Strategy-Formulation Analytical Framework

1

Strategy-Formulation Analytical Framework

Stage 1: The Input Stage

Stage 2: The Matching Stage

Stage 3: The Decision Stage 2

Formulation Framework External Factor Evaluation Matrix (EFE)


Internal Factor Evaluation Matrix (IFE)

Competitive Profile Matrix 3

Input Stage • Provides basic input information for the matching and decision stage matrices • Requires strategists to quantify subjectivity early in the process • Good intuitive judgment always needed

4

Formulation Framework TOWS Matrix SPACE Matrix Stage 2: The Matching Stage

BCG Matrix IE Matrix Grand Strategy Matrix

5

Matching Stage

• Match between organization’s internal resources and skills and the opportunities and risks created by its external factors.

6

Matching Key Factors to Formulate Alternative Strategies Key Internal Factor

Resultant Strategy

+

20% annual growth in the cell phone industry = (opportunity)

Insufficient capacity (weakness)

+

Exit of two major foreign competitors form the industry (opportunity)

=

Pursue horizontal integration by buying competitor's facilities

Strong R&D (strength)

+

Decreasing numbers of young adults (threat)

=

Develop new products for older adults

Poor employee morale (weakness)

+ Strong union activity (threat)

Excess working capacity (strength)

7

Key External Factor

=

Acquire Cellfone, Inc.

Develop a new employee benefits package

Formulation Framework

Stage 3: The Decision Stage

8

Quantitative Strategic Planning Matrix (QSPM)



Internal Factor Evaluation Matrix (IFE) Competitive Profile Matrix

9

The External Assessment

Prediction is very difficult, especially about the future. -- Neils Bohr

10

Nature of External Audit Purpose: – Development of Finite List: • Opportunities • Threats to be avoided

11

Key External Forces Five (5) broad categories: 1. Economic forces 2. Social, cultural, demographic, & environmental forces 3. Political, governmental, and legal forces 4. Technological factors 5. Competitive forces 12

Relationships Between Key External Forces and an Organization

Key External Forces

13

Competitors Suppliers Distributors Creditors Customers Employees Communities Managers Stockholders Labor Unions Special Interest Groups Products Services

Opportunities & Threats

Exhibit 2.4

Porter’s Five Forces Model of Industry Competition POTENTIAL ENTRANTS

Bargaining power of suppliers

Threat of new entrants

INDUSTRY COMPETITORS

SUPPLIERS

Bargaining power of buyers BUYERS

Rivalry Among Existing Firms

Threat of substitute products or services

SUBSTITUTES

Reprinted with the permission of The Free Press, a division of Simon & Schuster, Inc. from Competitive Strategy: Techniques for Analyzing Industries and Competitors by Michael E. Porter. Copyright © 1980, 1998 by The Free Press.

14

Five Forces Analysis of the Automotive Industry Threat of Rivalry  Oligopolistic industry  Overcapacity

Global Competitive Environment

Threat of Market Entry  High barriers to entry  High capital requirements  Contrived deterrence  Cost disadvantages

Threat of Substitutes  Train, public transport or other means of transportation

15

 Differentiation on basis of functional attributes only temporary

Threat of Suppliers Automotive Industry

 Consolidation  Single Sourcing  Low level of total value added

Threat of Buyers  Numerous potential customers  Industry policy of rebates  More demanding customers

Industry Analysis (EFE) External Factor Evaluation Matrix Summarize & evaluate:

16

Economic

Demographic

Governmental

Social

Environmental

Technological

Cultural

Political

Competitive

External Factor Evaluation (EFE)

Menggambarkan keseluruhan opportunities dan threats yang ada untuk mengetahui seberapa besar pengaruh dari setiap faktor tersebut terhadap institusi, respons institusi setiap faktor tersebut dan untuk mengetahui nilai institusi terhadap keseluruhan faktor dibandingkan dengan Institusi lain 17

Industry Analysis (EFE) Five-Step process: •

List key external factors (10-20) Opportunities

•

Assign weight to each (0 to 1.0) Sum

18

& threats

of all weights = 1.0

Industry Analysis (EFE) Five-step process: •

Assign 1-4 rating to each factor • Firm’s current strategies response to the factor

•

Multiply each factor’s weight by its rating • Produces a weighted score

19

Industry Analysis (EFE) Five-step process: •

Sum the weighted scores for each Determines

the total weighted score for the organization.

•

20

Highest possible weighted score for the organization is 4.0; the lowest, 1.0. Average = 2.5

UST—Key External Factors

Weight

Rating

Weighted score

Global markets untapped

.15

1

.15

Increased demand

.05

3

.15

Astronomical Internet growth

.05

1

.05

Pinkerton leader in discount market

.15

4

.60

More social pressure to quit smoking

.10

3

.30

Legislation against the tobacco industry

.10

2

.20

Production limits on tobacco

.05

3

.15

Smokeless market SE region U.S.

.05

2

.10

Bad media exposure from FDA

.10

2

.20

Clinton Administration

.20

1

.20

Opportunities

Threats

TOTAL 21

1.00

2.10

Tabel : Matriks EFE PT. Pos Indonesia Faktor Eksternal

Bobot

Rating

Nilai

- Jumlah penduduk

0,12

3

0,36

- Bentuk negara yang geografis

0,10

3

0,30

- Perusahaan yang berbentuk Persero

0,08

4

0,32

- Jumlah SDM memadai

0,10

2

0,20

- Tersedianya sarana promosi

0,05

2

0,10

- Perkembangan teknologi

0,10

2

0,20

- Pesaing baru dan lama

0,10

2

0,20

- Munculnya produk substitusi

0,12

2

0,24

- Tuntutan terhadap mutu dan pelayanan

0,08

2

0,16

- Daya beli konsumen

0,05

1

0,05

- Kondisi SDM yang berorientasi kepada produk Total

0,10

2

0,20

Peluang (opportunities)

Ancaman (threats)

22

1

2,33

Industry Analysis (EFE) Total weighted score of 4.0 = Organization response is outstanding to threats & weaknesses

Total weighted score of 1.0 = Firm’s strategies not capitalizing on opportunities or avoiding threats 23

Industry Analysis (EFE)

Important •

24

Understanding of the factors used in the EFE Matrix is more important than the actual weights and ratings assigned.





