WAZIR
IIM ROHTAK
KNOWLEDGE SESSION
STRATEGIC MANAGEMENT
TERM III
STRATEGY
A strategy is an integrated and coordinated set of commitments and actions designed to exploit core
competencies and gain a competitive advantage.
Strategic Planning
Tactical Planning
Operational Planning
Duration
Long term(>3
years)
Medium term(<3
years)
Short term(day to day)
Done by
Senior
management
Middle
management
Frontline workers
Necessary
information
Primarily external
information regional, national,
international
Primarily
information from
within the
organization
Ground level and daily
operational information
within the company
Broad in nature;
subjectively based
Detailed
information and
analysis; objectively
based
Detail level processes for
specific outcomes
Degree of
detail
© Wazir- The Strategy & Consulting Club, IIM Rohtak
MISSION & VISION
Mission
“present self”
The present reality of your organization.
Defines who you are and what you do.
Outlines core values and principles.
Focuses on current activities and deliverables.
WHY ARE MISSION AND VISION IMPORTANT?
Having a clear and compelling mission and vision is like having a
compass for the organization. They provide direction, clarity, and
purpose, guiding organization’s team towards shared goals. They also
act as a magnet, attracting and retaining talent who align with
organization’s values and aspirations. Moreover, they serve as
benchmarks to measure your progress and assess the impact.
Example Let's look at a real-world example. Google's mission clearly defines its
present role: organizing information and making it accessible. Its
vision, however, paints a broader picture of its desired impact: building
a better world through technology. This combination provides
direction, attracts talent, and inspires its team to push boundaries.
Vision
“dream future”
The aspirational future of your organization.
Describes where you want to be.
Paints a picture of your ideal impact.
Focuses on long-term goals and desired outcomes.
Vision-Level BHAGs
Big, Hairy, Audacious Goals
Ambitious, long-term (10-30 years) goals designed to energize the entire
organization.
Require extraordinary effort, perhaps a little luck (50-70% chance of success).
Examples:
\\
Sony: Change the poor-quality image of Japanese products worldwide
NASA: Land a man on the moon and return him safely
Creating Effective BHAGs:Think in terms of 4 categories: target, common
enemy, role model, and internal transformation.
Vivid Description is a vibrant, engaging picture of achieving the BHAG,
making it tangible and motivating - create by asking questions about the
desired future state: How will it feel? Look like?
CORE IDEOLOGY VS BHAG
Core ideology: The unchanging reason why the organization exists.
BHAG: A specific, achievable goal within 10-30 years that
contributes to the core ideology.
© Wazir- The Strategy & Consulting Club, IIM Rohtak
PATH DEPENDENCE & LONG TAIL EFFECT
PATH DEPENDENCE
Expertise that a company develops during its
journey while navigating in its arena
Set of unique knowledge, expertise and
resources developed owing to its unique path
LONG TAIL EFFECT
A phenomena wherein you maintain a rich
inventory that has low maintenance cost, and
low demand.
Example: Netflix
Netflix began as a mail-order DVD rental service. This unique
strategy, unlike brick-and-mortar rentals, built expertise in data
management, logistics, and personalized recommendations
Leveraging their expertise in data, logistics, and customer
understanding, Netflix transitioned to streaming. They were
well-positioned to personalize content recommendations and
build a vast online library, drawing on their knowledge from the
DVD era
Netflix's unique path dependence created a First-mover
advantage in streaming and personalized recommendations
Netflix has a rich repository of old movies and unpopular
genres that have cheaper maintenance costs because of low
royalty charges.
Thus through this strategy, Netflix covers a group of
subscribers who may not find their favorite showcase in the
portfolio of products on any other platform.
