STRATEGIC MANAGEMENT

Pavan Gadade Sachin Chavan

STRATEGIC MANAGEMENT
Enviourment:- Surrounding factors that affect the business
4 C:1. Company Internal Factor External Factor

2.
3. 4.

Customer
Competition Condition

STRATEGY
Strategy :- Taking action in order to achieve desired outcome
Types of Strategy Corporate Strategy
Higher Level Management

Function Strategy

Business Strategy
Middle Level Management

Middle Level Management

SWOT ANALYSIS
Strength
1) Best Design & Engineering Capability 2) Eco System

Weakness
1)Higher Cost as compared to competitor 2) High lead time

Opportunity
1) Enter into different market segment 2) Demand for smart phone and tablet is growing

Threat
1) Samsung competition in technology 2) Chinese intervention

MICHAEL PORTERS FIVE FORCES MODEL

MICHAEL PORTERS FIVE FORCES MODEL

Example:- Cement Industry
BPOS (Bargaining power of supplier):- High
Scarcity of raw material (Mineral) Most of mines are own or govern by government body Many customer and few supplier

BPOB :- HIGH
High number of cement company

TONE :- LOW
Require own plant
Own distribution network

High technology
Government licenses High capital requirement

TOS :- LOW

Nothing can replace cement for construction purpose

IOC/CR :- LOW
There are many players in market but few player dominate the market
Market share of cement company L & T :- 22 % ACC :- 15 % Ambuja :- 13 % JP :- 10 % India Cement:- 10%

SUSTAINABLE COMPETITIVE ADVANTAGE

SUSTAINABLE COMPETITIVE ADVANTAGE

AMUL VALUABLE INIMITABLE RARE UNSUBSTITUTABL E Below average returns Average returns Above average returns Above Above average returns

VIRU
Example: Apple

VALUABLE Product Design Product interface

INIMITABLE Heritage of technology Innovation

RARE

UNSUBSTITUTABLE

Convergence ( 4 segment got unstable)

Linkage to customer
Trust

INTEGRATION
Integration

Vertical

Horizontal

Forward

Backward

INTEGRATION
Forward Integration : From Firm to Source
Example:- Videocon

Backward Integration : From Firm to Customer

Example:-Reliance Fresh, Vedanta Group Horizontal Integration:- a strategy where a company acquires another company in the same Production Line. Example:- Ultratech acquired JP Cement plant

MERGER & ACQUISITION

Merger :- A merger is a integration of two companies relatively on co-equal basis to form a new company Company A +Company B= Company c Acquisition: It is strategy when firm buys controlling or 100 % interest in another firm to make acquired firm a subsidiary business with its portfolio
Company A +Company B= Company A

WHY MERGER FAILS

Diversification away from firms core business
Inadequate analysis

Ethical Concern
Large Extra ordinary Debt

DIVERSIFICATION
When firm decides to operate business in several Industries Related Diversification Unrelated Diversification

RELATED DIVERSIFICATION

Mahindra systech (component)

Farm Construction Equipment

Mahindra Automotive

Steel processing

M& M

UNRELATED DIVERSIFICATION

Leisure & Hospitality

Club Mahindra

IT
Tech Mahindra

Retail
Mom & Me

Mahindra Satyam

BCG MATRIX
Objective :- To help SBUs with analyzing their business units or product lines & recommend strategies with the help of four quadrants by plotting products against Relative market share & Market growth Brand L/F Market Growth Relative Market Share

Swift
Swift Dzire Alto 800 Wagon R

L
L L L

13
12 4 3

4X
4X 4X 3X

Omni
Ritz Ertiga SX 4 Kizashi Grand Vitara

L
F F F F F

2
10 6 2 -3 -4

2X
0.8X 0.9X 0.6X 0.1X 0.1X

Boston Consulting Group Model

15

Swift Swift Dzire

Market Growth

Ritz
Ertiga

Alto 800 Wagon R Omni

SX4 Kizashi Grand Vitara

-5 5x

1x

Relative Market Share

0.1x

GE MCKINSEY MATRIX
Assess the strength of a SBU Analyze current portfolio and resource allocation Focuses on Profitability, Market Attractiveness and Business Strength.
Industry Attractiveness Growth Business Unit Strength Market share Growth

SBU Beverage and alcohol

Aviation UB Engineering

Size XXL
XXL XXL

XXL
M S S

Chemical & fertilizers XL (MCF)

GE MCKINSEY MATRIX

Beverage & alcohol

Engineerin g

Chemical & Fertilizer

Aviation

VALUE CHAIN ANALYSIS

Value chain analysis (VCA) is a process where a firm identifies its primary and support activities that add value to its final product and then analyse these activities to reduce costs or increase differentiation.

Food Segment
Details
Inbound Logistics Operations Outbound Logistics Sales & Marketing Service Total

ITC
9 9 9 9 36

HUL
8 9 8 8 34

Nestle
7 7 8 10 32

WEBLIOGRAPHY
http://www.theautomotiveindia.com/forums/indian-auto-news/12327-march-2013sales-figures-cars-india.htm http://autobei.com/blog/indian-passenger-vehicle-sales-analysis-april-2013/ http://en.wikipedia.org/wiki/Mahindra_%26_Mahindra_Limited http://www.oncars.in/compare-cars/hyundai-i10-asta-1-2-at-kappa2-with-sunroof-Vsmaruti-suzuki-omni-e-mpi-std-bs-iv http://www.mahindra.com/What-We-Do/Automotive http://economictimes.indiatimes.com/news/news-by-industry/auto/automobiles http://en.wikipedia.org/wiki/United_Breweries_Group http://en.wikipedia.org/wiki/Mahindra_Group http://www.mahindra.com/#

thank you