Modern strategic analysis lecture. The main directions and approaches of strategic analysis. Competition and increased environmental variability

Strategic analysis can be carried out both in relation to the organization itself and in relation to other enterprises. Their actions can be analyzed for benefit and harm, their capabilities can be assessed for completeness and emptiness, their plans can be studied in terms of strategy and tactics.

Based on this vision, we can more adequately build our strategy. Thus, strategic analysis is not only the decomposition of a phenomenon into separate components, but also their understanding, comprehension from a certain angle.

Let's consider and analyze the main approaches and directions of strategic analysis in the context of changes and transformations in economic processes.

One of the popular methods of strategic analysis is the method of the Boston Consulting Group, the growth-market share matrix, developed to assist managers of diversified multi-products, multi-markets and multi-national businesses in diagnosing corporate strategy by providing an analytical framework for calculating the optimal product or business portfolio. Many other management tools cannot combine the depth and breadth of information in the way that the growth-to-market share matrix does in one concise document. This simplicity allows the portfolio matrix to be used simply and quickly to identify areas for further in-depth analysis.

Rice. 1.1

Despite the fact that the matrix "growth - share in market turnover" is a conceptual tool that allows you to easily and quickly identify areas for further comparative analysis, its main drawback is that the relative market share does not allow you to correctly assess the competitive position of an enterprise ( that is, there is no clear and definite relationship between market share and the level of income of the enterprise or has grown as a whole).

The second method of strategic analysis is the General Electric business screen matrix (Fig. 1.4) - a descriptive method using an evaluation and regulatory strategy.

It consists of a matrix that combines an internal strengths analysis of an organization with an analysis of the industry's external environment to describe the competitive situation of various strategic organizational units and to guide the allocation of resources between strategic organizational units.

The business screen model offers greater flexibility than the growth-to-market ratio matrix. This is for two reasons: firstly, different variables can be included in the definitions of business stability and industry attractiveness, allowing for a more detailed analysis, and secondly, different weights can be assigned to the selected variables, making the business screen more useful in each unique situation of each strategic organizational unit. The disadvantages of this method is the exhaustibility of the considered variables chosen to determine the stability of the business and the attractiveness of the industry. Moreover, the choice of significance for each variable is subject to bias and error. The use of return on invested capital as the only benchmark does not fully reflect the performance of an enterprise that competes in the market with other economic entities.

The industry analysis method (the “five forces” model) has become widespread, which offers a structured analysis and overview of any industry (Fig. 1.2)

Rice. 1.2

The purpose of this method is to identify the development potential of the industry. Competitive forces analysis is used to identify the main sources of competitive forces and the corresponding strength of these influences. The use of the "five forces" model will greatly improve the analysis of the environmental component in the formulation of the strategy and its practical application. The main weakness of the five forces model is the assumption that the economic structure of industries drives competition. Moreover, this framework is designed to analyze the strategies of only individual organizational units, since synergies and interdependencies of the overall corporate level portfolio are not taken into account.

The most popular method of strategic analysis is SWOT analysis or TOWS analysis, which is an abbreviation consisting of the words: "strengths", "weaknesses", "opportunities" and "threats". SWOT analysis is an analogue of a more detailed situational analysis, used to assess the possible comparison of an organizational strategy, its internal capabilities (namely, strengths and weaknesses) and external conditions (that is, its opportunities and threats).

One of the most important advantages of SWOT analysis is its wide applicability. It can be applied to a wide variety of organizational units, including individual managers or decision makers, teams, projects, products/services, functional areas of an organization (e.g. accounting, marketing, manufacturing and sales), manufacturing units, corporations, conglomerates and product markets. SWOT analysis does not require special financial or computer resources, it can be carried out quickly and with high efficiency without the need to collect a lot of data. The SWOT model is clearly a descriptive model that does not provide the analyst with clear and well-articulated strategic recommendations. A SWOT analysis will not provide the decision maker with concrete answers. On the contrary, the method is a way of organizing information and determines the probabilities of potential events - both positive and negative - as a basis for developing business strategy and operational plans. Usually, as a result of the analysis, only too generalized, clearly manifested recommendations are offered: to protect the company from threats, to align the strengths of the company with its capabilities, or to protect the company from weaknesses using methods and means of protecting property, stimulating the creative activity of the company's personnel, developing innovative activities .