With the merge of many small markets involving less popular
movies or series, Netflix managed to create a large
community of subscribers making Netflix one of the largest
providers of online streaming services in the world
© Wazir- The Strategy & Consulting Club, IIM Rohtak
PORTER'S GENERIC COMPETITIVE STRATEGIES
NARROW
SCOPE
BROAD
Cost Leadership
Cost
Leadership
Differentiation
The firm sets out to become the low-cost producer in its
industry. The sources of cost advantage are varied and
depend on the structure of the industry. They may
include the pursuit of economies of scale, proprietary
technology and other factors.
Example: Southwest Airlines, Wal-Mart
Differentiation
Cost Focus
Differentiation
Focus
COST
DIFFERENTIATION
SOURCE OF COMPETITIVE ADVANTAGE
WHERE TO USE
Developing a new business: Choosing the right competitive
strategy for developing a new business
WHERE
TO USE
Launching a new product:
Deciding
how to differentiate your
product in the market through cost, features, or targeting a specific
segment.
Setting pricing strategies: Deciding whether to compete on price,
value, or niche offerings.
In a differentiation strategy a firm seeks to be unique in
its industry along some dimensions that are widely
valued by buyers.
Example: Apple, Harley-Davidson
Cost Focus
In cost focus, a firm seeks a cost advantage in its target
segment.
Example : JetBlue Airlines
Differentiation Focus
In differentiation focus a firm seeks differentiation in its
target segment.
Example : Starbucks
© Wazir- The Strategy & Consulting Club, IIM Rohtak
RESOURCES & CAPABILITIES
Resources and Capabilities are the sources of competitive advantage and the primary source of profitability for any firm. Resources and
capabilities empower a company to drive the business and face competition with their products & and offerings for the needs of
customers.
Resources
Capabilities
An asset or input to production that an organization owns, controls or has
access to on a semi-permanent basis
The ability of an organization to perform a coordinated set of tasks, utilizing
organizational resources, for the purpose of achieving
TANGIBLE
INTANGIBLE
OPERATIONAL
DYNAMIC
With physical existence
Without physical
existence
Make a living
Alter how to make a
living
Examples
Examples
Examples
Examples
Administer
Operate
Govern
Purchase
Manufacture
Orchestrate
Adapt
Innovate
Recognize
Opportunities
Property
Plant
Equipment
Financial
assets
IT systems
Knowledge
Sales Orientation
Client
Involvement
Reputational
Capital
Leadership Skills
© Wazir- The Strategy & Consulting Club, IIM Rohtak
INDUSTRY EVOLUTION
Industries evolve along four distinct trajectories—radical, progressive, creative, and intermediating—that set boundaries
on what will generate profits in a business.
An Industry's trajectory is defined by two types of threats :1. Threat to the industry’s core activities— The recurring activities companies perform to attract and retain suppliers and
buyers that have historically generated profits for the industry and are threatened because of some new, outside
alternative.
2. Threat to the industry’s core assets— The resources, knowledge, and brand capital that have historically made the
organization unique, are failing to generate value as they once did.
1. Radical: Highly disruptive change- normally occurs
following the mass introduction of some new
technology or regulatory changes or simply because
of changes in taste of customers.
2. Progressive: Most common trajectory. In those
industries, the basic assets, activities, and underlying
technologies remained stable.
3. Creative: This means that companies must
continually find ways to restore their assets while
protecting ongoing customer and supplier
relationships.
4. Intermediating: More common than radical
industry evolution occurs when core activities are
threatened with obsolescence.
© Wazir- The Strategy & Consulting Club, IIM Rohtak
VALUE CREATION
Value creation is the process to transform resources into something worthwhile. It is a broad
idea that includes the production of tangible goods and services. It describes the process of
producing value for stakeholders going beyond the initial investment or input.