The Internal Assessment

Great spirits have always encountered violent opposition from mediocre minds. -- Albert Einstein

26

Nature of an Internal Audit All organizations – Strengths • Weaknesses •

27

Nature of an Internal Audit Basis for objectives & strategies: – Internal strengths/weaknesses – External opportunities/threats – Clear statement of mission

28

Key Internal Forces Distinctive Competencies • A firm’s strengths that cannot be easily matched or imitated by competitors • Building competitive advantage involves taking advantage of distinctive competencies • Strategies designed in part to improve on a firm’s weaknesses and turn to strengths 29

Internal Audit • Parallels process of external audit • Gather & assimilate information from: • • • • • • 30

Management Marketing Finance/accounting Production/operations Research & development Management information systems

Functions of Management Five basic activities – – – – – –

31

Planning Organizing Motivating Staffing Controlling

Functions of Management

32

Function

Stage When Most Important

Planning

Strategy Formulation

Organizing

Strategy Implementation

Motivating


Staffing


Controlling

Strategy Evaluation

Planning

Forecasting Establishing objectives Planning

Devising strategies Developing policies Setting goals

33

Organizing

Organizing Organizing Organizing

34

Organizational Organizational Organizational design design Job Job Job specialization specialization specialization Job Job descriptions descriptions Job Job Job specifications specifications specifications Span Span Span of of control control Unity Unity of ofcommand command Coordination Coordination Job Job design design Job Job Job analysis analysis analysis

Motivating

Motivating

35

Leadership Communication Work groups Job enrichment Job satisfaction Needs fulfillment Organizational change Morale

Staffing

Staffing

36

Wage & salary admin Employee benefits Interviewing Hiring Firing Training Management development Safety Affirmative action EEO Labor relations Career development Discipline procedures

Controlling

Controlling

37

Quality control Financial control Sales control Inventory control Expense control Analysis of variances Rewards Sanctions

Marketing

Process of defining, anticipating, creating, and fulfilling customers’ needs and wants for products and services

38

Marketing

1. 2. 3. 4. 5. 6. 7. 39

Customer analysis Selling products/services Product and service planning Pricing Distribution Marketing research Opportunity analysis

Marketing Customer surveys Consumer information

Customer analysis

Market positioning strategies Customer profiles Market segmentation strategies

40

Marketing Advertising Sales Promotion Selling Products/services

Publicity Sales force management Customer relations Dealer relations

41

Marketing Test marketing Brand positioning Devising warrantees Product/service planning

Packaging Product features/options Product style Quality

42

Marketing Forward integration Discounts Credit terms Pricing

Condition of sale Markups Costs Unit pricing

43

Marketing Warehousing Channels Coverage

Distribution

Retail site locations Sales territories Inventory levels Transportation

44

Marketing Data collection Data input Marketing research

Data analysis Support all business functions

45

Marketing Assessing costs Assessing benefits Opportunity Analysis

Assessing risks Cost/benefit/risk analysis

46

Finance/Accounting

• • • •

47

Determining financial strengths and weaknesses key to strategy formulation Investment decision (Capital budgeting) Financing decision Dividend decision

Finance/Accounting

Functions of Finance/Accounting – Investment decision (Capital budgeting) 2. Financing decision 3. Dividend decision 1.

48

Basic Financial Ratios Firm’s ability to meet its short-term obligations Ratios Liquidity ratios Current ratio Quick (or acid-test) ratio 49

Basic Financial Ratios •

Extent of debt financing Ratios

Leverage ratios

Debt-to-total-assets Debt-to-equity Long-term debt-to-equity Times-interest earned

50


Effective use of firm’s resources Ratios Inventory-turnover

Activity ratios

Fixed assets turnover Total assets turnover Accounts receivable turnover Average collection period

51


Effectiveness shown by returns on sales and investment Ratios

Profitability ratios

Gross profit margin Operating profit margin Net profit margin Return on total assets (ROA)

52


Profitability ratios (continued)

Effectiveness shown by returns on sales and investment Ratios Return on stockholders’ equity (ROE) Earnings per share Price-earnings ratio

53


Firm’s ability to maintain economic position Ratios

Growth ratios

Sales Net income Earnings per share Dividends per share

54

Production/Operations • • • • •

55

Process Capacity Inventory Workforce Quality

Production/Operations Design of facility Choice of technology Facility layout Process

Process flow analysis Facility location Line balancing Process control

56

Production/Operations Forecasting Facilities planning Aggregate planning Capacity

Scheduling Capacity planning Queuing analysis

57

Production/Operations

Raw material Inventory

Work in process Finished goods Materials handling

58

Production/Operations Job design Work measurement Workforce

Job enrichment Work standards Motivation techniques

59

Production/Operations Quality control Sampling Quality

Testing Quality assurance Cost control

60

Research and Development • • •

61

Development of new products before competition Improving product quality Improving manufacturing processes to reduce costs

Research and Development Financing as many projects as possible Use percentage-of-sales method R&D budgets

Budgeting relative to competitors Deciding how many successful new products are needed

62

Management Information Systems

Purpose – –

63

Improve performance of an enterprise by improving the quality of managerial decisions.

Internal Analysis (IFE) Menggambarkan keseluruhan strength dan weakness yang ada untuk mengetahui seberapa besar pengaruh dari setiap faktor tersebut terhadap institusi, respons institusi setiap faktor tersebut dan untuk mengetahui nilai institusi terhadap keseluruhan faktor dibandingkan dengan Institusi lain 64

Internal Analysis (IFE) Five-Step Process: •

List key internal factors (10-20) Strengths

•

Assign weight to each (0 to 1.0) Sum

65

& weaknesses

of all weights = 1.0

Internal Analysis (IFE) Assign 1-4 rating to each factor  Firm’s

current strategies response to the

factor •

Multiply each factor’s weight by its rating  Produces

66

a weighted score

Internal Analysis (IFE)

•

Sum the weighted scores for each  Determines

the total weighted score for the organization

 Highest

possible weighted score for the organization is 4.0; the lowest, 1.0. Average = 2.5