Thus, we believe that in the theory and practice of strategic planning there is no clear classification of methods of strategic analysis and there is no the most optimal one. Moreover, the attribution of a particular method to strategic analysis or strategic choice is most often very conditional, since the methods (models) themselves are quite universal. In strategic analysis, as noted above, the focus is on qualitative, substantive aspects.

Part 1

Master's degree

direction "Management",

program "System Management"

direction "Economics"

program "Financial planning and control"

Lecturer - Ph.D. in Economics, Associate Professor Shcherba Tamara Andreevna

Kaliningrad

		Page
1.	The concept of strategic analysis. The role of the analytical unit in the system strategic management…………………………………
2.	Analysis of macro-environment factors: PEST-analysis……………………………
3.	A modern approach to the analysis of industry structure and competition. The concept of sustainable competitive advantage……………
4.	Analysis of company resources and competencies. SNW analysis………………..
5.	Assessment of the strategic type of a company: consumer matrix and producer matrix……………………………………………………..
6.	Matrix models of portfolio analysis of diversified companies……………………………………………………………………..
7.	Generalizing methods of situational analysis: SWOT analysis, GAP analysis, cost analysis…………………………………………………
8.	List of basic and additional educational literature…………….
9.	Practical illustrations………………………………………………
10.	Glossary…………………………………………………………………

Topic № _1__ “__The concept of strategic analysis. The role of the analytical unit in the strategic management system»

Plan:

1. Place of strategic analysis in the system of strategic management

2. The modern concept of strategic analysis

3. Strategic analysis as the basis for the formation of a company's strategy

4. Sources of information for strategic analysis

Educational information on the topic

The strategic management process begins with strategic analysis. Strategic analysis is the basis for assessing the strategic position and the formation of strategic alternatives. The essence of strategic analysis is to identify trends, the nature and dynamics of the external environment, assess the state of the company, assess the state of the company, identify its strengths and weaknesses, assess the degree of impact of risks.

The structure of the basic model of strategic management includes elements of three sections: strategic analysis h, strategic planning, strategy implementation and strategic control

Purpose of strategic management:

• ensuring that the whole company is focused on the key aspect of the strategy: “What are we trying to do and what are we achieving?” , thus defining the vector of development.
• the need for managers to respond more clearly to emerging change, new opportunities and threatening trends.
• the ability for managers to evaluate alternative capital investment and staff expansion options, i.e. wisely transfer resources to strategically sound and high-impact projects.

· the ability to combine the decisions of managers at all levels related to the strategy.

• creating an environment conducive to development and counteracting trends that can only lead to a passive response to changing situations.

The study of different views on the company's strategy made it possible to single out the most preferable one given by M. Porter:

“The essence of strategy is the ability to choose what should be abandoned. If there were no alternative, there would be no need for a strategy. A good idea will be quickly copied by competitors. Again, the profit will depend on the operating efficiency of the company. The choice of strategy comes down to the choice of points of growth and competitive advantage».

The purpose of strategic analysis is an objective assessment of strategic alternatives and the choice of "growth points" based on an analysis of the external and internal environment.

Purpose of strategic analysis- to form a reliable opinion about:

¾ what is the company as an economic entity, how it functions and is managed, what are the results of its activities and how they are formed, what are the strengths and weaknesses at the moment;

¾ what external factors influence the development of the company as a system, what

the mechanism of their impact, how these factors are manifested and measured, what are the trends of their change in the future.

Conceptually, the process of strategic analysis is presented in Figure 1.

Figure 1- Strategic Analysis Process

The initial stage is the formulation of strategic initiatives. Strategic Initiatives are the intentions of the owners and top management regarding the key idea and business model, vision and mission, strategic goals and objectives. In terms of strategic alternatives, owners and managers express their intentions, wishes and requirements for the future state of the company. Strategic initiatives are characterized by:

¾ ambitious ideas;

¾ the scope of activities and structure of the company;

¾ predetermining influence on performance results.