“Valuable”
Value to Employees
Value to Investors
Value to Customers
COMPONENTS OF VALUE CREATION
IMPORTANCE OF VALUE CREATION
Enhancing Stakeholder Relations for Sustainable Success
Customer Satisfaction and Loyalty
Efficiency and Cost Management
Competitive Advantage
Innovation and Differentiation
Profitability
Sustainability and Social Responsibility
Innovation and Adaptation
Measurement and Evaluation
Shareholder Value Creation
Financial Performance and Adaptation to Market Dynamics
Employee Engagement and Retention
© Wazir- The Strategy & Consulting Club, IIM Rohtak
VALUE CHAIN ANALYSIS
Support activities
PRIMARY ACTIVITIES
Firm Infrastructure
Inbound logistics: availability of raw materials, warehousing, and
distribution
Human Resource Management
Operations: creating products from raw materials
Outbound logistics: delivery of products to customers, including
Technology Development
warehouse, transportation, and distribution
Marketing and sales: all advertising and sales interactions and
activities
Procurement
Service: all forms of customer support interaction and brand
Primary activities
Inbound
Logistics
Operations
credibility
Outbound
Logistics
Marketing
and sales
Service
SECONDARY ACTIVITIES
Infrastructure: any administrative, finance, management, planning,
or legal operations needed to support primary activities
WHERE TO USE
WHERE TO USE
To assess activities in comparison to competitors to identify unique
value propositions and areas where differentiation can be achieved
To assess supplier performance to negotiate improved terms,
strengthen relationships, and boost supply chain efficiency
To study value creation to innovate products/services, optimizing
features to meet customer needs
Technology development: any technological improvements made to
existing machinery, hardware, or software in the name of supporting
primary activities
Human resource management: hiring and then placing workers in
the correct and most efficient positions
Procurement: all purchases related to buying raw materials or any
fixed assets (for example, vendor fees and selection)
© Wazir- The Strategy & Consulting Club, IIM Rohtak
VRIO ANALYSIS (1/2)
VRIO Model
Yes
V
Valuable
Yes
R
Rare
Valuable
This means the resource provides benefit to the organization
How expensive is it, is it easily accessible, should it be
purchased, rented or leased?
Yes
I
O
Imitable
Organised
Rare
No
Competitive
Disadvantage
No
No
No
Competitive
Parity
Temporary
Competitive
Advantage
Unused
Competitive
Advantage
The resource is your unique strength in the market, that
distinguishes the company from its competitors. It is
connected with the rarity or scarcity of the resource
Hard to Imitate
All - Sustained Competitive Advantage
It means that the resource should be difficult to replicate
Concerns with the degree of imitation or to what extent is it
possible to imitate the product
WHERE TO USE
To assess the internal resources and capabilities of your business
to make informed strategic decisions
To identify and understand the sources of your competitive
advantage by analyzing the Value, Rarity, Imitability, and
Organization of your resources
To evaluate the potential of your resources in fostering innovation
and staying ahead in the market
Organised
A resource is organized to capture value only if it’s supported
by the processes, structure, and culture of the company. The
firm must be capable of exploiting the resources
43
© Wazir- The Strategy & Consulting Club, IIM Rohtak
VRIO ANALYSIS (2/2)
VALUE
Starbucks has a number of resources and capabilities that are valuable to customers.
These include a loyal customer base that is willing to pay a premium for its products and services and a wellestablished supply chain that allows it to get coffee beans and other ingredients to its stores quickly and
efficiently
RARITY
A unique store atmosphere: Starbucks' outlets are designed to be comfortable and inviting, offering a place for people to
relax and socialize or work
INIMITABILITY
ORGANISATION
Starbucks' brand is rare and difficult to replicate. It took years to build and maintain
Starbucks' strong management team and efficient organization allow it to open new stores quickly and respond to market
changes
© Wazir- The Strategy & Consulting Club, IIM Rohtak
STRATEGIC DIAMOND (1/2)
Arenas
Arenas
Identifies target areas, including geographical markets,
demographics, channels, product categories, and industries.
Differentiators
Vehicles
Economic
Logic
Outlines the means to reach goals, encompassing joint
ventures, partnerships, licenses, internal development, and
mergers and acquisitions.
