ *ea!. See a,#o 'e!fo!"an$e "et!i$# ESHWARI.S---LORAA BUSINESS ACADEMY Page >>
G o!e$a#t $a'ita, e6'en&it%!e !e8%i!e"ent# P!e'a!e an ann%a, $a'ita, e6'en&it%!e fo!e$a#t fo! ea$ *ea!. Ti# #o# &etai,# of *o%! '!o'o#e& $a'ita, e6'en&it%!e fo! te 'e!io& in te %#ine## ',an. J o!e$a#t $a# f,o Afte! *o% a)e '!e'a!e& te fo!e$a#t '!ofit an& $a'ita, e6'en&it%!e #tate"ent#5 *o% $an no '!e'a!e $a# f,o #tate"ent# fo! ea$ *ea! of te %#ine## ',an. Potentia, ,en&e!# i,, $!iti$a,,* ana,*#e *o%! $a# f,o fo!e$a#t# to &ete!"ine *o%! ai,it* to "eet ,oan !e'a*"ent#. A $a# f,o #tate"ent #o# te inten&e& $a# !e$ei't# an& 'a*"ent# of te %#ine## o)e! te 'e!io& of te %#ine## ',an5 i$ ten a,,o# te $a# f,o to e $a,$%,ate&. A fo!e$a#t $a# f,o #tate"ent #o# te $a# !e$ei't# /inf,o# an& 'a*"ent# /o%tf,o# of te o'e!ation5 i$ ena,e# f%t%!e $a# 'o#ition# to e '!e&i$te&. Ti# i# one,e)e, of te finan$ia, o2e$ti)e# *o%! 'e!io& %#ine##5 an& &i$tate# an* !e8%i!e& of(e* f%n&ing o)e! te $o"ing of t!a&ing /%&get *ea!. inan$ia, Ratio# Te $a,$%,ation of finan$ia, !atio# '!o)i&e# a %#ef%, #%""a!* of te a$$e'tai,it* of fo!e$a#t#. Te* $an e %#e& to i&entif* #t!engt# an& ea(ne##e# in ',anne& o'e!ating a$ti)itie#. Ratio# a!e $o"'a!e& it #tan&a!& en$"a!(# #%$ a# in&%#t!* a)e!age# fo! a$$e'tai,it*. Ratio# #o%,& a,#o e i"'!o)ing o)e! ti"e. Te i&entifi$ation of an* %na$$e'ta,e !atio# #o%,& $a%#e *o% to !e)ie an& a&2%#t !e,e)ant #e$tion# of te o'e!ationa, ',an to '!o&%$e #ati#fa$to!* fo!e$a#t# an& !e#%,t#. o! a $o"'!een#i)e %n&e!#tan&ing of finan$ia, !atio# #ee o%! eBoo( !e,ation#i'# tat #o te ea,t of *o%! %#ine##. 1 inan$ia, !e$o!&# Yo% i,, nee& to &e#ign a $o"'!een#i)e !e$o!& #*#te" tat !e$o!&# te finan$ia, t!an#a$tion# of te %#ine##. inan$ia, !e$o!&# a!e ne$e##a!* fo! te finan$ia, $ont!o, of te o'e!ation. Re$o!&# of finan$ia, t!an#a$tion# ena,e a$$%!ate !e'o!t# to e '!e'a!e& fo! "onito!ing te finan$ia, !e#%,t# of te o'e!ation. inan$ia, !e#%,t# a!e $o"'a!e& it $o!!e#'on&ing ta!get# to i&entif* an* %n#ati#fa$to!* 'e!fo!"an$e #o tat fo,,o %' a$tion $an e ta(en. 11 B%#ine## in#%!an$e P,an at t*'e# of in#%!an$e i,, e !e8%i!e& fo! te %#ine## no an& fo! te 'e!io& of te ',an5 te t*'e# of in#%!an$e "igt in$,%&e '%,i$ ,iai,it* /%#%a,,* te "ini"%" an& '!ofe##iona, in&e"nit*. Co"'!een#i)e in#%!an$e $o)e! #o%,& e a!!ange& an& "aintaine& fo! *o%! %#ine## o'e!ation to "ini"i#e e6'o#%!e to &ai,* !i#(# i$ $an $a%#e finan$ia, ,o##e#. 17 inan$ia, $ont!o,# Te fina, a!ea of finan$ia, o2e$ti)e# i# to e#ta,i# te finan$ia, $ont!o,# fo! *o%! %#ine##. Afte! *o% a)e &e#igne& *o%! finan$ia, !e$o!& (ee'ing #*#te"5 *o% #o%,& ten &e$i&e at finan$ia, $ont!o,# to a&o't fo! *o%! %#ine## o'e!ation. ESHWARI.S---LORAA BUSINESS ACADEMY Page >
inan$ia, $ont!o,# a!e te "eto&# o! te$ni8%e# *o% i,, %#e to "onito! an& e)a,%ate te finan$ia, !e#%,t# of *o%! o'e!ation. ?e* finan$ia, !e#%,t# a!e 9'!ofit95 9$a# f,o9 an& 9finan$ia, 'o#ition9. See a,#o 'e!fo!"an$e "et!i$# Un&e!#tan&ing te finan$ia, o2e$ti)e# fo! *o%! %#ine## o'e!ation i# e##entia, if *o%! %#ine## i# to e #%$$e##f%,. Man* %#ine## fai, e$a%#e te* &o not ta(e ti"e o%t to fi!#t e#ta,i# te#e5 an& ten to "onito! te". Te#e a!e *o%! 4#ta(e# in te g!o%n&4 i$ %,ti"ate,* #%''o!t te #t!%$t%!e of *o%! %#ine## Te Ba,an$e& S$o!e$a!& T!a&itiona, finan$ia, !e'o!ting #*#te"# '!o)i&e an in&i$ation of o a fi!" a# 'e!fo!"e& ino! tee6a"',e5 'a#t5 %t ,itt,e info!"ation ao%t it "igt 'e!fo!" in te f%t%!e. a offe! fi!" "igt !e&%$e it# ,e)e, of o $%#to"e! #e!)i$e in o!&e! to oo#t $%!!ent ea!ning#5 %t ten f%t%!e ea!ning# "igt e negati)e,* i"'a$te& &%e to !e&%$e& $%#to"e! #ati#fa$tion. To &ea, it ti# '!o,e"5 Roe!t ?a',an an& Da)i& No!ton &e)e,o'e& te Ba,an$e& S$o!e$a!&5 a 'e!fo!"an$e "ea#%!e"ent #*#te" tat $on#i&e!# not on,* finan$ia, "ea#%!e#5 %t a,#o $%#to"e!5 %#ine## '!o$e##5 an& ,ea!ning "ea#%!e#. Te Ba,an$e& S$o!e$a!& f!a"eo!( i# &e'i$te& in te fo,,oing &iag!a": Te a,an$e& #$o!e$a!& t!an#,ate# te o!gani+ation9# #t!ateg* into fo%! 'e!#'e$ti)e#5 it a a,an$e eteen te fo,,oing: * * * eteen inte!na, an& e6te!na, "ea#%!e# eteen o2e$ti)e "ea#%!e# an& #%2e$ti)e "ea#%!e# eteen 'e!fo!"an$e !e#%,t# an& te &!i)e!# of f%t%!e !e#%,t# Be*on& te inan$ia, Pe!#'e$ti)e In te in&%#t!ia, age5 "o#t of te a##et# of a fi!" e!e in '!o'e!t*5 ',ant5 an& e8%i'"ent5 an& te finan$ia, a$$o%nting #*#te" 'e!fo!"e& an a&e8%ate 2o of )a,%ing to#e a##et#. In te info!"ation age5 "%$ of te )a,%e of te fi!" i# e"e&&e& in inno)ati)e '!o$e##e#5 $%#to"e! !e,ation#i'#5 an& %"an !e#o%!$e#. Te finan$ia, a$$o%nting #*#te" i# not #o goo& at )a,%ing #%$ a##et#. ESHWARI.S---LORAA BUSINESS ACADEMY Page >
Diag!a" of te Ba,an$e& S$o!e$a!& inan$ia, C%#to"e! St!ateg* B%#ine## P!o$e##e# Lea!ning = !ot Te Ba,an$e& S$o!e$a!& goe# e*on& #tan&a!& finan$ia, "ea#%!e# to in$,%&e te fo,,oing a&&itiona, 'e!#'e$ti)e#: te $%#to"e! 'e!#'e$ti)e5 te inte!na, '!o$e## 'e!#'e$ti)e5 an& te ,ea!ning an& g!ot 'e!#'e$ti)e. * * * * inan$ia, 'e!#'e$ti)e - in$,%&e# "ea#%!e# #%$ a# o'e!ating in$o"e5 !et%!n on $a'ita, e"',o*e&5 an& e$ono"i$ )a,%e a&&e&. C%#to"e! 'e!#'e$ti)e - in$,%&e# "ea#%!e# #%$ a# $%#to"e! #ati#fa$tion5 $%#to"e! !etention5 an& "a!(et #a!e in ta!get #eg"ent#. B%#ine## '!o$e## 'e!#'e$ti)e - in$,%&e# "ea#%!e# #%$ a# $o#t5 t!o%g'%t5 an& 8%a,it*. Te#e a!e fo! %#ine## '!o$e##e# #%$ a# '!o$%!e"ent5 '!o&%$tion5 an& o!&e! f%,fi,,"ent. Lea!ning = g!ot 'e!#'e$ti)e - in$,%&e# "ea#%!e# #%$ a# e"',o*ee #ati#fa$tion5 e"',o*ee !etention5 #(i,, #et#5 et$. Te#e fo%! !ea,"# a!e not #i"',* a $o,,e$tion of in&e'en&ent 'e!#'e$ti)e#. Rate!5 te!e i# a ,ogi$a, $onne$tion eteen te" - ,ea!ning an& g!ot ,ea& to ette! %#ine## '!o$e##e#5 i$ in t%!n ,ea& to in$!ea#e& )a,%e to te $%#to"e!5 i$ fina,,* ,ea&# to i"'!o)e& finan$ia, 'e!fo!"an$e. ESHWARI.S---LORAA BUSINESS ACADEMY Page >G
O2e$ti)e#5 Mea#%!e#5 Ta!get#5 an& Initiati)e# Ea$ 'e!#'e$ti)e of te Ba,an$e& S$o!e$a!& in$,%&e# o2e$ti)e#5 "ea#%!e# of to#e o2e$ti)e#5 ta!get )a,%e# of to#e "ea#%!e#5 an& initiati)e#5 &efine& a# fo,,o#: * * * * O2e$ti)e# - "a2o! o2e$ti)e# to e a$ie)e&5 fo! e6a"',e5 '!ofita,e g!ot. Mea#%!e# - te o#e!)a,e 'a!a"ete!# tat i,, e %#e& to "ea#%!e '!og!e## toa!& !ea$ing o2e$ti)e. o! e6a"',e5 te o2e$ti)e of '!ofita,e g!ot fo! "igt "ea#%!e& te * g!ot in net "a!gin. Ta!get# - te #'e$ifi$ ta!get )a,%e# tee "ea#%!e#5 fo! e6a"',e5 7 g!ot in net "a!gin. Initiati)e# - a$tion '!og!a"# to e initiate& in o!&e! to "eet te o2e$ti)e. Te#e $an e o!gani+e& fo! ea$ 'e!#'e$ti)e in a ta,e a# #on e,o. O2e$ti)e# Mea#%!e# Ta!get# Initiati)e# inan$ia, C%#to"e! P!o$e## Lea!ning Ba,an$e& S$o!e$a!& a# a St!ategi$ Manage"ent S*#te": Te Ba,an$e& S$o!e$a!& o!igina,,* a# $on$ei)e& a# an i"'!o)e& 'e!fo!"an$e "ea#%!e"ent #*#te". Hoe)e!5 it #oon e$a"e e)i&ent tat it $o%,& e %#e& a# a "anage"ent #*#te" to i"',e"ent #t!ateg* at a,, ,e)e,# of te o!gani+ation * fa$i,itating te fo,,oing f%n$tion#: 1. C,a!if*ing #t!ateg* - te t!an#,ation of #t!ategi$ o2e$ti)e# into 8%antifia,e "ea#%!e# $,a!ifie# te "anage"ent tea"9# %n&e!#tan&ing of te #t!ateg* an& e,'# to &e)e,o' a $oe!ent $on#en#%#. 7. Co""%ni$ating #t!ategi$ o2e$ti)e# - te Ba,an$e& S$o!e$a!& $an #e!)e to t!an#,ate ig ,e)e, o2e$ti)e# into o'e!ationa, o2e$ti)e# an& $o""%ni$ate te #t!ateg* effe$ti)e,* t!o%go%t te o!gani+ation. . fee&a$( an& ,ea!ning. T!an#,ating te )i#ion i# a "ean# of e6'!e##ing te "i##ion)i#ion #tate"ent# it an integ!ate& #et of o2e$ti)e# an& "ea#%!e#. Ti# fo!$e# te to' "anage"ent to &e)e,o' o'e!ationa, "ea#%!e#5 i$ !e8%i!e# te" to &i#$%##5 an& e)ent%a,,* ag!ee on5 a "ean# of a$ie)ing te goa,# of te $o"'an*. Co""%ni$ating an& ,in(ing i# a '!o$e## tat fa$i,itate# te $o""%ni$ation of #t!ategie# t!o%go%t te enti!e o!gani+ation. De'a!t"enta, an& in&i)i&%a, o2e$ti)e# "%#t e a,igne& it te #t!ateg* t!o%g e)a,%ation '!o$e&%!e# an& in$enti)e#. To a)e goa, $ong!%en$e eteen te in&i)i&%a, e"',o*ee# an& te $o"'an*5 #$o!e$a!& %#e!# engage in t!ee a$ti)itie#: $o""%ni$ating an& e&%$ating5 #etting goa,#5 an& ,in(ing !ea!&# to 'e!fo!"an$e "ea#%!e# i$ a!e in t%!n ,in(e& to te o)e!a,, #t!ateg*. Co""%ni$ating an& e&%$ating i# a$ie)e& * "aintaining 'o,i$ie# tat en#%!e a,, e"',o*ee# a!e aa!e of te #t!ategie# of te o!gani+ation. A,#o5 it i# i"'o!tant fo! te ,oe! ,e)e, e"',o*ee# to e a,e to $o""%ni$ate %'a!&# ao%t ete! o! not te #t!ategie# a!e !ea,i#ti$ f!o" te $o"'etiti)e o! o'e!ationa, 'e!#'e$ti)e. ESHWARI.S---LORAA BUSINESS ACADEMY Page >
Setting goa,# a,one i# not #%ffi$ient to $ange e"',o*ee;# "in&-#et. One te$ni8%e to en#%!e te o2e$ti)e# !e,ate& to te goa,# a!e a$ie)e& i# te %#e of a 'e!#ona, #$o!e$a!&. It i# #i"',* a $a!& tat a# info!"ation tat &e#$!ie# $o!'o!ate o2e$ti)e#5 "ea#%!e#5 an& ta!get#. E"',o*ee# o%,& $a!!* it it te". Ti# a,,o# e"',o*ee# to ette! t!an#,ate te#e o2e$ti)e# into "eaningf%, ta#(# tat i,, e,' !ea$ te#e goa,#. Lin(ing !ea!&# to 'e!fo!"an$e i# an i"'o!tant in$enti)e to e,' an o!gani+ation a$ie)e it# '%!'o#e. Wat te a,an$e& #$o!e$a!& a&&# to te t!a&itiona, "ean# of ,in(ing !ea!&# to finan$ia, 'e!fo!"an$e i# tat it ta(e# a "o!e o,i#ti$ ,oo( at te o!gani+ation. It en#%!e# tat te $o!!e$t $!ite!ia a!e %#e& a# a "ea#%!e of 'e!fo!"an$e efo!e !ea!&# a!e gi)en. Te i&ea i# tat5 if *o% a!e not %#ingti# te ea)io!. $o!!e$t in&i$ato!# to e)a,%ate 'e!fo!"an$e5 te!e%#e& i# a* ig !i#( in !ea!&ing B%#ine## ',anning i# te ti!& '!o$e## "anage!# it te a,an$e& #$o!e$a!&. B* %#ing te #$o!e$a!&5 %#ine##e# i,, integ!ate tei! #t!ategi$ ',anning an& %&geting '!o$e##e#. Ti# "a(e# #%!e tat te %&get# #%''o!t te #t!ategie# of te $o"'an*. Te %#e!# of te #$o!e$a!& 'i$( "ea#%!e# tat !e'!e#ent ea$ of te fo%! 'e!#'e$ti)e#5 an& ten #et ta!get# fo! ea$. Ten te* i,, &e$i&e i$ #'e$ifi$ a$tion# i,, e,' te" in !ea$ing to#e ta!get#. U#ing #o!t-te!" "i,e#tone# to e)a,%ate te '!og!e## toa!& te #t!ategi$ goa, i# at !e#%,t# f!o" %#ing te a,an$e& #$o!e$a!&. Te fo%!t5 an& fina,5 '!o$e## i# fee&a$( an& ,ea!ning. Wit te a,an$e& #$o!e$a!& in ',a$e "anage!# $an "onito! fee&a$( an& !e,ate ti# to te #t!ateg*. Te fi!#t t!ee '!o$e##e# a!e )e!* i"'o!tant5 %t te* &e"an& a $on#tant o2e$ti)e. An* &e)iation f!o" te ',an i# $on#i&e!e& a &efe$t. B* a&&ing te fee&a$( an& ,ea!ning '!o$e##5 te #$o!e$a!& e$o"e# a,an$e& * '!o)i&ing !ea, ti"e info!"ation to enan$e #t!ategi$ ,ea!ning. Te a,an$e& #$o!e$a!& #%'',ie# t!ee e##entia, ite"# to #t!ategi$ ,ea!ning. i!#t5 it a!ti$%,ate# te )i#ion. Te o,i#ti$ )i#ion i# $o""%ni$ate& to te enti!e o!gani+ation5 an& te in&i)i&%a, effo!t# a!e ,in(e& to %#ine## %nit o2e$ti)e#. Se$on&5 te #$o!e$a!& #%'',ie# a #t!ategi$ fee&a$( #*#te".Ti# #*#te" )ie# te #t!ategie# a# *'ote#e#5 an& #o%,& e a,e to te#t5 )a,i&ate5 an& "o&if* te#e *'ote#e#. Ti!&5 te a,an$e& #$o!e$a!& fa$i,itate# #t!ateg* !e)ie. In#tea& of %#ing 'e!io&i$ "eeting# to e)a,%ate 'a#t 'e!fo!"an$e# a# te t!a&itiona, finan$ia, !e)ie '!o$e## &oe#5 ESHWARI.S---LORAA BUSINESS ACADEMY Page