Examples of strategic initiatives include:

¾ changing the key idea of ​​the business;

¾ improvement of the business model;

¾ mergers or acquisitions, sale of part of the business;

¾ attraction of strategic partners, etc.

The main stages of strategic analysis:

1. Analysis of the internal environment is the process of evaluating the company's performance over a certain period of time in functional areas, the purpose of which is to form a reliable opinion about what the company is like, how it functions and is managed, what opportunities and problems it has at the moment.
2. Analysis of the external environment- this is the process of determining the state and key factors, identifying trends in their change and assessing the degree of influence on the company's activities, the purpose of which is to identify opportunities and threats from the outside based on an assessment of the competitive and macro environment.
3. Analysis of strengths, weaknesses, opportunities and threats– SWOT analysis, the results of which make it possible to form a field of strategic alternatives and evaluate each of them from the standpoint of strengthening the company's competitiveness.
4. risk analysis, which is necessary to understand the degree of exposure of the company to the influence of uncertain external factors. The essence of this stage of the analysis is to identify risks, determine the factors that cause them, and identify the likely consequences of their occurrence.

The results of strategic analysis make it possible to form a reliable and complete picture of what is happening inside and outside the company, its competitive advantages and disadvantages, development opportunities and threats, and the degree of riskiness of strategic alternatives. Each alternative ultimately receives a characteristic in the following aspects:

¾ areas of development: portfolio of strategic business units, product line, target customer groups;

¾ essence of development: business model, business concentration or diversification, competitive advantages, development priorities;

¾ strengths and weaknesses of the company, development opportunities and threats;

¾ sources of development: growth of own and borrowed capital, mergers and acquisitions, strategic alliances, restructuring;

¾ assessment of risks and the degree of their impact on the development of the company;

¾ compliance of the strategic alternative with the strategic initiatives and expectations of owners and managers.

Based on the results of the analysis, decisions can be made on the choice of strategic alternatives, which is the basis of goal setting.

Table 1 presents a matrix of combining strategic analysis techniques with the stages of developing a company's strategy.

Table 1 - The use of strategic analysis techniques in the process of developing a strategy

Methods of strategic analysis	Stages of strategy development
Developing a vision and mission	Development of strategic goals	Choosing a strategy	Implementation of the strategy	Strategy evaluation
PEST analysis	+	+	+
SWOT analysis	+	+	+
Industry Analysis and Competitive Analysis	+	+	+	+	+
Positional Analysis	+	+	+	+	+
Resource analysis (SNW analysis)		+	+	+	+
Strategic cost analysis			+	+	+
Control system diagnostics		+	+	+	+
Diagnostics org. culture	+	+	+	+	+

Effective implementation of a strategic analysis of the external and internal environment of the company is impossible without a well-functioning information support systems. In general, information sources are divided into external and internal. To external sources include legislative and regulatory documents, statistical data, periodicals, economic literature, independent expert assessments, market information, etc. To internal sources include accounting and management accounting and reporting data, constituent documents, technical documentation, audit reports, etc.

A comparative assessment of information sources for strategic analysis is given in Table 2.

