Strategic Management
The Strategy Process
Prof. Dr. E.Vatchkova
Contents
Understanding
strategy
development
Instruments for strategic analysis
An overall strategic model
Types of strategies
Understanding strategy
development (1)
How strategy development can be seen
How strategy development process
can be understood
Implications for strategy development
Understanding strategy
development (2)
How strategy development can be seen
THREE STRATEGY LENSES
1. Strategy as design
2. Strategy as experience
3. Strategy as ideas
Understanding strategy
development (3)
How strategy development process can be
understood
Strategic planning systems
Strategic leadership
Organizational politics
Logical incrementalism
The learning organization
Imposed strategy
Understanding strategy
development (4)
Implications for strategy development
Intended and realized strategy
Strategic drift
Strategic management in uncertainty
and complexity
SWOT ANALYSIS DIAGRAM
Numerous Environmental
Opportunities
QUADRANT ||
QUADRANT |
Critical
Substantial
Internal
Internal
Weaknesses
QUADRANT |||
QUADRANT |V
Major Environmental
Treats
Strengths
Forces Affecting Industry Competition
Potential Entrants
Treat of New
Entrants
Bargaining Power
of Suppliers
Industry
Competitors
Buyers
Suppliers
Bargaining Power
of Buyers
Rivalry among
Existing Firms
Treat of
Substitute
Products or
Services
Substitutes
Portfolio Matrix
M
a
r
k
e
t
G
r
o
w
t
h
R
a
t
e
High
Stars
Question
Marks
Dogs
Low
Cash
Cows
High
Relative Market Share
Low
Strategic alternative matrix
Numerous Environmental
Opportunities
QUADRANT ||
QUADRANT |
Concentration
Vertical Integration
Critical
Internal
Weaknesses
Conglomerate
Diversification
QUADRANT |||
Turnaround
Divestiture
Liquidation
Market Development
Product Development
Innovation
QUADRANT |V
Horizontal Integration
Concentric
Diversification
Joint Venture
Major Environmental
Treats
Substantial
Internal
Strengths
Strategies of Portfolio Types
PORTFOLIO TYPES
STRATEGY
Stars
Cash
Cows
Question Dogs
Marks
Invest for
rapid
growth,
convert
to cash
cow
Channel
revenues
to stars
and
question
marks
Evaluate
for future
potential
as star,
divest
reminder
Divest or
liquidate
Survival Strategies and Environmental
Conditions
Specialists will
outperform
generalists.
Generalists are
more likely to fail.
Stable
Market
Stability
Generalists will
outperform
specialists.
Specialists are
more likely to fail.
Unstable
Homogeneity
Market Complexity
Heterogeneity
Types of strategies (1)
 Concentration
– single product in a single
market
 Market
development – selling present
products in new markets
 Product
development – modification of
existing product or creation of a similar one
Types of strategies (2)
 Innovation – creation of a new product
based on the technology of a current product
 Horizontal integration – acquisition of
another organization in the same industry
 Vertical integration – acquire or create
organizations that distribute its product,
supply materials for its product, or both
Types of strategies (3)

Joint venture – two or more organizations
increase their capabilities

Concentric Diversification – creating or
acquiring organizations that manufactures or
distribute related products

Conglomerate Diversification – creating or
acquiring another organization that
manufactures or distributes unrelated
products
Types of strategies (4)

Defender strategy – seeks or creates an
environment, that is stable, protecting the market
share

Prospector strategy - seeks or creates an unstable
environment in the form of rapid change and high
growth in the market

Analyzer strategy – involves adapting solutions from
both – the defender and prospector to the three
problems – entrepreneurial, engineering and
administrative
Types of strategies (5)

Turnaround – correct existing problems by
invoking techniques for improving operational
efficiency

Divestiture – sell parts of the organization

Liquidation – acquire cash from the sale of
parts of the company which can then be
transferred to owner-stockholders
Thank you !