Staging and
Pacing
Economic Logic
Vehicles
WHERE TO USE
WHERE TO USE
To guide the development of comprehensive business plans
To inform investment decisions through strategic analysis
To shape marketing strategies considering market focus and
differentiators
To evaluate organizational performance
To ensure alignment across organizational units and teams
To communicate strategic direction effectively to stakeholders
Differentiators
Highlights factors that set the company apart, such as brand,
price point, product/service differentiation, speed, and
competitive landscape.
Staging and Pacing
Examines the order and speed of executing tasks within the
strategic plan, specifying key events and suggested
timescales.
Economic Logic
Focuses on ensuring a healthy margin through factors like
scalability, cost of processes/delivery, commercial models,
and price points.
© Wazir- The Strategy & Consulting Club, IIM Rohtak
STRATEGIC DIAMOND (2/2)
(value creation)
(market segment)
(geographic areas)
(speed of expansion)
(internal development)
(sequence of initiatives)
(lowest costs through scale
advantages)
(reliability)
(lowest costs through
replication advantages)
(price)
(image)
(image)
© Wazir- The Strategy & Consulting Club, IIM Rohtak
RED OCEAN -BLUE OCEAN
In business strategy, red oceans are established markets that are saturated and overdeveloped, while blue oceans are
uncontested and growing markets.
RED OCEAN
Existing High saturated market
Battle from other Market players, cut thorat
compettion
Expand Existing demand
Case 6: S’well : The Mass Market Decision
Blue Ocean Strategy:
S'well's creation of a high-end, premium reusable water bottle
market was a blue ocean strategy, offering a unique, stylish, and
environmentally friendly product.
The introduction of the S'ip bottle targeted at children and
teenagers represents a blue ocean move, creating a new market
space by targeting a different demographic.
S'well's partnership with Starbucks tapped into a new
distribution channel, creating a new market space for its
products.
BLUE OCEAN
New Unsaturated Market
Producing Without Market Segments
Competition
Create and Attract new demand
Red Ocean Strategy:
S'well faces intense competition from copycat products
and lower-priced competitors in the existing market
space
The potential entry into mass market retailers like Target
with the S'ip bottle represents a red ocean strategy,
placing S'well in direct competition with existing lowerpriced products in a highly contested market space.
© Wazir- The Strategy & Consulting Club, IIM Rohtak
PESTEL FRAMEWORK (1/2)
P
Political
E
Economic
S
Social
T
Technological
These factors include government policies, regulations, and
laws that can affect an organization's operations
Economic factors
E Environmental
L
Political Factors
Legal
WHERE TO USE
To identify opportunities and threats in the external environment
To develop strategic plans and assist in making informed decisions
To monitor changes in the macro-environment
To Understand the impact of external factors on the organization
To Benchmark against competitors
Economic trends include inflation, interest rates, and
consumer spending that affect an organization’s functioning
Social Factors
These include population growth, demographics, education,
income distribution, lifestyle trends, and cultural norms
Technological Factors
These include advances in technology, innovation, research
and development, and the adoption of new technologies
Environmental Factors
These include environmental regulations, climate change,
resource scarcity, pollution, and sustainability
Legal Factors
These include contract law, intellectual property law, labor
laws, consumer protection laws, & environmental regulations
© Wazir- The Strategy & Consulting Club, IIM Rohtak
PESTEL FRAMEWORK (2/2)
POLITICAL
Regulations add costs and limit access, but green policies favor OLA's electric offerings.
ECONOMIC
Rising incomes = more ride-hailing demand, but fluctuating fuel prices and inflation hurt customer spending and driver
earnings
SOCIAL
More city dwellers = more ride-hailing demand, but OLA needs to address safety concerns and cater to digital, sustainable
preferences.