#$o!e$a!& %#e!# !e)ie te fee&a$( in a a* to gain a ette! %n&e!#tan&ing of if te #t!ateg* i# eing !ea$e&5 o i# it eing !ea$e&5 an& #o%,& te #t!ateg* e "o&ifie& a#e& on ne info!"ation. Ti# gi)e# te o!gani+ation a fo!a!& fo$%#. Te a,an$e& #$o!e$a!& fa$i,itate# an o!gani+ation9# ',an to a,ign "anage"ent '!o$e##e# an& fo$%#e# it te ,ong-te!" #t!ateg* of te $o"'an*. Wito%t te #$o!e$a!& it o%,& e nea!,* i"'o##i,e to "aintain a $on#i#ten$* of )i#ion an& a$tion i,e atte"'ting to int!o&%$e ne #t!ategie# an& '!o$e##e#. KTe a,an$e& #$o!e$a!& '!o)i&e# a f!a"eo!( fo! "anaging te i"',e"entation of a #t!ateg*5 i,e a,#o a,,oing te #t!ateg* to e)o,)e in !e#'on#e to $ange# in te $o"'an*;# $o"'etiti)e5 "a!(et5 an& te$no,ogi$a, en)i!on"ent#. Te St!ategi$ P,anning P!o$e## In te 1G9#5 "an* ,a!ge fi!"# a&o'te& a fo!"a,i+e& to'-&on #t!ategi$ ',anning "o&e,. Un&e! ti# "o&e,5 #t!ategi$ ',anning e$a"e a &e,ie!ate '!o$e## in i$ to' e6e$%ti)e# 'e!io&i$a,,* o%,& fo!"%,ate te fi!"9# #t!ateg*5 ten $o""%ni$ate it &on te o!gani+ation fo! i"',e"entation. Te fo,,oing i# a f,o$a!t "o&e, of ti# '!o$e##: Ti# '!o$e## i# "o#t a'',i$a,e to #t!ategi$ "anage"ent at te %#ine## %nit ,e)e, of te o!gani+ation. o! ,a!ge $o!'o!ation#5 #t!ateg* at te $o!'o!ate ,e)e, i# "o!e $on$e!ne& it "anaging a 'o!tfo,io of %#ine##e#. o! e6a"',e5 $o!'o!ate ,e)e, #t!ateg* in)o,)e# &e$i#ion# ao%t i$ %#ine## %nit# to g!o5 !e#o%!$e a,,o$ation a"ong te %#ine## %nit#5 ta(ing a&)antage of #*ne!gie# a"ong te %#ine## %nit#5 an& "e!ge!# an& a$8%i#ition#. In te '!o$e## o%t,ine& e!e5 4$o"'an*4 o! 4fi!"4 i,, e %#e& to &enote a #ing,e-%#ine## fi!" o! a #ing,e %#ine## %nit of a &i)e!#ifie& fi!". Mi##ion A $o"'an*9# "i##ion i# it# !ea#on fo! eing. Te "i##ion often i# e6'!e##e& in te fo!" of a "i##ion #tate"ent5 i$ $on)e*# a #en#e of '%!'o#e to e"',o*ee# an& '!o2e$t# a $o"'an* i"age to $%#to"e!#. In te #t!ateg* fo!"%,ation '!o$e##5 te "i##ion #tate"ent #et# te "oo& of e!e te $o"'an* #o%,& go. O2e$ti)e# O2e$ti)e# a!e $on$!ete goa,# tat te o!gani+ation #ee(# to !ea$5 fo! e6a"',e5 an ea!ning# g!ot ta!get. Te o2e$ti)e# #o%,& e $a,,enging %t a$ie)a,e. Te* a,#o #o%,& e "ea#%!a,e #o tat te $o"'an* $an "onito! it# '!og!e## an& "a(e $o!!e$tion# a# nee&e&. ESHWARI.S---LORAA BUSINESS ACADEMY Page 1
Te St!ategi$ P,anning P!o$e## Mi##ion X O2e$ti)e# X Sit%ation Ana,*#i# X St!ateg* o!"%,ation X I"',e"entation X Cont!o, Sit%ation Ana,*#i# On$e te fi!" a# #'e$ifie& it# o2e$ti)e#5 it egin# it it# $%!!ent #it%ation to &e)i#e a #t!ategi$ ',an to !ea$ to#e o2e$ti)e#. Cange# in te e6te!na, en)i!on"ent often '!e#ent ne o''o!t%nitie# an& ne a*# to !ea$ te o2e$ti)e#. An en)i!on"enta, #$an i# 'e!fo!"e& to i&entif* te a)ai,a,e o''o!t%nitie#. Te fi!" a,#o "%#t (no it# on $a'ai,itie# an& ,i"itation# in o!&e! to Te #e,e$t te o''o!t%nitie# tat it in)o,)e# $an '%!#%e a ige! '!oai,it* of #%$$e##. #it%ation ana,*#i# te!efo!e an it ana,*#i# of ot te e6te!na, an& inte!na, en)i!on"ent. ESHWARI.S---LORAA BUSINESS ACADEMY Page 7
Te e6te!na, en)i!on"ent a# to a#'e$t#: te "a$!o-en)i!on"ent tat affe$t# a,, fi!"# an& a "i$!o-en)i!on"ent tat affe$t# on,* te fi!"# in a 'a!ti$%,a! in&%#t!*. Te "a$!o-en)i!on"enta, ana,*#i# in$,%&e# 'o,iti$a,5 e$ono"i$5 #o$ia,5 an& te$no,ogi$a, fa$to!# an& #o"eti"e# i# !efe!!e& to a# a PEST ana,*#i#. An i"'o!tant a#'e$t of te "i$!o-en)i!on"enta, ana,*#i# i# te in&%#t!* in i$ te fi!" o'e!ate# o! i# $on#i&e!ing o'e!ating. Mi$ae, Po!te! &e)i#e& a fi)e fo!$e# f!a"eo!( tat i# %#ef%, fo! in&%#t!* ana,*#i#. Po!te!9# fo!$e# in$,%&e a!!ie!# to ent!*5 $%#to"e!#5 #%'',ie!#5 #%#tit%te '!o&%$t#5 an& !i)a,!* a"ong $o"'eting fi!"#. Te inte!na, ana,*#i# $on#i&e!# te #it%ation itin te fi!" it#e,f5 #%$ a#: * * * * * * * * * * * * * Co"'an* $%,t%!e Co"'an* i"age O!gani+ationa, #t!%$t%!e ?e* #taff A$$e## to nat%!a, !e#o%!$e# Po#ition on te e6'e!ien$e $%!)e O'e!ationa, effi$ien$* O'e!ationa, $a'a$it* B!an& aa!ene## Ma!(et #a!e inan$ia, !e#o%!$e# E6$,%#i)e $ont!a$t# Patent# an& t!a&e #e$!et# A #it%ation ana,*#i# $an gene!ate a ,a!ge a"o%nt of info!"ation5 "%$ of i$ i# not 'a!ti$%,a!,* !e,e)ant to #t!ateg* fo!"%,ation. To "a(e te info!"ation "o!e "anagea,e5 it #o"eti"e# i# %#ef%, to $atego!i+e te inte!na, fa$to!# of te fi!" a# #t!engt# an& ea(ne##e#5 an& te e6te!na, en)i!on"enta, fa$to!# a# o''o!t%nitie# an& t!eat#. S%$ an ana,*#i# often i# !efe!!e& to a# a SWOT ana,*#i#. St!ateg* o!"%,ation On$e a $,ea! 'i$t%!e of te fi!" an& it# en)i!on"ent i# in an&5 #'e$ifi$ #t!ategi$ a,te!nati)e# $an e &e)e,o'e&. Wi,e &iffe!ent fi!"# a)e &iffe!ent a,te!nati)e# &e'en&ing on tei! #it%ation5 te!e a,#o e6i#t gene!i$ #t!ategie# tat $an e a'',ie& a$!o## a i&e !ange of fi!"#. Mi$ae, Po!te! i&entifie& $o#t ,ea&e!#i'5 &iffe!entiation5 an& fo$%# a# t!ee gene!i$ #t!ategie# tat "a* e $on#i&e!e& en &efining #t!ategi$ a,te!nati)e#. Po!te! a&)i#e& again#t i"',e"enting a $o"ination of te#e #t!ategie# fo! a gi)en '!o&%$t !ate!5 e a!g%e& tat on,* one of te gene!i$ #t!ateg* a,te!nati)e# #o%,& e '%!#%e&. I"',e"entation Te #t!ateg* ,i(e,* i,, e e6'!e##e& in ig-,e)e, $on$e't%a, te!"# an& '!io!itie#. o! effe$ti)e i"',e"entation5 it nee&# to e t!an#,ate& into "o!e &etai,e& 'o,i$ie# tat $an e %n&e!#too& at te ESHWARI.S---LORAA BUSINESS ACADEMY Page <
f%n$tiona, ,e)e, of te o!gani+ation. Te e6'!e##ion of te #t!ateg* in te!"# of f%n$tiona, 'o,i$ie# a,#o #e!)e# to ig,igt an* '!a$ti$a, i##%e# tat "igt not a)e een )i#i,e at a ige! ,e)e,. Te #t!ateg* #o%,& e t!an#,ate& into #'e$ifi$ 'o,i$ie# fo! f%n$tiona, a!ea# #%$ a#: * * * * * * Ma!(eting Re#ea!$ an& &e)e,o'"ent P!o$%!e"ent P!o&%$tion H%"an !e#o%!$e# Info!"ation #*#te"# In a&&ition to &e)e,o'ing f%n$tiona, 'o,i$ie#5 te i"',e"entation 'a#e in)o,)e# i&entif*ing te$ange#. !e8%i!e&Cont!o, !e#o%!$e# an& '%tting into ',a$e te of ne$e##a!* o!gani+ationa, On$e i"',e"ente&5 te !e#%,t# te #t!ateg* nee& to e "ea#%!e& an& e)a,%ate&5 it $ange# "a&e a# !e8%i!e& to (ee' te ',an on t!a$(. Cont!o, #*#te"# #o%,& e &e)e,o'e& an& i"',e"ente& to fa$i,itate ti# "onito!ing. Stan&a!&# of 'e!fo!"an$e a!e #et5 te a$t%a, 'e!fo!"an$e "ea#%!e&5 an& a''!o'!iate a$tion ta(en to en#%!e #%$$e##. D*na"i$ an& Contin%o%# P!o$e## Te #t!ategi$ "anage"ent '!o$e## i# &*na"i$ an& $ontin%o%#. A $ange in one $o"'onent $an ne$e##itate a $ange in te enti!e #t!ateg*. A# #%$5 te '!o$e## "%#t e !e'eate& f!e8%ent,* in o!&e! to a&a't te #t!ateg* to en)i!on"enta, $ange#. T!o%go%t te '!o$e## te fi!" "a* nee& to $*$,e a$( to a '!e)io%# #tage an& "a(e a&2%#t"ent#. D!aa$(# of ti# P!o$e## Te #t!ategi$ ',anning '!o$e## o%t,ine& ao)e i# on,* one a''!oa$ to #t!ategi$ "anage"ent. It i# e#t #%ite& fo! #ta,e en)i!on"ent#. A &!aa$( of ti# to'-&on a''!oa$ i# tat it "a* not e !e#'on#i)e eno%g fo! !a'i&,* $anging $o"'etiti)e en)i!on"ent#. In ti"e# of $ange5 #o"e of te "o!e #%$$e##f%, #t!ategie# e"e!ge info!"a,,* f!o" ,oe! ,e)e,# of te o!gani+ation5 e!e "anage!# a!e $,o#e! to $%#to"e!# on a &a*-to-&a* a#i#. Anote! &!aa$( i# tat ti# #t!ategi$ ',anning "o&e, a##%"e# fai!,* a$$%!ate fo!e$a#ting an& &oe# not ta(e into a$$o%nt %ne6'e$te& e)ent#. In an %n$e!tain o!,&5 ,ong-te!" fo!e$a#t# $annot e !e,ie& %'on it a ig ,e)e, of $onfi&en$e. In ti# !e#'e$t5 "an* fi!"# a)e t%!ne& to #$ena!io ',anning a# a too, fo! &ea,ing it "%,ti',e $ontingen$ie#. ESHWARI.S---LORAA BUSINESS ACADEMY Page >
Te ie!a!$* of St!ategi$ intent: St!ategi$ Intent Define& St!ategi$ intent i# a ig-,e)e, #tate"ent of te "ean# * i$ *o%! o!gani+ation i,, a$ie)e it# )i#ion. It i# a #tate"ent of &e#ign fo! $!eating a &e#i!a,e f%t%!e /#tate& in '!e#ent te!"#. Si"',* '%t5 a #t!ategi$ intent i# *o%! $o"'an*9# )i#ion of at it ant# to a$ie)e in te ,ong te!". In $o"',e6it* #$ien$e9# te!"#5 #t!ategi$ intent i# &e$o"'o#ition of e6',o!ation !%,e# into te ne6t ,e)e, of &etai,5 te ,in(age# to te e6',o!ation !%,e# an& te t!an#ition !%,e# tat &efine o it i,, "ig!ate f!o" it# $%!!ent &e#ign an& e$o#*#te" to a f%t%!e %#ine## &e#ign an& e$o#*#te".1 P%!'o#e of St!ategi$ Intent Te ,ogi$5 %ni8%ene## an& &i#$o)e!* tat "a(e *o%! #t!ategi$ intent $o"e to ,ife a!e )ita,,* fo! e"',o*ee#. a)ee6e!$i#e5 to %n&e!#tan&5 an& ,i)e a$$o!&ing toi"'o!tant it. St!ateg* #o%,& e aTe* #t!et$ not a e,ie)e fit e6e!$i#e. E6'!e##ion of #t!ategi$ intent i# to e,' in&i)i&%a,# an& o!gani+ation# #a!e te $o""on intention to #%!)i)e an& $ontin%e o! e6ten& te"#e,)e# t!o%g ti"e an& #'a$e. St!ategie# a!e in)o,)e& in te fo!"%,ation5 i"',e"entation an& e)a,%ation of #t!ateg*. Te ie!a!$* of #t!ategi$ intent ,a*# te fo%n&ation fo! #t!ategi$ "anage"ent '!o$e##. Te '!o$e## of e#ta,i#ing te ie!a!$* of #t!ategi$ intent i# )e!* $o"',e6. In ti# ie!a!$*5 te )i#ion5 "i##ion5 %#ine## &efinition an& o2e$ti)e# a!e e#ta,i#e&. o!"%,ation of #t!ategie# i# 'o##i,e on,* en #t!ategi$ intent i# $,ea!,* #et %'. Ti# #te' i# "o#t,* 'i,o#o'i$a, in nat%!e. It i,, a)e ,ong te!" i"'a$t on te o!gani+ation. i#ion i# at te to' in te ie!a!$* of #t!ategi$ intent. It i# at te fi!" o%,& %,ti"ate,* ,i(e to e$o"e. Mi##ion i# te Ke##entia, '%!'o#e of te o!gani+ation5 $on$e!ning 'a!ti$%,a!,* * it i# in e6i#ten$e5 te nat%!e of te %#ine## it i# in5 an& te $%#to"e!# it #ee(# to #e!)e an& #ati#f*.4 Te "i##ion #tate"ent# #tage te !o,e tat o!gani+ation ',a*# in #o$iet*. B%#ine## &efinition e6',ain# te %#ine## of an o!gani+ation in te!"# of $%#to"e! nee $%#to"e! g!o%'# an& a,te!nati)e te$no,ogie#. O2e$ti)e# !efe! to te %,ti"ate en& !e#%,t# i$ a!e to e a$$o"',i#e& * te o)e!a,, ',an o)e! a #'e$ifie& 'e!io& of ti"e. Te )i#ion5 "i##ion an& %#ine## &efinition &ete!"ine te %#ine## 'i,o#o'* to e a&o'te& in te ,ong !%n. Te goa,# an& o2e$ti)e# a!e #et to a$ie)e te" ESHWARI.S---LORAA BUSINESS ACADEMY Page