67

Internal Analysis (IFE) Mandalay Bay

Weight

Rating

Weighted score

Largest casino company in world

.05

4

.20

Room occupancy rates over 95%

.10

4

.40

Increasing free cash flows

.05

3

.15

Owns 1 mile on Las Vegas strip

.15

4

.60

Strong management team

.05

3

.15

Buffets at most facilities

.05

3

.15

Minimal comps provided

.05

3

.15

Long-range planning

.05

4

.20

Reputation as family-friendly

.05

3

.15

Financial ratios

.05

3

.15

Internal Strengths

68

Internal Analysis (IFE) Mandalay Bay

Weight

Rating

Weighted score

Most properties located in Las Vegas

.05

1

.05

Little diversification

.05

2

.10

Family reputation, not high rollers

.05

2

.10

Laughlin properties

.10

1

.10

Recent loss of joint ventures

.10

1

.10

TOTAL (including Strengths)

1.0

Internal Weaknesses

69

2.75

Tabel : Matriks IFE PT. Pos Indonesia

Faktor Internal

Bobot

Rating

Nilai

- Keragaman jenis jasa pengiriman

0,09

4

0,36

- Harga murah

0,10

4

0,40

- Jaringan pos yang sangat luas

0,10

3

0,30

- Sebaran lokasi pelayanan

0,10

3

0,30

- Kemudahan mencapai tempat pelayanan & pengiriman Kelemahan (weaknesses)

0,11

3

0,33

- Ketepatan waktu pengiriman

0,11

1

0,11

- Kecepatan pengiriman

0,11

1

0,11

- Kecepatan pelayanan petugas

0,10

1

0,10

- Informasi biaya dan waktu pengiriman

0,09

2

0,18

- Kemudahan memperoleh info promosi dan iklan Total

0,09

2

0.18

Kekuatan (strengths)

70

1

2,37

Menentukan Distinctive Competencies

Diantara sejumlah strengths yang dimiliki suatu institusi dapat saja beberapa diantaranya merupakan distinctive competencies. Untuk mengevaluasi apakah suatu strength adalah distinctive competency dapat digunakan metode Barney yaitu dengan konsep VRIO 71

VRIO ◆ Value : apakah faktor tersebut memberikan keunggulan kompetitif pada institusi ? ◆ Rareness : apakah pesaing tidak memiliki faktor tersebut ? ◆ Imitability : apakah tidak mudah untuk memiliki faktor tersebut ? ◆ Organization : apakah institusi memanfaatkan faktor tersebut secara maksimal ? Jika jawab dari keempat : Ya

distinctive competency 72





Industry Analysis (CPM) Competitive Profile Matrix •

74

Identifies firm’s major competitors and their strengths & weaknesses in relation to a sample firm’s strategic position

(CPM) Critical Success Factor

75

Avon

L’Oreal

Procter & Gamble

Weight Rating Score Rating Score Rating Score

Advertising

0.20

Product Quality

0.10

Price Competition

0.10

Management

0.10

Financial Position

0.15

Customer Loyalty

0.10

Global Expansion

0.20

Market Share

0.05

Total

1.00

1 4 3 4 4 4 4 1

0.20 0.40 0.30 0.40 0.60 0.40 0.80 0.05 3.15

4 4 3 3 3 4 2 4

0.80

3

0.60

0.40

3

0.30

0.30

4

0.40

0.30

3

0.30

0.45

3

0.45

0.40

2

0.20

0.40

2

0.40

0.20

3

0.15

3.25

2.80

Competitive Profile Matrix

Critical Success Factors Brand Recognition Market Share Financial Strength R&D Product Quality Advertising Number of Retail Outlets Product Mix Depend on Suppliers for Quality Total 76

Weight 0.15 0.14 0.13 0.10 0.10 0.12 0.05 0.11 0.10 1.00

Nike Weighted Rating Score 4 0.60 4 0.56 3 0.39 4 0.40 3 0.10 4 0.48 4 0.20 4 0.44 2 0.20 3.37

Adidas Weighted Rating Score 4 0.60 2 0.28 2 0.26 2 0.20 3 0.30 3 0.36 1 0.05 3 0.33 3 0.30 2.68

Reebok Weighted Rating Score 4 0.60 3 0.42 2 0.26 3 0.30 3 0.30 4 0.48 3 0.15 3 0.33 2 0.20 3.04



77

Strategy Analysis & Choice

Whether it’s broke or not, fix it—make it better. Not just products, but the whole company if necessary. -- Bill Saporito

78

SWOT ANALYSIS

79

☛ Asumsi: Suatu strategi yang efektif akan memaksimalkan kekuatan (Strength) dan peluang (Opportunities), dan meminimalkan kelemahan (Weaknesses) dan ancaman ((Threat) ☛ Opportunities: Situasi penting dari faktor eksternal yang menguntungkan perusahaan. (perubahan teknologi, membaiknya hubungan pembeli & pemasok, dll) ☛ Threat: faktor internal yang tidak menguntungkan perusahaan. (masuknya pesaing baru, lambatnya pertumbuhan pasar, meningkatnya kekuatan pembeli & pemasok, dll) ☛ Strength: Kekuatan internal meliputi sumberdaya, keterampilan/ keunggulan lainnya relatif terhadap pesaing dan kebutuhan pasar yang dilayani/ ingin dilayani perusahaan. (sumber daya keuangan, citra, dll) ☛ Weaknesses: Kekurangan/ keterbatasan daam sumber daya, keterampilan dan kapabilitas yang menghambat kinerja perusahaan.