TECHNOLOGY
ENVIRONMENTAL
LEGAL
Autonomous vehicles pose a threat, but mobile advancements offer opportunities. OLA must prioritize data security to
address user concerns
Stricter emission standards can incentivize OLA to switch to electric vehicles and cleaner technologies
Regulations regarding driver employment status and rights impact workforce management and potential liability
© Wazir- The Strategy & Consulting Club, IIM Rohtak
PORTER’S 5 FORCES (1/2)
Bargaining Power of Buyers
Bargaining Power of
Buyers
Bargaining Power of
Suppliers
Threat of Substitute
Products
This assesses how much influence customers have in a
market. High power means customers can demand lower
prices or higher quality.
Bargaining Power of Suppliers
This evaluates how much control suppliers have over
businesses. High power means suppliers can demand higher
prices or provide lower quality materials
Threat of Substitute Products
Threat of New
Entrants
Competitive Rivalry
WHERE TO USE
WHERE TO USE
To assess the attractiveness and challenges of entering a specific
market
To evaluate the competitive dynamics before making decisions
about mergers, acquisitions, or partnerships
To identify and mitigate risks associated with competitive forces in
the industry
This considers the availability of alternative products or
services. High threat means consumers may switch to
alternatives, impacting existing businesses
Competitive Rivalry
This examines the level of competition among existing
companies in a market. High intensity means companies
fiercely compete, potentially affecting prices and profitability
Threat of New Entrants
This looks at how easy or difficult it is for new companies to
enter a market. High threat means new competitors can
potentially disrupt existing businesses
© Wazir- The Strategy & Consulting Club, IIM Rohtak
PORTER’S 5 FORCES (2/2)
Airline Industry
BARGAINING POWER OF
BUYERS
High
Customers can check prices of different airline companies without any switching costs involved
Customers are willing to fly with different carriers as long as ticket prices are low
BARGAINING POWER OF
SUPPLIERS
Very high
THREAT OF SUBSTITUTE
PRODUCTS
Medium to High
COMPETITIVE RIVALRY
THREAT OF NEW
ENTRANTS
Aircrafts have only two suppliers, namely Boeing and Airbus
Boeing and Airbus therefore have a substantial bargaining power of the prices they charge
Many alternatives to travelling like trains, cars, and the like
High
High number of active players like Indigo, American Airlines, Turkish Airlines, etc.
High fixed costs leading to high barriers to exit
Medium
High upfront investments to start an airline company
New entrants need access to flight routes, licences, insurances, and other qualifications that are not easy to obtain when you are
new to the industry
© Wazir- The Strategy & Consulting Club, IIM Rohtak
BUSINESS MODEL CANVAS (1/2)
How is value created? - Key partners, Key
Activities, Key Resources and Cost Structure
How is value delivered? - Customer
Relationships, Channels, and Customer
Segments
How is value captured? - Revenue Streams
© Wazir- The Strategy & Consulting Club, IIM Rohtak
BUSINESS MODEL CANVAS (2/2)
Ingredient Suppliers:
Establishing partnerships with
suppliers for a consistent
Food delivery, Food
Quick Delivery: Promising
Quick 30 min Delivery, Allowing
Preparation, Sales and
timely delivery of freshly made
customers to create their own
Marketing
pizzas.
pizzas with various toppings.
Individuals and Families:
Offering a variety of pizzas and
sides for home delivery or
takeaway.
supply of quality ingredients.
Customization: Allowing
Online Platforms: Collaborating
customers to create their own
Busy Professionals: Providing a
pizzas with various toppings.
convenient option for quick
with online food delivery
and hassle-free meals.
platforms for extended reach.
Online Ordering: Convenient
Delivery fleet, culinary team,
technology
and user-friendly online
Online orders, physical stores,
platform for easy ordering.
phone orders
Party and Event Planners:
Catering services for
gatherings and events.
Ingredient Costs: Expenses related to sourcing and purchasing ingredients for
Pizza Sales: Generating revenue through the sale of a variety of pizzas.
pizza preparation.