Table 2 - Sources of information for strategic analysis

Sources of information	Characteristic
1. Officially disclosed information (annual reports, etc.).	It is one of the most reliable and complete sources. The downside is that only open joint-stock companies officially disclose information, and for the analysis of small companies, you will have to look for other ways.
2.Official statistics	Government statistics may not contain data on some important market players. Therefore, statistics are useful not so much on their own, but in combination with general market trends and information obtained in other ways.
3. Internal press of the enterprise	Large companies very often place on their website issues of a corporate newspaper prepared by employees of the enterprise. They raise the most pressing issues. Usually they are identified with great difficulty during interviews with leading specialists of the company, but here they are presented in finished form.
4. Publications in the press (analytics, news).	The value of this source is very often underestimated, although sometimes it allows you to find completely closed information. In addition, this source of information is very good for preliminary acquaintance with the situation in the industry and allows you to understand the main specifics of the business, its main problems and trends.
5. Competitors	They are interesting, first of all, for their market assessments, how they position their products, what methods they use to promote them and stimulate sales. Sometimes obtaining information from them in a direct way is impossible, and then various options can be used. The most affordable way is to act on behalf of the buyer. Indirect sources of information can be advertising campaigns of competitors, information of service, transport companies serving them, etc.
6. Market Experts	In addition to competing companies, there is a huge variety of industry experts: research institutes, various associations, large clients. Their main feature and advantage is that they see the entire situation in the industry, they can clearly capture common features and trends.
7. Exhibitions	They allow you to quickly establish contact and collect data on the main players in the industry. They are good because in front of your eyes are all the companies of interest at once on one site. Moreover, they, as a rule, are tuned in to communication, ready to share information.
8. Industry associations, informats. portals	As a rule, they contain information of sufficiently high quality, prepared by specialists who know the specifics of their industry well. This is a good and reliable source of information.
9. Purchase analytics	Various studies are now on the market very widely. Their use is a good alternative to conducting market analysis on your own, but there are a number of significant limitations. When purchasing a study, you need to be sure that it contains the necessary information. Another problem may be the quality of the information available in the report. Try to clarify how you can get answers to these questions before you buy the study.

Of particular importance among sources of external information are the results of research and forecasts of independent experts specializing in a particular industry.

Questions for self-control

1. Determine the place of strategic analysis in common system strategic management.
2. What are strategic initiatives?
3. What are the stages of strategic analysis?
4. What are the main methods of strategic analysis. How do they relate to the stages of strategy development?
5. What sources of information do you know for strategic analysis? Describe them.

Strategic analysis involves the study of the provisions of the organization, for which changes in the external environment of the organization are studied and the advantages (disadvantages) of the organization's resources that it may have with these changes are evaluated. The main purpose of strategic analysis is to evaluate the key impacts on the current and future position of the organization.

There are 3 components of strategic analysis:

1) Purpose, objectives and expectations. The goal and main objectives provide the background in which the proposed strategies are formulated, as well as the criteria by which they are evaluated. The goal establishes the meaning of the existence of the organization and the nature of its activities. The main objectives define what the organization intends to accomplish in the medium and long term to achieve the goal.

2) Analysis of the external environment. The second component of strategic analysis is the study of the characteristics of the external environment in which the organization operates. The external environment can create opportunities or threats for the organization: the organization exists against the backdrop of a complex external environment that includes many elements: political, technological, social and economic. The external environment is undergoing significant changes, which poses a major strategic issue for the organization.

3) Analysis of internal resources. The third component of strategic analysis is an analysis of the internal resources available to the organization of the key advantages and disadvantages of the organization. The purpose of the analysis is to develop an overall picture of the internal influences and constraints on strategic choices. Internal analysis focuses on two areas: identifying the strengths and weaknesses of organizations and identifying expectations and opportunities to influence the enterprise's strategic planning process. One of the results of strategic analysis is the formulation of the overall goals of the organization, which determines the scope of its activities. Based on the goals, tasks are put forward.

Model "Semi - S"

The Seven C's are a framework for analyzing the performance of organizations. They represent the seven elements key to the success of an organization - they are: strategy, structure, systems, style, dexterity, people, and shared values. This theory has helped change the way managers approach the issue of improving organizations. She says that it is not enough just to develop a new strategy and follow it. And it's not about creating new systems that generate improvements. To be effective, your organization must have a high degree of alignment (internal coherence) between all seven Cs. Each "C" must be consistent with the other "C" and reinforce them.

All "C"s are interdependent, so a change in one of them affects all the others. It is impossible to achieve progress in one area without progress in all other areas. Therefore, in order to improve the organization, you need to pay attention to all seven elements at the same time.

Strategy- the way of further development chosen by the organization; a plan designed to achieve sustainable competitive advantage.