ANALISA SWOT (TOWS) MATRIX Dikemukakan oleh : Thomas L. Wheelen dan J. David Hunger Menggunakan matrix untuk menghasilkan strategi alternatif dengan memanfaatkan EFE dan IFE

Langkah-Langkahnya : ➲ Pada blok opportunities cantumkan sejumlah opportunities yang diambil dari tabel EFE ➲ Pada blok threats cantumkan sejumlah threats yang diambil dari EFE ➲ Pada blok strength, cantumkan sejumlah strength yang diambil dari IFE ➲ Pada blok weakness cantumkan sejumlah weakness yg diambil dari IFE ➲ Dapatkan sejumlah strategi-strategi yang mungkin untuk perusahaan berdasarkan kombinasi dari 4 elemen tersebut 80

Matching Stage TOWS Matrix – Threats – Opportunities – Strengths – Weaknesses 81

TOWS Matrix Develop four types of strategies – Strengths-Opportunities (SO) – Weaknesses-Opportunities (WO) – Strengths-Threats (ST) – Weaknesses-Threats (WT) 82

Kuadran SO, ST, WO, WT ◆ Kuadran SO : posisi yang paling menguntungkan dimana institusi sedang melihat peluang-peluang dan memiliki kekuatan untuk meraihnya ◆ Kuadran ST : institusi dengan beberapa kekuatan yang dimilikinya sedang menghadapi ancaman dari luar. Institusi dapat menggunakan kekuatan untuk menciptakan peluang di masa yang akan datang ◆ Kuadran WO : institusi sedang melihat peluang tetapi mengalami kendala dalam meraihnya karena perusahaan memiliki kelemahan. Institusi harus dapat mengeliminir kekurangan-kekurangan supaya lebih efektif dalam meraih peluang ◆ Kuadran WT : posisi yang paling tidak menyenangkan dimana perusahaan sedang menghadapi ancaman dari luar bersamaan dengan posisinyapun sedang lemah. Institusi bertahan sambil mengkaji ulang keterlibatan institusi dalam pelayanan yang sedang terancam tersebut 83

STRATEGI SO, ST, WO, WT ◆ Strategi SO : strategi memanfaatkan peluang dengan mendayagunakan kekuatan internal ◆ Strategi ST : strategi untuk menghadapi atau menghidarkan ancaman dengan mendayagunakan kekuatan yang dimiliki ◆ Strategi WO : strategi untuk mengatasi kelemahan dengan cara memanfaatkan peluang yang ada

84

◆ Strategi WT : strategi yang meminimalkan kelemahan sambil mencegah ancaman yang ada di luar

SO Strategies

Threats Opportunities Weaknesses Strengths (TOWS)

85

SO Strategies

Use a firm’s internal strengths to take advantage of external opportunities

WO Strategies


86

WO Strategies

Improving internal weaknesses by taking advantage of external opportunities

ST Strategies


87

ST Strategies

Using firm’s strengths to avoid or reduce the impact of external threats.

WT Strategies


88

WT Strategies

Defensive tactics aimed at reducing internal weaknesses and avoiding environmental threats.

TOWS Matrix Steps in developing the TOWS Matrix 1. 2. 3. 4.

89

List the firm’s key external opportunities List the firm’s key external threats List the firm’s key internal strengths List the firm’s key internal weaknesses

TOWS Matrix Developing the TOWS Matrix

1. 2. 3. 4.

90

Match internal strengths with external opportunities and record the resultant SO Strategies Match internal weaknesses with external opportunities and record the resultant WO Strategies Match internal strengths with external threats and record the resultant ST Strategies Match internal weaknesses with external threats and record the resultant WT Strategies

TOWS Matrix Leave Blank

91

Strengths-S

Weaknesses-W

List Strengths

List Weaknesses

Opportunities-O

SO Strategies

WO Strategies

List Opportunities

Use strengths to take advantage of opportunities

Overcome weaknesses by taking advantage of opportunities

Threats-T

ST Strategies

WT Strategies

List Threats

Use strengths to avoid threats

Minimize weaknesses and avoid threats

SWOT MATRIX

STRENGHTS (S) List Internal Strenghts Here

WEAKNESSES (W) List Internal Weaknesses Here

OPPORTUNITIES (O) List External Opportinities Here

S-O Strategies Generate strategies here that use Strenghts to take adventage of opportunities

W-O Strategies Generate strategies here that take adventage of opportunities by overcoming weaknesses

THREATS (T) List External Threats Here

S-T Strategies Generate strategies here that use strenghts to avoid threats

W-T Strategies Generate strategies here that minimize weaknesses and avoid threats

EXTERNAL INTERNAL FACTORS

92

TOWS Matrix

Strengths 1. Customer satisfaction. 2. Copyright to one-click method. 3. Humanitarian efforts. 4. Strong Research & Development. 5. Exclusive agreements with Internet sites. 6. Ability to track customer interests. 7. Formation of strategic alliances with physical retailers.

93

Weaknesses 1. Accumulated deficits. 2. Anticipates further losses. 3. Slowing growth, core business, U.S. Books, Music, & Video. 4. Lawsuit with Barnes & Noble over patent for oneclick method. 5. Class Action Suits filed with stockholders. 6. Doses not have a mission statement. 7. Financial position.

TOWS Matrix

S-O Strategies Opportunities 1. Expand European presence 1. Continuous increase of through strategic alliances internet users. with established online 2. Increasing business to retailers or physical consumer e-commerce. retailers 3. U. S. Internet economy (S1,O1,O2,O3,O5). 2. Refocus on core business projections 3.1 trillion by taking full advantage of by 2004. e-books sales projection 4. Brick & Mortar (S1,S2,S6,O1,O2,O3). companies lack technology expertise. 5. European on-line projections 3.1 trillion by 2004.

94

W-O Strategies 1. Enter into more strategic agreements with U. S. physical retailers possibly Wal-mart (W2,W3,W7,O4,O5).

TOWS Matrix

Threats 1. Seasonality of internet usage & revenue generation. 2. Economic downturn & global recession. 3. Low consumer confidence levels. 4. Competition. 5. Security/Privacy of information concerns. 6. Internet Taxation. 7. Market valuation .

95

S-T Strategies

1. Establish direct order link with publishers/manufacturers (S5, T4). 2. Enhance attractiveness of platform (S1,S2,S4,S6,T4,T7). 3. Promote ease of use (S2,T4,T5).

W-T Strategies 1.

Reduce fulfillment costs by reduction in number of fulfillment centers (W1,W2,W3,W7,T1,T2,T3,T7).