Side Orders: Additional revenue from sales of sides like breadsticks, chicken
Labor Costs: Staff salaries for both in-store and delivery operations.
wings, etc.
Marketing Expenses: Costs associated with advertising and promotions.
Beverages: Revenue from the sale of drinks.
© Wazir- The Strategy & Consulting Club, IIM Rohtak
Levels of Strategy
© Wazir- The Strategy & Consulting Club, IIM Rohtak
FOUR ACTIONS FRAMEWORK
The Four Actions Framework is a blue ocean strategy tool that poses four central questions designed to help you create
value innovation and break the value-cost trade-off. These four key questions or actions include: Eliminate, Reduce, Raise and
Create. The framework helps you raise and create customer value, and reduce or eliminate what is not needed.
1. Eliminate: Cut outdated industry norms that lack
revenue or relevance.
2. Reduce: Streamline competitive features to save
resources.
3. Raise: Address market pain points with
innovative solutions.
4. Create: Pioneer new offerings to meet future
customer needs.
© Wazir- The Strategy & Consulting Club, IIM Rohtak
INTEGRATION
FORWARD INTEGRATION
Your paragraph text
Forward integration is a process in which a
company gains ownership of parts of the supply
chain that occur after their handling of the
product.
Example: Netflix was a DVD rental-by-mail service.
Then company forward integrated into streaming
services and then further into content production,
creating original shows and movies.
1. Purpose is to gain market share
2. Acquisition of distributors and gain control
over distribution channel
BACKWARD INTEGRATION
Backward integration is a business strategy
where a company gains control of its suppliers
by acquiring, merging with, or starting its own
businesses that previously provided raw
materials, components and other inputs for its
products or services.
Example: Apple started manufacturing M1 chip for
its own laptops. The development of the chip
eliminated the need for third-party chips from
Intel and provided more creative control.
1. Purpose is to gain economies of scale and
creative control
2. Gain control over the supply chain
© Wazir- The Strategy & Consulting Club, IIM Rohtak
THE BALANCED SCORECARD
High
Financial Perspective
Revenue
Expenses
Net Income
Cash flow
Asset Value
Customer Satisfaction
Customer Retention
Market Share
Brand Strength
Financial
Perspective
Measuring financial performance metrics such as
profitability, revenue growth, and shareholder value. This
perspective focuses on the organization's ability to
generate financial returns for its stakeholders.
Customer
Perspective
Customer Perspective
Inventory
Orders
Resource Allocation
Cycle Time
Quality Control
Internal
Perspective
Learning
Perspective
Employee Satisfaction
Employee Turnover
Employee Skills
Employee Education
Measuring customer satisfaction, loyalty, and retention
rates. This perspective focuses on the organization's ability
to attract, retain, and satisfy its customers
Internal Perspective
WHERE TO USE
WHERE TO USE
To translate strategic goals into operational objectives and align
activities with the organization's overall strategy
Identify areas for improvement, make data-driven decisions, and
enhance overall organizational performance
Provide a common language to communicate strategic objectives
and performance results, fostering alignment and engagement
Measuring the efficiency and effectiveness of internal
processes such as operational excellence, innovation, and
product development. This perspective focuses on the
organization's ability to deliver high-quality products and
services to its customers
Learning Perspective
Measuring employee satisfaction, skill development, and
cultural alignment. This perspective focuses on the
organization's ability to develop its human capital and foster
a culture of innovation and continuous improvement
© Wazir- The Strategy & Consulting Club, IIM Rohtak
THE BALANCED SCORECARD
Balanced scorecard of Tata Consultancy Services Ltd.
FINANCIAL
PERSPECTIVE
CUSTOMER
PERSPECTIVE
Revenue Growth
Measure the growth in
revenue over time, reflecting
the company's ability to
acquire new clients and
expand its services.
Customer Satisfaction
Measure customer
satisfaction through surveys,
feedback, and client
retention rates.
