OUTLINE:  STRATEGIC MANAGEMENT PAPER

I. Executive Summary

  1. One to two paragraph company background
  2. Summary of recommendations
  3. Strategy Map to show how all your recommendations hang together

     Note: not more than 3 pages

II. Research Design and Methodology

  1. Data gathering techniques
  2. Framework of analysis used
  3. Processes/Activities

 

Note:  Not more than two pages.

III. Societal Environment Analysis

Choose factors in the societal environment that are relevant to your industry/company. Gather and present data, analyze them and make sure that the analysis will bring out the OPPORTUNITIES and THREATS found in the societal environment. Use the STEP framework in any order as a general outline:

  1. Socio-Cultural
  2. Technological
  3.  Economic
  4.  Political-Legal

To help you brainstorm on what factors to consider in the societal environmental analysis, you can use the table below.

                                       Some Important Variables in the Societal Environment


Economic


Technological


Political-Legal


Socio-cultural

Globalization of Markets

E-commerce

GNP trends

Interest rates

Money Supply

Inflation rates

Unemployment levels

Wage/price controls

Depreciation/ Appreciation of Currency

Energy availa-bility and cost

Disposable and discretionary income

New developments in IT

Total national spending for R&D

Total industry spending for R&D

Focus of technological efforts

Patent protection

New Products

New developments in technology transfer from lab to market place

Productivity improvements through automation

Stability of government

Environmental protection laws

Tax laws

Special incentives

Foreign trade regulations

Attitudes toward foreign companies

Laws on hiring and promotion

Fair trade laws

E-life, N-generation

Life-style changes

Career expectations

Rate of family formation

Consumer activism

Growth rate of population

Age distribution of population

Regional shifts in population

Life expectancies Birth rates

 

IV. Industry Analysis

You can use any framework of analysis. If you are going to use the 5-Forces of Competition, make sure that as you cover each and every force of competition and make sure that you are able to:

  1. Provide sufficient information to analyze the strength or weakness of the force of competition;
  2. Cite specific factors affecting the force of competition. These factors are found below.

 

Outline of this chapter follows the five forces of competition model:

  1. Threat of new entrants
  2. Rivalry among existing firms
  3. Bargaining power of Buyers
  4. Bargaining power of Sellers
  5. Threat of Substitute Products

Make sure that as you discuss each force of competition you will clearly state the force of competition as either STRONG, MODERATE or WEAK. If necessary you can add a section called Trends in the Industry.

Part of your RIVALRY among EXISTING FIRMS section would be the COMPETITIVE PROFILE MATRIX. In this matrix, include sufficient information on competitors so that your ratings will be appreciated by the panelists.

V. External Factor Evaluation Matrix

This will serve as a summary of the Societal Environmental Analysis and Industry Analysis. Write only the opportunities and threats covered in the societal and industry analysis.

VI. Company Analysis

Use any framework of analysis. If you are going to use the 7-S framework, add the 8th S which is the State of Finances. Make sure that whatever framework you use must include an analysis of the company’s financial statements, preferably the last 3 years.  The 8-s framework is found below.

Internal Analysis

7-S Framework

In the analysis of the culture or the shared values of the company, include the analysis of the mission/vision statement in terms of the nine components and how the Mission/Vision is currently cascaded throughout the organization.

After the company analysis, the IFE can be prepared as a summary. Only the strengths and weaknesses discussed in the analysis must be placed in IFE.

VII. Strategy Formulation

  1. Basic Introduction - Place one paragraph to introduce the different strategy formulation tools.
  2. TOWS
  3. SPACE
  4. I-E
  5. Grand
  6. BCG

IMPORTANT: After showing the strategic options presented by the different Strategy formulation tools, a SUMMARY OF MATRICES should be prepared.

Immediately after the SUMMARY OF MATRICES an ANALYSIS should be made which should take into consideration the following:

  1. Are the STRATEGIES with high scores relevant to the Company? If not, state the reasons. These strategies will not be considered for prioritization.
  2. Are there strategies derived from the TOWS which you think should be included in the STRATEGIES inspite of the fact that it only came out of the TOWS Matrix? State your reasons in the analysis.

The strategies remaining after #1 and the other TOWS strategies to be included in #2 should then be the subject of Prioritization.

VIII. Prioritization of Strategies

Use the QSPM or any other tool for prioritization. This tool of analysis can be made an appendix. The results can be presented in this section.

IX. Recommendations

A. Mission/Vision. State any proposed changes, including final Mission/Vision wordings. If the company does not have a mission/vision statement, recommend one.  Suggest  ways by which you can improve the cascading and internalization of the Mission/Vision.

B. Proposed Strategies (Based only on those that were prioritized in the QSPM).

List down and describe each of the proposed strategies. A one to two  paragraph description of these strategies to give the reader an idea of the direction that the strategy will take is enough. For example, if one of the strategies is PRODUCT DEVELOPMENT, the student must discuss the possible product changes and rationale for the changes in the features of the product &/or services. In the description, DO NOT INCLUDE ANYMORE THE TEXTBOOK DEFINITION OF THE STRATEGY.

C.  Departmental Programs - This section should amplify the recommended strategies. Thus, it is expected that more details will be presented in terms of the activities needed for FINANCE, OPERATIONS, MARKETING, HR, IT (if applicable) or R&D (if applicable) to implement the strategies.

Improving the customer value package can be included in the Departmental Program for MARKETING. Alternatively, these could be taken as a separate section in the departmental programs.  Refer to the Seven Dimensions of the Customer Value Package web page.

D. Strategy Evaluation and Control

State here the manner by which you will be judging the effectiveness of the STRATEGIES and DEPARTMENTAL PROGRAMS. The Balanced Scorecard covering the Financial Perspective, Customer Perspective, Internal Business Perspective and Learning and Growth Perspective can be useful. State the GOALS, MEASURES, TARGETS (including timetables) and INITIATIVES. Make sure that corporate level and departmental level goals, measures, targets and initiatives are covered.

 Financial projections (Income Statement, Balance Sheet, Cash Flow) for the next 3 years reflecting the strategies and departmental programs should be prepared. For example, if product development, market penetration and market development are the chosen strategies, how will these strategies affect revenues? What percentage of the growth in revenues will come from Product Development? Market Penetration? Market Development? Price Increase? If part of the strategies will result in cost reduction for the company, this should be reflected in the financial statements. If borrowings &/or additional equity is necessary, the same should be reflected in the financial statements. These are just some examples of strategies and departmental programs that need to be reflected in the financial projections. The financial projections should serve as a  standard by which the effectiveness of the strategies and departmental programs can be judged.  Assumptions  to financial projections should be clearly stated.  Financial ratio analysis should be made.


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