STRATEGIC

MANAGEMENT
(7)

Seminar 7. External analysis

(Strategic groups, Strategic profile)
Titov Sergei Anatolyevich, MBA, PhD,
satitov@fa.ru
PLAN FOR TODAY

 Your projects review

 Strategic group map
 Strategic profile
 Value chain + strategic profile
CAMPUS.FA.RU

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to our course
 5 FORCES

Buyers are demanding more and more robotic vacuum

cleaners. This is an indicator of:
1. High bargaining power of suppliers
2. High bargaining power of buyers
3. Low bargaining power of buyers
4. Low bargaining power of suppliers
2
5. Increasing rivalry among producers/sellers
6. Decreasing rivalry
 5 FORCES

Digital technologies help to introduce more different

features to RVCs and consequently launch various models of
cleaners on the market. This is an indicator of:
1. Increasing threat of new entrants

4
2. High bargaining power of buyers
3. Low bargaining power of buyers
4. Decreasing threat of new entrants
5. Increasing rivalry among producers/sellers
6. Decreasing rivalry
 5 FORCES
Developers of RVCs are outsourcing more and more manufacturing
activities to the numerous producers which produce many different
components for many different developers of home appliances (not
only RVCs). These outsourcers are not experiencing any problems
with demand for their services and goods. This is an indicator of:
1. Increasing threat of new entrants

6
2. High bargaining power of buyers
3. Low bargaining power of buyers
4. Decreasing threat of new entrants
5. Increasing rivalry among producers/sellers
6. Decreasing rivalry
 5 FORCES
Developers of RVCs are outsourcing more and more
manufacturing activities to the limited number producers
which produce almost all part for these appliances. This is
an indicator of:
1. High bargaining power of suppliers

7
2. High power of substitutes
3. Low power of substitutes
4. Low bargaining power of suppliers
5. Increasing rivalry among producers/sellers
6. Decreasing rivalry
 5 FORCES
Many producers of traditional vacuum cleaners introduced
many new features (silent, cordless, extra suction power,
…). The demand for these new models is increasing. This is
an indicator of:
1. High bargaining power of suppliers

8
2. High power of substitutes
3. Low power of substitutes
4. Low bargaining power of suppliers
5. Increasing rivalry among producers/sellers
6. Decreasing rivalry
 5 FORCES
Traditional vacuum cleaners are getting extremely
cheap. This is an indicator of:
1. High bargaining power of suppliers
2. High power of substitutes
3. Low power of substitutes
4. Low bargaining power of suppliers
9
5. Increasing rivalry among producers/sellers
6. Decreasing rivalry
 5 FORCES
Middle class people who were the traditional
customer base for RVC-producers is suffering from the
extreme income decrease. This is an indicator of:
1. High bargaining power of suppliers
2. High price sensitivity of buyers
3. Low price sensitivity of buyers
4. Low bargaining power of suppliers
10
5. Low bargaining power of buyers
6. Decreasing rivalry
STRATEGIC GROUP
MAPPING
Infinity

Price-Quality
Lexus
Toyota

Subaru Mazda

Honda Mitsubishi

Nissan
Isuzu
Acura

Product line
?
• Construct two aggregate, but
meaningful axis to measure
competition
• Evaluate all competitors
based on these axes
• Locate them on the map as
circles size of which reflects
their market shares
• Analyze
• Deliver a pitch (2 mins)
?
?
• Construct two aggregate, but
meaningful axis to measure
competition
MOSCOW • Evaluate at least 15
competitors based on these
FOOD axes
RETAIL • Locate them on the map as
circles size of which reflects
their market shares
• Analyze
• Deliver a pitch (2 mins)
?
STRATEGIC PROFILE/
CURVE
10

2
Nissan Mitsubishi Mazda
0
t y e
b ili tic
s
s anc ty ics ri c
e
li a t h e ga en afe om
f p
Re Es on i nt S g on so
g a r es
in m E
en
s av on i v
st in
g ct
Co v ttra
t sa A
s
Co
10

• Identify 10 key success factors

8
• Evaluate three companies (not just their
products) based on these KSFs
6
(including related to a company)
• Draw lines
4

• Interpret
2
• Deliver a pitch (2 mins)

0
10

• Identify 10 key success factors

6
• Evaluate three companies (not just their
products) based on these KSFs
(including related to a company)
4

