How to Conduct Strategic Analysis
One critical piece of the Strategic Planning process is Strategic Analysis. It is an integral part of a company’s evaluation program; it provides managers with a comprehensive assessment of the organization’s capabilities and market factors; revealing growth opportunities and vulnerabilities. With this information, managers can more effectively choose from strategic alternatives and create the greatest future reward potential.
A) Company Mission – Vision
The first step I would take as part of my Strategic Analysis process would be to look at the Company’s mission and its vision. Mission statements include the aim of the organization, the organization’s primary stakeholders, the product or service offered and a declaration of the organization’s core purpose. A vision statement is similar to the mission statement but it doesn’t include customers or clients in the statement. The vision statement is for members of the company and it paints a picture of what the company aims to be in the future. Both the mission statement and vision statement must be examined before beginning the strategic analysis as they provide the framework for this process.
B) External Analysis
The next step I would take for my strategic analysis process would be to examine the company’s external environment. The external environment includes all factors that affect the firm. Some of these forces may be outside of the firm’s control such as technological, governmental, economic, cultural, and demographic factors. Knowing these factors however, enables a firm to look at strategies that work within their respective environments. Other factors within the external environment include: competitive rivalries, threat of new entrants, supplier power, buyer power, and threat of substitute products. These external industry environmental factors would be analyzed using Porter’s Five Forces Model which is discussed below.
- Porters 5 Rivals forces
One of the earliest models used to examine
A) Company Mission – Vision
The first step I would take as part of my Strategic Analysis process would be to look at the Company’s mission and its vision. Mission statements include the aim of the organization, the organization’s primary stakeholders, the product or service offered and a declaration of the organization’s core purpose. A vision statement is similar to the mission statement but it doesn’t include customers or clients in the statement. The vision statement is for members of the company and it paints a picture of what the company aims to be in the future. Both the mission statement and vision statement must be examined before beginning the strategic analysis as they provide the framework for this process.
B) External Analysis
The next step I would take for my strategic analysis process would be to examine the company’s external environment. The external environment includes all factors that affect the firm. Some of these forces may be outside of the firm’s control such as technological, governmental, economic, cultural, and demographic factors. Knowing these factors however, enables a firm to look at strategies that work within their respective environments. Other factors within the external environment include: competitive rivalries, threat of new entrants, supplier power, buyer power, and threat of substitute products. These external industry environmental factors would be analyzed using Porter’s Five Forces Model which is discussed below.
- Porters 5 Rivals forces
One of the earliest models used to examine