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Module 2. Lesson Proper

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36 views3 pages

Module 2. Lesson Proper

Uploaded by

Pauline Chua
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Strategic Management Page 1 of 12

Introduction to Strategic Management

III. LESSON PROPER

Environmental Scanning
Environmental scanning is the process of systematically monitoring and analyzing
external factors that affect an organization. This process helps in identifying
opportunities and threats in the business environment.

Components of the External Environment:


The external environment includes various forces and factors such as:
1. Political: Government policies, regulations, political stability
2. Economic: Economic growth, inflation rates, exchange rates
3. Social: Demographic changes, lifestyle shifts, cultural trends
4. Technological: Technological advancements, innovation trends
5. Environmental: Environmental regulations, ecological concerns
6. Legal: Laws, regulations, and legal issues affecting the industry

Tools and Techniques:

1. PESTEL Analysis: A framework for analyzing the macro-environmental factors.


2. Scenario Planning: Developing different scenarios to anticipate future changes.

Discussion Questions:
Why is it crucial for organizations to conduct environmental scanning regularly?
How can changes in technological trends impact a company's strategy?
SWOT Analysis
SWOT Analysis is a strategic planning tool used to identify and evaluate the internal
Strengths and Weaknesses, and external Opportunities and Threats facing an
organization.
Strategic Management Page 2 of 12
Introduction to Strategic Management

Components:
1. Strengths: Internal attributes that provide an advantage (e.g., strong brand, loyal
customer base)
2. Weaknesses: Internal attributes that place the organization at a disadvantage
(e.g., high employee turnover, limited distribution channels)
3. Opportunities: External factors that the organization can exploit for growth (e.g.,
emerging markets, new technology)
4. Threats: External factors that could cause trouble for the organization (e.g.,
increased competition, regulatory changes)

Application:
SWOT Analysis helps organizations in strategic decision-making by matching their
internal strengths and weaknesses with external opportunities and threats.

Discussion Questions:
How can a company leverage its strengths to take advantage of opportunities?
What strategies can an organization adopt to mitigate threats identified in a SWOT
analysis?

Competitive Analysis
Competitive analysis involves identifying and evaluating competitors' strengths and
weaknesses, strategies, and market positioning. It provides insights into the competitive
landscape and helps in developing strategies to achieve a competitive edge.

Key Elements:
1. Competitor Identification: Determining who the competitors are in the market.
2. Competitor Profiling: Analyzing competitors' market share, product offerings,
pricing strategies, and customer base.
Strategic Management Page 3 of 12
Introduction to Strategic Management

3. Competitive Dynamics: Understanding the moves and countermoves of


competitors, market trends, and industry changes.

Tools and Frameworks:


1. Porter's Five Forces: A framework for analyzing the competitive forces in an
industry (threat of new entrants, bargaining power of buyers and suppliers, threat
of substitutes, and industry rivalry).
2. Benchmarking: Comparing the organization's performance metrics with
competitors to identify areas for improvement.
Discussion Questions:
How can an organization use competitive analysis to inform its strategic decisions?
In what ways can understanding competitors' strengths and weaknesses benefit a
company?

References:
Barney, Jay et. al (2019). Strategic Management and Competitive Advantage: Concepts
6th Edition. Publisher: Pearson

Forest, David et.al (2020). Strategic Management: A Competitive Advantage Approach,


Concepts and Cases 17th edition. Publisher: Pearson

Grant, Robert (2021). Contemporary Strategy Analysis 11th Edition. Publisher: Wiley

Martin, Frank et. al (2021). Strategic Management: Awareness & Change 9th Edition.
Publisher: Cengage Learning

Rothaermel, Frank (2020). Strategic Management: Concepts and Cases 5th Edition.
Publisher: McGraw-Hill Education

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