Unit-7 Ana,*+ing a $o"'an*;# e6te!na, en)i!on"ent: A %#ine## &oe# not f%n$tion in a )a$%%". It a# to a$t an& !ea$t to at a''en# o%t#i&e te fa$to!* an& offi$e a,,#. Te#e fa$to!# tat a''en o%t#i&e te %#ine## a!e (non a# e6te!na, fa$to!# o! inf,%en$e#. Te#e i,, affe$t te "ain inte!na, f%n$tion# of te %#ine## an& 'o##i,* te o2e$ti)e# of te %#ine## an& it# #t!ategie#. Main a$to!# Te "ain fa$to! tat affe$t# "o#t %#ine## i# te &eg!ee of $o"'etition o fie!$e,* ote! %#ine##e# $o"'ete it te '!o&%$t# tat anote! %#ine## "a(e#. Te ote! fa$to!# tat $an affe$t te %#ine## a!e: * * * * * * So$ia, o $on#%"e!#5 o%#eo,&# an& $o""%nitie# ea)e an& tei! e,ief#. o! in#tan$e5 $ange# in attit%&e toa!&# ea,t5 o! a g!eate! n%"e! of 'en#ione!# in a 'o'%,ation. Lega, te a* in i$ ,egi#,ation in #o$iet* affe$t# te %#ine##. E.g. $ange# in e"',o*"ent ,a# on o!(ing o%!#. E$ono"i$ o te e$ono"* affe$t# a %#ine## in te!"# of ta6ation5 go)e!n"ent #'en&ing5 gene!a, &e"an&5 inte!e#t !ate#5 e6$ange !ate# an& E%!o'ean an& g,oa, e$ono"i$ fa$to!#. Po,iti$a, o $ange# in go)e!n"ent 'o,i$* "igt affe$t te %#ine## e.g. a &e$i#ion to #%#i&i#e %i,&ing ne o%#e# in an a!ea $o%,& e goo& fo! a ,o$a, !i$( o!(#. Te$no,ogi$a, o te !a'i& 'a$e of $ange in '!o&%$tion '!o$e##e# an& '!o&%$t inno)ation affe$t a %#ine##. Eti$a, at i# !ega!&e& a# "o!a,,* !igt o! !ong fo! a %#ine## to &o. o! in#tan$e #o%,& it t!a&e it $o%nt!ie# i$ a)e a 'oo! !e$o!& on %"an !igt#. Canging E6te!na, En)i!on"ent Ma!(et# a!e $anging a,, te ti"e. It &oe# &e'en& on te t*'e of '!o&%$t te %#ine## '!o&%$e#5 oe)e! a %#ine## nee&# to !ea$t o! ,o#e $%#to"e!#. So"e of te "ain !ea#on# * "a!(et# $ange !a'i&,*: * * * * * C%#to"e!# &e)e,o' ne nee&# an& ant#. Ne $o"'etito!# ente! a "a!(et. Ne te$no,ogie# "ean tat ne '!o&%$t# $an e "a&e. A o!,& o! $o%nt!*i&e e)ent a''en# e.g. %,f Wa! o! foot an& "o%t &i#ea#e. o)e!n"ent int!o&%$e# ne ,egi#,ation e.g. in$!ea#e# "ini"%" age. ESHWARI.S---LORAA BUSINESS ACADEMY Page
B%#ine## an& Co"'etition To%g a %#ine## &oe# not ant $o"'etition f!o" ote! %#ine##e#5 ine)ita,* "o#t i,, fa$e a &eg!ee of $o"'etition. Te a"o%nt an& t*'e of $o"'etition &e'en&# on te "a!(et te %#ine## o'e!ate# in: * * * Man* #"a,, !i)a, %#ine##e# e.g. a #o''ing "a,, o! $it* $ent!e a!$a&e $,o#e !i)a,!*. A fe ,a!ge !i)a, fi!"# e.g. a#ing 'o&e! o! Co(e an& Pe'#i. A !a'i&,* $anging "a!(et e.g. e!e te te$no,og* i# eing &e)e,o'e& )e!* 8%i$(,* te "oi,e 'one "a!(et. A %#ine## !ea$t to a*#: an in$!ea#e in $o"'etition /e.g. a ,a%n$ of !i)a, '!o&%$t in$o%,& te fo,,oing * * * * C%t '!i$e# /%t $an !e&%$e '!ofit# I"'!o)e 8%a,it* /%t in$!ea#e# $o#t# S'en& "o!e on '!o"otion /e.g. &o "o!e a&)e!ti#ing5 in$!ea#e !an& ,o*a,t* %t $o#t# "one* C%t $o#t#5 e.g. %#e $ea'e! "ate!ia,#5 "a(e #o"e o!(e!# !e&%n&ant So$ia, En)i!on"ent an& Re#'on#ii,it* So$ia, $ange i# en te 'eo',e in te $o""%nit* a&2%#t tei! attit%&e# to a* te* ,i)e. B%#ine##e# i,, nee& to a&2%#t tei! '!o&%$t# to "eet te#e $ange#5 e.g. ta(ing #%ga! o%t of $i,&!en;# &!in(#5 e$a%#e 'a!ent# fee, tei! $i,&!en a!e a)ing too "%$ #%ga! in tei! &iet#. Te %#ine## a,#o nee&# to e aa!e of tei! #o$ia, !e#'on#ii,itie#. Te#e a!e te a* te* a$t toa!&# te &iffe!ent 'a!t# of #o$iet* tat te* $o"e into $onta$t it. Legi#,ation $o)e!# a n%"e! of te a!ea# of !e#'on#ii,it* tat a %#ine## a# it it# $%#to"e!#5 e"',o*ee# an& ote! %#ine##e#. It i# a,#o i"'o!tant to $on#i&e! te effe$t# a %#ine## $an a)e on te ,o$a, $o""%nit*. Te#e a!e (non a# te #o$ia, enefit# an& #o$ia, $o#t#. A #o$ia, enefit i# e!e a %#ine## a$tion ,ea&# to enefit# ao)e an& e*on& te &i!e$t enefit# to te %#ine## an&o! $%#to"e!. o! e6a"',e5 te %i,&ing of an att!a$ti)e ne fa$to!* '!o)i&e# e"',o*"ent o''o!t%nitie# to te ,o$a, $o""%nit*. A #o$ia, $o#t i# e!e te a$tion a# te !e)e!#e effe$t te!e a!e $o#t# i"'o#e& on te !e#t of #o$iet*5 fo! in#tan$e 'o,,%tion. Te#e e6t!a enefit# an& $o#t# a!e &i#ting%i#e& f!o" te '!i)ate enefit# an& $o#t# &i!e$t,* att!i%ta,e to te %#ine##. Te#e e6t!a $o#t an& enefit# a!e (non a# e6te!na,itie# e6te!na, $o#t# an& enefit#. ESHWARI.S---LORAA BUSINESS ACADEMY Page G
o)e!n"ent# en$o%!age #o$ia, enefit# t!o%g te %#e of #%#i&ie# an& g!ant# /e.g. !egiona, a##i#tan$e fo! %n&e)e,o'e& a!ea#. Te* a,#o &i#$o%!age #o$ia, $o#t# it fine#5 ta6e# an& ,egi#,ation. P!e##%!e g!o%'# i,, a,#o &i#$o%!age #o$ia, $o#t#. Ana,*+e te $o"'an*;# e6te!na, en)i!on"ent an& i&entif* o''o!t%nitie# an& t!eat# it fa$e#. Li#t te o''o!t%nitie# an& t!eat# te $o"'an* fa$e# in to $o,%"n# 2%#t a# *o% ,i#te& #t!engt# an& ea(ne##e# in to $o,%"n#. On$e e;)e #t%&ie& te in&%#t!* ,ife-$*$,e "o&e, an& te Po!te! -fo!$e# "o&e, in Ca'te! . Te fo%!t fo!$e !e'!e#ent# te a!!ie!# to $ange in in&%#t!* #t!%$t%!e5 eite! f!o" ne $o"'etito!# ente!ing te in&%#t!* o! $%!!ent $o"'etito!# e6i#ting te in&%#t!*. Ba!!ie!# to ent!* often in$,%&e ea)* in)e#t"ent in $a'ita,5 e8%i'"ent5 an& "a!(et &e)e,o'"ent. Ba!!ie!# to e6it often in$,%&e o%t#tan&ing a!!ant* o! #e!)i$e $ont!a$t# tat "%#t e ono!e&5 an& a,te!nati)e %#e o! 'otentia, #a,e of e8%i'"ent an& fa$i,itie#. On$e #'e$ia,i+e& fa$i,itie# a!e e#ta,i#e&5 te* a!e #e,&o" #%t &on5 %t a!e often #o,& to anote! in&%#t!* 'a!ti$i'ant. . Te fift fo!$e !e'!e#ent# te 'otentia, fo! $ange in '!o&%$t"a!(et #t!%$t%!e of te in&%#t!* t!o%g te #%#tit%tion of '!o&%$t# o! #e!)i$e# it a,te!nati)e a''!oa$e# to #ati#f*ing te $%#to"e!9# nee&#. Ti# !e8%i!e# te i&entifi$ation of 'otentia, #%#tit%te# an& te $a!a$te!i#ti$# tat o%,& $a%#e !a'i& #%#tit%tion. P!i$e often e$o"e# a &!i)e! fo! #%#tit%te#5 #%$ a# ',a#ti$# fo! "eta,# in $a!# an& ',%"ing #%'',ie#. To&a*5 te Inte!net i# e$o"ing a #%#tit%te fo! "ai, #e!)i$e an&5 e)ent%a,,*5 te,e'one #e!)i$e. ESHWARI.S---LORAA BUSINESS ACADEMY Page
C. IDENTIY ?EY SUCCESS ACTORS. Te '!i"a!* '%!'o#e of in&%#t!* ana,*#i# i# to i&entif* te !e8%i!e"ent# an& t!en&# tat &ete!"ine te (e* #%$$e## fa$to!# fo! te %#ine##. Te#e fa$to!# en$o"'a## /1 $%#to"e! !e8%i!e"ent#5 /7 $o"'etiti)e fa$to!# tat "%#t e "et5 / te !e#o%!$e !e8%i!e"ent# to i"',e"ent $o"'etiti)e #t!ateg*5 an& ote! / te$ni$a, !e8%i!e"ent# to %i,& a $o"'etiti)e 'o#ition. 1. C%#to"e!# a!e ,oo(ing fo! '!o&%$t# tat '!o)i&e #o"e ,e)e, of )a,%e fo! te '!i$e te* 'a*. Ea$ %*e! #eg"ent a# &iffe!ent !e8%i!e"ent# tat affe$t it# (e* #%$$e## fa$to!#. Re8%i!e"ent# $an in$,%&e ig 'e!fo!"an$e5 &%!ai,it*5 #'e$ia, feat%!e# o! fa#ion5 ea#e of %#e5 o! !a'i& a)ai,ai,it*. 7. Co"'eting fi!"# often %#e #i"i,a! '!o&%$t"a!(et #t!ategie#. i# often '!i$e5 8%a,it*5 &e,i)e!*. De'en&ing on tei! Co"'etition #t!ategi$ fo$%#5 ea$a#e& fi!" on "%#t &e)e,o' a #et an& of #(i,,# /#t!ategi$ ea'on# tat a,,o it to 'e!fo!" ette! tan tei! $o"'etito!# on ea$ $o"'etiti)e &i"en#ion. J o%! !e'ai!# of tei! '!o&%$t# /often ne6t &a* #e!)i$e. e!o6 '!o)i&e# G&a*5 7>-o%! !e'ai! ,a!geTe #*#te" $%#to"e!#. D. STRATEIC PERORMANCE. Pe!fo!"an$e i# an#e!)i$e o%t$o"eto oftei! #t!ateg*. #%$$e## it i$ a fi!"9# %#ine## #t!ateg* effe$ti)e,* a&&!e##e# it# in&%#t!*9# (e* #%$$e## fa$to!# i,, &ete!"ine it# #t!ategi$ 'e!fo!"an$e. St!ategi$ 'e!fo!"an$e i# "ea#%!e& in te!"# of ot finan$ia, an& "a!(et #%$$e##. 1. inan$ia, 'e!fo!"an$e i# e##entia, fo! $ontin%e& %#ine## o'e!ation#. inan$ia, $a'ai,itie# a!e $!iti$a, in #%''o!ting f%n$tiona, #t!ategie# an& "a(ing !e8%i!e& inf!a#t!%$t%!e in)e#t"ent#. o! e6a"',e5 a $o"'an* it a&e8%ate f%n&ing $an e6'an& o! in)e#t5 o! $an '!o)i&e $%#to"e! finan$ing. 7. Ma!(et #a!e &e"on#t!ate# a fi!"9# ai,it* to $!eate an& o,& $%#to"e!#5 i$ &ete!"ine# te ,ong te!" #%$$e## of a fi!". Te f!e#ne## of '!o&%$t ,ine# an& "a!(et 'o#itioning affe$t a fi!"9# ai,it* to att!a$t $%#to"e!# aea& of tei! $o"'etition. Po!te! # &o"inant e$ono"i$ feat%!e#: * HOME In&%#t!*Z# Do"inant E$ono"i$ eat%!e# I&entifi$ation of in&%#t!*;# &o"inant e$ono"i$ feat%!e# i# )e!* i"'o!tant fo! ana,*+ing a $o"'an*;# in&%#t!*;# an& $o"'etiti)e en)i!on"ent. It a,#o '!o)i&e# an o)e!)ie of te o)e! a,, ,an&#$a'e of in&%#t!*. So a#i$a,,* it e,'# te o!gani+ation to (no te &iffe!ent (in& of #t!ategi$ "o)e# tat in&%#t!* "e"e!# a!e ,i(e,* to e"',o*. So"e of te i"'o!tant in&%#t!*;# &o"inant e$ono"i$ feat%!e# a!e gi)en e,o. Ma!(et #i+e an& g!ot !ate Ma!(et #i+e !efe!# to te tota, n%"e! of fi!"# o'e!ating in te in&%#t!*. It i# a,#o i"'o!tant to (no ete! te in&%#t!* i# g!oing5 #tati$ o! &e$,ining. It &e'en&# %'on te 'o#ition of in&%#t!* in te %#ine## ,ife $*$,e i.e. ea!,*&e)e,o'"ent5 !a'i& g!ot5 ea!,* "at%!it*5 "at%!it*5 #tagnation5 &e$,ine. ESHWARI.S---LORAA BUSINESS ACADEMY Page <
N%"e! of !i)a,# O!gani+ation# #o%,& a,#o (no ete! te in&%#t!* $ontain# too "an* #"a,, !i)a,# o! i# it &o"inate& * a fe ,a!ge fi!"#. Si"i,a!,* te* #o%,& a,#o (no ao%t te )a!io%# &e)e,o'"ent in te in&%#t!* #%$ a# "e!ge!# an&a$8%i#ition# et$. S$o'e of $o"'etiti)e !i)a,!* S$o'e of $o"'etiti)e !i)a,!* i# an i"'o!tant fa$to! fo! te o!gani+ation# to (no ao%t te ,e)e, of $o"'etition. In&%#t!* "e"e!# "%#t (no ao%t te nat%!e of f%t%!e $o"'etition. o! e6a"',e if a $o"'an* !ea,i+e# tat it# f%t%!e #%$$e## &e'en&# %'on &i)e!#ifi$ation5 '!o&%$t &e)e,o'"ent an& "a!(et e6'an#ion5 ten it "%#t #ta!t ',anning f!o" te )e!* fi!#t &a*. B%*e! nee&# an& !e8%i!e"ent# In&%#t!* "e"e!# "%#t ta(e into $on#i&e!ation te nee& an& ta#te of fina, %*e!# a# e,, a# te "i&&,e"en. So5 a#i$a,,* o!gani+ation# a)e to &o a ,ot of 'e!io&i$ !e#ea!$ o!&e! tote (no te te "a2o! #ift# in %*e!# nee&# an& !e8%i!e"ent#. Te* #o%,&in a,#o (no ao%t )a!io%# fa$to!# fa$to!# affe$ting $on#%"e! ea)io!. Deg!ee of '!o&%$t &iffe!entiation P!o&%$t &iffe!entiation i# anote! i"'o!tant fa$to! fo! ana,*+ing te o)e!a,, in&%#t!* #it%ation. If a,, te '!o&%$t# of in&%#t!* a!e not f%,,* &iffe!entiate& ten it i,, in$!ea#e $o"'etition a"ong te "e"e!# of in&%#t!*. In #%$ $a#e '!i$e# of te '!o&%$t# i,, e ,o an& te ne ent!ant# i,, fin& it &iffi$%,t to $o"'ete it te e6i#ting fi!"#. P!o&%$t inno)ation P!o&%$t inno)ation $an e %#e& a# a "ea#%!e to (no te &o"inant in&%#t!* feat%!e#. If te in&%#t!* i# $a!a$te!i+e& * !a'i& '!o&%$t inno)ation an& #o!t '!o&%$t ,ife $*$,e ten te !e#ea!$ an& &e)e,o'"ent i# )e!* i"'o!tant fo! te #%$$e## of an o!gani+ation. In #%$ $a#e#5 "e"e!# of te in&%#t!* "%#t $o"e %' it ne '!o&%$t# to $o"'ete effe$ti)e,*. Pa$e of te$no,ogi$a, $ange If te in&%#t!* i# $a!a$te!i+e& * !a'i& 'a$e of te$no,ogi$a, $ange ten te a!t of te #tate te$no,og* i# i"'e!ati)e fo! te #%$$e## of o!gani+ation#. o! e6a"',e In&%#t!* of "oi,e 'one# !e8%i!e# !a'i& $ange# in te te$no,og* in o!&e! to "eet te $anging $on#%"e! &e"an&#. ESHWARI.S---LORAA BUSINESS ACADEMY Page >
