BUSINESS MANAGEMENT

WHAT IS STRATEGY?  Strategy may be defined as a course of action, including the specification of resources required to achieve the specific objective.  Strategy is a course of action to achieve an objective. Strategies are set at corporate, business & operational level.

Strategic Management & Its Purpose  It is a plan of action and managerial decisions which measure the future growth and long term performance of any organization or business. The term strategic management originated from the army which used strategies in wars.  So the word strategic means something that is done cleverly. Strategic management is used in business to build up the competitive edge against any competition. Many successful businesses use competitive advantage in order to lead the market or to come at the top. So this is used very commonly today. It links the management functions in a way that brings the desired results.

Business Planning  Business planning is often conducted when:  Starting a new venture (organization, product or service)  Expanding a current organization, product or service  Buying a current organization, product or service  Working to improve the management of a current organization, product or service

Contents of Business Planning  Describe the venture (new or current organization, product or service), often including its primary features, advantages and benefits  What the organization wants to do with it  Justification that the plans are credible  Marketing plans, including research results about how the venture will be marketed how they will use the venture, what they will be willing to pay, how the venture will be advertised and promoted,  Staffing plans, including what expertise will be needed to build and provide the venture on an ongoing basis  Management plans, including how the expertise will be organized, coordinated and led  Financial plans, including costs to build the venture, costs to operate the venture, expected revenue, budgets for each of the first several years into the future, when the venture might break-even

SWOT ANALYSIS & GAP ANALYSIS  SWOT analysis or corporate appraisal is a quantitative & qualitative review of the internal strength & weakness and their relationship with external threats & opportunities.  It is also a CRITICAL ASSESSMENT of the strengths and weakness, opportunities & threats in relation to the internal & environmental factor affecting an entity in order to establish its condition prior to the preparation of long term plans.

STRENGTHS & WEAKNESSES  Strengths & weaknesses are internal matters. The management accountants role is to appraise & measure them. Area Issues Marketing Products & Brands Distribution Finance Use of advertising Market share & Market Size Success rate of the sales team Analysis of Sales Product Quality Reputation of brand Age & future life of products Service Standards Geographical availability Availability of funds Returns on investment Accounting Rations

Area Issues Plant & Production Management & Staff Business Management Raw Material & Finished Good stocks Production capacity Value of assets Land & buildings Economies of scale Age Skills Industrial Relation Training Recruitment Communications Organization Structure Management Style Communication Links Information systems Source of supply Storage capacity