• Draw lines
2 • Interpret
• Deliver a pitch (2 mins)
0
VALUE CHAIN
VALUE CHAIN
 10
8
6
4
2
Nissan Mitsubishi Mazda
0 lit
y
ic
s s y ic
s
bi et ga nc
e
fe
t m e
li a th on na Sa no ric
Re Es g te go fp
v in a in Er so
sa m es
st on en
Co ng c ti v
vi tra
sa At
st
Co
VALUE CHAIN: OUR
APPROACH
VALUE CHAIN: OUR
APPROACH
• Develop value chain
specifically for a company
• Combine value chain with
strategic profile
• Find the links between
current position and
activities
• Identify strengths and
weaknesses, problematic
areas and areas of
excellence
VALUE CHAIN
Development management (decisions on opening or closing outlets, price decisions, changing the assortment,
...)

Property management (search, lease, renovation, arrangement, moving out/ in, ...)

Accounting and finance (short-term credits, analysis of turnover and sales margins, retail accounting)

Market research (study of consumer preferences, analysis of regional markets)

Human resource management (assortment training, outlet managers’ development)

Information technology (development of distributed network)

Legal support (property contracts; compliance of outlets with legal requirements)

Back office procurement (office supply, cleaning of premises)

Operational
Search and Acceptance of
assortment Advertising in the Technical support, work
selection of goods, distribution
management, media and outdoor, on claims, product
suppliers, contracts, logistics, delivery to
merchandising, collecting feedback replacement,
organization of points of sale, on-
customer from buyers organization of repairs
transportation site storage
consulting, sales
VALUE CHAIN
Development management (decisions on opening or closing outlets, price decisions, changing the assortment,
...)

Property management (search, lease, renovation, arrangement, moving out/ in, ...)

Accounting and finance (short-term credits, analysis of turnover and sales margins, retail accounting)

Market research (study of consumer preferences, analysis of regional markets)

Human resource management (assortment training, outlet managers’ development)

Information technology (development of distributed network)

Legal support (property contracts; compliance of outlets with legal requirements)

Back office procurement (office supply, cleaning of premises)

Operational
Search and Acceptance of
assortment Advertising in the Technical support, work
selection of goods, distribution
management, media and outdoor, on claims, product
suppliers, contracts, logistics, delivery to
merchandising, collecting feedback replacement,
organization of points of sale, on-
customer from buyers organization of repairs
transportation site storage
consulting, sales
VALUE CHAIN
Development management (decisions on opening or closing outlets, price decisions, changing the assortment,
...)

Property management (search, lease, renovation, arrangement, moving out/ in, ...)

Accounting and finance (short-term credits, analysis of turnover and sales margins, retail accounting)

Market research (study of consumer preferences, analysis of regional markets)

Human resource management (assortment training, outlet managers’ development)

Information technology (development of distributed network)

Legal support (property contracts; compliance of outlets with legal requirements)

Back office procurement (office supply, cleaning of premises)

Operational
Search and Acceptance of
assortment Advertising in the Technical support, work
selection of goods, distribution
management, media and outdoor, on claims, product
suppliers, contracts, logistics, delivery to
merchandising, collecting feedback replacement,
organization of points of sale, on-
customer from buyers organization of repairs
transportation site storage
consulting, sales
VALUE CHAIN
Development management (decisions on opening or closing outlets, price decisions, changing the assortment,
...)

Property management (search, lease, renovation, arrangement, moving out/ in, ...)

Accounting and finance (short-term credits, analysis of turnover and sales margins, retail accounting)

Market research (study of consumer preferences, analysis of regional markets)

Human resource management (assortment training, outlet managers’ development)

Information technology (development of distributed network)

Legal support (property contracts; compliance of outlets with legal requirements)

Back office procurement (office supply, cleaning of premises)

Operational
Search and Acceptance of
assortment Advertising in the Technical support, work
selection of goods, distribution
management, media and outdoor, on claims, product
suppliers, contracts, logistics, delivery to
merchandising, collecting feedback replacement,
organization of points of sale, on-
customer from buyers organization of repairs
transportation site storage
consulting, sales
TASKS FOR NEXT
SEMINAR
• Prepare project results for review
• Read the textbook Chapter 4: 102-112
• Read Grant (https://cloud.mail.ru/public/howH/q39Wm1whk),
Contemporary Strategic Analysis, Chapter 5: 107-129
• Read ‘Perekrestok’ case
(https://campus.fa.ru/mod/resource/view.php?id=313210)
REVERSI GAME
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