e!ti$a, integ!ation It i# i"'o!tant to (no ete! te $o"'etito!# in te in&%#t!* a!e 'a!tia,,* o! f%,,* integ!ate&. Si"i,a!,* te $o"'etiti)e a&)antage# an& &i#a&)antage# of f%,,*5 'a!tia,,* an& non integ!ate& fi!"# #o%,& e ta(en into $on#i&e!ation. e!ti$a, integ!ation $an $a%#e 'otentia, $o#t of '!o&%$tion &iffe!en$e#. E$ono"ie# of #$a,e O!gani+ation# "%#t a,#o (no ao%t te &iffe!ent e$ono"ie# of #$a,e in '%!$a#ing5 "an%fa$t%!ing5 an& ote! a$ti)itie#. Te* #o%,& ana,*+e ete! te $o"'anie# it ig #$a,e o'e!ation# a# an* $o#t a&)antage o! not. An* !e&%$tion in te $o#t of '!o&%$tion ,ea&# to ige! $o"'etiti)ene## i$ %,ti"ate,* !e#%,t# ige! '!ofit#. tt':"a-,e$t%!e#.$o"tagin&%#t!*#-&o"inant-e$ono"i$-feat%!e# Co"'etiti)e En)i!on"ent Ana,*#i# Co"'etiti)e En)i!on"ent Ana,*#i# e6',ain# te #t!%$t%!e5 'a!ti$i'ant# an& fo!$e# tat affe$t te $o"'etiti)e inten#it* an& '!ofitai,it* of an in&%#t!* o! "a!(et. It i# a %#ef%, too, to $o"',e"ent a SWOT ana,*#i# an& to a##e## te att!a$ti)ene## of a 'otentia, %#ine## &i)e!#ifi$ation. i)e o!$e# Mo&e, Te e#t-(non "o&e, fo! ana,*#ing a $o"'etiti)e en)i!on"ent i# Mi$ae, Po!te!9# i)e o!$e# "o&e,. Po!te! $,a##ifie# te fi)e fo!$e# o! 4!%,e# of $o"'etition4 a#: 1. T!eat of ne ent!ant# 7. Ba!gaining 'oe! of #%'',ie!# . A fo$%#e& o! "a!(et ni$e #t!ateg* a#e& on ,oe! $o#t Con$ent!ating on a na!!o %*e! #eg"ent an& o%t$o"'eting !i)a,# * #e!)ing ni$e "e"e!# at a ,oe! $o#t tan !i)a,#. . A fo$%#e& o! "a!(et ni$e #t!ateg* a#e& on &iffe!entiation Con$ent!ating on a na!!o %*e! #eg"ent an& o%t$o"'eting !i)a,# * offe!ing ni$e "e"e!# a $%#to"i+e& '!o&%$t o! #e!)i$e tat "eet# tei! ta#te# an& !e8%i!e"ent# ette! tan !i)a,# offe!ing. ESHWARI.S---LORAA BUSINESS ACADEMY Page G7
T * ' e o f C o " ' e titi) e A & ) a n ta g e B e in g P % !# % e & S e $ tio n o f Lo e! C o#t B % * e !# D iffe !e n tia tio n A B !o a & M a !( e t T a !g e t C !o # # A N a !!o SWOT Ana,*#i# SWOT a too, an& fo! e,'# a%&iting an o!gani+ation it en)i!on"ent. i# te fi!#tana,*#i# #tage ofi# ',anning "a!(ete!# to fo$%# an& on (e* i##%e#. SWOT It #tan&# fo! #t!engt#5 ea(ne##e#5 o''o!t%nitie#5 an& t!eat#. St!engt# an& ea(ne##e# a!e inte!na, fa$to!#. O''o!t%nitie# an& t!eat# a!e e6te!na, fa$to!#. Seg" ent O ) e !a ,, L o -C o # t B !o a & L e a & e !# i' D iffe !e n tia tio n S t!a te g * S t!a te g * B e # t-C o # t P !o ) i& e ! S t!a te g * o$%#e& o$%#e& Lo D iffe !e n tia tio n C o # t S t!a te g * S t!a te g * B %*e! SWOT Ana,*#i# A #$an of te inte!na, an& e6te!na, en)i!on"ent i# an i"'o!tant 'a!t of te #t!ategi$ ',anning '!o$e##. En)i!on"enta, fa$to!# inte!na, to te fi!" %#%a,,* $an e $,a##ifie& a# #t!engt# /S o! ea(ne##e# /W5 an& to#e e6te!na, to te fi!" $an e $,a##ifie& a# o''o!t%nitie# /O o! t!eat# /T. S%$ an ana,*#i# of te #t!ategi$ en)i!on"ent i# !efe!!e& to a# a SWOT ana,*#i#. Te SWOT ana,*#i# '!o)i&e# info!"ation tat i# e,'f%, in "at$ing te fi!"9# !e#o%!$e# an& $a'ai,itie# to te $o"'etiti)e en)i!on"ent in i$ it o'e!ate#. A# #%$5 it i# in#t!%"enta, in #t!ateg* fo!"%,ation an& #e,e$tion. Te fo,,oing &iag!a" #o# o a SWOT ana,*#i# fit# into an en)i!on"enta, #$an: SWOT Ana,*#i# !a"eo!( En)i!on"enta, S$an [ Inte!na, Ana,*#i# E6te!na, Ana,*#i# [ [ St!engt# Wea(ne##e# O''o!t%nitie# T!eat# X SWOT Mat!i6 ESHWARI.S---LORAA BUSINESS ACADEMY Page G<
St!engt# A fi!"9# #t!engt# a!e it# !e#o%!$e# an& $a'ai,itie# tat $an e %#e& a# a a#i# fo! &e)e,o'ing a $o"'etiti)e a&)antage. E6a"',e# of #%$ #t!engt# in$,%&e: * * * * * * 'atent# #t!ong !an& na"e# goo& !e'%tation a"ong $%#to"e!# $o#t a&)antage# f!o" '!o'!ieta!* (no-o e6$,%#i)e a$$e## to ig g!a&e nat%!a, !e#o%!$e# fa)o!a,e a$$e## to &i#t!i%tion neto!(# Wea(ne##e# Te a#en$e of $e!tain #t!engt# "a* e )iee& a# a ea(ne##. o! e6a"',e5 ea$ of te fo,,oing "a* e $on#i&e!e& ea(ne##e#: * * * * * * ,a$( of 'atent '!ote$tion a ea( !an& na"e 'oo! !e'%tation a"ong $%#to"e!# ig $o#t #t!%$t%!e ,a$( of a$$e## to te e#t nat%!a, !e#o%!$e# ,a$( of a$$e## to (e* &i#t!i%tion $anne,# In #o"e $a#e#5 a ea(ne## "a* e te f,i' #i&e of a #t!engt. Ta(e te $a#e in i$ a fi!" a# a ,a!ge a"o%nt of "an%fa$t%!ing $a'a$it*. Wi,e ti# $a'a$it* "a* e $on#i&e!e& a #t!engt tat $o"'etito!# &o not #a!e5 it a,#o "a* e a $on#i&e!e& a ea(ne## if te ,a!ge in)e#t"ent in "an%fa$t%!ing $a'a$it* '!e)ent# te fi!" f!o" !ea$ting 8%i$(,* to $ange# in te #t!ategi$ en)i!on"ent. O''o!t%nitie# Te e6te!na, en)i!on"enta, ana,*#i# "a* !e)ea, $e!tain ne o''o!t%nitie# fo! '!ofit an& g!ot. So"e e6a"',e# of #%$ o''o!t%nitie# in$,%&e: * * * * an %nf%,fi,,e& $%#to"e! nee& a!!i)a, of ne te$no,ogie# ,oo#ening of !eg%,ation# !e"o)a, of inte!nationa, t!a&e a!!ie!# T!eat# Cange# in te e6te!na, en)i!on"enta, a,#o "a* '!e#ent t!eat# to te fi!". So"e e6a"',e# of #%$ t!eat# in$,%&e: ESHWARI.S---LORAA BUSINESS ACADEMY Page G>
* * * * #ift# in $on#%"e! ta#te# aa* f!o" te fi!"9# '!o&%$t# e"e!gen$e of #%#tit%te '!o&%$t# ne !eg%,ation# in$!ea#e& t!a&e a!!ie!# Te SWOT Mat!i6 A fi!" #o%,& not ne$e##a!i,* '%!#%e te "o!e ,%$!ati)e o''o!t%nitie#. Rate!5 it "a* a)e a ette! $an$e at &e)e,o'ing a $o"'etiti)e a&)antage * i&entif*ing a fit eteen te fi!"9# #t!engt# an& %'$o"ing o''o!t%nitie#. In #o"e $a#e#5 te fi!" $an o)e!$o"e a ea(ne## in o!&e! to '!e'a!e it#e,f to '%!#%e a $o"'e,,ing o''o!t%nit*. To &e)e,o' #t!ategie# tat ta(e into a$$o%nt te SWOT '!ofi,e5 a "at!i6 ofi# te#e fa$to!# e$on#t!%$te&. SWOT "at!i6 /a,#o (non a# a TOWS Mat!i6 #on e,o:$an SWOT TOWS Mat!i6 Te St!engt# Wea(ne##e# O''o!t%nitie# S-O #t!ategie# W-O #t!ategie# T!eat# S-T #t!ategie# W-T #t!ategie# * * * * S-O #t!ategie# '%!#%e o''o!t%nitie# tat a!e a goo& fit to te $o"'an*9# #t!engt#. W-O #t!ategie# o)e!$o"e ea(ne##e# to '%!#%e o''o!t%nitie#. S-T #t!ategie# i&entif* a*# tat te fi!" $an %#e it# #t!engt# to !e&%$e it# )%,ne!ai,it* to e6te!na, t!eat#. W-T #t!ategie# e#ta,i# a &efen#i)e ',an to '!e)ent te fi!"9# ea(ne##e# f!o" "a(ing it ig,* #%#$e'ti,e to e6te!na, t!eat#. )a,%e $ain ana,*#i# Int!o&%$tion a,%e Cain Ana,*#i# &e#$!ie# te a$ti)itie# tat ta(e ',a$e in a %#ine## an& !e,ate# te" to an ana,*#i# of te $o"'etiti)e #t!engt of te %#ine##. Inf,%entia, o!( * Mi$ae, Po!te! #%gge#te& tat te a$ti)itie# of a %#ine## $o%,& e g!o%'e& %n&e! to ea&ing#: /1 P!i"a!* A$ti)itie# - to#e tat a!e &i!e$t,* $on$e!ne& it $!eating an& &e,i)e!ing a '!o&%$t /e.g. $o"'onent a##e",* an& ESHWARI.S---LORAA BUSINESS ACADEMY Page G
/7 S%''o!t A$ti)itie#5 i$ i,#t te* a!e not &i!e$t,* in)o,)e& in '!o&%$tion5 "a* in$!ea#e effe$ti)ene## o! effi$ien$* /e.g. %"an !e#o%!$e "anage"ent. It i# !a!e fo! a %#ine## to %n&e!ta(e a,, '!i"a!* an& #%''o!t a$ti)itie#. a,%e Cain Ana,*#i# i# one a* of i&entif*ing i$ a$ti)itie# a!e e#t %n&e!ta(en * a %#ine## an& i$ a!e e#t '!o)i&e& * ote!# /4o%t #o%!$e&4. Lin(ing a,%e Cain Ana,*#i# to Co"'etiti)e A&)antage Wat a$ti)itie# a %#ine## %n&e!ta(e# i# &i!e$t,* ,in(e& to a$ie)ing $o"'etiti)e a&)antage. o! e6a"',e5 a %#ine## i$ i#e# to o%t'e!fo!" it# $o"'etito!# t!o%g &iffe!entiating it#e,f t!o%g ige! 8%a,it* i,, a)e to 'e!fo!" it# )a,%e $ain a$ti)itie# ette! tan te o''o#ition. B* $ont!a#t5 a #t!ateg* a#e& on #ee(ing $o#t ,ea&e!#i' i,, !e8%i!e a !e&%$tion in te $o#t# it te )a,%e $ain a$ti)itie#5 o! a $ain !e&%$tion in te tota, a"o%nt of a##o$iate& !e#o%!$e# %#e&. P!i"a!* A$ti)itie# P!i"a!* )a,%e a$ti)itie# in$,%&e: P!i"a!* A$ti)it* Ino%n& ,ogi#ti$# O'e!ation# De#$!i'tion A,, to#e a$ti)itie# $on$e!ne& it !e$ei)ing an& #to!ing e6te!na,,* #o%!$e& "ate!ia,# Te "an%fa$t%!e of '!o&%$t# an& #e!)i$e# - te a* in i$ !e#o%!$e in'%t# /e.g. "ate!ia,# a!e $on)e!te& to o%t'%t# /e.g. '!o&%$t# O%to%n& A,, to#e a$ti)itie# a##o$iate& it getting fini#e& goo&# an& #e!)i$e# to ,ogi#ti$# %*e!# Ma!(eting an& E##entia,,* an info!"ation a$ti)it* - info!"ing %*e!# an& $on#%"e!# ao%t #a,e# '!o&%$t# an& #e!)i$e# /enefit#5 %#e5 '!i$e et$. Se!)i$e A,, to#e a$ti)itie# a##o$iate& it "aintaining '!o&%$t 'e!fo!"an$e afte! te '!o&%$t a# een #o,& S%''o!t A$ti)itie# S%''o!t a$ti)itie# in$,%&e: Se$on&a!* A$ti)it* P!o$%!e"ent H%"an Re#o%!$e Manage"ent Te$no,og* De)e,o'"ent De#$!i'tion Ti# $on$e!n# o !e#o%!$e# a!e a$8%i!e& fo! a %#ine## /e.g. #o%!$ing an& negotiating it "ate!ia,# #%'',ie!# To#e a$ti)itie# $on$e!ne& it !e$!%iting5 &e)e,o'ing5 "oti)ating an& !ea!&ing te o!(fo!$e of a %#ine## A$ti)itie# $on$e!ne& it "anaging info!"ation '!o$e##ing an& te &e)e,o'"ent an& '!ote$tion of 4(no,e&ge4 in a %#ine## ESHWARI.S---LORAA BUSINESS ACADEMY Page G
Inf!a#t!%$t%!e Con$e!ne& it a i&e !ange of #%''o!t #*#te"# an& f%n$tion# #%$ a# finan$e5 ',anning5 8%a,it* $ont!o, an& gene!a, #enio! "anage"ent Ste'# in a,%e Cain Ana,*#i# a,%e $ain ana,*#i# $an e !o(en &on into a t!ee #e8%entia, #te'#: /1 B!ea( &on a "a!(eto!gani#ation into it# (e* a$ti)itie# %n&e! ea$ of te "a2o! ea&ing# in te "o&e, /7 A##e## te 'otentia, fo! a&&ing )a,%e )ia $o#t a&)antage o! &iffe!entiation5 o! i&entif* $%!!ent a$ti)itie# e!e a %#ine## a''ea!# to e at a $o"'etiti)e &i#a&)antage /
f%n$tion5 te* $an e $on#o,i&ate& into one5 an& te tota, n%"e! of #taff "e"e!# $an e !e&%$e&. A $o"'an* "a* ,a$( a (e* $a'ai,it*5 #%$ a# te$ni$a, inno)ation5 tat it nee&# to $o"'ete. A$8%i!ing a $o"'an* #t!ong in ti# !ega!& fi,,# te ga'. A$8%i#ition C!ite!ia: Setting o2e$ti)e# !e#%,t# in te $!eation of a #et of a$8%i#ition $!ite!ia. Te#e a!e te e,e"ent# tat &e#$!ie te i&ea, a$8%i#ition fo! te $o"'an*. Te* in$,%&e te #i+e of $o"'an* tat i,, e a$8%i!e& -- in te!"# of !e)en%e an& '!eta6 in$o"e -- e!e it i# ,o$ate&5 an& te in&%#t!* o! "a!(et ni$e# te $o"'an* #e!)e#. Dea, So%!$e#: I"',e"enting an M=A '!og!a" !e8%i!e# at i# te!"e& 4&ea, f,o4 -- eing '!e#ente& it a #tea&* #t!ea" of ig-8%a,it* a$8%i#ition $an&i&ate#. E6e$%ti)e# it !e#'on#ii,it* fo! "a(ing a$8%i#ition# %#%a,,* it '!ofe##iona,# #%$ a# atto!ne*#5 a$$o%nt# an& in)e#t"ent an(e!# neto!( tat o!( it ote! %#ine##e#. Te $o"'an* "a(e# it (non it i# #ee(ing to "a(e a$8%i#ition# an& te#e '!ofe##iona,# !efe! $o"'anie# tat a!e a goo& fit fo! te a$8%i#ition $!ite!ia te $o"'an* a# #e,e$te&. A$8%i#ition Tea" B%i,t: Se,e$ting $o"'anie# to a$8%i!e an& $o"',eting te negotiation# %' to $,o#ing of a t!an#a$tion !e8%i!e a #'e$ifi$ #et of #(i,,# an& e6'e!ien$e. Te#e in$,%&e an %n&e!#tan&ing of te ,ega, a#'e$t# of "a(ing an a$8%i#ition5 #%$ a# te &o$%"entation !e8%i!e& an& $o"',ian$e it a'',i$a,e #e$%!itie# ,a#. ?no,e&ge of %#ine## )a,%ation te$ni8%e# i# a,#o i"'o!tant to en#%!e te &ea, te!"# a!e fai! to ot 'a!tie# an& te $o"'an* &oe# not o)e!'a* fo! te a$8%i#ition. St!ategi$ ',anning #(i,, a,#o i# nee&e& -- te ai,it* to #ee o te to $o"'anie# $o%,& fit togete! #t!ategi$a,,* going fo!a!& an& ta(e a&)antage of ea$ ote!9# #t!engt#. If te "anage"ent tea" &oe# not a)e a,, of te#e #(i,,#5 o%t#i&e $on#%,tant# $an e i!e& to a##i#t o! "anage"ent 'e!#onne, i,, e a&&e& to te tea". %n&ing So%!$e# in P,a$e: A $o"'an* #ee(ing to "a(e an a$8%i#ition "a* not a)e a,, te $a# !e8%i!e& to $o"',ete te t!an#a$tion. In tat $a#e5 f%n&ing #o%!$e# "%#t e ,ine& %'. Te#e $o%,& e e8%it* 'a!tne!# o! ,en&e!# tat #'e$ia,i+e in a$8%i#ition finan$ing. Te $o"'an* #o%,& a)e te finan$ing #o%!$e# a)ai,a,e '!io! to eginning negotiation# it te $o"'an* to e a$8%i!e&. Po#t-A$8%i#ition P,an: Te &e$i#ion ete! to go aea& it an a$8%i#ition &e'en&# on o fa)o!a,e a '!i$e $an e negotiate& %t a,#o on te enefit# te $o"'an* i,, !e$ei)e afte! te t!an#a$tion i# $,o#e&. Te#e enefit# a!e 8%antifie& t!o%g $!eating a 'o#ta$8%i#ition %#ine## ',an tat '!o2e$t# te !e)en%e# an& '!ofit fo! te $o"ine& entitie#5 an& '!e#ent# #t!ategie# fo! %i,&ing te $o"ine& $o"'an*9# !e)en%e# an& "a!(et #t!engt. Te 'o#t-a$8%i#ition ',an i# '!e#ente& to te e8%it* 'a!tne!# o! ,en&e!# tat i,, e a#(e& to '!o)i&e finan$ing. Diffe!en$e eteen Me!ge!# an& A$8%i#ition# To%g te to o!&# "e!ge!# an& a$8%i#ition# a!e often #'o(en in te #a"e !eat an& a!e a,#o %#e& in #%$ a a* a# if te* a!e #*non*"o%#5 oe)e!5 te!e a!e $e!tain &iffe!en$e# eteen "e!ge!# an& a$8%i#ition#. ESHWARI.S---LORAA BUSINESS ACADEMY Page 1
