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Strategic ManagementThe environment and strategic
capabilities (SWOT)
September 2009
Mark van der [email protected]
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Programme
Introduction (1)
Strategic Position 1, The Environment andStrategic Capabilities (2,3)
Strategic Position 2, Expectations,Purposes and Culture; Business levelstrategies (4,5,6)
Strategic Choice, Strategies (7,8,10)
Strategy into Action (11,12,14,15)
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Programme for today
FAQs
Introduction to the theory
Instructions for the case study assignment
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FAQs
Where is the lecture, what should we read, etc
Who is my tutor
SEFA sold me a book without cases
CTIS doesnt work
There are only English groups left
I want to change-over to another group
New questions, please mail to
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SWOT
Opportunities Threats
relativeStrengths
relativeWeaknesses
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Scanning the environment, 3 levels
Macro PESTEL
Scenarios
Industry Five forces
Cycles of competition
Competitors and markets
Strategic groups Market segments
Critical success factors
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The macro environment
PESTEL, key drivers for change
Building scenarios; considering the implicationsof high levels of uncertainty for key drivers for
change, related to PESTEL
Full-timemastersremain
MorePart-timemasters
HBO andUnisremain
Newsystem
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The industry environment
Five forces
Direct competitive rivalry
Threat of new entry < scale, experience,access to resources, expected defense;legislation; differentiation
Bargaining power of buyers < cooperation,
switching cost, alternatives (diy) Threat of substitutes
Bargaining power of suppliers
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Competitors and markets
Strategic groups (identify the most directcompetitors)
Scope of activities (products, regions, segments,
channels) Resource commitment (branding, marketing,
integration, quality, innovation, size)
Market segments (group with similar needs)
Developing customer needs Relative market share
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Opportunities and threats
Strategic gaps (new to the marketopportunities)
Opportunities in substitutes
Opportunities in other strategic groups
Opportunities in the chain of buyers
Opportunities in complementary services
Opportunities in new market segments
Opportunities over time (first mover)
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Elements of strategic management
Strategic position
The environment (PESTEL, O&T)
Capabilities (Resources and Competences,S&W)
Stakeholders
Strategic choice
Strategy into action
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Strategic capability
Resources and competences of anorganisation that determine thecompetitive position (labour productivity,
technology, market orientation, etc)
Enable companies to exploit opportunities,neutralize threats
Resource-based view focuses on resourcesto explain differences in business results
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Strategic capabilities
Tangible, Intangible
Unique, Treshold
Competences: how resources are used
Sustainable Competitive AdvantageValuable (to the customer)
Unique
Difficult to imitate (complex, cultural andhistorical, not evident to competitors
Dynamic capabilities: ability to change
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Diagnosing strategic capability
Value chain:
Activities within and around the organisationwhich create a product or service
Where do we add value, perform well? Howto become more profitable?
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Diagnosing strategic capability
Value network:
Organisational links and relationships that arenecessary to create a product or service
Identify which activities are centrallyimportant, where are the profit pools?
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Diagnosing strategic capability
In the value network:
What are the bases of the strategic capabilities, thesources of competitive advantage?
Where are cost and value created? Which activities are centrally important?
Where are the profit pools in the value network?
Is it possible to outsource some activities?
Which organisations are the best partners in thenetwork?
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Diagnosing strategic capability
Activity map: showing how activities of anorganisation are linked to identify strategiccapabilities at a detailed level.
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Benchmarking
Comparing capabilities instead ofperformance
Historical
Industy
Best-in-class
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SWOT
Opportunities Threats
Relativestrengths
Relativeweaknesses
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Managing capabilities
Managers should look for strategic capabilities andexploit them (Barney), but
Competences may be difficult to manage (notunderstood, not valued, difficult to formalise)
Options for managing capabilities: Extend best practices to other units
Change activities
Diversify based on the core competences
Outsource activities
Separate units for different activity maps
HRM in general
Building dynamic capabilities, the learning organisation
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Assignment
Case Study Airlines
Analyse the attractiveness of the industrypre-9/11
Analyse the attractiveness of the industrypost-9/11
How might arilines better plan for
disruptive events such as 9/11 2 pages, group work max 3, hand in
before
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Conclusion
A SWOT is the end result of analyses, notthe starting point
Outside the competitive context a SWOT isnonsense
A SWOT can help to develop strategicoptions to use internal strengths inexploiting opportunities and neutralizingthreats, while avoiding weaknesses