FORMULATION FRAMEWORK TOWS Matrix SPACE Matrix Stage 2: The Matching Stage


96

SPACE Matrix •SPACE

=

The Strategic Position and ACtion Evaluation

•Dikemukakan oleh : R. Howe, R. Mason & K. Dickel •Diadaptasi oleh : Fred R. David •Menilai seluruh strategic factors •Mengolah – 97

Ditampilkan pada sistem koordinat 2 dimensi

SPACE Matrix Strategic Position and Action Evaluation Matrix  

Four quadrant framework Determines appropriate strategies    

98

Aggressive Conservative Defensive Competitive

SPACE Matrix Two Internal Dimensions  

Financial Strength [FS] Competitive Advantage [CA]

Two External Dimensions  

99

Environmental Stability [ES] Industry Strength [IS]

SPACE Matrix Overall Strategic position determined by: – – – –

100

Financial Strength [FS] Competitive Advantage [CA] Environmental Stability [ES] Industry Strength [IS]

SPACE Matrix Developing the SPACE Matrix: • • • • • • 101

EFE Matrix IFE Matrix Financial Strength Competitive Advantage Environmental Stability Industry Strength

SPACE Matrix • •

•

102

Select variables to define FS, CA, ES, & IS Assign numerical ranking from +1 (worst) to +6 (best) for FS and IS; Assign numerical ranking from –1 (best) to –6 (worst) for ES and CA. Compute average score for FS, CA, ES, & IS

SPACE Matrix Internal Strategic Position

103

External Strategic Position

Financial Strength (FS)

Environmental Stability (ES)

Return on investment Leverage Liquidity Working capital Cash flow Ease of exit from market Risk involved in business

Technological changes Rate of inflation Demand variability Price range of competing products Barriers to entry Competitive pressure Price elasticity of demand

SPACE Matrix Internal Strategic Position

104

External Strategic Position

Competitive Advantage CA

Industry Strength (IS)

Market share Product quality Product life cycle Customer loyalty Competition’s capacity utilization Technological know-how Control over suppliers & distributors

Growth potential Profit potential Financial stability Technological know-how Resource utilization Capital intensify Ease of entry into market Productivity, capacity utilization

SPACE Matrix FS

Conservative

Aggressive

+6 +5 +4 +3 +2 +1

CA

IS -6

-5

-4

-3

-2

-1

+1

-1

+2 +3

+4

+5

+6

-2 -3 -4 -5

Defensive 105

-6

ES

Competitive

SPACE Matrix : NIKE INTERNAL STRATEGIC POSITION Financial strength Environmental stability

+4 -3

+1 best to +6 worst -6 worst to –1 best

Y axis: 4 + (-3) = 1

EXTERNAL STRATEGIC POSITION Competitive advantage Industry strength Conservative

-2 +3

-6 unstable to –1 stable +1 best to +6 worst FS

X axis: 3 + (-2) = 1

Aggressive

CA

IS

Defensive

106

ES

Competitive

SPACE Matrix : AMAZON FS Conservative

Aggressive

CA

Defensive

IS

ES

Competitive

Y axis Financial strength Environmental stability

+1 -2

+1 worst to + 6 best -1 best to –6 worst

Y axis: 1 + (-2) = -1

X axis Industry strength 107 Competitive advantage

3 -2

+1 worst to +6 best -1 best to -6 worst

X axis: 3 + (-2) = 1

Opportunities Posisi Strategis SO + 0,59 ; + 0,60

+2,75

Weakness -2,50

Rata-Rata Opportunities = +33/12 = + 2,75 Rata-Rata Threats = -28/13 = - 2,15 Rata-Rata Strength = +34/11 = + 3,09 108

Strength

+0,60

Rata-Rata Weakness = -15/6 = - -2,50

+0,59

+3,09

-2,15

Koordinat X = +3,09 + (-2,50) = 0,59 Threats Koordinat Y = +2,75 + (-2,15) = 0,60

SPACE MATRIX POSISI STRATEGIS PERUSAHAAN

OPPORTUNITIES Supports an Aggressive Strategy

Supports a Turn Oriented Strategy

WEAKNESSES

STRENGTHS

Supports a Difensive Strategy

Supports a Diversification Strategy

THREATS 109



110

BCG Matrix Boston Consulting Group Matrix • • • • • •

111

Enhances multidivisional firms’ efforts to formulate strategies Autonomous divisions (or profit centers) constitute the business portfolio Firm’s divisions may compete in different industries requiring separate strategy Graphically portrays differences among divisions Focuses on market share position and industry growth rate Manage business portfolio through relative market share position and industry growth rate

BCG Matrix Relative Market Share Position Industry Sales Growth Rate

High 1.0

112

High +20

Medium .50

Low 0.0

Stars II

Question Marks I

Cash Cows III

Dogs IV

Medium 0

Low -20

Kondisi Bisnis Perusahaan

113

Perusahaan dengan satu bisnis

Diversifikasi perusahaan yang berhubungan

Diversifikasi perusahaan yang tak ada hubungan

Bersaing sebagai satu bisnis

Membagi kompetensi bisnis satu sama lain

Tiap unit bisnis otonom pada pasar yang berbeda-beda

Apple Computer McDonald’s Corp. Wrigley Maytag Texas Air Ford Motor

P&G Philip Morris Dow-Corning Johnson & Johnson Du Pont Gilette

ITT Rockwell GE LTV Textron Litton

Pendekatan Portofolio Pendekatan portofolio ditandai ciri berikut :  Menguji setiap bisnis perusahaan yang terpisah sebagai elemen portofolio dari total bisnis.  Suatu unit bisnis dalam portofolio perusahaan, pada derajat tertentu, adalah merupakan penghasil (generators) atau penerima (recipients) dari sumber-sumber (resources) perusahaan.

114

 Pendekatan portofolio merupakan cara yang sederhana dan visual untuk mengidentifikasi dan mengevaluasi alternatif strategi guna dapat menghasilkan dan mengalokasikan sumber-sumber perusahaan (corporate resources)

SUSUNAN MATRIKS BCG • Matrix BCG ini dibentuk dari empat sel (Matriks 2 X 2) yang mengukur laju pertumbuhan pasar (market growth) pada sumbu vertikal, dan pangsa pasar relatif (relative market share) pada sumbu horizontal • Didalam matriks BCG, setiap unit bisnis menempati salah satu dari kategori “tanda tanya”

115

   

Question mark Star Cash cow Dogs

MATRIKS BCG • Matrixs BCG merupakan model yang sederhana dan paling banyak digunakan. • Model ini berguna bagi top manager yang membawahi unit bisnis yang berbeda-beda (diversified forms), khususnya untuk mengalokasikan sumber-sumber (resources) dari satu unit ke unit bisnis lainnya.

