StrategyStrat should answer 3 ques 1. Where you are- starting point 2. where you want to be3. how to get there Strategy is simplest insight, odnt complicate it Strategy diamond- 5 elements Arenas, vehicles-how going to serve, differentiator-, economic logic-how to generate profit, stajing and pacing- at what rate you are growing and expanding Why differntiate- customer pay more Two views on stratgeyindustrial organisation view macro to micro view- every industry is impacted by external forces and how we can leverage them 1. Study external environment 2. locate an industry with high potential for above avg returns 3. identify start for attractvie indstry resource based view of above avg return micro to macro view- capabilites of organs and try to cater it to other industry stages1. identify firms resources 2. identify strength and weakness 3. determine firms capabilities 4. determine potential of firms resources and capabilities in term of competitive advantage Why strategy is required1. scarcity of resource,innovation, 2. uneven distribution of resources 3. why paytm ipo not subscribed, Competitive advantage- something competitiorsc annot replicate Test in strategy1. fit test2. perfromanc etest 3. competitive advantage test 5P of strategy- all are interconnected 1. Plan 2. position- how you want your customer to perceive you, 3. ploy- how to disrupt/challenge your competition 4. pattern-find the pattern and make stratgey acc 5. perspective- speaks about culture within organisation Start management process1. Environment scanning- understand external environment 2. establishing vision and mission 3. 3. crafting a strategy 4. strategy implementation or execution 5. stratgey monitoring and evaluation Clear the law, better the business Political Economic SocietyTechnology Environment- Legal- Environmnet, Business- Triple line Porters 5 forces Threat of new entrants- how easy or difficult is to enter new markets Capital reqmnt Size of organisation Distribution network Government policies and regulation Cost of switching- dusre brand me jane ka cost Substitute-different product but meeting sameneed like mbile is substitute of watch,calc,radio Threat of substitutes is high whenCost of switching-low Affordable and accessible Quality and serivce offering better Bargaining power of suppliers is low when Cost of switching-low Cost of substitute-low If unique reqmt is low Number os supplier is more Bargaining power of buyer-more Number of supplier is more Cost of substitute-low Cost of switching-low Rivalry within industry-high Competitors-more Buyers price sensitive-more Exit barriers-high Growth rate-low 5 generic startegi Cost leadership- low price more sale, buy in volumes from supplier, Works best when product is standarized, cost of switching is low challenges- tech advacnement, do not fixate on cost, Differentiation strategy-adding value to product to make it unique Why differentiate-brand loyalty,sustain,edge over substitute, Works well when-buyer have diverse needs and reqmnt, Challenges-price sensitive, fake piece,high cost r&d, Focus cost differentiation startegyWork when-sizeable number of customer Focused DifferentiatonStuck in middle- neither differntiated player nor low cost SW- internal OT – external Strength- maximinse Opportunities- leverage Sustainable competitive advantage- how long you could hold that one fluke advantage V – valuable- what is value of product to the company R rare- how rare or difficult it is for competitor I inemitable how easy difficult to copy N non substitute-if resource is vulnerable to substitute O organised to capture value Primary activitiesInbound logostics operations Outbound logistics- product shifting from org to customers Marketing and sale- activities rrelated to pricing,promotion,discounts etc Service- all the after sale service