KEY SUCCESS FACTORS

5. What Strategic Moves are Rivals Likely to Make? Need to monitor the actions of rivals carefully Identify competitors strategies Evaluate who are going to be the major players in the market. Predict competitors’ next moves Strategic intent How well it is faring in the market Financial performance Market Intelligence System

6. What are the Key Factors for Competitive Success? Key Success Factors (KSFs) are the strategy-related actions / approaches that a firm must be competent at doing to be successful. Managers must know the industry well to know which factors are more important and which factors less. Managers need to use KSFs as cornerstones for company’s strategy. Mostly industry has few KSFs, three to four and managers should rank them in order of their importance.

Key Success Factors in Brewery Full utilization of brewing capacity to keep cost low A strong network for distribution Appropriate advertising

Key Success Factors in Banking Use of technology Product innovation Low cost Customer service and orientation

7. Is the Industry Attractive and What are Its Prospects for Above-average Profitability? Attractive industry invites more competitors

Attractiveness of industry depends on Industry’s growth potential Whether the prevailing driving forces are favorable or unfavorable Potentials of entry/exit of major firms Stability of demand Whether competitive forces will be stronger or weaker Risk and uncertainty in the industry’s future

If an industry’s overall profitability prospects are above average, the industry can be considered attractive Attractive is a relative term. It needs to be appraised from the standpoint of a particular company. USE OF SCENARIOS