Structure- the framework within which the activities of the members of the organization are coordinated. The four basic forms of structure are: functional, branch, matrix, and network.

Systems- formal and informal procedures, including compensation, information management and capital allocation systems that govern day-to-day operations.

Style- the leadership approach of top management to business and the overall production approach of the organization; also the manner in which employees of the organization present themselves: to suppliers and buyers.

Skill- what the company does best, the distinctive abilities and capabilities of the organization.

Employees- labor resources of the organization; refers to the development, training, socialization, integration, motivation of personnel and management of their promotion.

Shared Values- originally called subordinate goals - the guiding concept and principle of the organization's values ​​and aspirations. Often unwritten fundamental ideas that go beyond the stated goals of the corporation around which the business is built, factors that influence the work of the group towards achieving a common goal.

The essence of SWOT - analysis

SWOT - this abbreviation is made up of the first letters English words. SWOT - analysis means identifying the strengths and weaknesses of the organization, external threats and opportunities that may hinder or help the organization in its activities. The SWOT analysis technique is to compare the company's internal strengths and weaknesses with its external opportunities and threats and is a very useful and easy to use tool for a quick overview of the company's strategic position. It is based on the position that the strategy must ensure a strict correspondence between the internal capabilities of the firm and the situation outside it.

When conducting a SWOT analysis, the following are considered:

1 - strengths - this is something that the company does especially well and is considered an important characteristic in its competitive struggle;

2 - weaknesses - what the company lacks or what it does poorly in comparison with others, i.e. internal conditions that put it at a disadvantage.

3 - Opportunities - favorable factors and changes in the external environment that can give a particular company any competitive advantage or open important growth and development paths for it.

4 - threats - factors of the external environment of a particular company that pose a threat to its well-being and prosperity, for example: the emergence of cheaper technology, the introduction of new and cheaper products by competitors on the market.

Portfolio Analysis: Boston Advisory Group Matrix

The strategic analysis of the company is called portfolio analysis. An enterprise portfolio, or a corporate portfolio, is a collection of relatively independent business units (SEBs) owned by one owner. Portfolio analysis is a tool by which the company's management identifies and evaluates its economic activity in order to invest in the most profitable or promising areas and reduce investment in inefficient projects.

At the same time, the relative attractiveness of the markets and the competitiveness of the enterprise in each of these markets are assessed. It is assumed that the company's portfolio should be balanced, i.e. the right combination of products that need capital for further development with economic units that have some excess capital must be ensured. The purpose of portfolio analysis is the coordination of business strategies and the distribution of finances between the business units of the company.

The normal analysis process includes 4 stages and is carried out according to the following scheme:

Stage 1. All activities of the enterprise are divided into SEB.

Stage 2. The relative competitiveness of individual business units and the development prospects of the respective markets are determined.

Stage 3. A strategy is developed for each business unit and business units, with similar strategies are combined into homogeneous groups.

Stage 4. Management evaluates the strategies of all divisions in terms of their alignment with the corporate strategy, commensurate the profit and resources required by each division, using portfolio analysis matrices.

The Boston Matrix is ​​based on a product life cycle model, according to which a product goes through 4 stages in its development:

1) Entering the market (product - "question mark");

2) Growth (product - "star");

3) Maturity (product - "milk cow");

4) Recession (goods - "dog"). To assess the competitiveness of certain types of business, 2 criteria are used: the growth rate of the industry market and the relative market share.

Zvezda are market leaders. They generate significant profits due to their competitiveness, but also need funding to maintain a high market share. "Question mark" - the goods in this group can be very promising, as the market expands, but requires significant funds to maintain growth. With regard to this group of products, it is necessary to decide whether to increase the market share of these products or stop financing them. "Cash cows" are products that can generate more profit than is necessary to sustain their growth.

They are the main source of funds for investing in a new product. "Dogs" are products that are at a cost disadvantage and have no room for growth. The preservation of such goods is associated with significant financial costs with little chance of improvement. They do not need investments, if they bring profit, it is advisable to keep them as part of the company. Possible sale. Ideally, a balanced portfolio of an enterprise should include 2-3 goods - "cows", 1-2 - "stars", several "question marks", as a reserve for the future a small number of goods "dogs".

