SWOT which stands for an abbreviation of (strength, weakness, opportunity and threat; is an analysis that defined as method to examine organization’s internal factors dealing with strengths and weaknesses, and its environmental opportunities and also the threats. SWOT analysis usually use in the preliminary phase of decision making as a general tool which it designed for being antecedent to strategic planning in different case and applications. SWOT Analysis can be used as a model, process, technique or framework to provide information about those factors strengths, of an organization by having many applications with possibility of being used in all the levels of the organization. SWOT analysis is a part of the strategic planning process. Companies have some internal and external Continue reading
Strategic Management Tools
Institution-Based View of Business Strategy
An industry-based view, illustrated by Porter (1980), decides firm strategy and performance. Sustainable competitive advantages can be discovered by industry analysis and by selecting from the generic strategies. The competitive strength and the firm’s ability can maintain positional advantages through the efficient and effective implementation of competitive strategy. Secondly, a resource-based view (RBV), was demonstrated by Barney (1991), advocates that firm-specific differences determine strategy and performance. RBV emphases internal resources and capabilities of organisations. RBV portraits companies as idiosyncratic bundles of resources and capabilities that are available for distribution by the organization’s business units. Heterogeneity in the resources and capabilities is the reason of variations in organization performance. Sustainable competitive advantage is not the result of correct position in the Continue reading
Value Stream Mapping (VSM)
Value stream mapping is a framework that could be used by the line-managers to identify the types of wastages in a value chain. The goal of value stream mapping is to identify, demonstrate and decrease the waste. Value stream mapping identifies the non value adding activities in a process and eliminates wastage due to non-value adding activities. It focuses on visual maps the flow of materials and information from the time products come in the back door as a raw material through all manufacturing raw materials. In this frame work, the line-manager could be able to track the process flow and value addition to the product in every activity. Whenever a non value adding activity is identified then it is Continue reading
Porter’s Value Chain
The term ‘Value Chain’ was used by Michael Porter in his book “Competitive Advantage: Creating and Sustaining superior Performance” (1985). The value chain analysis describes the activities the organization performs and links them to the organizations competitive situation. Value chain analysis describes the activities within and around an organization, and relates them to an analysis of the competitive strength of the organization. Therefore, it evaluates which value every particular activity adds to the organizations products or services. This idea was build upon the insight that an organization is more than a random compilation of machinery, equipment, people and money. Only if these things are arranged into systems and systematic activates it will turn’s possible to manufacture something for which customers Continue reading
Michael Porter’s Four Corners Model
Profiling a specific competitor is often important to management. However, many competitive profiles will fail to give management insights into how competitors will respond to your own strategy. Understanding this inter-relationship is important for knowing how to position your company in relation to the competition. One of the most popular models for this type of competitor analysis is the so-called Four Corners Analysis. The Four Corners Analysis developed by Harvard Business School professor and strategy guru Michael Porter is a model well designed to help company strategists assess a competitor’s intent and objectives, and the strengths it is using to achieve them. By examining a competitor’s current strategy, future goals, assumptions about the market, and core capabilities, the Four Corners Continue reading
TOWS Matrix – Threats Opportunities Weaknesses Strengths Matrix
SWOT Analysis is a commonly used strategic management framework which scans internal strengths and internal weaknesses of a product or service industry and highlights the opportunities and threats of the external environment. This will help to focus on the strengths, minimize weaknesses and take the greatest possible advantage of opportunities available by overcoming threats. SWOT Analysis becomes a useless exercise if it is not extended to TOWS Analysis where the strengths are used to capitalize on opportunities and to counter threats and, the weaknesses are minimized using opportunities and both weaknesses and threats are avoided. Read More: SWOT Analysis — A Strategic Planning Tool Weihrich developed TOWS Matrix in 1982, as the next step of SWOT Analysis in developing alternative Continue reading