Professional Documents
Culture Documents
Introduction
All companies face competition
For resources, customers, sales revenues, and profitsAll companies face uncertain industry environments Managers must position the organizations strategically in order to compete successfully
This is what we call business definition Requires that managers understand the dynamics of their firms markets before formulating strategies
Introduction (cont.)
Rapidly growing markets (emerging industries) tend to be less competitive & often attract new entrants
Usually provide sufficient room in competitive space for making some mistakes
Mature, concentrated markets provide firms with very little breathing room
Mistakes by one firm can significantly impact entire industry
One firms price reductions can set off industry-wide price war
SWOT Analysis
Acronym derived from Strengths, Weaknesses, Opportunities, and Threats
Used for analyzing industry environments and firms internal strengths and weaknesses
Managers thoroughly evaluate their firms internal strengths and weaknesses and its environmental (external) opportunities and threats Managers use the evaluation developed in the first step to place the firm in one of the quadrants of the SWOT matrix
Stimulates communication outside normal channels Result is varied information from diverse sources Provides an outsiders perspective in the SWOT Sales -Inventory control Production -Quality control Advertising -Research & development Finance Customer service
SWOT Analysis
Objective of SWOT
Strengths (based on analysis of): Strategies R&Cs Performance Weaknesses (based on analysis of): Strategies R&Cs Performance Opportunities (based on analysis of): General Environment Industry Environment Main Competitors Threats (based on analysis of): General Environment Industry Environment Main Competitors
SWOT Analysis
Numerous Environmental Opportunities
Grow
Diversify