Portfolio analysis based on the McKinsey matrix

The matrix is ​​characterized in a coordinate scheme, one of the axes of which is the attractiveness of the industry in which the SEB operates, and the other axis is the competitive position of the SEB in the industry. Attractiveness of the industry: profitability, industry growth, industry size, technological stability. Competitive position in the industry: production costs, productivity, market share. Horizontally, the competitive position is plotted, and vertically, the attractiveness of the industry. Each of the axes is divided into 3 equal parts, characterizing the degree of attractiveness of the industry (high, medium, low) and the state of the competitive position (good, medium, poor). Inside the matrix, 9 squares are allocated, hitting which indicates what place the company's strategy should be given to them in the future.

In relation to those SEBs (products) that fell into the “success” square, the company must apply a development strategy. These businesses are well positioned in attractive industries, so the future clearly belongs to them. SEBs (products) that appear in the “question mark” box may have a good future, but for this the firm should make great efforts to improve their competitive position. SEB, which are in the "profitable business" square, is a source of money. They are very important for maintaining the normal life of the company. But they can die, because. attractiveness to firms of the industry in which they are located is low. Getting into the “medium business” square does not make it possible to unambiguously judge the future fate of SEB. In relation to it, a decision can be made only on the basis of the analysis of the state of the entire portfolio of business (products).

With regard to SEBs that fell into the “defeat” square, it can be concluded that it is in a very undesirable position, requiring fairly quick and effective intervention in order to prevent possible serious negative consequences for the company. The expediency of this strategy is to invest in SEB in order to maintain its position and follow the development of the market. The “business screen” reflects the results of the study for all strategic units of the enterprise and, on the basis of this, forms the market strategy of the enterprise as a whole.

Conclusions for the strategy on the matrix "McKinsey":

1 - resources should be taken from the losers and given to the winners, the position of the winners is strengthened.

2 - "question marks" the organization is trying to turn into winners.

3 - resources are invested in winners and "question marks". Based on these findings, the organization chooses a development strategy.

New economy

Economic and technological changes in the 1990s and 2000s were colossal. They have led some economists to refer to these changes as the "Third Industrial Revolution". Of course, the "third industrial revolution" is a delusion. The revolution can be attributed to the 1980s, moreover, it cannot be called "industrial". Rather, it is a "post-industrial" revolution. It marked the transition to an information economy, to a knowledge economy, to a new economy.

Digital technologies and new means of communication, the Internet, wireless telephony and, finally, new wireless telephony that does not require cellular networks have become an important driving force behind the "new economy". However, the triumph of the new economy has more than once been replaced by collapse. The new economy, like previous economies, is prone to crises caused by the periodic onset of pessimism and a drop in business activity.

In the new economy, the source of value is primarily information, such as software, rather than material values. P. Romer points out that the main feature of a new value - a movie, a book, a computer program or a business system - is that the initial cost of its creation is very high, but subsequent copies cost many times less.

Economies through reproduction, combined with complementary relationships between different types of knowledge, contribute to an unprecedented increase in the level of productivity. Digital technologies reduce the cost of reproducing value to almost zero and facilitate instant global distribution.

In the business of transforming administrative processes and the way firms make decisions, cardinal changes are coming, as firms will have to move to high-speed electronic communication processes, to real-time decision making.

Competition and increased environmental variability

New information technologies, instead of being the source of extraordinary wealth that many expected, increased competition and reduced profitability in all industries. E-commerce has lowered barriers to entry and expanded the geographical coverage of markets, increased price transparency. Digital technologies combined with network effects have created winner-take-all markets where price competition has intensified.

The intensification of competition is far from the only source of increased volatility in the business environment. The acceleration of technological change has become a major cause of unpredictability. Climb Nokia and decline Motorola in the mobile phone industry gives vivid evidence of the ruthlessness of the forces of creative destruction, which J. Schumpeter wrote about. Economic uncertainty and volatility manifest itself in price volatility across multiple markets.

