1. STRATEGY ANALYSIS
CHAPTER 3

2. INTERNIAL ENVIROMENT ANALYSIS

3. INTERNAL ENVIRONMENT ANALYSIS
The external environment creates opportunities and threats and can give an ‘outside-in’ stimulus to the development of strategy
Successful strategies depend on something else as well: the capability of the organisation to perform
( internal situation)
We need to use the following techniques for that
MOST
Resource Audit
BOSTON Matrix
SWOT

4. MOST analysis technique
MOST analysis examines the current mission, objectives, strategy and tactics,
and considers whether these are clearly defined and supported within the organisation. We can define the MOST terms as follows:
a statement declaring what business the organisation is in, and what it is intending to achieve
Mission
the goals against which the organisation’s achievements can be measured
Objectives
the approach thato achieve the objectives and mission t is going to be taken by the organisation in order
Strategy
the detailed means by which the strategy will be implemented
Tactics

5. Mission Objectives Strategy Tactic FOR DRAY CLEANING
the best possible dry cleaning business that you can be and impress each customer that comes through the door
Mission
grow sales by 5% each month,
attract ‘x’ number of customers to switch from your competition,
receive a certain number of reviews online
Objectives
Invest in new advertising channels such as paid online advertisements or local radio
Offer benefits to customers who take the time to leave a review about your business
Strategy
FOR Ads channel
writing a script, hiring a voice over artist, contacting radio stations
Tactic

6. MOST analysis technique
A clear mission driving the organization forward, a set of measurable objectives and a coherent strategy will enhance the capability of the organization and be a source of strength. On the other hand, where there is a lack of direction, unclear objectives and an ill-defined strategy the internal capability is less effective and we have a source of weakness

7. Resource Audit
The resource audit can help us to identify core competences or may highlight where there is a lack of competence that could undermine any competitive moves
They determine the strengths and weakness of the organization
Intangible Resources
Tangible Resources
Trademarks,
the physical
Manufacturing technology
the financial
Reputation ( Brand)
the human

8. Portfolio analysis
Each organization have to develop the direction ( strategy) , by take a decision about the recourses.
Portfolio analysis help organization to do that.
The original portfolio matrix – the Boston Box – was developed by the Boston Consulting Group. This analysis concentrates on immediate financial gain

9. the Boston Box
This matrix offers a simple technique for assessing your firm’s position relative to others in terms of its product range.
It is a 2×2 matrix, plotting market share against market growth.
The BCG matrix should help you think about the portfolio of products and services that you offer and make decisions about which you should keep, which you should let go of, and which you should invest further in.

10. The Boston Box

11. Problem children (question mark)
represent those products or services in which your company has a high share of the market and the market is growing. They should be invested in further to maintain the growth
Stars
represent those products in which your company has a high market share, but where the market is mature and slow growing, or even declining. These products should be ‘milked’ to provide cash for investments in future product areas.
Cash cows
are products where your company has low market share and where the market itself is not growing. These should be dropped from your product portfolio to release funds for investment in more attractive opportunities.
Dogs
Are those products in which you have a low market share but where the market is beginning to take off or has significant growth potential. They need to be watched closely and investment maintained to keep a presence since they could become tomorrow’s stars – but equally the commitment should not be too high since they could also turn out to be tomorrow’s dogs!
Problem children (question mark)

12. The Boston Box – Product life cycle

13. Case Study ( Apple Products) Category those products in Boston Matrix

15. Case Study ( Google Products) Category those products in Boston Matrix

16. SWOT ANALYSIS
SWOT (strengths, weaknesses, opportunities, threats) analysis
is often used to pull together the results of an analysis of the external and internal environments
A SWOT analysis is often represented as a two-by- two matrix,

17. SWOT ANALYSIS

19. SWOT EXAMPLES SOWT Strengths -strong product branding
- We secure ‘best space’ in all branches of the top five supermarkets.
Weaknesses:
- we have poor cash flow.
- Against industry benchmarks we are in
the bottom quartile.
-We exceed our overdraft limits on 19 days every quarter.
Opportunities:
- demographic change in Europe will provide a greater
market for our products
Threats:
- low market growth will see increased concentration of business
through acquisition. The poorest-performing businesses will fail.
SOWT

20. SWOT ANALYSIS
It is important to get the balance between the external and the internal analysis right.
Completely changing the nature of the organisation because of what the external analysis says leads to radical change; basing everything on an internal analysis may lead to little or no change. Either case could be right, of course, but both analyses are likely to contribute towards the creation of a new strategic direction.