116

• Matriks ini juga digunakan untuk memperkirakan posisi pasar suatu unit bisnis beberapa tahun ke depan bila tidak dilakukan perubahan kebijakan (policies) selama ini

Bentuk BCG Matrix High

Market Growth

Star

Question Mark

Cash Cow

Dog

Low Strong 117

Relative Market Share

Weak

Market Growth Rate

The Boston Consulting Group’s Growth-Share Matrix

118

20%18%16%14%12%10%8%6%4%2%0

Stars

4

5

Question marks

3

? ? ?

1

2

Dogs

Cash cows

8

7

6 10x 4x 2x 1.5x 1x

.5x .4x .3x .2x .1x


Indikator Cash Flow Beberapa indikator berikut diperlukan dalam penyusunan matriks BCG:  Cash flow merupakan indikator kunci pada matriks BCG  Cash flow merepresentasikan kemampuan dari unit bisnis untuk membangun portofolio-nya  Cash flow dalam matriks BCG dapat dibagi atas:  Pemakaian kas (cash use) karena pangsa pasar relatif (relative market share) di sumbu horizontal  Penerimaan kas (cash generated) karena pertumbuhan pasar (market growth rate) di sumbu vertikal  Relative market share dapat dihitung dari ratio market share unit bisnis dengan market share pesaing tertinggi 119

 Market growth atau pertumbuhan pada industri bersangkutan.

Asumsi Cash flow vs. posisi bisnis Hubungan antara cash flow perusahaan dengan portofolio bisnisnya dapat terjadi berdasarkan beberapa asumsi :  Profit margin dan penerimaan kas (cash generation) makin besar dengan bertambahnya relative market share, akibat learning curve  Market growth membutuhkan uang tunai (cash used) guna membiayai modal kerja, penambahan kapasitas, dan investasi lainnya  Sebagian unit bisnis membutuhkan uang tunai lebih besar dari pendapatannya, sedang sebagian lain menghasilkan lebih besar dari yang digunakannya  Dalam portofolio perusahaan, cash flow keseluruhan perusahaan harus seimbang, yaitu antara kebutuhan tunai total dengan kemampuan unit-unit usaha dalam menghasilkan uang tunai ditambah pembiayaan dari luar.

120

Analisa Cash Flow High

Star

Question Mark

Cash generated +++ Cash use

Market Growth

--0

Cash Cow Cash generated +++ Cash use ++

Low Strong 121


Cash generated + Cash use ----

Dog Cash generated + Cash use 0

Weak

4 Strategi Utama BCG Matrix  Build market share  Hold market share  Harvest  Divest 122

BCG Matrix: Karakteristik Kuadran 30% Star

Market Growth

-10%

Earnings: high stable, growing Cash flow: neutral Strategy: hold or invest for growth

Earnings: low, unstable, growing Cash flow: negative Strategy: build market share or harvest/divest

Cash Cow

Dog

Earnings: high stable Cash flow: high stable Strategy: hold or add market share

Earnings: low, unstable Cash flow: neutral or negative Strategy: harvest/divest

10 123

Question Mark

1.0


.1

Penggunaan Model : Simbol

P roduc t A P revious M a rk et S ize a nd P os ition

P roduc t A T o ta l M a rk et M a rk et S ha re

B 124

P roduc t B M a rk et S m a ller but firm ha s g rea ter

Plotting Your SBU’s 30% Star

Question Mark

C Market Growth

C

B

A Cash Cow

Dog

A

B

-10% 10 125

1.0 Relative Market Share

.1

Traditional SBU or Product Path 30% Star

Question Mark 2

Market Growth

Cash Cow

1

Dog 3

4

-10% 10 126

2

1.0 Relative Market Share

.1

Question mark

???

MATRIKS BCG & BUSINESS LIFE CYCLE

Berada pada kuadran 1, dimana relative market share-nya rendah (low), namun dengan market groqth rate yang tinggi (high) Ini mengingat posisi market share yang rendah, menunjukkan cash generated yang rendah pula, dan cash use yang tinggi pada market growth yang tinggi. Dalam kondisi bisnis “question mark” ini perusahaan harus memutuskan untuk memperkuat diri dengan strategi intensif (penetrasi pasar, pengembangan pasar, atau pengembangan produk) atau menjualnya bila pelaksanaan strategi terlalu mahal. Misi yang dituntut dari anak perusahaan ini adalah membangun (build) market share. Dalam daur hidup bisnis, posisi ini terletak pada masa perkenalan atau masa-masa awal bisnis (introduction) perusahaan 127

Star


Berada pada kuadran II, menunjukkan baik relative market share dan market growth yang tinggi, serta menunjukkan cash generated maupun cash use yang tinggi pula. Posisi star merupakan posisi dominan yang dikejar setiap perusahaan dan posisi yang paling kuat, namun harus dipertahankan dengan investasi yang memadai. Hal tersebut dapat dilakukan dengan strategi integrasi, strategi intensif atau joint ventures, melalui integrasi ke hilir (forward), ke hulu (backward) atau ke pesaing (horizontal), serta melalui penetrasi pasar, pengembangan pasar, atau pengembangan produk dan joint ventures. Misi yang perlu dilakukan adalah mempertahankan (hold) market share. Posisi “hold” sama dengan siklus pertumbuhan (growth) pada business life cycle. 128

Cash cow MATRIKS BCG & BUSINESS LIFE CYCLE

Berada pada kuadran III, yaitu dengan relative market share yang tinggi namun market growth-nya rendah. Pada market share yang tinggi, biaya per unit cenderung rendah dan berarti menghasilkan laba yang tinggi. Sebaliknya dengan market growth yang rendah, bisnis dalam keadaan menurun sehingga kurang di perlukan uang tunai untuk keperluan investasi. Unit bisnis ini memiliki keuntungan dan cash flow yang tinggi

129

Misi yang di emban adalah memanen (harvest) keuntungan dan cash flow jangka pendek untuk membiayai bisnis anak perusahaan yang lainnya, dengan pendapatan yang besar, namun dengan pertumbuhan yang rendah

Dog


Berada pada kuadran IV, berada pada posisi yang lemah dan industri sudah tidak menarik. Biasanya strategi yang baik adalah melakukan divestasi, kecuali masih ada kemungkinan memperbaikinya dengan biaya yang tidak terlalu mahal. Misi yang dilakukan adalah melakukan (divest) bisnis tersebut. Disini perusahaan berada dalam keadaan “declining” atau mengalami siklus menurun.