Influence of social groups

Events of the 2000s contributed to the confirmation of these ideas and discredited the doctrine of maximizing the value of the firm, which dominated in the 1990s. Notably, some of the most praised in the 1990s firms that exemplify shareholder value maximization have been the hallmark victims of the new decade.

As a result, demands for increased social responsibility of companies began to be heard more and more loudly. The harshest criticism was directed against the system of payments to top management, which came to be considered generous to the point of obscenity. Expectations have spread in society that firms should expand their commitments to consider the interests of staff, local communities, the natural environment and the economic development of the third world. S. Hart and K. Prahalad argue that such initiatives can pave the way for innovation, growth, and ultimately shareholder value, rather than becoming an additional cost source.

Expectations about the social role of companies matter to the relationship between employees and the firms they work for. In the past, employment was regarded primarily as a source of economic security and material reward. But people are increasingly looking for meaning, identity, and companionship beyond financial gain. This “paradigm shift” has important implications not only for governance by human resourses but also for strategy, management roles and corporate identity.

It is a means of transforming the database resulting from the analysis of the environment into the strategic plan of the organization. Strategic analysis tools include formal models, quantitative methods, analysis that takes into account the specifics of the organization.

Strategic analysis can be divided into two main steps:

1. Comparison of the benchmarks set by the firm and the real opportunities offered by the environment, analysis of the gap between them;

2. analysis of possible options for the future of the company, identification of strategic alternatives.

When strategic alternatives are identified, the firm moves to the final stage of strategy development - the choice of a specific strategy option and the preparation of a strategic plan.

Gap Analysis

Gap analysis is a simple but effective method and analysis. Its purpose is to determine whether there is a gap between the firm's goals and its capabilities and, if so, how to "fill" it.

Gap Analysis Algorithm:

Determination of the main interest of the company, expressed in terms of strategic planning (for example, in increasing the number of sales);

Finding out the real possibilities of the company in terms of the current state of the environment and the expected future state (in 3, 5 years);

Determination of specific indicators of the strategic plan, corresponding to the main interest of the company;

Establishing the difference between the indicators of the strategic plan and the opportunities dictated by the real situation of the company;

Development of special programs and methods of action necessary to fill the gap.

Another way to apply gap analysis is to determine the difference between the highest expectations and the most modest forecasts. For example, if top management expects a real rate of return on capital employed of 20%, but analysis shows that 15% is the most realistic, discussion and action is required to close the 5% gap.

Filling can be done in several ways, for example:

By increasing productivity and achieving the desired 20%;

By abandoning more ambitious plans in favor of 15%;

The following methods of strategic analysis are usually used to identify strategic alternatives, possible options for a strategic plan.

Cost Dynamics Analysis and Experience Curve

One of the classic strategy models was developed in 1926. It links the definition of strategy to the achievement of cost advantages.

The reduction in costs with an increase in production volume is due to a combination of the following factors:

1. advantages in technology that arise with the expansion of production;

2. learning by experience the most effective way to organize production;

3. economies of scale effect.

According to the experience curve, the main direction of the firm's strategy should be to gain the largest market share, since it is the largest of the competitors who has the opportunity to achieve the lowest unit costs and, therefore, the highest profits.

The application of the experience curve is possible in the branches of material production.

In modern conditions, the achievement of cost leadership is not necessarily associated with an increase in the scale of production. The current high-tech equipment is designed not only for large-scale production, but also for small ones. Today, even a small firm can use computers, modular equipment that provides high performance and the ability to reconfigure to solve various specific problems. The main disadvantage of the model is that it takes into account only one of the internal problems of the organization and inattention to the external environment (primarily to the needs of customers).

Analysis of market dynamics, life cycle model

The analysis of the dynamics of the market for a given product is based on the well-known model of the life cycle of a product, which is an analogy of the life cycle of a biological being.