21. EXAMPLE For APPLE
المرجع :

22. CASE STUDY
بدأت ليلى شركة لتفصيل و بيع الفساتين وترغب في تغيير نشاطها إلي سوق الحلي والإكسسوارات اليدوية. ليلى نفذت عملية التحليل الرباعي (SWOT). نظرت أولًا إلى البيئة الداخلية. تشمل قائمة نقاط القوة لمشرعها الجديد شبكة جيدة من زبائنها السيدات إلى جانب أن لديها حس فني في تصميم الأزياء. أما عن نقاط الضعف؛ لاحظت ليلى أنها لا تعرف أي الموردين الجيدين من حيث التكلفة والجودة. بالإضافة إلى ذلك، لن تكون قادرة على استئجار محل بسبب التكلفة العالية للعقارات.
ثانيًا حددت العوامل الخارجية. فرص السوق: بدأت النساء تفضيل المنتجات اليدوية على غيرها بالإضافة إلى قدرة ليلى على تسويق وبيع منتجات عبر الإنترنت. يمكن استنتاج التهديدات التجارية كالتهديد بمنافسين جدد في السوق والذي قد يخفض من حصتها في السوق.

24. CASE STUDY
تعمل شركة (Sh.G) في مجال خدمات الاتصالات وأنظمة إدارة علاقات العملاء. تستحوذ الشركة على نسبة 10% من السوق منذ عدة سنوات، بينما تمتلك 15% من سعة التشغيل. وتعاني الشركة أحياناً من عدم القدرة على الاحتفاظ بالموظفين بسبب نظام الورديات وبعد موقع الشركة عن العاصمة.

26. IMPLEMENTING STRATEGY
There are three particular aspects of implementing strategy:
the context for the strategy
the role of the leader
two tools that we can use – the balanced business scorecard (BBS) and the McKinsey 7-S Model

27. IMPLEMENTING STRATEGY
We will deal with some of the contextual issues first. There are five of these:
Time: how quickly does the new strategy need to be implemented? What pace of change is needed?
Scope: how big is the change? Is the new strategic direction transformational or incremental?
Capability: dose the organization have a required resources? ? Are the experiences of change positive or negative?
Readiness: is the whole organisation, or the part of it to be affected, ready to make the change?
Strategic leadership: is there a strategic leader?

28. IMPLEMENTING STRATEGY
In this context, the strategic leader will have the key role. The strategic leaders does not have to be delivered from the top managers!!!
The key characteristics for the leader :
Challenges the status quo all the time, and sets new and demanding targets.
Establishes and communicates a clear vision of the direction to be taken
Models the way’. Such leaders demonstrate through their behaviour how everyone else should behave and act in order to deliver the strategy.

29. IMPLEMENTING STRATEGY
The key characteristics for the leader :
Empowers people to deliver their parts of the strategic change within the vision, values and mission that have been set out – the leader cannot be everywhere.
Celebrates success with those who achieve it.

30. IMPLEMENTING STRATEGY
Two tools that help in the implementation of strategy are
the McKinsey 7-S model,
and the balanced business scorecard

31. The McKinsey 7-S model

32. The McKinsey 7-S model
The McKinsey 7-S model supposes that all organisations are made up of seven components.
Three are often described as ‘hard’ components – strategy, structure and systems –
and four as ‘soft’ – shared values, style, staff and skills
if there is a change in one, others will be affected.
Changing the strategy means that all of the other components have to change as well

33. The Balanced Business Scorecard
The BBS supplements financial measures with three other perspectives on organisational performance:
customers,
learning and growth,
and internal business processes.
Vision and strategy connect with each of these,

35. The Balanced Business Scorecard
Financial: to succeed financially and have the resources to deliver our strategy, how must we be seen by our stakeholders?
Customer: to achieve our vision, what do we want customers to say about us?
Learning and growth: how will we sustain our ability to change and improve so that we constantly keep ahead of the competition?
Internal business processes: what are the business processes that we must excel at in order to deliver customer value?

36. The Balanced Business Scorecard
The BBS helps in the definition of tow components :
Critical Success Factors (CSF)
Key Performance Indicators (KPI)

37. The Balanced Business Scorecard
CSF
particular areas or issues which are important to the success of an organization (goals)
qualitative
KPI
a collection of events or action that play an important role in the success of organizations (measures)
usually quantitative

38. Example Example 1: A restaurant
Goal: Increase profit by 5% by January next year by increasing throughput by 10% in lunch and dinner trade without reducing our gross margins.