Module: Enterprise Strategy
Lecture 7 – Strategic Evaluation & Selection
A company will have a lot of strategic options to consider such as location (local or
international), whether to go into a related or unrelated business.
For the purpose of growth, there are many different options: can choose to advertise
more, increase sales, start delivering customer orders.
You will need to narrow the choices to a few and then evaluate those options to see
which one is best.
Evaluation criteria for strategic options
Consistency
Look at if there is a strategic fit. If you feel there is some sort of disagreement
between your mission and objectives and strategies, then you reject the
option.
With Covid, organisations have found that they have to re-evaluate their
options because the environment has changed.
Suitability (SWOT analysis)
Looks at strengths, weaknesses and threats.
First question to ask: are we building on our strengths? Do they build on the
core competence that the company has got?
Second question: will we be exposing our weaknesses if we go with any of
these options? Example: things can go wrong when a company doesn’t
understand the overseas market. The company might not know the customs
and end up offending the client or not know how to market the product
properly.
Third question: do the strategy options allow you to take the opportunities
available?
Fourth question: look at the environment and ask what the threats are and
how can you avoid those threats.
Validity
We make decisions on the future based on assumptions.
When we build a product, you have a set of assumptions such as assuming
that the customer will like it and that the product will do well.
Lecture 7 – Strategic Evaluation & Selection
A company will have a lot of strategic options to consider such as location (local or
international), whether to go into a related or unrelated business.
For the purpose of growth, there are many different options: can choose to advertise
more, increase sales, start delivering customer orders.
You will need to narrow the choices to a few and then evaluate those options to see
which one is best.
Evaluation criteria for strategic options
Consistency
Look at if there is a strategic fit. If you feel there is some sort of disagreement
between your mission and objectives and strategies, then you reject the
option.
With Covid, organisations have found that they have to re-evaluate their
options because the environment has changed.
Suitability (SWOT analysis)
Looks at strengths, weaknesses and threats.
First question to ask: are we building on our strengths? Do they build on the
core competence that the company has got?
Second question: will we be exposing our weaknesses if we go with any of
these options? Example: things can go wrong when a company doesn’t
understand the overseas market. The company might not know the customs
and end up offending the client or not know how to market the product
properly.
Third question: do the strategy options allow you to take the opportunities
available?
Fourth question: look at the environment and ask what the threats are and
how can you avoid those threats.
Validity
We make decisions on the future based on assumptions.
When we build a product, you have a set of assumptions such as assuming
that the customer will like it and that the product will do well.