The life of a product on the market is divided into several main stages, each of which has its own level of sales and other marketing characteristics:

• birth and introduction to the market - small sales and growth-oriented strategy;
• growth stage - a significant increase in sales and a strategy for rapid growth;
• maturity stage - sustainable sales and stability-oriented strategy;
• stage of market saturation and decline - sales decline and reduction strategy.

The purpose of the life cycle model is to correctly determine the business strategy for each stage of the product's life on the market. There are a large number of life cycle modifications depending on the types of goods. However, the strategy should not be tied too tightly to the life cycle model.

The "experience curve" and "life cycle" models are the simplest methods of strategic analysis, since they associate strategy development with only one of the factors of the firm's activity. The methods described below are more complex and follow the path of linking the various components of the internal and external environment of the organization.

Model "product - market"

Suggested by A.J. Steiner in 1975. It is a matrix that includes the classification of markets and the classification of products into existing, new, but related to existing, and completely new products.

Rice. 1. Matrix "market-product"

The matrix shows the levels of risk and, accordingly, the degree of probability of success for various market-product combinations. The model is used for:

1. determining the probability of successful activity when choosing a particular type of business;

2. choice between different types of business, including when determining the ratio of investments for different business units, that is, when forming a company's securities portfolio.

Portfolio Strategy Analysis Models

Portfolio models determine the present and future position of the business in terms of the attractiveness of the market and the ability of the business to compete within it. The original, classic portfolio model is the BCG (Boston Consulting Group) matrix.

The matrix indicates four main business positions:

1. highly competitive business in fast growing markets - ideal "star" position;

2. A highly competitive business in mature, saturated, stagnant markets (which produce steady profits, "cash cows" or "money bags") is a good source of cash for the firm;

3. not having good competitive positions, but operating in promising markets "question marks", whose future is uncertain;

About the combination of weak competitive positions with markets that are in a state of stagnation - "dogs" - outcasts of the business world.

The BCG model is used:

To determine interrelated conclusions about the position of the business unit (business) that is part of the organization, and its strategic prospects;

Using the BCG matrix, the company forms the composition of its portfolio (that is, it determines the combination of capital investments in various industries, various business units).

Within the framework of the BCG matrix, strategy options can be proposed:

1. Growth and increase in market share - the transformation of the "question mark" into a "star" (aggressive "question marks" are sometimes called "wild cats").

2. Maintaining market share is a strategy for cash cows whose revenues are important for growing businesses and financial innovation.

3. "Harvesting", that is, obtaining a short-term share of the profits as much as possible, even at the expense of reducing market share - a strategy for weak "cows", deprived of the future, unfortunate "question marks" and "dogs".

4. Liquidation or abandonment of the business and the use of the resulting funds in other industries - a strategy for "dogs" and "question marks" who do not have more opportunities to invest to improve their positions.

The BCG model has the following advantages and disadvantages:

Advantages:

The model is used to study the relationship between the business units that make up the organization, as well as their long-term goals;

The model can be the basis for the analysis of different stages of development of a business unit (business);

It is a simple, easy-to-understand approach to organizing an organization's business portfolio (security portfolio).

Flaws:

Does not always correctly assess business opportunities. For a unit defined as "dog", it may recommend exit from the market, while external and internal changes are able to change the position of the business. So, a small farm supplying vegetable products in the 70s could be assessed as a "dog", but by the 90s, environmental degradation and a special attitude towards "clean" products created new prospects for this business;

Overly focused on cash flow, while investment performance is equally important to the organization. Aimed at super growth and ignores the possibility of business recovery, application of the best management methods.

A more complex version of the portfolio model is the McKinsey multi-factor matrix of the company that is developing it by order of General Electric.

Evaluation of the multi-profile portfolio model:

Its advantage over a simple portfolio model is that it takes into account the largest number of significant factors in the internal and external environment of the company;

In the application of this model, there are limitations, which include the lack of specific recommendations for behavior in a particular market, as well as the possibility of a subjective, distorted assessment by the firm of its position.

Source - I.A. PODELINSKAYA, M.V. BYANKIN STRATEGIC PLANNING Tutorial. - Ulan-Ude: Publishing House of the ESGTU, 2005. - 55 p.