Module I Business Environment and Corp. Strategies

AMITY BUSINESS SCHOOL

1

Amity Business SchoolMBA Semester II

Business Environment and Strategic Analysis

Himanshu Mahobia

AMITY BUSINESS SCHOOLModule I

CONTENTS

• SOCIO-ECONOMIC ENVIRONMENT OF BUSINESS• VISION AND MISSION• STRATEGIC IMPLICATIONS OF COMPANY DECISIONS• EVOLUTION OF STRATEGIC MANAGEMENT PARADIGM• CONCEPT OF CORPORATE STRATEGY• STRATEGIC RESPONSE TO CHANGES IN BUSINESS

ENVIRONMENT

2

AMITY BUSINESS SCHOOL Business Environment

• Political Environment• Demographic Environment• Legal Environment• Economic Environment• Social Environment• Cultural Environment• Technological Environment• Natural Environment

3

AMITY BUSINESS SCHOOL Socio-Economic Environment

• GDP • Purchasing Power Parity• Social Class• Foreign Direct Investment• Economic Policies• Inflation• Exchange Rate• Resource Availability • Urbanization, Westernization and Modernization

4

AMITY BUSINESS SCHOOLVision

»What is Vision?

5

AMITY BUSINESS SCHOOLMission

»What is Mission?

6

AMITY BUSINESS SCHOOL

Constituents of Corporate Mission Statement

• Ambition and visionary zeal

• Organizational Values and Beliefs

• Specifications of Businesses

7

AMITY BUSINESS SCHOOL

Strategic Implications of Company Decisions – A few cases

• Acquisition of Jaguar and Land Rover brands by Tata.

• Britannia exiting Joint Venture with its French Partner.

• Godrej Sara Lee joint venture

• Future Implications of possible acquisitions of Sara Lee’s fertilizers business by Godrej

• Future implications of a strategic tie-up between Microsoft and Yahoo

8

AMITY BUSINESS SCHOOL

• Bajaj Renault Nissan’s three way joint venture to produce ultra low cost car

• Onida’s diversification into cellphone business

9

Strategic Implications of Company Decisions – A few cases

AMITY BUSINESS SCHOOL What is Strategy

?

AMITY BUSINESS SCHOOL5Ps of Strategy

• Strategy as a Plan (intended)

• Strategy as a Pattern (realized)

AMITY BUSINESS SCHOOL

AMITY BUSINESS SCHOOL•

Strategy as Position

AMITY BUSINESS SCHOOL

Strategy as Perspective

AMITY BUSINESS SCHOOL

Strategy as Ploy

• specific "maneuver" intended to outwit an opponent or competitor

AMITY BUSINESS SCHOOL

Strategic Planning Gap

Intensive Growth

Integrative Growth

Diversification

Present Sales

Expected Sales

AMITY BUSINESS SCHOOL

Intensive Growth

• Market Penetration

• Product Development

• Market Development

AMITY BUSINESS SCHOOL

Igor Ansoff’s Product Market Expansion Grid

AMITY BUSINESS SCHOOL

Market Penetration

• Adding non-users

• Attracting competitor’s customers

• Increasing usage

AMITY BUSINESS SCHOOL

Product Development

• New Products, same market segments

AMITY BUSINESS SCHOOL

Market Development

• Same Product, New Market Segments

AMITY BUSINESS SCHOOL

Diversification• Concentric Diversification

• Horizontal Diversification

• Conglomerate Diversification

AMITY BUSINESS SCHOOL

Concentric Diversification

New Products, new markets with

• Similarity in production and/or marketing and distribution

AMITY BUSINESS SCHOOL

Horizontal Diversification