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GMS200 Lecture Notes - Swot Analysis, Strategic Business Unit, Peter Drucker

Global Management
Course Code
Ashley Scarlett

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Chapter 7: Strategy and Strategic Management
Competitive Advantage:
Competitive Advantage: is the ability to do something so well that one outperforms competitors
Sustainable Competitive Advantage: is the ability to outperform rivals in ways that are difficult or costly to imitate
*google formula for competitive advantage*
Strategy and Strategic Intent:
Strategy: is a comprehensive plan guiding resource allocation to achieve long-term org. goals
Strategic Intent: focuses and applied org.’al energies on a unifying and compelling goal
Levels of Strategy:
1. Corporate-Level strategy: sets long-term direction for the total enterprise
2. Business-Level strategy: identifies how a division or strategic business unit will complete its product or service do-
3. Functional strategy: guides activities within one specific area of operations
The Strategic Management Process
Strategic Management: is the process of formulating and implementing strategies
1. Strategic analysis: is the process of analyzing the org., the environment and the org.’s competitive position and current
2. Strategy formulation: is the process of crafting strategies to guide the allocation of resources (peter drucker 5 q’s)
3. Strategy implementation: is the process o putting strategies into action
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Analysis of Mission, Values and Objectives:
Mission and Stakeholders:
Mission: statement expresses the org.’s reason for existence in society
Stakeholders: are individuals and groups directly affected by the org. and its strategic accomplishments
Strategic Constituencies Analysis: assesses interests of stakeholders and how well the org. is responding to them
Core Values:
Core Values: are broad beliefs about what is or is not appropriate behavior
Organizational Culture: is the predominant value system for the org. as a whole
Operating Objectives: are specific results that org.’s try to accomplish
Typical Operating Objectives of a bus.:
Financial health
Cost efficiency
Customer service
Product quality
Market share
Human talent
Social responsibility
Swot Analysis of Organization and Environment:
SWOT Analysis: examines strengths and weaknesses and environmental opportunities and threats
Organizational Strengths and Weaknesses
• SWOT analysis begins with a systematic evaluation of org.‘s strengths and weaknesses
Core Competency: is a special strength that gives an organization a competitive advantage
• found in special knowledge or expertise, superior technologies
• weaknesses need to be identified, plans need to be set to eliminate them, or to possibly turn them into strengths.
Environmental Opportunities and Threats
SWOT analysis is complete until opportunities and threats in the external environment are also analyzed.
emergence of new competitors, resource scarcities, changing customer tastes, new government regulations etc.
Analysis of Rivalry and Industry Attractiveness:
Porter's Five Forces Model
1. Industry competition
2. New entrants
3. Substitute products or services
4. Bargaining power of suppliers
5. Bargaining power of customers
Industry Attractiveness
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