Me!ge! Te $a#e en to $o"'anie# /often of #a"e #i+e &e$i&e to "o)e fo!a!& a# a #ing,e ne $o"'an* in#tea& of o'e!ating %#ine## #e'a!ate,*. Te #to$(# of ot te $o"'anie# a!e #%!!en&e!e&5 i,e ne #to$(# a!e i##%e& af!e#. o! e6a"',e5 ,a6o We,,$o"e an& S"it?,ine Bee$a" $ea#e& to e6i#t an& "e!ge& to e$o"e a ne $o"'an*5 (non a# ,a6o S"it?,ine. A$8%i#ition Te $a#e en one $o"'an* ta(e# o)e! anote! an& e#ta,i#e# it#e,f a# te ne one! of te %#ine##. Te %*e! $o"'an* K#a,,o# te %#ine## of te ta!get $o"'an*5 i$ $ea#e# to e6i#t. D!. Re&&*9# La# a$8%i!e& Beta'a!" t!o%g an ag!ee"ent a"o%nting G "i,,ion. A %*o%t ag!ee"ent $an a,#o e (non a# a "e!ge! en ot one!# "%t%a,,* &e$i&e to $o"ine tei! %#ine## in te e#t inte!e#t of tei! fi!"#. B%t en te ag!ee"ent i# o#ti,e5 o! en te ta!get fi!" i# %ni,,ing to e o%gt5 it i# $on#i&e!e& a# an a$8%i#ition. Me!ge!# = A$8%i#ition Ri#(# An a$8%i#ition o$$%!# en one $o"'an* %*# anote!. Wen to $o"'anie# ag!ee to $o"ine into one $o"'an*5 te* "e!ge. Rea#on# fo! te#e $o!'o!ate a$tion# in$,%&e a #t!ategi$ ',an to e,i"inate $o"'etition * a$8%i!ing it5 a &e#i!e to e6'an& into anote! geog!a'i$a, a!ea o! '!o&%$t ,ine o! a nee& to #e,, o! "e!ge te $o"'an* e$a%#e of one! !eti!e"ent o! $o!'o!ate finan$ia, &iffi$%,tie#. Bot $o"'anie# fa$e #%#tantia, !i#(#. It i# not %n%#%a, fo! one $o"'an* #ee(ing to a$8%i!e anote! to en& %' eing a$8%i!e& it#e,f5 an& a$8%i#ition ',an# #o"eti"e# e$o"e "e!ge!#. 1. Re$(,e## Ent%#ia#": Me!ge!# an& a$8%i#ition#5 a,#o (non a# M=A5 egin in #t!ategi$ ',anning #e##ion#5 en $o"'an* "anage"ent &e$i&e# to a$8%i!e anote! $o"'an*5 to e a$8%i!e& o! to "e!ge. Te ne6t #te' i# i!ing an in)e#t"ent an(e! o! atto!ne* #'e$ia,i+ing in M=A o!(. Te enti!e '!o$e## i# ,ong5 ti"e-$on#%"ing an& #t!e##f%,. Mo#t M=A #'e$ia,i#t# #a* te "o#t &ange!o%# 'a!t i# '!o2e$t fatig%e5 i$ $a%#e# $o"'an* "anage"ent to &e$i&e on a $an&i&ate 2%#t to get te ta#( o)e! it. Re$(,e## ent%#ia#" o!n of '!o2e$t fatig%e i# one of te "ain !ea#on# fo! fai,%!e# of "e!ge!# o! a$8%i#ition#. Ret%!n on In)e#t"ent: Te !ong a$8%i#ition $an #e)e!e,* a!" a $o"'an*9# '!ofitai,it*. Wen AT=T a$8%i!e& NCR5 afte! fi)e *ea!# of #tea&i,* a$$%"%,ating ,o##e# tota,ing 7 i,,ion5 AT=T fina,,* a&"itte& te fai,%!e an& #o,& it# #ta(e in NCR. Ti"e Wa!ne!9# '%!$a#e of AOL a,#o en&e& in *ea!# of ,o##e# an& an e)ent%a, #'in-off of AOL. M%$ &eate in te M=A in&%#t!* $ente!# a!o%n& ete! to 'e!fo!" e6a%#ti)e &%e &i,igen$e an& negotiation# o! to 2%#t 2%"' in an& %* o! "e!ge it te fi!#t $o"'an* tat ,oo(# goo&5 o!!*ing ao%t te $on#e8%en$e# ,ate!. De,oitte = To%$e LLP $o%n#e,# a !oa&-a#e& a''!oa$ ESHWARI.S---LORAA BUSINESS ACADEMY Page 1
in)o,)ing e6a"ination of a,, 'a!t# of a $an&i&ate $o"'an*5 it ',anne& !i#( "anage"ent at "%,ti',e ,e)e,#. Co!'o!ate Integ!ation: Te #e$on& "ain !i#( in M=A '!o2e$t# i# 'oo! integ!ation of te $o"'anie#. An e6a"',e of ti# i# en a $o"'an* a$8%i!e# anote! fo! a #'e$ifi$ te$no,og* it &e)e,o'e& an& ten in te $onf%#ion of integ!ating te to $o"'anie# "i#ta(en,* $,o#e# te &e'a!t"ent tat $!eate& te ta!gete& te$no,og* a##et. Ote! e6a"',e# of 'oo! integ!ation a!e $o"'an* $%,t%!e $,a#e#5 a# in te Dai",e! Ben+-C!*#,e! "e!ge! e!e e!"an effi$ien$* "et ea&-on it A"e!i$an %nion o!( !%,e#. A ti!& e6a"',e of $o""on integ!ation fai,%!e i# te ,o## of i"'o!tant $%#to"e!# o ,i(e& &oing %#ine## it te o,& $o"'an*5 not te ne one. Te #o,%tion i# &etai,e& ',anning an& te#ting of &e$i#ion#5 it a $ent!a,i+e& integ!ation "anage"ent tea" te tat "onito!# e)e!* e,e"ent of te '!o2e$t. Lega, S%!'!i#e#: No "atte! o $a!ef%, &%e &i,igen$e effo!t5 nea!,* e)e!* "e!ge! an& a$8%i#ition e6'e!ien$e# ,ega, #%!'!i#e#. Te#e a!e often in te fo!" of ,a#%it# tat te ',aintiff# #%&&en,* &e$i&e to fi,e e$a%#e te $o"ination of $o"'anie# a# '!e#ente& g!eate! a##et# to atta$. Yo% $an e6'e$t e)e!*ting f!o" e6'i!ing 'atent#5 $an$e,e& ,i$en#e#5 %n!e'o!te& f!a%&5 inf!inge"ent on anote! $o"'an*9# 'atent an& #a!eo,&e! $,a## a$tion #%it#. Ri#( "anage"ent5 in ti# $a#e5 in)o,)e# te e#t &ea, $ont!a$t# tat $an e $!eate&5 i$ i# * goo& M=A atto!ne*# a!e #o ne$e##a!* an& e6'en#i)e. o Me!ge! an& A$8%i#ition St!ategie# Me!ge! an& a$8%i#ition a!e te $o!'o!ate #t!ategie# tat &ea, it %*ing5 #e,,ing o! $o"ining &iffe!ent $o"'anie# it a goa, to a$ie)e !a'i& g!ot. Hoe)e!5 te &e$i#ion# on "e!ge!# an& a$8%i#ition# a!e ta(en afte! $on#i&e!ing a fe fa$t# ,i(e te $%!!ent %#ine## #tat%# of te $o"'anie#5 te '!e#ent "a!(et #$ena!io5 an& te t!eat# an& o''o!t%nitie# et$. In fa$t5 te #%$$e## of "e!ge!# an& a$8%i#ition# ,a!ge,* &e'en& %'on te "e!ge! an& a$8%i#ition #t!ategie# a&o'te& * te o!gani+ation#. Me!ge! an& a$8%i#ition #t!ategie# a!e te !oa&"a' fo! te $o!'o!ate &e)e,o'"ent effo!t# of an o!gani+ation. Te #t!ategie# on "e!ge! an& a$8%i#ition a!e &e)i#e& to t!an#fo!" te #t!ategi$ %#ine## ',an of te o!gani+ation to a ,i#t of ta!get a$8%i#ition '!o#'e$t#. Te "e!ge! an& a$8%i#ition #t!ategie# offe! a f!a"eo!(5 i$ e)a,%ate# a$8%i#ition $an&i&ate# an& e,'# te o!gani+ation to i&entif* te #%ita,e one#. Man* ig $o"'anie# $ontin%o%#,* ,oo( o%t fo! 'otentia, $o"'anie#5 '!efe!a,* #"a,,e! one#5 fo! "e!ge!# an& a$8%i#ition#. So"e $o"'anie# "a* a)e tei! $o!e $e,,#5 i$ $on$ent!ate on "e!ge!# an& a$8%i#ition#. Me!ge! an& a$8%i#ition #t!ategie# a!e &e)i#e& in a$$o!&an$e it te 'o,i$* of te o!gani+ation. So"e "a* '!efe! to &i)e!#if* o! to e6'an& in a #'e$ifi$ fie,& of %#ine##5 i,e #o"e ote!# "a* i# to #t!engten tei! !e#ea!$ fa$i,itie# et$. Me!ge! an& A$8%i#ition St!ateg* P!o$e## ESHWARI.S---LORAA BUSINESS ACADEMY Page 1G
Te "e!ge! an& a$8%i#ition #t!ategie# "a* &iffe! f!o" $o"'an* to $o"'an* an& a,#o &e'en& a ,ot on te 'o,i$* of te !e#'e$ti)e o!gani+ation. Hoe)e!5 "e!ge! an& a$8%i#ition #t!ategie# a)e got #o"e &i#tin$t '!o$e##5 a#e& on i$5 te #t!ategie# a!e &e)i#e&. Dete!"ine B%#ine## P,an D!i)e!#: Me!ge! an& a$8%i#ition #t!ategie# a!e &e&%$e& f!o" te #t!ategi$ %#ine## ',an of te o!gani+ation. So5 in "e!ge! an& a$8%i#ition #t!ategie#5 *o% fi!#t,* nee& to fin& o%t te a* to a$$e,e!ate *o%! #t!ategi$ %#ine## ',an t!o%g te M=A. Yo% nee& to t!an#fo!" te #t!ategi$ %#ine## ',an of *o%! o!gani+ation into a #et of $a,(ing &!i)e!#5 o%t i$ *o%! "e!ge! an& a$8%i#ition #t!ategie# o%,& a&&!e##. Wi,e #t!ategie#5 *o% nee& to $on#i&e! te 'oint# ,i(e te "a!(et# of *o%! inten&e& %#ine##5 te "a!(et #a!e tat *o% a!e e*eing fo! in ea$ "a!(et5 te '!o&%$t# an& te$no,ogie# tat *o% o%,& !e8%i!e5 te geog!a'i$ ,o$ation# e!e *o% o%,& o'e!ate *o%! %#ine## in5 te #(i,,# an& !e#o%!$e# tat *o% o%,& !e8%i!e5 te finan$ia, ta!get#5 an& te !i#( a"o%nt et$. Dete!"ine A$8%i#ition inan$ing Con#t!aint#: No5 *o% nee& to fin& o%t if te!e a!e an* finan$ia, $on#t!aint# fo! #%''o!ting te a$8%i#ition. %n&# fo! a$8%i#ition# "a* $o"e t!o%g )a!io%# a*# ,i(e $a#5 &et5 '%,i$ an& '!i)ate e8%itie#5 PIPE#5 "ino!it* in)e#t"ent#5 ea!n o%t# et$. Yo% nee& to $on#i&e! a fe fa$t# ,i(e te a)ai,ai,it* of %nta''e& $!e&it fa$i,itie#5 #%!',%# $a#5 o! %nta''e& e8%it*5 te a"o%nt of ne e8%it* an& ne &et tat *o%! o!gani+ation $an !ai#e et$. Yo% a,#o nee& to $a,$%,ate te a"o%nt of !et%!n# tat *o% "%#t a$ie)e. De)e,o' A$8%i#ition Can&i&ate Li#t: No *o% a)e to i&entif* te #'e$ifi$ $o"'anie# /'!i)ate an& '%,i$ tat *o% a!e e*eing fo! a$8%i#ition. Yo% $an i&entif* to#e * "a!(et !e#ea!$5 '%,i$ #to$( !e#ea!$5 !efe!!a,# f!o" oa!& "e"e!#5 in)e#t"ent an(e!#5 in)e#to!# an& atto!ne*#5 an& e)en !e$o""en&ation# f!o" *o%! e"',o*ee#. Yo% a,#o nee& to &e)e,o' #%""a!* '!ofi,e fo! e)e!* $o"'an*. B%i,& P!e,i"ina!* a,%ation Mo&e,#: Ti# #tage i# to $a,$%,ate te initia, e#ti"ate& a$8%i#ition $o#t5 te e#ti"ate& !et%!n# et$. Man* o!gani+ation# a)e tei! on fo!"at# fo! '!e#enting '!e,i"ina!* )a,%ation. RateRan( A$8%i#ition Can&i&ate#: Rate o! !an( te a$8%i#ition $an&i&ate# a$$o!&ing to tei! i"'a$t on %#ine## an& fea#ii,it* of $,o#ing te &ea,. Ti# '!o$e## i,, e,' *o% in %n&e!#tan&ing te !e,ati)e i"'a$t# of te a$8%i#ition#. Re)ie an& A''!o)e te St!ateg*: Ti# i# te ti"e to !e)ie an& a''!o)e *o%! "e!ge! an& a$8%i#ition #t!ategie#. Yo% nee& to fin& o%t ete! a,, te $!iti$a, #ta(eo,&e!# ,i(e oa!& "e"e!#5 in)e#to!# et$. ag!ee it it o! not. If e)e!*one gi)e# tei! no&# on te #t!ategie#5 *o% $an go aea& it te "e!ge! o! a$8%i#ition. ESHWARI.S---LORAA BUSINESS ACADEMY Page 1J
Me!ge! an& A$8%i#ition P!o$e## Me!ge!# an& a$8%i#ition# a!e 'a!t# of $o!'o!ate #t!ategie# tat &ea, it %*ing #e,,ing o! $o"ining of %#ine## entitie#5 i$ in t%!n5 e,' a $o"'an* to g!o 8%i$(,*. Hoe)e!5 "e!ge! an& a$8%i#ition '!o$e## i# 8%ite a $o"',e6 '!o$e## tat $on#i#t# of a fe #te'#. Befo!e going fo! an* "e!ge! an& a$8%i#ition5 ot te $o"'anie# nee& to $on#i&e! a fe 'oint# an& a,#o nee& to go t!o%g #o"e &i#tin$t #te'#. Te "e!ge! an& a$8%i#ition '!o$e## i# a,#o a ig 'oint of $on$e!n fo! te $o"'anie# in)o,)e& in te &ea,5 a# te '!o$e## $o%,& e f%,, of !i#( an& %n$e!taint*. Hoe)e!5 '!io! effe$ti)e ',anning an& !e#ea!$ $o%,& "a(e te '!o$e## ea#* an& #i"',e. Ste'# of Me!ge!# an& A$8%i#ition P!o$e## Te '!o$e## of "e!ge! an& a$8%i#ition a# te #te'#: Ma!(ettat a,%ation Befo!e fo! an* "e!ge! an& a$8%i#ition5 it fo,,oing i# of %t"o#t i"'o!tant *o% "%#t (no*o% tego '!e#ent "a!(et )a,%e of te o!gani+ation a# e,, a# it# e#ti"ate& f%t%!e finan$ia, 'e!fo!"an$e. Te info!"ation ao%t o!gani+ation5 it# i#to!*5 '!o&%$t##e!)i$e#5 fa$i,itie# an& one!#i'# a!e !e)iee&. Sa,e# o!gani+ation an& "a!(eting a''!oa$e# a!e a,#o ta(en into $on#i&e!ation. E6it P,anning: Te &e$i#ion to #e,, %#ine## ,a!ge,* &e'en&# %'on te f%t%!e ',an of te o!gani+ation at &oe# it ta!get to a$ie)e an& o i# it going to an&,e te ea,t et$. a!io%# i##%e# ,i(e e#tate ',anning5 $ontin%ing %#ine## in)o,)e"ent5 &et !e#o,%tion et$. a# e,, a# ta6 i##%e# an& %#ine## i##%e# a!e $on#i&e!e& efo!e "a(ing e6it ',anning. Te #t!%$t%!e of te &ea, ,a!ge,* &e'en&# %'on te a)ai,a,e o'tion#. Te fo!" of $o"'en#ation /#%$ a# $a#5 #e$%!e& note#5 #to$(5 $on)e!ti,e on !o*a,tie#5 f%t%!e ea!ning# #a!e5 $on#%,ting ag!ee"ent#5 o! %* a$( o''o!t%nitie# et$. a,#o ',a*# a "a2o! !o,e e!e in &ete!"ining te e6it ',anning. St!%$t%!e& Ma!(eting P!o$e## Ti# i# "e!ge! an& a$8%i#ition '!o$e## in)o,)e# "a!(eting of te %#ine## entit*. Wi,e &oing te "a!(eting5 #e,,ing '!i$e i# ne)e! &i)%,ge& to te 'otentia, %*e!#. Se!io%# %*e!# a!e a,#o i&entifie& an& ten en$o%!age& &%!ing te '!o$e##. o,,oing a!e te feat%!e# of ti# 'a#e. * * * * Se,,e! ag!ee# on te &i##e"inate& "ate!ia,# in a&)an$e. B%*e! a,#o nee&# to #ign a NonDi#$,o#%!e ag!ee"ent. Se,,e! a,#o '!e#ent# Me"o!an&%" an& P!ofi,e#5 i$ fa$t%a,,* #o$a#e# te %#ine##. Dataa#e of '!o#'e$ti)e %*e!# a!e #ea!$e&. A##e##"ent an& #$!eening of %*e!# a!e &one. Page 1 ESHWARI.S---LORAA BUSINESS ACADEMY
