Business Strategy

Formulation
Motivation
What is my strategy to finish my
studies?
Objectives
➢ Identify and explain a business
strategy
➢ Identify and analyze business in
terms of competitive strategy, plans,
and current markets.
➢ Identify the types of business-level
strategies and examine the
difference per strategies made.
Strategy
combination of goals, plans and
actions to accomplish an
organization’s mission.
Mission and Vision
Mission Vision
 specifies the businesses  It is a picture of what the
in which the firm intends business wants to be and
to compete and the what it wants to ultimately
customers it intends to achieve. It is a statement
serve. that articulates the ideal
description of an
organization and gives
shape to its intended
future.
SWOT Analysis
Term Definition
Strength It refers to the valuable or unique resources
that an organization has or any activity that it
does particularly well.
Weakness It refers to a lack of specific resources or
abilities that an organization needs for it to do
well.
Opportunity It is a condition in the external environment
that has the potential to help managers meet
or exceed organizational goals.
Threat It is a condition in the external environment
that has the potential to prevent managers
from meeting organizational goals.
Five Forces Model
Five Competitive Attractive to The Force is Lower When
Forces Strategic
Managers
when
Supplier power Low There are numerous suppliers
Buyer power Low There are numerous customers
Threat of substitutes Low There are few substitutes, or when
the use of substitute requires
extra resources
Threat of entrants Low There is high capital requirement
to start a new organization in the
industry
Intensity of rivalry Low There is a lot of differentiation
among organizations, so
managers face little direct
competition from other
organizations.
Resources
Resources Definition
Physical Resources Material assets an organization
owns or has access to. It includes
its factories and equipment,
financial assets, real estate and
inventory.
Human Resources Competencies held by an
organization’s members. It includes
formal trainings and informal
experience.
Infrastructural resources Organization’s structures and
systems. It includes firm’s formal
and informal planning process and
control systems, trust and
teamwork, and other aspects of
firm’s culture.
Capabilities
Characteristics How can it achieve competitive advantage?
Valuable The resource can serve as the basis of a
competitive advantage.

Rare The resource is held by no (or very few) other

organizations.

Imitable The resource cannot easily be copied or

developed in another organization.

Nonsubstitutable The resource cannot be easily replaced by other

resources.
Business-level strategy
Integrated and coordinated set
of commitments and actions the
firm uses to gain a competitive
advantage by exploiting core
competencies in specific
product.
Cost Leadership
Integrated set of actions taken to
produce goods or services with
features that are acceptable to
customers at the lowest cost,
relative to that of competitors.
Differentiation

Integrated set of actions taken to

produce goods or services (at an
acceptable cost) that customers
perceive as being different in
ways that are important to them.
Focus

Thisstrategy is an integrated set of

actions taken to produce goods
or services that serve the needs of
a particular competitive segment.