Mingxu Yang Jing Pang Lu Li,Indentifying Suitable Strategic Options,Indentifying strategic options,SWOT analysis,SWOT Analysis was developed by Albert Humphrey. It is a tool to find out the Strengths, Weaknesses, Opportunities, and Threats that are to be expected in a project or in a business venture or in something similar. It means that the marketing environment (internal and external to the organization or individual) is looked at.,Strengths and weaknesses(internal),Strengths A strength is something that an organization is good at doing or something that gives it particular credibility. It can be a particular attribute of a product or service that provides a competitive advantage, a resource such as a strong financial position or new production facilities, or superior competencies or capabilities. Weaknesses A weakness is something an organization lacks or performs in an inferior way in comparison to others.,Opportunities and Threats(External),Opportunities An opportunity is a condition in the environment that is helpful. Threats A threat is a condition that is harmful to the achievement of the objectives of the organization. Indentifying threats and opportunities(Chapter 14 Page 343) Having undertaken an appraisal of the wider external environment using PESTEL analysis, market analysis and an analysis of the competitive environment using the five forces model, it is possible to summarize the main opportunities and threats.,PESTEL Analysis,Michael Porters Five Forces Model,The steps of SWOT analysis,Make sure the current strategy of one company Make sure the changing external environment According to the company resources combination, confirm the ability and limit Use general matrix or a similar way to grade and evaluate,Put results on SWOT analysis matrix,opportunities,threats,weakness,strength,Line growth strategy,Reverse strategy,Defensive Strategy,Diversification,TOWS analysis matrix,The TOWS analysis matrix can be used as extension of SWOT analysis. Having indentified the key strengths and weaknesses of the organization and the opportunities and threats in the environment. With the TOWS matrix the following analysis is undertaken to suggest strategies that: 1. Use a strength identified from an internal appraisal of the organization to take advantage of an environmental opportunity or combat an environmental threat. 2.Can help the organization correct a weakness identified from an internal appraisal of the organization to take advantage of an environmental opportunity or combat an environmental threat.,Ansoffs product/market matrix,Ansoffs product/market matrix can help to specify the direction in which a company intends to develop its strategic portfolio.,Ansoffs product/market matrix,Existing products/existing markets,Market Penetration This might involve the firm in an attempt to increase the market share of its existing products in existing markets through greater marketing effort. For example, a firm may select promotion, advance the service quality or buy up some of its competitors to gain more market share. Consolidation Maintenance of the current position: this may be appropriate when trading conditions are difficult. For example. The firm may be uncertain of the future and may wish to preserve its existing cash holdings and withhold from investing in new ventures. In order to mainten market share, one company can select Strategy of Product Differentiation to advance customer loyalty degree. Retrenchment(downsizing,reduce department),New products/existing markets,Product development With a rapid cycle of introduction, growth, maturity and decline, it is necessary to have new products being developed to replace the existing products. For example, in the car industry, new products are introduced on a regular basis in order to compete against competitors.,Existing products/new markets,Market development This could involve the marketing of products to new geographical areas, new channels of distribution and new users of the product or new uses of the product. This strategy is often used where there are significant economies of scale, with high fixed costs and inflexible facilities.,New products/New markets,Diversification Diversification is the most risky as it involves developing new products and selling into new markets. The successful enterprise can make some Synergy from sales , channel or product technology. Otherwise ,the failure probability is very high.,Methods for achieving different options,Internal development,01,Merger and acquisition,02,04,Growth can be achieved through:,Joint development and strategy alliances,03,Internal development,Organic growth,01,Relatively inexpensive,02,04,Advantages:,Take a long time to achieve the required size,01,Disadvantages:,Merger and acquisition,Acquisition: An organization takes over another organization,Merger: The result of organizations coming together voluntarily,Merger and acquisition,Both of them make it quicker