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Unit 32 Business Strategy

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Aim of Unit 32 Business Strategy

A variety of models and theories can be used for understanding the strategic decisions to support the organization’s choice and the direction. Strategic decision making takes at three levels, operational, tactical and strategic. This study mainly aims to identify the importance and significance of business strategies at all three levels. A positive and effective contribution can be made for the development of business plans and directing an organization towards the right path. Proper decision making is necessary for successful generation of business strategies.

Learning outcomes

LO1 Analyse the impact and influence which the macro environment has on an organisation and its business strategies

LO2 Assess an organisation’s internal environment and capabilities

LO3 Evaluate and apply the outcomes of an analysis using Porter’s Five Forces model to a given market sector

LO4 Apply models, theories and concepts to assist with the understanding and interpretation of strategic directions available to an organisation.

LO1 Analyse the impact and influence which the macro environment has on an organisation and its business strategies

An organization has a certain mission, vision and objectives that the employees have to abide by. Strategy is a policy framed by an organization which all the members of the organization have to cooperate with. Strategy plays an important role in achieving business goals and objectives. There are different strategic planning techniques. The stakeholder matrix and stakeholder mapping can be done through stakeholder analysis. The models used for analysing the macroeconomic environment are PESTLE and Porter’s Five Forces model. Ansoff’s matrix can be used for as a market strategy. The internal audit can be analysed with the help of SWOT analysis and benchmarking indicators.

LO2 Assess an organisation’s internal environment and capabilities

In order to understand the internal capabilities and competitive tendencies of an organization it is necessary to analyse the internal environment. The key components of strategic capabilities are it value in the market and the position at which the Company is stranded in. McKinsey’s 7 S models can be used as a management tool. VRIO and value chain analysis analysis can be used for analysing the internal capabilities. Cost benefit analysis would enable the maximization of output with lesser amount of resources.

LO3 Evaluate and apply the outcomes of an analysis using Porter’s Five Forces model to a given market sector

The Balanced scorecard can be used to arrive at the organizational vision and strategy. A Porter’s Five Forces model can be used to analyse the competitive analysis. A stakeholder analysis and Ansoff’s matrix can be used to arrive at product and market strategy. The various analytical tools and models of analysis can be used to arrive at an outcome of analysis.

LO4 Apply models, theories and concepts to assist with the understanding and interpretation of strategic directions available to an organization

The models and theories help in assisting and understanding the interpretation and direction of the organization. The cost and leadership strategy, differentiation strategy and focus strategy can be used as a strategic choice. Bowman’s strategy clock helps in identifying the strategic choices and directions. Hybrid strategy, diversification and vertical horizontal integration helps in understanding the strategic directions and goals of the organization.

Learning outcomes and assessment criteria

Pass Merit Distinction
LO1 Analyse the impact and influence which the macro environment has on an organisation and its business strategies.       LO1, LO2, LO3 & LO4 D1 Critique and interpret information and data applying environmental and competitive analysis to produce a set of valid strategic directions, objectives and tactical actions.
P1 Applying appropriate frameworks analyse the impact and influence of the macro environment on a given organisation and its strategies. M1 Critically analyse the macro environment to determine and inform strategic management decisions.
LO2 Assess an organisation’s internal environment and capabilities
P2 Analyse the internal environment and capabilities of a given organisation using appropriate frameworks. M2 Critically evaluate the internal environment to assess strengths and weaknesses of an organisation’s internal capabilities, structure and skill set.
LO3 Evaluate and apply the outcomes of an analysis using Porter’s Five Forces model to a given market sector
P3 Applying Porter’s Five Forces model evaluate the competitive forces of a given market sector for an organisation. M3 Devise appropriate strategies to improve competitive edge and market position based on the outcomes.
LO4 Apply models, theories and concepts to assist with the understanding and interpretation of strategic directions available to an organisation
P4 Applying a range of theories, concepts and models, interpret and devise strategic planning for a given organisation. M4 Produce a strategic management plan that has tangible and tactical strategic priorities and objectives.

Links

This unit links to the following related units:

Unit 1: Business and the Business Environment

Unit 18: Global Business Environment

Unit 25: Principles of Operations Management

Unit 27: Identifying Entrepreneurial Opportunities

Unit 33: Business Information Technology Systems

Unit 42: Planning for Growth