1.

STRATEGIC MANAGEMENT The term strategic management refers to the Managerial process of Forming a strategic vision, Setting objectives, crafting a strategy, Implementing and executing the strategy, And making corrective adjustments if necessary. 2. STRATEGY AT DIFFERENT LEVELS OF A BUSINESS Strategies exist at several levels in any organization . Corporate Strategy - is concerned with the overall purpose and scope of the business to meet stakeholder expectations. This is a crucial level since it is heavily influenced by investors in the business and acts to guide strategic decision-making throughout the business. Corporate strategy is often stated explicitly in a "mission statement". Business Unit Strategy - is concerned more with how a business competes successfully in a particular market. It includes strategic decisions about choice of products, meeting needs of customers, gaining advantage over competitors, creating new opportunities etc. Operational Strategy - is concerned with how each part of the business is organized to deliver the corporate and businessunit level strategic direction. Operational strategy therefore focuses on issues of resources, processes, people etc. 3. ETOP Analysis In order to draw a clear picture of what opportunities and threats are faced by the organization at a given time. It is necessary to appraise the environment. This is done by identifying the environmental factors that affect environmental appraisal and structuring the results of this environmental appraisal. The preparation of an ETOP involves dividing the environment into different sectors and then analyzing the impact of each sector on the organization.

S.No 1

Environment al sector Economic

Nature of Impact Up Arrow

Impact of each sector Favorable Impact

Market

Horizontal Arrow

Neutral Impact

International

Down Arrow unfavorable Impact

ETOP provides a clear picture to the strategists about each sectors and the different factors in each sector have a favorable impact on the organization. By the means of an ETOP, the organization knows where it stands with respect to its environment.

Competitive Rivalry The level of rivalry is minimum in a perfectly competitive market and monopoly market . The following factors determine the level of rivalry o The stability of environment o The life expectancy of competitive advantage o Characteristics of the strategies pursued by competitors. Threat of New Entrants Entry of a firm in a market is considered as a threat to the established firms because the entrants may add new production capacity or it may affect their market shares. Therefore they raise barriers in entry of a new firm in the following ways. o Economies of scale o Brand benefits o Capital requirements o Switching costs o Access to distribution channels o Anticipated growth Bargaining power of suppliers Business organizations have a large dependency on suppliers. Suppliers decisions on prices, quality of goods and services, other terms and conditions of delivery and payments have significant impact on the profit trends of an industry. Supplier bargaining power would normally depend on o Importance of the buyer to the supplier group o Importance of the suppliers product to the buyers o High switching costs for buyers Bargaining power of customers Customers with stronger bargaining power may force supply prices down or demand better quality for the same price. Following factors attach greater power to buyers o Undifferentiated or standard suppliers o Customers price sensitivity o Accurate information about the cost structure of suppliers Threat of substitutes Often firms in an industry face competition from outside industry products, which may be close substitutes of each other. depends primarily on three factors o Whether the substitutes available are attractively priced o Whether buyers view of the substitutes available as satisfactory in terms of their quality and performance o How easily buyers can switch to substitutes. 1. Customers: Who are the enterprise's customers? 2. Products or services: What are the firm's major products or services? 3. Markets: Where does the firm compete? 4. Technology: What is the firm's basic technology? 5. Concern for survival, growth, and profitability: What is the firm's commitment towards economic objectives? 6. Philosophy: What are the basic beliefs, core values, aspirations and philosophical priorities of the firm? 7. Self-concept: What are the firm's major strengths and competitive advantages? 8. Concern for public image: What is the firm's public image? 9. Concern for employees: What is the firm's attitude/orientation towards employees?

SWOT analysis is a strategic planning method used to evaluate the Strengths, Weaknesses, Opportunities, and Threats of an organization. Strengths: attributes of the person or company that are helpful to achieving the objective(s). Weaknesses: attributes of the person or company that are harmful to achieving the objective(s). Opportunities: external conditions that are helpful to achieving the objective(s). Threats: external conditions which could do damage to the objective(s).

Internal factors The strengths and weaknesses internal to the organization.

External factors The opportunities and threats presented by the external environment to the organization. - Use a PEST or PESTLE analysis to help identify factors

SWOT analysis can be used to assess: a company (its position in the market, commercial viability, etc) a product or brand a business idea a potential partnership changing a supplier an investment opportunity