Profitability
Assess the company's
profitability through metrics
such as net profit margin
and return on investment
(ROI).
Cost Management
Monitor and control
operational costs to ensure
efficient resource utilization
and maintain healthy profit
margins.
Service Quality
Evaluate the quality of
services provided to clients,
including project delivery
timelines, reliability, and
responsiveness.
Market Share
Track the company's market
share in key regions and
industries, indicating its
competitive position and
ability to attract new clients.
INTENRAL
PERSPECTIVE
LEARNING
PERSPECTIVE
Operational Efficiency
Monitor key operational
metrics such as project
delivery time, resource
utilization, and project
profitability.
Innovation and Technology
Assess the company's ability
to innovate and adopt new
technologies to stay ahead
of competitors and meet
evolving client needs.
Employee Productivity
Measure employee
productivity and
engagement levels,
reflecting the company's
ability to attract, retain, and
develop talent.
Employee Training and
Development
Track investments in
employee training and
development programs to
enhance skills and
capabilities.
Knowledge Management
Evaluate the effectiveness of
knowledge sharing and
collaboration initiatives
within the organization.
Organizational Culture
Assess employee
satisfaction, diversity, and
inclusion initiatives,
reflecting the strength of
the company's
organizational culture.
© Wazir- The Strategy & Consulting Club, IIM Rohtak
VAN DEN STEEN FRAMEWORK
When to use
When there is a defined strategy and focus is on “expected profits under normal competition”.
Objective
“To analyse a firm’s performance and to determine its components and their drivers.”
Performance analysis
Components of strategic performance:
1. “Common performance” – Components of profits of the firm common with competitors
2. “Bargaining (or Pricing) Advantage – Component of the firm’s performance due to its
ability to charge higher than the competitors”.
3. Value Creation advantage - Components of firm’s performance that comes from creation
of more value than a competitor”
Value analysis
Perceived customer value - “amount of money that would make a customer indifferent between
receiving the money and receiving the product”.
Perceived supplier cost - “amount of money that makes supplier indifferent between keeping the
money and keeping the supply”.
Value created = Perceived customer value – Perceived supplier cost
© Wazir- The Strategy & Consulting Club, IIM Rohtak
VAN DEN STEEN FRAMEWORK
Exclusive and Common value
Performance decomposition based on value
creation and capture
© Wazir- The Strategy & Consulting Club, IIM Rohtak
BCG MATRIX
Stars
Low
Question
Mark
Low
GROWTH
High
High
Cash Cows
Pets
MARKET SHARE
WHERE TO USE
To analyze a company's product portfolio
To develop a marketing strategy
To make investment decisions
To assess the performance of a business unit
It is particularly useful for large companies with a diverse product
portfolio
It can also be used by smaller companies with a more focused
product portfolio
High Growth, High Share
Companies should significantly invest in “stars” as they have
high future potential. They generate high income but also
consume large amounts of the company's cash.
Example : Kinley (BCG Matrix of Coca Cola Company)
High Growth, Low Share
Companies should invest in or discard “question marks,”
depending on their chances of becoming stars. They typically
grow fast but consume large amounts of resources.
Example : Fanta (BCG Matrix of Coca Cola Company)
Low Growth, High Share
Companies should milk “cash cows” for cash to reinvest.
These products generate returns higher than the market's
growth rate and sustain itself from a cash flow perspective
Example : Coca Cola (BCG Matrix of Coca Cola Company)
Low Growth, Low Share
Companies should liquidate, divest, or reposition these
“pets”. They don't generate much cash for the company and
tie up the company's funds for long periods of time
Example : Minute Maid (BCG Matrix of Coca Cola Company)
© Wazir- The Strategy & Consulting Club, IIM Rohtak
STAKEHOLDER RELATIONSHIP MODEL
The stakeholder relationship model (SRM) identifies key
stakeholders engaged in the organization’s business model and
the interactions that the organization has with these
stakeholders. The purpose of the SRM is illustrating the network
effects that may modify the competitive strength of the
platform.