* * S'e$ia, fo$%#e# a!e gi)en on e 'e!#ona, nee&# of te #e,,e! &%!ing #t!%$t%!ing of &ea,#. ina, ,ette! of intent i# &e)e,o'e& afte! a 'a#e of negotiation. Lette! of Intent Bot5 %*e! an& #e,,e! ta(e te ,ette! of intent to tei! !e#'e$ti)e atto!ne*# to fin& o%t ete! te!e i# an* #$o'e of f%!te! negotiation ,eft o! not. I##%e# ,i(e '!i$e an& te!"#5 &e$i&ing on &%e &i,igen$e 'e!io&5 &ea, #t!%$t%!e5 '%!$a#e '!i$e a&2%#t"ent#5 ea!n o%t '!o)i#ion# ,iai,it* o,igation#5 ISRA an& ERISA i##%e#5 Non-#o,i$itation ag!ee"ent5 B!ea(%' fee# an& no #o' '!o)i#ion#5 '!e $,o#ing ta6 ,iai,itie#5 '!o&%$t ,iai,it* i##%e#5 'o#t $,o#ing in#%!an$e 'o,i$ie#5 !e'!e#entation# an& a!!antie#5 an& in&e"nifi$ation i##%e# et$. a!e negotiate& in te Lette! of Intent. Afte! !e)ieing5 a Definiti)e P%!$a#e Ag!ee"ent i# '!e'a!e&. B%*e! D%e Di,igen$e Ti# i# te 'a#e in te "e!ge! an& a$8%i#ition '!o$e## e!e #e,,e! "a(e# it# %#ine## '!o$e## o'en fo! te %*e!5 #o tat it $an "a(e an in-&e't in)e#tigation on te %#ine## a# e,, a# it# atto!ne*#5 an(e!#5 a$$o%ntant#5 ta& a&)i#o!# et$. Definiti)e P%!$a#e Ag!ee"ent: ina,,* Definiti)e P%!$a#e Ag!ee"ent a!e "a&e5 i$ #tate# te t!an#a$tion &etai,# in$,%&ing !eg%,ato!* a''!o)a,#5 finan$ing #o%!$e# an& ote! $on&ition# of #a,e. O%t#o%!$ing - A St!ategi$ De$i#ion3 Doe# #t!ategi$ o%t#o%!$ing a$t%a,,* enefit an o!gani+ation3 O! i,, it a$(fi!e in te ,ong !%n3 He!e9# o o%t#o%!$ing a# i"'a$te& o!gani+ation# in In&ia5 an& o it $an enefit *o%. * So%ti"an Da# %'ta Wat &o $o"'anie# ,i(e He!o Hon&a Moto!#5 Ba!ti Te,e-ent%!e# Li"ite&5 te Nationa, Sto$( E6$ange /NSE5 HDC Ban(5 Son* Ente!tain"ent Te,e)i#ion5 H*att Se!)i$e# In&ia P)t. Lt&5 an& HPCL a)e in $o""on3 Te $o""on t!ea& !%nning t!o%g te#e ,a!ge o!gani+ation# i# tat a,, of te" a)e $o#en o%t#o%!$ing a# a #t!ategi$ %#ine## &e$i#ion to ga!ne! tangi,e an& intangi,e enefit# in te nea! an& ,ong !%n. In&ee&5 it9# &iffi$%,t to fin& a #%$$e##f%, an& g!oing o!gani+ation in In&ia5 i!!e#'e$ti)e of #i+e5 tat &oe# not o%t#o%!$e a $e!tain a"o%nt of it# IT inf!a#t!%$t%!e #e!)i$e# o! "anage"ent. o$%# on te $o!e: ESHWARI.S---LORAA BUSINESS ACADEMY Page 11
i)en te '!e##%!e# of a $o"'etiti)e "a!(et5 o!gani+ation# ten& to fo$%# on tei! $o!e a$ti)itie# Q a$ti)itie# tat ,in(-%' &i!e$t,* it te !e)en%e# an& en$e te '!ofitai,it*. In #%$ a #$ena!io5 $o"'anie# ten& to o%t#o%!$e tei! non-$o!e ta#(# to fo$%# on %#ine## &e$i#ion-"a(ing. An& IT inf!a#t!%$t%!e ea#i,* ,en&# it#e,f to o%t#o%!$ing. He!o Hon&a Moto!# i# a goo& e6a"',e of an o!gani+ation tat %#e# #t!ategi$ o%t#o%!$ing to fo$%# on $o!e $o"'eten$*. KWe ante& to o%t#o%!$e a,, !o%tine /IT "aintenan$e ta#(# #o tat e $o%,& $on$ent!ate on te "ain %#ine## i##%e#. Wit te ea&a$e of &ea,ing it !o%tine $o"',aint# ta(en aa*5 o%! #taff fo$%#e# on %#e! !e8%i!e"ent# an& i# a,e to &e,i)e! #e!)i$e# to %#e!# on ti"e5 e6',ain# SR Ba,a#%!a"anian5 i$e P!e#i&ent - Info!"ation S*#te"#5 He!o Hon&a Moto!# Li"ite&. Co"'etiti)e %#ine## #t!ateg*: O%t#o%!$ing i# e#t a&o'te& afte! a $a!ef%, ,oo( at %#ine## nee&# an& a)ai,a,e o'tion#. It i# e##entia, tat te o%t#o%!$ing !e,ation#i' '!o)i&e# #t!ategi$ %#ine## enefit# in te f%t%!e. KO%t#o%!$ing '!o)i&e# a $o"'etiti)e #t!ateg* enefit in a n%"e! of a*# to an o!gani+ation. It a,,o# ea#e of "anage"ent5 !e&%$tion in $o#t5 ,e##e! "an'oe!5 an& f!ee# %' inte!na, !e#o%!$e#5 #a*# Pan(a2. KO%t#o%!$ing $an5 an& f!e8%ent,* &oe#5 '!o)i&e ot ,ong- an& #o!t-te!" enefit# to $o"'anie# tat o%t#o%!$e5 '!o)i&e& te* a)e a #t!ategi$ o2e$ti)e fo! o%t#o%!$ing. Me&i%" an& ,ong-te!" gain# a!e e#t !ea,i#e& * #e,e$ting a )en&o! o !ing# )a,%e to *o%! $o!e %#ine##5 !ate! tan one o $an '!o)i&e *o% it te ,oe#t '!i$e#5 e6',ain# Sa!a& Sangi5 Managing Di!e$to! = CEO5 Net"agi$ So,%tion P)t. Lt&. B%#ine##-!e,ate&: It9# i"'o!tant to %n&e!#tan& tat o%t#o%!$ing i# a %#ine##-!e,ate& &e$i#ion an& not #i"',* an IT nee&. Te %,ti"ate goa, of o%t#o%!$ing i# to !ing enefit# to te %#ine## an& #%#e8%ent,* te $%#to"e!. He!o Hon&a9# Ba,a#%!a"anian #a*#5 KWe e,ie)e an o%t#o%!$ing #e!)i$e '!o)i&e! $o%,& ette! an&,e o%! &a*-to-&a* "anage"ent nee&# tan o%! on tea". We9)e not a&&e& n%"e!# to o%! #taffing in #'ite of in$!ea#e& %#ine## a$ti)it*. Sin$e te o%t#o%!$ing agen$* "anage# te &ata $ent!e !o%n& te $,o$(5 o%! #taff a# een !e,ie)e& f!o" o!(ing in #ift#. Ko! $%#to"e!#5 it !ing# inno)ati)e an& #t!ea",ine& '!o&%$t# an& #e!)i$e# ,i(e i,,ing5 CRM an& &ata a!eo%#ing. o! e"',o*ee#5 it !ing# enan$e& 'e!fo!"an$e-$!iti$a, a'',i$ation# ,i(e int!anet5 e-"ai, an& on,ine $o,,ao!ation. An& at an o)e!a,, ,e)e,5 te #t!ategi$ a,,ian$e '!o)i&e# ESHWARI.S---LORAA BUSINESS ACADEMY Page 111
'!e&i$ta,e IT #'en an& a&&itiona, !e)en%e #t!ea"# to f%!te! enan$e #a!eo,&e! )a,%e5 e a&&#. Te $anging ,an&#$a'e: In te 'a#t5 In&ian $o"'anie# e!e not )e!* (een to o%t#o%!$e tei! IT nee '!i"a!i,* e$a%#e tei! ente!'!i#e IT en)i!on"ent# e!e !e,ati)e,* ,e## $o"',e65 ea#ie! to "anage5 an& ine6'en#i)e to "aintain. Be#i&e#5 fe o%t#o%!$ing #e!)i$e '!o)i&e!# offe!e& a n%"e! of o%t#o%!$ing o'tion# %n&e! one !oof. B%t no5 IT en)i!on"ent# in $o"'anie# a)e e$o"e "o!e $o"',e6. Te!e a# een g!ot in te!"# of )o,%"e of %#ine##5 !ange of #e!)i$e#5 n%"e! of e"',o*ee#5 n%"e! of $o"'etito!#5 ,o$ation#5 an& ente!'!i#e a'',i$ation#. Ti# To $a,,# fo! "o!e attention to nationi&e IT a# a #e!)i$e to '!o)i&e #t!ategi$ %#ine## enefit#. e,' o!gani+ation# get o'ti"%" )a,%e o%t IT an& %#e it a# a #t!ategi$ too, to f%!te! te $a%#e of %#ine##5 "an* CIO# tin( it o!t tei! i,e to o%t#o%!$e IT inf!a#t!%$t%!e "anage"ent. Inno)ati)e o'tion#: In&ian ente!'!i#e# to&a* a)e a )a!iet* of o%t#o%!$ing o'tion# f!o" i$ te* $an $oo#e te !igt fit. O%t#o%!$ing #o,%tion '!o)i&e!# offe! #e!)i$e# tat in$,%&e &e#(to' $,ient "anage"ent5 #e!)e! "anage"ent5 $a,e "anage"ent5 fi!ea,, "anage"ent5 'at$ "anage"ent5 #ofta!e ,i$en#e "anage"ent5 IT a%&it#5 a$(one an& $onne$ti)it*5 e#ite o#ting5 an& IT inf!a#t!%$t%!e "anage"ent. T%# te a)ai,a,e #e!)i$e# a!e inno)ati)e5 #ignifi$ant,* "o!e $%#to"i#e&5 an& ette! a,igne& it in&i)i&%a, $%#to"e! !e8%i!e"ent#. An ente!'!i#e $an 'i$(-an&-$o#e #'e$ifi$ #e!)i$e# an& %i,& a !e,ia,e "o&e of #e!)i$e &e,i)e!*. A $o"'an* $an o%t#o%!$e a#i$ &e#(to' "anage"ent nee o! te "anage"ent of te enti!e nationi&e IT inf!a#t!%$t%!e if nee&e&. To int!o&%$e "o!e f,e6ii,it*5 "an* #e!)i$e '!o)i&e!# offe! $,ient# i!e-'%!$a#e #$e"e#5 inf!a#t!%$t%!e on-&e"an&5 an& 'a*-a#-*o%-%#e o'tion#. Befo!e *o% o%t#o%!$e: A,, ting# #ai&5 o%t#o%!$ing i# a #t!ategi$ %#ine## &e$i#ion tat #o%,& e "a&e on,* if a $o"'an* #ee# t!%e %#ine## enefit# a$$!%ing f!o" it. Ba&,*-',anne& o%t#o%!$ing $o%,& !e#%,t in e!o#ion of #e!)i$e )a,%e an& $o#t e#$a,ation5 %t a e,,-',anne& o%t#o%!$ing &e$i#ion $an e,' *o% #,ee' ette! at nigt5 (noing tat te !e#'on#ii,it* of &e,i)e!a,e# i# in #afe an&#. ESHWARI.S---LORAA BUSINESS ACADEMY Page 117
Mi$e,e Ca"ino# of a!tne! ig,igt# a fe #te'# tat $an ,ea& *o% to ta(e a '!o'e! &e$i#ion in ti# $onte6t. * * * * * * Wat t*'e of a #e!)i$e i# it3 I&entif* $a!a$te!i#ti$# of #e!)i$e an& te !e#'e$ti)e t*'e. Wat 'e!#'e$ti)e i# &!i)ing te effo!t3 I&entif* &e$i#ion !igt# /#e!)i$e one! an& in'%t !igt# /ote! #ta(eo,&e!#. Ho a!e ote! 'e!#'e$ti)e# affe$te&3 I&entif* $onf,i$t# an& o!( te" o%t. Ce$( 9(i,,e!9 fa$to!. I"'!o)e #o,%tion. Ce$( $o"',ian$e it '!in$i',e# an& fit it a!$ite$t%!e. Wo #o%,& $a!!* it o%t3 E)a,%ate &iffe!ent #taffing 'o##ii,itie#. Se,e$t e#t f!o" $o"ination. Wo #o%,& 'a!ti$i'ate te &e$i#ion3 S%"it #e!)i$e '!o'o#a, to #'e$ifi$ &e$i#ion '!o$e##. o,,o itin %'. Te To' 1 Ting# Yo% Nee& to ?no Ao%t O%t#o%!$ing St!ategie# 1. One a&)antage i# tat * o%t#o%!$ing5 $o"'anie# a!e a,e to fo$%# "o!e on tei! $o!e a$ti)itie#. Wen $o"'anie# g!o an& e6'an&5 te* egin to %#e "o!e !e#o%!$e# #%$ a# %"an an& finan$ia,. Ti# "a* ta(e aa* f!o" at te $o"'an* a# %i,t a!o%n&. O%t#o%!$ing te#e !e#o%!$e# i,, a,,o fo! !efo$%#ing on to#e $o!e #t!ategie#. 7. O%t#o%!$ing a,,o# fo! $o#t an& effi$ien$* #a)ing#. Se)e!a, of te 2o# in a $o!'o!ation $an e te&io%# an& $o#t,*. B* o%t#o%!$ing te#e 2o#5 #%$ a# $%#to"e! #e!)i$e5 ,ao! fo%n& e,#ee!e $an e $ea'e! an& te $o"'an* $an fo$%# on te a!ea# tat nee& te "o#t attention in o!&e! to ea!n '!ofit#. o!"%,ating Long Te!" O2e$ti)e# an& !an& St!ategie# Long Te!" O2e$ti)e# Te!e a!e #e)en a!ea# in i$ ,ong te!" o2e$ti)e# a)e to e e#ta,i#e& 1. P!ofitai,it* Te ai,it* of an* fi!" to o'e!ate in te ,ong te!" &e'en&# on attaining an a$$e'ta,e ,e)e, of '!ofit#. St!ategi$a,,* "anage& fi!"# a)e a ,ong te!" o2e$ti)e5 %#%a,,* e6'!e##e& in ea!ning# 'e! #a!e o! !et%!n on e8%it*. 7. P!o&%$ti)it* Co""on,* %#e& '!o&%$ti)it* o2e$ti)e# a!e te n%"e! of ite"# '!o&%$e& o! te n%"e! of #e!)i$e# !en&e!e& 'e! %nit of in'%t. Te* a!e a,#o5 #o"eti"e#5 te!"# of &e#i!e& $o#t &e$!ea#e.
Se)e!a, #"a,, an& "e&i%" #i+e& fi!" o'e!ating in a fa"i,ia! "a!(et- "o!e often a ni$e "a!(et tat i# ,i"ite& in #$o'e an& offe!ing '!o&%$t# o! #e!)i$e# t!o%g a ti"e te#te& te$no,og* !e,* on te No Cange St!ateg*. 7. P!ofit St!ateg* No fi!" $an $ontin%e it te No Cange St!ateg*. So"eti"e# ting# &o $ange an& te fi!" i# fa$e& it te #it%ation e!e it a# to &o #o"eting. A fi!" "a* a##e## te #it%ation an& a##%"e tat it# '!o,e" a!e #o!t ,i)e& an& i,, go aa* it ti"e. Ti,, ten a fi!" t!ie# to #%#tain it# '!ofitai,it* * a&o'ting a '!ofit #t!ateg* o! in#tan$e in a #it%ation en te '!ofit i# e$o"ing ,oe! fi!" ta(e# "ea#%!e# to !e&%$e in)e#t"ent#5 $%t $o#t#5 !ai#e '!i$e#5 in$!ea#e '!o&%$ti)it* an& a&o't ote! "ea#%!e# to #o,)e te te"'o!a!* &iffi$%,tie#. Te '!o,e" a!i#e# &%e to %nfa)o!a,e #it%ation ,i(e e$ono"i$ go)e!n"ent attit%&e5 an& in&%#t!* &on t%!n5 $o"'etiti)e '!e##%!e# an& !e$e##ion5 ,i(e. D%!ing ti# (in& of #it%ation tat te fi!" a##%"e# to e te"'o!a!* it o%,& a&o't '!ofit #t!ategie# So"e fi!"# to o)e!$o"e te#e &iffi$%,tie# o%,& #e,, off a##et# #%$ a# '!i"e ,an& in a $o""e!$ia, a!ea an& "o)e to #%%!#. Ote!# a)e !e"o)e& #o"e of it# non-$o!e %#ine## to !ai#e "one*5 i,e ote!# a)e &e$i&e& to '!o)i&e o%t#o%!$ing #e!)i$e to ote! o!gani+ation#.
