Week 2

Designing a
Competitive Business
Model & Building a S
olid Strategic Plan
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Strategic Management
• A very crucial area in building a successful
business.
• Involves developing a game plan to guide a
company as it strives to accomplish its
mission, goals , and objectives, and to keep it
on its desired course.
Strategic Management and Competitive
Advantage
Developing a strategic plan is crucial creating
a sustainable competitive advantage, the
aggregation of factors that sets a company
apart from its competitors and gives it a unique
position in the market that is superior to its
competition.
Example: Blockbuster Video
Building a Competitive Advantage
Consider four aspects of a small company:

1. The products they sell.
2. The service they provide.
3. The pricing they offer.
4. The way they sell.
. Key: Core Competencies
Unique set of capabilities a company
develops in key areas, such as superior quality,
customer service, innovation, team-building,
flexibility, responsiveness, and others that allow
it to vault past competitors.
They are what a company does best.
Best to rely on a natural advantage
Strategic Management Process
1. Develop a vision and translate it into a
mission statement.
2. Assess strengths and weaknesses.
3. Scan environment for opportunities and
threats.
4. Identify key success factors.
Strategic Management Process
• 5. Analyze competition.
• 6. Create goals and objectives.
• 7. Formulate strategies.
• 8. Translate plans into actions.
• 9. Establish accurate controls.
Develop a Vision and Create a Mission Statement
• Vision - the result of an entrepreneur's dream
of something that does not exist yet and the
adaptability to paint a compelling picture of
the dream for everyone to see.
• Clearly defined vision:
– Provides direction
– Determines decisions
– Motivate people
• Addresses question: “What business are
we in?”
• The mission is a written expression of
how the company will reflect an
entrepreneur's values, beliefs and vision
more than just” making money”.
• Serves as a “strategic compass.”
• Survey of employees: 89 percent of
employees say their companies have
a mission statement but ..
• Only 23 percent of workers believe their
company's mission statement has
become a way of doing business.
Assess Company Strengths and Weakness
• Strengths
– Positive internal factors a company can draw
on to accomplish its mission, goals and
objectives.
– Weakness
Negative internal factos that inhibit a
company's ability to accomplish its mission,
goals and objectives.
• Opportunities
– Positive external factors the company can
exploit to accomplish its mission, goals and
objectives.
– Threats
• Negative external factors that inhibit the firms
ability to accomplish its mission , goals and
objectives.
Identify Key Success Factors
• Focus on your strengths and weaknesses

that determine the relative success of
market participants.
• The keys to unlocking the secrets of
competing successfully in a particular
market segment.
Analyze Competitors
• Analyzing key competitors allow an
entreprenuer to:
– Avoid surprises from existing competitors' new
strategies and tactics.
– Identify potential new competitors and the threats
they pose.
– Improve reaction time to competitors' actions.
– Anticipate rivals next strategic moves.
Create Company Goals and Objectives
• Goals- broad , long range attributes to

be accmplished.
• “BHAGS “ Big Hairy Audacious Goals
-encourage the companies to define the
visionary goals that are more strategic
and emotionally compelling
S.M.A.R.T
• Objectives - more detailed , specific
targets of performance that are
S.M.A.R.T
–SPECIFIC
–MEASURABLE
–ATTAINABLE
–REALISITC
–TIMELY
Formulate Strategies
• Strategy- a road map of the actions an

entrepreneur draws up to achieve a
company's mission, goals and objective
s. It is the companies game plan for
gaining a competitive advantage.
Three Basic Stretegies
Differentiation
Cost
Focus
leadership
Strategy
?
Translate Strategies into Action Plans
• Survey of senior executives: Companies
achieved only 63 percent of the results in
their strategic plans
– Create projects by defining :
• Purpose
• Scope
• Contribution
• Resource Requirements
• Timing
Establish Accurate Controls
• Plan establishes the standards against

which actual performance is measured.
• Entrepreneur must:
– Identify and track key performance indicators
– take corrective actions.
Balanced Scorecards
A set of measurements unique to a
company that includes both financial
and operational measures.
Balanced Scorecard
• Four Perspectives
– Customer: How do customers see us?
– Internal Business: At what must we excel?
– Innovation and Learning : Can we continue
to improve and create value?
– Financial: How do we look to shareholders?
References
Strategic Planning Basics
https://www.balancedscorecard.org
7 Steps for Establishing the Right Business
Model (Zwilling )
https://www.entrepreneur.com

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Designing a

ALLPPT.com _ Free PowerPoint Templates, Diagrams and Charts

Consider four aspects of a small company:

• Focus on your strengths and weaknesses

• Goals- broad , long range attributes to

• Strategy- a road map of the actions an

• Plan establishes the standards against

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