Strategic Group Analysis

A strategic groups map is a visualization tool for capturing the essence of the competitive landscape in an industry: extent of competition between and among strategic groups, mobility barriers, available niches, positioning and industry dynamics.

strategic group mapping

• Extent of product (or service) diversity.
• Extent of geographic coverage.
• Number of market segments served.
• Distribution channels used.
• Extent of branding.
• Marketing effort.
• Degree of vertical integration.
• Product (or service) quality.

There are four steps to construct a strategic group map: (i) identify the competitive variables that distinguish companies; (ii) plot firms on a two-variable map with pairs of characteristics; (iii) assign companies to the strategic groups; (iv) draw circles around each strategic group.

Strategic Group Analysis

1. Identify the strategic direction of the direct rivals in the industry.
2. Identify the strategies used by companies in other strategic groups.
3. Discover untapped opportunities in the industry by revealing the gaps (i.e. disclose areas where there is limited or no competition)

It helps managers determine the changing speed of an industry or the rate of innovation. It views competition within an industry broadly to include forces such as buyers, suppliers, and the threat of substitutes. A firm’s strategic position is likely to be strong when. A.

A strategic group is a set of firms within an industry that employ similar practices in order to achieve comparable goals. An example of a strategic group within the food service industry would be fast-food chains.

It was noted that Porter’s Five Forces analysis assumes that the key objectives for any organisation is to gain competitive advantage over its rivals, while Strategic Groups were defined as groups of business that are likely to respond similarly to environmental changes.

There are five essential tasks of strategic management. They include developing a strategic vision and mission, setting objectives, crafting tactics to achieve those objectives, implementing and executing the tactics, and evaluating and measuring performance.

The five stages of the process are goal-setting, analysis, strategy formation, strategy implementation and strategy monitoring.

Strategic management is the process of employing that kind of large-scale, objective-oriented approach through the use of three major components: environmental scanning, strategy formulation and implementation and strategy evaluation.

They include strategies for goal-setting, leadership, business administration and operational activities. Management strategies exist because, in the long-run, organizations can only achieve top performance if they have a clear strategy in place and the strategy is anchored throughout the company.

Three Inputs Your Strategy Development Process Needs to Consider

• Input from employees throughout and across the organization.
• Customers’ needs, industry trends, and competitors’ strengths and weaknesses.
• Strategic management and strategy development process best practices.

There are four key elements of the strategic management process: environmental scanning, strategy formulation, strategy implementation and strategy evaluation.

An effective strategy contains five key elements: Arenas, Differentiators, Vehicles, Staging, and Economic Logic. Remember that it’s important to consider each element in the diamond because they are all interrelated and mutually reinforcing.

Three Types of Strategy

• Business strategy.
• Operational strategy.
• Transformational strategy.

The strategic management process has six major components:

• Establishment of mission, vision, and goals.
• Analysis of external opportunities and threats.
• Analysis of internal strengths and weaknesses.
• SWOT (strengths, weaknesses, opportunities, and threats) analysis and strategy formulation.
• Strategy implementation.

The 5 Key Elements of a Strategic Plan

• Vision.
• Values.
• Clearly Defined Outcomes.
• Accountability.
• KPIs.

The main steps that are taken in planning process are as follows:

1. Establishing Objectives: Establishing the objectives is the first step in planning.
2. Determining Planning Premises.
3. Determining Alternative Courses.
4. Evaluating Alternative Courses.
5. Selecting the Best Course.
6. Formulating Derivative Plans.
7. Implementation of Plans.

7 Steps to Kick-Start Your Strategic Planning Process

1. Identify your mission statement.
2. Create a vision of the future.
3. Develop core values and guiding principles.
4. Create long-term goals and smart objectives.
5. Establish an action roadmap with timelines.
6. Build a communication plan.
7. Establish an implementation and monitoring plan.

He taught that the three most important strategic questions each company must answer are:

• What is our business? (Mission)
• What will our business be? (The changing environment that we are certain about)
• What should our business be? (Vision)

To help you succeed, use this proven strategic plan template, and the information below details the 13 key sections you must include in your strategic plan.

1. Section 1: Executive Summary.
2. Section 2: Elevator Pitch.
3. Section 4: SWOT.
4. Section 5: Goals.
5. Section 6: Key Performance Indicators (KPIs)
6. Section 7: Target Customers.