O!gani+ation# #%$$e##f%, at #t!ateg* i"',e"entation effe$ti)e,* "anage #i6 (e* #%''o!ting fa$to!#: 1. 7. . . . A$tion P,anning O!gani+ation St!%$t%!e H%"an Re#o%!$e# Te Ann%a, B%#ine## P,an Monito!ing an& Cont!o, Lin(age. A$tion P,anning i!#t5 o!gani+ation# #%$$e##f%, at i"',e"enting #t!ateg* &e)e,o' &etai,e& a$tion ',an#... $!ono,ogi$a, ,i#t# of a$tion #te'# /ta$ti$# i$ a&& te ne$e##a!* &etai, to tei! #t!ategie#. An& a##ign !e#'on#ii,it* to a #'e$ifi$ in&i)i&%a, fo! a$$o"',i#ing ea$ of to#e a$tion #te'#. A,#o5 te* #et a &%e &ate an& e#ti"ate te !e#o%!$e# !e8%i!e& to a$$o"',i# ea$ of tei! a$tion #te'#. T%# te* t!an#,ate tei! !oa& #t!ateg* #tate"ent into a n%"e! of #'e$ifi$ o!( a##ign"ent#. St!%$t%!e Ne6t5 to#e #%$$e##f%, i"',e"enting #t!ateg* gi)eO!gani+ationa, to%gt to tei! o!gani+ationa, #t!%$t%!e. Te* at a#( if tei! inten&e& #t!ateg* fit# tei! $%!!ent #t!%$t%!e. An& te* a#( a &ee'e! 8%e#tion a# e,,... 4I# te o!gani+ation9# $%!!ent #t!%$t%!e a''!o'!iate to te inten&e& #t!ateg*34 We9!e !e"in&e& e!e of a $,ient e o!(e& it #o"e *ea!# ago. Te $o"'an* a# e6'e!ien$ing '!o,e"# i"',e"enting it# #t!ateg* $a,,ing fo! te &e)e,o'"ent of to ne '!o&%$t#. Te !ea#on te fi!" a& een %na,e to &e)e,o' to#e '!o&%$t# a# #i"',e... te* a& ne)e! o!gani+e& to &o #o. La$(ing te ne$e##a!* $o""it"ent fo! ne '!o&%$t &e)e,o'"ent5 "anage"ent &i&n9t e#ta,i# an R=D g!o%'. Rate!5 it a##igne& it# "an%fa$t%!ing enginee!ing g!o%' te 2o of ne '!o&%$t &e)e,o'"ent... an& i!e& to 2%nio! enginee!# fo! te ta#(. Sin$e te '!i"a!* f%n$tion of te "an%fa$t%!ing enginee!ing g!o%' a# to (ee' te fa$to!* %""ing5 to#e enginee!# (e't getting '%,,e& off tei! 4ne '!o&%$t4 '!o2e$t# an& into te !o,e of te "an%fa$t%!ing #%''o!t. Re#%,t no ne '!o&%$t#. ESHWARI.S---LORAA BUSINESS ACADEMY Page 1
H%"an Re#o%!$e a$to!# O!gani+ation# #%$$e##f%, at #t!ateg* i"',e"entation $on#i&e! te %"an !e#o%!$e fa$to! in "a(ing #t!ategie# a''en. %!te!5 te* !ea,i+e tat te %"an !e#o%!$e i##%e i# !ea,,* a to 'a!t #to!*. i!#t5 $on#i&e!ation of %"an !e#o%!$e# !e8%i!e# tat "anage"ent tin( ao%t te o!gani+ation9# $o""%ni$ation nee&#. Tat te* a!ti$%,ate te #t!ategie# #o tat to#e $a!ge& it &e)e,o'ing te $o!!e#'on&ing a$tion #te'# /ta$ti$# f%,,* %n&e!#tan& te #t!ateg* te*9!e to i"',e"ent. Se$on&5 "anage!# #%$$e##f%, at i"',e"entation a!e aa!e of te effe$t# ea$ ne #t!ateg* i,, a)e on tei! %"an !e#o%!$e nee&#. Te* a#( te"#e,)e# te 8%e#tion#... 4Ho "%$ $ange &oe# ti# #t!ateg* $a,, fo!34 An&5 4Ho 8%i$(,* "%#t e '!o)i&e fo! tat $ange34 An&5 4Wat a!e te %"an !e#o%!$e i"',i$ation# of o%! an#e!# In an#e!ing te#e 8%e#tion#5 &e$i&e ete! to to to#e a,,o to ti"e8%e#tion#34 fo! e"',o*ee# to g!o t!o%g e6'e!ien$e5te*9,, to int!o&%$e t!aining5 o! to i!e ne e"',o*ee#. Te Ann%a, B%#ine## P,an O!gani+ation# #%$$e##f%, at i"',e"entation a!e aa!e of tei! nee& to f%n& tei! inten&e& #t!ategie#. An& te* egin to tin( ao%t tat ne$e##a!* finan$ia, $o""it"ent ea!,* in te ',anning '!o$e##. i!#t5 te* 4a,,'a!(4 te finan$ia, !e8%i!e"ent# en te* fi!#t &e)e,o' tei! #t!ateg*. Late! en &e)e,o'ing tei! a$tion ',an#5 te* 4fi!" %'4 tat $o""it"ent. A# a $,ient of o%!# e6',ain#5 te* 4&o,,a!i+e4 tei! #t!ateg*. Tat a*5 te* ,in( tei! #t!ategi$ ',an to tei! ann%a, %#ine## ',an /an& tei! %&get. An& te* e,i"inate te 4#%!'!i#e#4 te* "igt ote!i#e !e$ei)e at %&geting ti"e. Monito!ing = Cont!o, Monito!ing an& $ont!o,,ing te ',an in$,%&e# a 'e!io&i$ ,oo( to #ee if *o%9!e on $o%!#e. It a,#o in$,%&e# $on#i&e!ation of o'tion# to get a #t!ateg* on$e &e!ai,e& a$( on t!a$(. To#e o'tion# /,i#te& in o!&e! of in$!ea#ing #e!io%#ne## in$,%&e $anging te #$e&%,e5 $anging te a$tion #te'# /ta$ti$#5 $anging te #t!ateg* o! /a# a ,a#t !e#o!t $anging te o2e$ti)e. /o! "o!e on ti# 'oint5 #ee 4Monito!ing I"',e"entation of Yo%! St!ategi$ P,an.4 Lin(age - Te o%n&ation fo! E)e!*ting E,#e Man* o!gani+ation# #%$$e##f%,,* e#ta,i# te ao)e fi)e #%''o!ting fa$to!#. Te* &e)e,o' a$tion ',an#5 $on#i&e! o!gani+ationa, #t!%$t%!e5 ta(e a $,o#e ,oo( at tei! %"an ESHWARI.S---LORAA BUSINESS ACADEMY Page 1
!e#o%!$e nee f%n& tei! #t!ategie# t!o%g tei! ann%a, %#ine## ',an5 an& &e)e,o' a ',an to "onito! an& $ont!o, tei! #t!ategie# an& ta$ti$#. An& *et te* #ti,, fai, to #%$$e##f%,,* i"',e"ent to#e #t!ategie# an& ta$ti$#. Te !ea#on5 "o#t often5 i# te* ,a$( ,in(age. Lin(age i# #i"',* te t*ing togete! of a,, te a$ti)itie# of te o!gani+ation...to "a(e #%!e tat a,, of te o!gani+ationa, !e#o%!$e# a!e 4!oing in te #a"e &i!e$tion.4 It i#n9t eno%g to "anage one5 to o! a fe #t!ateg* #%''o!ting fa$to!#. To #%$$e##f%,,* i"',e"ent *o%! #t!ategie#5 *o%9)e go to "anage te" a,,. An& "a(e #%!e *o% ,in( te" togete!. St!ategie# !e8%i!e 4,in(age4 ot )e!ti$a,,* an& o!i+onta,,*. e!ti$a, ,in(age# e#ta,i# $oo!&ination an& #%''o!t eteen $o!'o!ate5 &i)i#iona, an& &e'a!t"enta, ',an#. o! e6a"',e5 fo!fo! &e)e,o'"ent of a ne e &!i)en *aa&i)i#iona, $o!'o!ate #t!ateg* o2e$ti)e$a,,ing $a,,ing g!ot5 'e!a'# -'!o&%$t an& on #o%,& a (no,e&ge of a)ai,a,e !e#o%!$e# - $a'ita, !e#o%!$e# a)ai,a,e f!o" $o!'o!ate a# e,, a# %"an an& te$no,ogi$a, !e#o%!$e# in te R=D &e'a!t"ent. Lin(age# i$ a!e o!i+onta, - a$!o## &e'a!t"ent#5 a$!o## !egiona, offi$e#5 a$!o## "an%fa$t%!ing ',ant# o! &i)i#ion# !e8%i!e $oo!&ination an& $oo'e!ation to get te o!gani+ationa, %nit# 4a,, ',a*ing in a!"on*.4 o! e6a"',e5 a #t!ateg* $a,,ing fo! int!o&%$tion of a ne '!o&%$t !e8%i!e# te $o"ine& effo!t# of an& t%# $oo!&ination an& $oo'e!ation a"ong te R=D5 te "a!(eting5 an& te "an%fa$t%!ing &e'a!t"ent#. o! "o!e on te #%2e$t of ,in(age5 ',ea#e #ee Lin(age: Te o%n&ation fo! E)e!*ting E,#e. Re,ation Beteen St!ateg* o!"%,ation An& St!ateg* I"',e"entation: In o!&e! to a$ie)e it# o2e$ti)e#5 an o!gani+ation "%#t not on,* fo!"%,ate %t a,#o i"',e"ent it# #t!ategie# effe$ti)e,*. Te ig%!e !e'!e#ent# te i"'o!tan$e of ot ta#(# in "at!i6 fo!" an& #%gge#t# te '!oa,e o%t$o"e# of te fo%! 'o##i,e $o"ination# of te#e )a!ia,e#: - S%$$e## i# te "o#t ,i(e,* o%t$o"e en #t!ateg* i# a''!o'!iate an& i"',e"entation goo&. Ro%,ette in)o,)e# #it%ation e!ein a 'oo! #t!ateg* i# i"',e"ente& e,,. - T!o%,e i# $a!a$te!i+e& * #it%ation# e!ein an a''!o'!iate #t!ateg* i# 'oo!,* i"',e"ente&. - ai,%!e in)o,)e# #it%ation# e!ein a 'oo! #t!ateg* i# 'oo!,* i"',e"ente&. ESHWARI.S---LORAA BUSINESS ACADEMY Page 1G
Diagno#ing * a #t!ateg* fai,e& in te !o%,ette5 t!o%,e5 an& fai,%!e $e,,# in o!&e! to fin& a !e"e&* !e8%i!e# te ana,*#i# of ot fo!"%,ation an& i"',e"entation. S.Ce!to an& 0. Pete! '!o'o#e& a fi)e-#tage "o&e, of te #t!ateg* i"',e"entation '!o$e##: 1. &ete!"ining o "%$ te o!gani+ation i,, a)e to $ange in o!&e! to i"',e"ent te #t!ateg* %n&e! $on#i&e!ation5 %n&e! $on#i&e!ation 7. ana,*+ing te fo!"a, an& info!"a, #t!%$t%!e# of te o!gani+ation . #e,e$ting an a''!o'!iate a''!oa$ to i"',e"enting te #t!ateg* . i"',e"enting te #t!ateg* an& e)a,%ating te !e#%,t#. I"',e"entation i# #%$$e##f%,,* initiate& in t!ee inte!!e,ate& #tage#: 1. I&entifi$ation of "ea#%!a,e5 "%t%a,,* &ete!"ine& ann%a, o2e$ti)e#. 7. De)e,o'"ent of #'e$ifi$ #t!ategie#.
#t!ategi$ ',anning '!o$e##5 an& $on$i#e $o""%ni$ation i# an e##entia, e,e"ent of ti# &e)e,o'"ent. A,ign"ent o St!ategi$ ,ea&e!#i' t*'i$a,,* in)o,)e# te a,ign"ent of te &a*-to-&a* o!( a$ti)itie# it te o!gani+ation9# "i##ion #tate"ent %#ing #t!ategi$ ,ea&e!#i'. Con$i#e $o""%ni$ation i# e##entia, to te #%$$e## of an* #t!ategi$ "anage"ent ',an. o! o'e!ationa, a$ti)itie# to a,ign it te "i##ion #tate"ent5 #t!ategi$ ,ea&e!# "%#t en#%!e tat"%#t o!(e!# "aintain $,ea! %n&e!#tan&ing of tat "i##ion #tate"ent. Senio! "anage!# en$o%!age tea$,a!ifi$ation of e6'e$tation# #o o!(e!#9 %n&e!#tan&ing of at i# e6'e$te& of te" "ea#%!e# %' to #t!ategi$ ,ea&e!#i' "et!i$#. Sen&e!Re$ei)e! Co""%ni$ation Mo&e, o One of te "o#t e##entia, ta#(# of te #t!ategi$ ,ea&e! i# to $o""%ni$ate o!gani+ationa, #t!ategie# to to#e o i,, i"',e"ent te". Con$i#e $o""%ni$ation i# a )ita, e,e"ent in ti# '!o$e##. Te #en&e!!e$ei)e! $o""%ni$ation "o&e, i# a %#ef%, too, fo! &e)e,o'ing te#e $o!e $o"'eten$ie# itin #t!ategi$ ,ea&e!#. E)e!* $o""%ni$ation in)o,)e# a #en&e! an& a !e$ei)e!. o! #t!ategi$ ,ea&e!# to e t!%,* effe$ti)e5 te* "%#t %n&e!#tan& te i"'o!tan$e of $on$i#e $o""%ni$ation# to en#%!e te "e##age# te* #en& to o!(e!# a!e !e$ei)e& in te "anne! inten&e&. Lea&e!# )#. Manage!# o Wi,e not a,, ,ea&e!# a!e ne$e##a!i,* "anage!#5 it i# e##entia, tat a,, "anage!# e '!o'e!,* &e)e,o'e& to '!o)i&e effe$ti)e #t!ategi$ ,ea&e!#i' fo! te o!gani+ation. Wa!!en Benni#5 a%to! of 4On Be$o"ing a Lea&e!54 &e#$!ie# #e)e!a, &iffe!en$e# eteen ,ea&e!# an& "anage!#. o! e6a"',e5 "anage!# a!e a&"ini#t!ato!#5 i,e ,ea&e!# a!e inno)ato!#. Manage!# fo$%# on $o"',eting ta#(#5 i,e ,ea&e!# fo$%# on 'eo',e. Con$i#e $o""%ni$ation i# an e##entia, too, of te effe$ti)e ,ea&e!. In#tit%tiona,i+ing te #t!ategi$ #t!%$t%!e: In#tit%tiona,i+ation of St!ateg*: Te fi!#t a#i$ a$tion tat i# !e8%i!e& fo! '%tting a #t!ateg* into o'e!ation i# it# in#tit%tiona,i+ation. Sin$e #t!ateg* &oe# not e$o"e eite! a$$e'ta,e o! effe$ti)e * )i!t%e of eing e,, &e#igne& an& $,ea!,* anno%n$e&5 te #%$$e##f%, i"',e"entation of #t!ateg* !e8%i!e# tat te #t!ateg* f!a"e! a$t# a# it# '!o"ote! an& &efen&e!. Often #t!ateg* $oi$e e$o"e# a 'e!#ona, $oi$e of te #t!ategi#t e$a%#e i# 'e!#ona,it* )a!ia,e# e$o"e an inf,%entia, fa$to! in #t!ateg* fo!"%,ation. T%#5 it e$o"e# a 'e!#ona, #t!ateg* of te #t!ategi#t. Te!efo!e5 te!e i# an %!gent nee& fo! te in#tit%tiona,i+ation of #t!ateg* e$a%#e ito%t it5 te #t!ateg* i# #%2e$t to eing ESHWARI.S---LORAA BUSINESS ACADEMY Page 1G
%n&e!"ine&. Te!efo!e5 it i# te !o,e of te #t!ategi#t to '!e#ent te #t!ateg* to te "e"e!# of te o!gani+ation in a a* tat a''ea,# to te" an& !ing# tei! #%''o!t. Ti# i,, '%t o!gani+ationa, 'eo',e to fee, tat it i# tei! on #t!ateg* !ate! tan te #t!ateg* i"'o#e& on te". S%$ a fee,ing $!eate# $o""it"ent #o e##entia, fo! "a(ing #t!ateg* #%$$e##f%,. ORMUTIN UNCTIONAL STRATEY Re$a,, f!o" Ca'te! > tat f%n$tiona, #t!ateg* '!o)i&e# an a$tion ',an fo! #t!ateg* i"',e"entation at te ,e)e, of te o!( g!o%' an& in&i)i&%a,. It '%t# $o!'o!ate an& %#ine## #t!ateg* into o'e!ation * &efining te a$ti)itie# nee&e& fo! i"',e"entation. De'en&ing on te #'e$ifi$ #t!ateg* e g!o%'# i"',e"ente&5 #t!ateg* na* nee& to e fo!"%,ate& * a )a!iet* of to o!( itin f%n$tiona, te o!gani+ation Con#i&e!5 fo! e6a"',e5 te f%n$tiona, #t!ategie# tat o%,& e ne$e##a!* if Co$a-Co,a &e$i&e& to &e)e,o' a ne ,ine of f!%it 2%i$e#. Te !e#ea!$ an& &e)e,o'"ent &e'a!t"ent o%,& a)e to &e)e,o' a fo!"%,a te "a!(eting &e'a!t"ent o%,& a)e to $on&%$t ta#te te#t#5 &e)e,o' '!o"otiona, $a"'aign#5 an& i&entif* te a''!o'!iate &i#t!i%tion $anne,# an& te '!o&%$tion &e'a!t"ent o%,& a)e to '%!$a#e ne e8%i'"ent an& 'e!a'# %i,& ne fa$i,itie# to '!o&%$e te f!%it 2%i$e ,ine. Ta,e .> o%t,ine# 2%#t a fe of te f%n$tiona, #t!ategie# ne$e##a!* to int!o&%$e a ne ,ine of f!%it 2%i$e#. Te "o#t #ignifi$ant $a,,enge ,ie# in $oo!&inating te a$ti)itie# of te )a!io%# o!( g!o%'# tat "%#t o!( togete! to i"',e"ent te #t!ateg*. Te #t!ategie# "%#t e $on#i#tent ot itin ea$ f%n$tiona, a!ea of te %#ine## /#%$ a# te "a!(eting &e'a!t"ent an& eteen f%n$tiona, a!ea# /#%$ a# te "a!(eting &e'a!t"ent an& te '!o&%$tion &e'a!t"ent.>J o! e6a"',e5 if Co$a-Co,a9# ne f!%it 2%i$e ,ine i# to e '!i$e& at a '!e"i%" ,e)e,5 it "%#t e '!o"ote& to %*e!# o &e#i!e a '!e"i%" '!o&%$t an& &i#t!i%te& t!o%g $anne,# tat !ea$ to#e %*e!#. Te#e "a!(eting &e$i#ion# "%#t e $on#i#tent. %!te!5 te '!o&%$tion &e'a!t"ent "%#t '%!$a#e ig8%a,it* !a "ate!ia,# an& '!o&%$e a '!o&%$t tat i# o!t* of a '!e"i%" '!i$e. Wito%t $on#i#ten$* itin an& eteen te o!( g!o%'# of te o!gani+ation5 te i"',e"entation '!o$e## i# #%!e to fai,. EERY BUSINESS UNIT DEELOPS UNCTIONAL STRATEIES OR EACH MA0OR DEPARTMENT * * * * MAR?ETIN STRATEY INANCIAL STRATEY RESEARCH = DEELOPMENT STRATEY OPERATIONS STRATEY ESHWARI.S---LORAA BUSINESS ACADEMY Page 1G