Stakeholders in the SRM are: organization, customer segments,
and key partners. One key relationship between stakeholders is
network effects which can either be positive or negative that are
modelled with: (+/+), (−/−), and (+/−). The (+/+) network effect means
that stakeholder ‘A’ induces a positive network effect on
stakeholder ‘B’ and vice versa.
NOTATIONS
Stakeholder with Name ‘S1’
S1
S1
S2
.........1
‘Description’
(+/+)
Sn
Group of stakeholders with names
‘S1,S2, ... Sn’
What kind of relationship does the
stakeholders share
Network effects between stakeholders
(+/+), (+/-), (-,-)
© Wazir- The Strategy & Consulting Club, IIM Rohtak
SRM: EXAMPLE
Airbnb is an example of an
organization using the
multisided
platform
business model. The main
value proposition of Airbnb
is to offer a mediation
service between the two
customer segments hosts
and guests . This is done
on the website or mobile
app.
© Wazir- The Strategy & Consulting Club, IIM Rohtak
RESOURCE BASED VIEW
The Resource-Based View (RBV) is a strategic management framework that emphasizes the importance of internal resources and capabilities
as the key to achieving this goal. To have an edge over the competition, the organization should look into the potential of the company’s
internal resource pool rather than seeking the external competitive environment.
IMPORTANCE
Provides visibility for efficient resource allocation
RBV helps managers gain insights into resource skills, competencies, and availability, enabling them to allocate resources effectively to
projects.
Facilitates strategic decision making
By analyzing resource strengths and weaknesses, RBV empowers managers to leverage strengths and address weaknesses, leading to
better strategic decision-making.
Enhances innovation & adaptability
RBV promotes understanding a firm's unique resources and leveraging them to drive innovation and adaptation to changing market
demands.
Promotes long-term sustainability
By focusing on developing unique and inimitable resources, RBV fosters long-term sustainability and reduces reliance on external
factors.
Maintains competitive advantage
RBV helps organizations leverage their workforce skills to execute critical projects and maintain a competitive edge.
Enables cross-functional usage of resources
RBV facilitates enterprise-wide visibility of the workforce and expertise, enabling allocation of resources from different departments for
cross-functional teams.
© Wazir- The Strategy & Consulting Club, IIM Rohtak
THEORY OF MULTI MARKET COMPETITION
Multi Market Competition is a strategic concept where firms compete against each other in multiple markets simultaneously. iT influences
competitive dynamics, strategic decision-making, and firm performance.
KEY CONCEPTS
BENEFITS
Interdependence
Diversification of Risk
Markets are interconnected so the actions in one
market can impact outcomes in others.
Spread risk across diverse markets that reduce
vulnerability to market-specific shocks.
Strategic Interactions
Economies of Scope
Firms strategically respond to competitors' actions
across different markets.
Leveraging shared resources, capabilities, and
knowledge across markets.
Competitive Dynamics
Strategic Flexibility
Understanding MMC involves analyzing how firms
compete across multiple markets.
Ability to deploy resources dynamically across
markets, adapting to changing conditions.
WHEN TO USE
FRAMEWORK
Overlapping Customer Segments
Market Mapping
When customer segments are similar across
markets, firms can exploit economies of scope.
Identify relevant markets and their characteristics
(e.g., size, growth rate, competitive intensity).
Regulatory Environment
Competitive Positioning
Market Volatility
Intermarket Rivalry
Diversifying across stable and volatile markets can
mitigate overall risk exposure.
Analyze strategic interactions and competitive
responses across markets.
Operating in multiple markets may offer regulatory
arbitrage opportunities or provide insulation against
regulatory risks.
Assess competitive dynamics, including rivals'
strategies and market shares.
© Wazir- The Strategy & Consulting Club, IIM Rohtak
WAZIR
IIM ROHTAK
THANK YOU