130

HUBUNGAN ANTARA KATEGORI BISNIS, MISI DAN DAUR HIDUP

131

KUADRAN

KATEGORI

MISI

DAUR HIDUP

I

Question Mark (“?”)

Build

Introduction

II

Stars

Hold

Growth

III

Cash Cows

Harvest

Mature

IV

Dogs

Divest

Decline

Keuntungan MATRIKS BCG  Pendekatan yang sederhana pemakaiannya dan disajikan secara visual  Memudahkan penentuan portofolio bisnis dari divisi atau anak perusahaan  Merangsang minat dalam perencanaan strategi  Mendorong perusahaan untuk melihat formulasi strategi sebagai hubungan kerjasama antara unit-unit bisnis yang ada didalam perusahaan  Memperlihatkan bagaimana setiap unit perusahaan memiliki penerimaan dan penggunaan dana tunai (cash flow) yang berbedabeda terhadap pencapaian tujuan perusahaan. 132

KELEMAHAN MATRIKS BCG • Penggunaan tinggi dan rendah pada growth-share matriks untuk empat kategori, terlalu menyederhanakan masalah bisnis. • Hubungan antara market share dengan profitabilitas tidak selalu linier karena market share unit bisnis yang rendah masih bisa mendapatkan keuntungan yang besar, bila di pasarkan pada “niche market” • Tingkat perrumbuhan yang tinggi tidak selalu yang terbaik. • Matriks ini hanya memperhitungkan pesaing yang kuat dengan mengabaikan pesaing-pesaing kecil yang sedang tumbuh dengan cepat. • Market growth hanyalah salah satu saja dari faktor daya tarik industri (industry attractiveness) dan market share adalah juga salah satu dari posisi kompettif bisnis. 133

GE Multifactor Portfolio Matrix

Industry Attractiveness

High High

Invest/Grow

Medium

134

Business Strengths Medium Low

Low

Selectivity /earnings Harvest /Divest

GE/McKinsey Matrix & Arah Strategis

135

Memposisikan berbagai divisi organisasi dalam 9-sel berdasarkan analisa SWOT dengan weighted scores (dari matriks EFE and IFE). Strategi yang dapat ditempuh, adalah:  Grow and build (divisi pada sel 1, 2 or 4): market penetration, market development, product development or backward, forward and horizontal integration.  Hold and maintain (divisi pada sel 3, 5, 7): market penetration or product development.  Harvest or divest (divisi pada cells 6, 8, 9): divest, liquidate, or retrench.

GE Multifactor Portfolio Matrix Business Strengths Industry Attractiveness

High

136

High

Medium

Low

Invest/Grow 1 Invest/Grow 2 Dominate/ 3 Strongly Selectively Delay/ (build) (build) divest

Invest/Grow 4 Medium Selectively (build)

Earn/ 5 Protect (hold)

Harvest/ 6 divest

Earn/ 7 Protect (hold)

Harvest/ 8 divest

Harvest/ 9 divest

Low

ADL Portfolio Matrix Industry Maturity (Attractiveness) Embrionic

Competitive Position

Dominant

Invest

Improve

137

Maintain Harvest Niche

Selective

Aging Hold

Selective

Tenable Weak

Mature

Consolidate

Strong

Favorable

Growing

Liquidate Divest

Penggunaan ADL Matrix

 ADL Matrix adalah matriks yang dibuat oleh konsultan Arthur D. Little sebagai penyempurnaan dari GE/McKinsey Matrix  Perbedaannya: Pada ADL Matrix di-plotkan posisi daya saing (competitive position) perusahaan terhadap tahaptahap siklus hidup (life cyclus dari produk, pasar, dan industri.  Penggunaan ketiga matriks dalam proses portofolio bisnis barangkali akan memberikan hasil yang lebih baik. 138

Illustrasi: Analisa Portofolio Internasional Competitive Strengths

Country Attractiveness

High

139

High

Medium

Low

Medium

Low

Dominate/ Divest/ Joint Venture

Invest/Grow

Selective Strategies Harvest/ Divest/ Combine/ License

Country’s Attractiveness: Market size, Market rate of growth,  Regulasi pemerintah, Faktor ekonomi, Politik, dll. Product’s Competitive Strength:  Market share, Product fit, Contribution margin, Market support, dll.



140

INTERNAL EXTERNAL (IE) MATRIX •

Matriks Internal-External adalah salah satu alat yang dapat digunakan untuk memposisikan perusahaan kedalam matriks yang terdiri atas 9 sel, untuk menyusun strategi perusahaan/grand strategy.

•

IE Matrix terdiri atas sumbu X yang menyatakan skor total dari IFE matrix (IFAS) dan sumbu Y yang menyatakan skor total EFE matrix (EFAS)

•

Arti posisi internal pada sumbu X dan posisi eksternal pada sumbu Y adalah sebagai berikut :

POSISI PADA SUMBU X POSISI INTERNAL LEMAH

POSISI INTERNAL RATA-RATA

POSISI EXTERNAL RENDAH

POSISI EXTERNAL SEDANG

POSISI INTERNAL KUAT POSISI EXTERNAL TINGGI

POSISI PADA SUMBU Y 141

9 SEL POSISI MATRIKS INTERNAL-EKSTERNAL

POSISI I, II, IV •

Posisi perusahaan yang menempati sel I, II & IV dapat digambarkan sebagai GROW & BUILD. Strategi yang cocok untuk masing-masing posisi sel ini adalah : Intensive (market penetration, market development & product development) atau integration (backward integration, forward integration, horizontal integration)

POSISI III, V, VII •

Posisi yang menempati sel III, V & VII dapat digambarkan sebagai HOLD & MAINTAIN. Strategi yang cocok untuk masing-masing posisi sel ini adalah : Market penetration & product development.