* * * * PURCHASIN STRATEY LOISTICS STRATEY HUMAN RESOURCES STRATEY INORMATION TECHNOLOY STRATEY BASIC MAR?ET-PRODUCT STRATEIES : THE CUSTOMERPRODUCT DECISION: MAR?ETIN STRATEIES: THE CUSTOMER-PRODUCT DECISION: MAR?ET PENETRATION STRATEY /Sta* in $%!!ent "a!(et# it e6i#ting '!o&%$t# INCREASE RATE O PURCHASECONSUMPTION ATTRACT RIAL;S CUSTOMERS BUY OUT RIALS CONERT NON-USERS INTO CURRENT USERS MAR?ET DEELOPMENT STRATEY /in& ne "a!(et# fo! $%!!ent '!o&%$t# ENTER NEW EORAPHICAL MAR?ETS IND NEW /De)e,o' USES OR ne EISTIN PRODUCTS IND NEW TARET MAR?ETS PRODUCT DEELOPMENT STRATEY '!o&%$t# fo! e6i#ting "a!(et# IMPROE EATURES IMPROE @UALITYRELIABILITYDURABILITY ENHANCE AESTHETICSSTYLIN ADD MODELS ESHWARI.S---LORAA BUSINESS ACADEMY Page 1GG
DIERSIICATION STRATEY /De)e,o' ne '!o&%$t# fo! ne "a!(et# THE > KP;S O MAR?ETIN: MAR?ETIN MI ISSUES P!o&%$t St!ateg* S'e$if*ing te e6a$t '!o&%$t o! #e!)i$e to e offe!e& P!o"otion St!ateg* Ho te '!o&%$t o! #e!)i$e i# to e $o""%ni$ate& to $%#to"e!# Canne, o! KP,a$e St!ateg* Se,e$ting te "eto& fo! &i#t!i%ting te '!o&%$t o! #e!)i$e P!i$e St!ateg* E#ta,i#ing a '!i$e fo! te '!o&%$t o! #e!)i$e KS(i" '!i$ing /ig en *o% a!e a 'ionee! KPenet!ation '!i$ing /,o %i,&# "a!(et #a!e# KD*na"i$ '!i$ing /'!i$e# )a!* f!e8%ent,* a#e& on &e"an&a)ai,ai,it* Di#t!i%te t!o%g &ea,e! neto!(# o! t!o%g "e!$an&i#e!#3 Se,, &i!e$t,* to $on#%"e!# on o! t!o%g "a## inte!net3 KP%# - #'en& on '!o"otion# an& t!o%g &i#$o%nt# to#to!e# '%# '!o&%$t# KP%,, - #'en& to %i,& !an& aa!ene## #o $on#%"e!# i,, a#( fo! it * na"e Ne o! e6i#ting '!o&%$t3 `fo! ne o! e6i#ting $%#to"e!#3 INANCIAL MANAEMENT STRATEIES: CAPITAL AC@UISITIONS Det Le)e!age5 Sto$( Sa,e#5 = ain# f!o" O'e!ation# E8%it* finan$ing i# '!efe!!e& fo! !e,ate& &i)e!#ifi$ation Page 1GJ ESHWARI.S---LORAA BUSINESS ACADEMY
Det finan$ing i# '!efe!!e& fo! %n!e,ate& &i)e!#ifi$ation Le)e!age& %*o%t# /LBO# "a(e te a$8%i!e& fi!" 'a* off te &et CAN WE ROW BY RELYIN ON ONLY INTERNAL CASH LOWS3 DO STOC? SALES DILUTE OWNERSHIP CONTROL3 DOES A LARE DEBT RATIO CRIPPLE UTURE ROWTH3 DOES STRON LEERAE BOOST EARNINS PER SHARE3 DOES HIH DEBT DETER TA?EOER ATTEMPTS3 DO MOST LBO# UNDERPERORM YEARS ATER THE BUYOUT3 RESOURCE ALLOCATIONS Di)i&en Sto$( P!i$e5 = Rein)e#t"ent Rein)e#t ea!ning# in fa#t-g!oing $o"'anie# ?ee'ing te #to$(o,&e!# $ontente& &i)i&en&# U#e of #to$( #',it# o! !e)e!#e# to "aintain ig it #to$($on#i#tent '!i$e# T!a$(ing #to$( (ee'# inte!e#t in / $o"'an*5 %t &oe#n;t a,,o ta(eo)e! RESEARCH = DEELOPMENT STRATEIES: LEEL O INNOATION Pionee! /Lea&e! ). Co'* Cat /o,,oe! Te$no,ogi$a, ,ea&e!#i' fit# e,, it &iffe!entiation A Kfo,,oe! #t!ateg* "a(e# #en#e it $o#t-,ea&e! #t!ategie# A!e e ette! at fin&ing a'',i$ation# an& $%#to"e! a&a'tation# tan a$t%a,,* in)enting #o"eting !ea,,* ne3 Diffe!ent t*'e# of R = D /a#i$5 '!o&%$t5 '!o$e## We!e i# te fi!";# i#to!i$ e6'e!ti#e a&)antage3 Ho $o"'etent a!e te R = D Pe!#onne,3 AC@UISITION O TECHNOLOY Inte!na,,* &e)e,o'e& ). a$8%i!e& f!o" o%t#i&e Te$no,og* KS$o%t# St!ategi$ Te$no,og* A,,ian$e# A$8%i!e "ino!it* #ta(e in '!o"i#ing ig-te$ )ent%!e#
OPERATIONS STRATEIES: ESHWARI.S---LORAA BUSINESS ACADEMY Page 1G
MANUACTURIN LOCATION Inte!na, P!o&%$tion ). O%t#o%!$ing Do"e#ti$ P,ant# ). Inte!nationa, Lo$ation# SYSTEM LAYOUT P!o&%$t ). P!o$e## La*o%t# 0o So'# ). Ma## P!o&%$tion 0o #o'#"a,, at$ '!o&%$tion fit# e,, it a &iffe!entiation #t!ateg* Contin%o%# '!o&%$tion &e&i$ate& t!an#fe! ,ine# e,'# a$ie)e $o#t ,ea&e!#i' U#e of !oot# an& CADCAM ). Lao! inten#e "an%fa$t%!ing Mo&%,a! Man%fa$t%!ing an& 2%#t-in-ti"e &e,i)e!* of #%a##e",ie# Contin%o%# i"'!o)e"ent #*#te"# ,oe! $o#t# an& in$!ea#e 8%a,it* PURCHASIN STRATEIES: SOURCIN
COMPONENTS AND SUPPLIES WHERE CAN THE HIHEST @UALITY COMPONENTS BE OUND3 O%t#o%!$ing /o%! fi!" %*# e)e!*ting B%*ing on te O'en Ma!(et /S'ot /'!i$e# f,%$t%ate Long-Te!" Cont!a$t# it M%,ti',e S%'',ie!# /,o i& So,e So%!$ing Pa!a,,e, /on,* one #%'',ie! i"'!o)e# 8%a,it* /to #ta(e #%'',ie!# '!ote$tion Ba$(a!& Integ!ation /o%! fi!" a# So%!$ing an one!#i' in te'!o)i&e# #%'',ie!# e %#e @%a#i-integ!ation /"ino!it* one!#i' 'o#ition in a #%'',ie! Ta'e!e& /'!o&%$e #o"e of at e nee&5 %t not a,, %,, /'!o&%$e a,, of o%! on nee&# U#e of Co"'onent In)ento!ie# ). 0%#t-in-ti"e #%'',* &e,i)e!* LOISTICS STRATEIES: DO WE HAE OODS THAT MUST BE TRANSPORTED OR DELIERED3 TYPE O MATERIALS TRANSPORTED /B%,(* o! Co"'a$t3 Ra Mate!ia,#5 S%'',ie#5 = Co"'onent# ESHWARI.S---LORAA BUSINESS ACADEMY Page 1J
ini#e& oo&# BEST MODE O TRANSPORTATION AIR RAIL TRUC? BARE DO WE WANT DEPENDABILITY5 LOW COST5 OR HIH @UALITY SERICE3 OUTSOURCE TRANSPORTATION OR DO IT YOURSEL3 CONTRACT WITH OTHERS U#e M%,ti',e Si''e!# ). 0%#t One /UPS3 Con#i&e! at$ &e,i)e!ie# ). 0%#t-in-ti"e a!!ange"ent#3 OWNERSHIP IN DISTRIBUTION CHAIN @%a#i Ta'e!e& %,, HUMAN RESOURCES STRATEIES: TALENT AC@UISITION Re$!%it f!o" O%t#i&e ). Inte!na, De)e,o'"ent Re8%i!e e6'e!ien$e&5 ig,*-#(i,,e& o!(e!# ). Ke i,, t!ain *o% Offe! Kto' &o,,a! age# = enefit# ). "ento!ing an& a $a!ee! WOR? ARRANEMENTS In&i)i&%a, 0o# ). Tea" Po#ition# Na!!o,*-&efine& 2o# ). Po#ition# it &i#$!etion an& a%tono"* On-'!e"i#e# Wo!( ). Te,e$o""%ting O'tion# MOTIATION = APPRAISAL E6t!in#i$ ). Int!in#i$ Rea!& S*#te"# A##e##"ent ). fo! &e)e,o'"ent a##e##"ent INORMATION fo! !ea!&# SYSTEMS In$enti)e# fo! i&ea# = o!igina,it* in$enti)e# fo!). $onfo!"it*3 STRATEIES: WOR?ER PRODUCTIITY = CONNECTIITY E"',o*ee# $an e neto!(e& togete! a$!o## te g,oe In#tant t!an#,ation #ofta!e fo! g,oa, fi!"# Ko,,o te S%n Manage"ent `'a## '!o2e$t# on to te ne6t tea" ESHWARI.S---LORAA BUSINESS ACADEMY Page 1J1
SALES = INENTORY MANAEMENT Inte!net #a,e# an& &e)e,o'"ent of $%#to"e! &ataa#e# In#tant #a,e# !e'o!t# a,,o i""e&iate in)ento!* !eo!&e!# SHIPPIN = TRAC?IN OODS EDE Poe!Si' #ofta!e`#to!e# a&&!e##e#5 '!int# ,ae,#5 et$. T!a$(ing te '!og!e## of 'a$(age #i'"ent`EDE = UPS WHICH UNCTIONS CAN WE OUTSOURCE3 LOBAL OUTSOURCIN INCREASES EICIENCY = @UALITY A)e!age# !e&%$tion in $o#t# an& 1 in$!ea#e in $a'a$it* an& 8%a,it* U' to G of Boeing ',ane# a!e o%t#o%!$e&..%i,t in 2%#t > "o# ). 1 *ea! AMA SUREY -- > OUTSOURCE AT LEAST ONE ACTIITY GJ ene!a, = A&"ini#t!ati)e a$ti)itie# GG H%"an Re#o%!$e# T!an#'o!tation Di#t!i%tion
Wi,e f%n$tiona, #t!ategie# a!e e##entia, to te #t!ateg* i"',e"entation '!o$e##5 it i# a,#o i"'o!tant tat te #t!ateg* e in#tit%tiona,i+e& itin te o!gani+ation. In#tit%tiona,i+ing a #t!ateg* "ean# tat e)e!* "e"e!5 o!( g!o%'5 &e'a!t"ent5 an& &i)i#ion of te o!gani+ation #%#$!ie# to an& #%''o!t# te o!gani+ation9# #t!ateg* it it# ',an# an& a$tion#. Teo!* #%gge#t# tat a fit "%#t e6i#t eteen te #t!ateg* of te o!gani+ation an& it# #t!%$t%!e5 $%,t%!e5 an& ,ea&e!#i' if te #t!ateg* i# to e in#tit%tiona,i+e&. Ea$ of te#e to'i$# i,, e e6a"ine& in "%$ g!eate! &etai, in a #%#e8%ent $a'te! /o!gani+ationa, #t!%$t%!e in Ca'te! 5 $%,t%!e in Ca'te! 115 an& ,ea&e!#i' in Ca'te! 1
It in)o,)e# te $e$(ing of en)i!on"enta, $on&ition#. P!e"i#e# a!e '!i"a!i,* $on$e!ne& it to t*'e# of fa$to!#: * En)i!on"enta, fa$to!# /fo! e6a"',e5 inf,ation5 te$no,og*5 inte!e#t !ate#5 !eg%,ation5 an& &e"og!a'i$#o$ia, $ange#. In&%#t!* fa$to!# /fo! e6a"',e5 $o"'etito!#5 #%'',ie!#5 #%#tit%te#5 an& a!!ie!# to ent!*. * A,, '!e"i#e# not !e8%i!e te #a"e a"o%nt of ,i(e,* $ont!o,. "%#t #e,e$t to#e "a* '!e"i#e# an& )a!ia,e# tat /aa!e toTe!efo!e5 $ange an&"anage!# / o%,& a "a2o! i"'a$t on te $o"'an* an& it# #t!ateg* if te &i&. I"',e"entation Cont!o, St!ategi$ i"',antation $ont!o, '!o)i&e# an a&&itiona, #o%!$e of fee&fo!a!& info!"ation. 4I"',e"entation $ont!o, i# &e#igne& to a##e## ete! te o)e!a,, #t!ateg* #o%,& e $ange& in ,igt of %nfo,&ing e)ent# an& !e#%,t# a##o$iate& it in$!e"enta, #te'# an& a$tion# tat i"',e"ent te o)e!a,, #t!ateg*.4 St!ategi$ i"',e"entation $ont!o, &oe# not !e',a$e o'e!ationa, $ont!o,. Un,i(e o'e!ation# $ont!o,5 #t!ategi$ i"',e"entation $ont!o, $ontin%o%#,* 8%e#tion# te a#i$ &i!e$tion of te #t!ateg*. Te to a#i# t*'e# of i"',e"entation $ont!o, a!e: 1. Monito!ing #t!ategi$ t!%#t# /ne o! (e* #t!ategi$ '!og!a"#. To a''!oa$e# a!e %#ef%, in ena$ting i"',e"entation $ont!o,# fo$%#e& on "onito!ing #t!ategi$ t!%#t#: /1 one a* i# to ag!ee ea!,* in te ',anning '!o$e## on i$ t!%#t# a!e $!iti$a, fa$to!# in te #%$$e## of te #t!ateg* o! of tat t!%#t /7 te #e$on& a''!oa$ i# to %#e #to'go a##e##"ent# ,in(e& to a #e!ie# of "eaningf%, t!e#o,&# /ti"e5 $o#t#5 !e#ea!$ an& &e)e,o'"ent5 #%$$e##5 et$. a##o$iate& it 'a!ti$%,a! t!%#t#. 7. Mi,e#tone Re)ie#. Mi,e#tone# a!e #ignifi$ant 'oint# in te &e)e,o'"ent of a '!og!a""e5 #%$ a# 'oint# e!e ,a!ge $o""it"ent# of !e#o%!$e# "%#t e "a&e. A "i,e#tone !e)ie %#%a,,* in)o,)e# a f%,,-#$a,e !ea##e##"ent of te #t!ateg* an& ESHWARI.S---LORAA BUSINESS ACADEMY Page 71
te a&)i#ai,it* of $ontin%ing o! !efo$%#ing te &i!e$tion of te $o"'an*. In o!&e! to $ont!o, te $%!!ent #t!ateg*5 "%#t e '!o)i&e& in #t!ategi$ ',an#. St!ategi$ S%!)ei,,an$e Co"'a!e& to '!e"i#e $ont!o, an& i"',e"entation $ont!o,5 #t!ategi$ #%!)ei,,an$e i# &e#igne& to e a !e,ati)e,* %nfo$%#e&5 o'en5 an& !oa& #ea!$ a$ti)it*. 4... #t!ategi$ #%!)ei,,an$e i# &e#igne& to "onito! a !oa& !ange of e)ent# in#i&e an& o%t#i&e te $o"'an* tat a!e ,i(e,* to t!eaten te $o%!#e of te fi!"9# #t!ateg*.4 Te a#i$ i&ea ein& #t!ategi$ #%!)ei,,an$e i# tat #o"e fo!" of gene!a, "onito!ing of "%,ti',e info!"ation #o%!$e# #o%,& e en$o%!age&5 it te #'e$ifi$ intent eing te o''o!t%nit* toto %n$o)e! i"'o!tant *eta* %nanti$i'ate& info!"ation. St!ategi$ #%!)ei,,an$e a''ea!# e #i"i,a! in #o"e to 4en)i!on"enta, #$anning.4 Te !ationa,e5 oe)e!5 i# &iffe!ent. En)i!on"enta,5 #$anning %#%a,,* i# #een a# 'a!t of te $!ono,ogi$a, ',anning $*$,e &e)ote& to gene!ating info!"ation fo! te ne ',an. B* a* of $ont!a#t5 #t!ategi$ #%!)ei,,an$e i# &e#igne& to #afeg%a!& tee#ta,i#e& #t!ateg* on a $ontin%o%# a#i#. S'e$ia, A,e!t Cont!o, Anote! t*'e of #t!ategi$ $ont!o, i# a #'e$ia, a,e!t $ont!o,. 4A #'e$ia, a,e!t $ont!o, i# te nee& to to!o%g,*5 an& often !a'i&,*5 !e$on#i&e! te fi!"9# a#i# #t!ateg* a#e& on a #%&&en5 %ne6'e$te& e)ent.4 Te ana,*#t# of !e$ent $o!'o!ate i#to!* a!e f%,, of #%$ 'otentia,,* ig i"'a$t #%!'!i#e# /i.e.5 nat%!a, &i#a#te!#5 $e"i$a, #'i,,#5 ',ane $!a#e#5 '!o&%$t &efe$t#5 o#ti,e ta(eo)e!# et$.. Wi,e Pea!$e an& Roin#on #%gge#t tat #'e$ia, a,e!t $ont!o, e 'e!fo!"e& on,* &%!ing #t!ateg* i"',e"entation5 P!e,e !e$o""en&# tat e$a%#e #'e$ia, a,e!t $ont!o,# a!e ESHWARI.S---LORAA BUSINESS ACADEMY Page 71
!ea,,* a #%#et of #t!ategi$ #%!)ei,,an$e tat te* e $on&%$te& t!o%go%t te enti!e #t!ategi$ "anage"ent '!o$e##. Te $a!a$te!i#ti$# of ea$ $ont!o, $o"'onent a!e &etai,e& in Ta,e ->5 in$,%&ing te $o"'onent9# '%!'o#e5 "e$ani#" %#e& to i"',e"ent it5 te '!o$e&%!e to e fo,,oe&5 &eg!ee of fo$%#ing5 info!"ation #o%!$e#5 an& o!gani+ationa,'e!#onne, to e %ti,i+e&. St!ategi$ Cont!o, P!o$e## A,to%g $ont!o, #*#te"# "%#t e tai,o!e& to #'e$ifi$ #it%ation#5 #%$ #*#te"# gene!a,,* fo,,o te #a"e a#i$ '!o$e##. Rega!&,e## of te t*'e o! ,e)e,# of $ont!o, #*#te"# an o!gani+ation nee $ont!o, "a* e &e'i$te& a# a #i6-#te' fee&a$( "o&e,: 1.to Dete!"ine at7. toSet $ont!o,. Wat a!e te Wat o2e$ti)e# te o!gani+ation o'e# a$$o"',i#3 $ont!o, #tan&a!&#. a!e te ta!get# an& to,e!an$e#3
View more...
Comments
