Strategic analysis: searching for opportunities and threats Focus: Daisytek

1. Strategic analysis: searching for opportunities and threatsFocus: Daisytek •  Assignment:     Study H&W Ch 3 Environmental scanning and industry analysis and Industry analysis using  Porter's framework.     Be prepared to present your evaluation of  Daisytek's external environment

2. Which elements are most relevant? What are the implications for management? Environmental Scan Economic Forces Sociocultural Forces Task Environment Suppliers Shareholders Governments Employees/ Labor Unions Internal Environment Special Interest Groups Structures Culture Resources Competitors Customers Trade Association Creditors Communities Political - Legal Forces Technological Forces

3. Environmental & industry analysis • Fig. 3-1 Environment • Note distinction between inside and outside • External focus is on Opportunities and Threats • Table 3.1 Environmental variables • Identify important variables. • Fig. 3.2 Scanning external environment • Which factors are key • Fig 3.3 Issues priority matrix • What issues, e.g., opportunities and threats, need to be addressed?

4. Industry Analysis (Porter) Potential Entrants Relative Power of Unions, Government, Etc. Threat of New Entrants Other Stakeholders Industry Competitors Rivalry Among Existing Firms Bargaining Power Of Buyers Buyers Suppliers Bargaining Power Of Suppliers Threat of Substitute Products or Services Substitutes

5. What opportunities & threats does relative power of Porter’s forces lead to? Buyers power Suppliers power Other stakeholders power Substitutes—alternative ways to satisfy need Rivalry among existing firms Potential new entrants Opportunities Threats Wrapping up from last session Identifying Opportunities and Threats using Porter’s industry analysis model

6. Value chains (external) • Industry value chain (Fig. 4.2)—show activity flow from raw materials to consumer • Corporate value chain—examines • How inputs are converted to outputs • Processes by which value is added ”Differences among competitor value chains are a key source of competitive advantage.” Porter

7. Analysis concepts • Strategy: purpose, formulation vs. implementation & elements of each; generic types • Strategic Management: process & sub tasks, strategic decision making, top management’s role • Hierarchy of strategy: corporate, business, functional • Organizational effectiveness: goal, RB, IP, stakeholders • Objectives vs. goals: criteria to distinguish; requirements of objectives • Analyzing external environment: societal & task; how to do it, Porter model, • Analyzing internal environment • Resource-based: core & distinctive competencies, elements of sustainability • Value chain • Scanning internal resources: structure, culture, functional capabilities • Strategic audit (appendix 11C) • SWOT and building a TOWS matrix of alternative strategies • Corporate strategy: directional (growth, stability, retrenchment), portfolio analysis, parenting • Functional strategies: outsourcing, marketing, finance, R&D, operations, HR, IT • 3 tests of distinctive competency • Financial performance and condition • Implementing strategy: role of programs, budgets, procedures