POSISI VI, VIII, IX •

142

Posisi perusahaan yang menempati sel VI, VIII & IX dapat menggunakan strategi HARVEST or DIVESTITURE

9 SEL POSISI MATRIKS INTERNAL-EKSTERNAL SKOR TOTAL IFE/IFAS 4,0

KUAT

3,0

RATA-RATA 2,0 LEMAH

4,0 TINGGI

I

II

III

IV

V

VI

VII

VIII

IX

3,0

SKOR TOTAL EFE/ EFAS

RATA RATA 2,0

RENDAH

1,0

143

1,0

IE MATRIX : AMAZON The IFE Total Weighted Score

High 3.0 to 3.99

Strong 3.0 to 4.0 I

Average 2.0 to 2.99 II

Weak 1.0 to 1.99 III 1

3

2 The EFE Total Weighted Score

144

Medium 2.0 to 2.99

IV

V

VI

Low 1.0 to 1.99

VII

VIII

IX

Segments 1. U. S. Books, Music-Dom 2. Early-Stage Businesses and Other 3. International

Revenue $1,700 million 683 million

EFE 2.5 3.5

IFE 1.9 2.5

381 million

3.6

2.5



145

Grand Strategy Matrix •

Popular tool for formulating alternative strategies

•

All organizations (or divisions) can be positioned in one of four quadrants

•

Based on two evaluative dimensions: – –

146

Competitive position Market growth

RAPID MARKET GROWTH 1. 2. 3. 4. 5. 6.

WEAK COMPETITIVE POSITION 1. 2. 3. 4. 5. 147

Quadrant II Market development Market penetration Product development Horizontal integration Divestiture Liquidation

1. 2. 3. 4. 5. 6. 7.

Quadrant I Market development Market penetration Product development Forward integration Backward integration Horizontal integration Concentric diversification

Quadrant III Quadrant IV Retrenchment 1. Concentric diversification Concentric diversification 2. Horizontal diversification Horizontal diversification 3. Conglomerate diversification Conglomerate diversification 4. Joint ventures Liquidation SLOW MARKET GROWTH

STRONG COMPETITIVE POSITION

Grand Strategy Matrix Quadrant I • • •

148

Excellent strategic position Concentration on current markets and products Take risks aggressively when necessary

Grand Strategy Matrix Quadrant II • Evaluate present approach seriously • How to change to improve competitiveness • Rapid market growth requires intensive strategy

149

Grand Strategy Matrix Quadrant III • • • •

150

Compete in slow-growth industries Weak competitive position Drastic changes quickly Cost and asset reduction indicated (retrenchment)

Grand Strategy Matrix Quadrant IV • • •

151

Strong competitive position Slow-growth industry Diversification indicated to more promising growth areas

Grand Strategy Matrix : Amazon RAPID MARKET GROWTH Quadrant II

Quadrant I

Amazon WEAK

STRONG

COMPETITIVE

COMPETITIVE

POSITION

POSITION

Quadrant III

Quadrant IV SLOW MARKET GROWTH

152

Formulation Framework

Stage 3: The Decision Stage

153

Quantitative Strategic Planning Matrix (QSPM)

QSPM Quantitative Strategic Planning Matrix •

154

Only technique designed to determine the relative attractiveness of feasible alternative actions

QSPM Quantitative Strategic Planning Matrix • • •

155

Tool for objective evaluation of alternative strategies Based on identified external and internal crucial success factors Requires good intuitive judgment

QSPM Quantitative Strategic Planning Matrix

156

•

List the firm’s key external opportunities & threats; list the firm’s key internal strengths and weaknesses

•

Assign weights to each external and internal critical success factor


157

•

Examine the Stage 2 (matching) matrices and identify alternative strategies that the organization should consider implementing

•

Determine the Attractiveness Scores (AS)


158

•

Compute the total Attractiveness Scores

•

Compute the Sum Total Attractiveness Score

QSPM Strategic Alternatives Key External Factors Economy Political/Legal/Governmental Social/Cultural/Demographic/ Environmental Technological Competitive Key Internal Factors Management Marketing Finance/Accounting Production/Operations Research and Development Computer Information 159Systems

Weight

Strategy 1

Strategy 2

Strategy 3

QSPM Strategic Alternatives Key Internal Factors Strengths Customer satisfaction Copyright to One-click online shopping Humanitarian efforts Strong Research & Development Exclusive agreements with Internet sites (Associates) Ability to track customized interests through customized home page Formation of strategic alliances Agreement with AOL Weaknesses Accumulated deficits/Anticipates further losses Financial position Slowing growth, core business-U.S. Books, & Music Video Lawsuit with Barnes & Noble over patent to 1 click method Class action suits filed by stockholders Does not have a mission statement SUBTOTAL

160

Weight

0.10 0.08 0.03 0.09 0.01 0.02

Enter into strategic agreements w/physical retailers AS TAS 4 0.40 2 0.02 -

Expand European presence through strategic alliances AS TAS 2 0.20 4 0.04 -

0.11 0.09

4 3

0.44 0.27

2 2

0.22 0.18

0.11 0.07 0.08

1 3 2

0.11 0.21 0.16

2 2 4

0.22 0.14 0.32

0.03

-

-

-

-

0.04 0.05 1.00

4 -

0.16 1.77

3 -

0.12 1.44

QSPM Limitations:

161

•

Requires intuitive judgments and educated assumptions

•

Only as good as the prerequisite inputs

QSPM Positives:

162

•

Sets of strategies examined simultaneously or sequentially

•

Requires the integration of pertinent external and internal factors in the decision-making process

Cultural Aspects of Strategy Choice

Culture: •

163

The set of shared values, beliefs, attitudes, customs, norms, personalities, heroes, and heroines that describe a firm

Cultural Aspects of Strategy Choice

Culture: •

164

Successful strategies depend on degree of support from a firm’s culture

Politics of Strategy Choice

Politics in organizations: • • •

165

Management hierarchy Career aspirations Allocation of scarce resources

Politics of Strategy Choice Political tactics for strategists: • • • • • 166

Equifinality Satisfying Generalization Focus on Higher-Order Issues Provide Political Access on Important Issues

Role of A Board of Directors

Duties and Responsibilities: 1. 2. 3. 4. 167

Control and oversight over management Adherence to legal prescriptions Consideration of stakeholder interests Advancement of stockholders’ rights

This is the end of the PRESENTATION

168

Strategy-Formulation Analytical Framework

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