Strategic Analysis and Developing a Competitive Strategy

How does strategic ysis relate to the development of a competitive strategy

Well, to begin with, there are various levels of strategy. Competitive strategy is used to differentiate yourself or stand out or otherwise excel against the competition that exists in your given market of operations

Now the competitive strategy is used to move forward your organizational or higher level strategy

That is the mission, vision, values, objectives, goals of the company. Now with that being said, how do you use strategic ysis in the development of a competitive strategy

Well, to begin with, you take a look at the internal and external elements or factors or characteristics of the organization

Generally, you use tools such as the SWOT ysis, which examines the internal strength and weaknesses and the internal and external opportunities and threats of the firm

You look at the external factors like the political, economic, sociotechnical, environmental, and legal factors that could somehow affect the business, generally giving rise to some level of threat or opportunity

And then you look at Porter five forces the competitors the substitute products the buyer power the supplier power and then the general competitive environment in which you operate to make the determination of how competitive is the environment and what are the forces that are going to be pulling upon you If you understand all of these

things, you truly understand the firm and the environment in which it operates. From there

you move on to develop a competitive strategy that in some way could lead to a competitive

advantage over other competitors in the marketplace that take advantage of potential opportunities

and utilize the strengths that the firm has and minimizes dependence or susceptibility

to the threats in the environment or the weaknesses that are internal to the firm

So generally, the information collected during the internal and external ysis is used

to define a given path or approach towards competing in the environment that aligns with

again, the strengths and opportunities and minimizes weaknesses and threats. And from there, you have to implement that competitive strategy

And that is done through what is known as an operational or a functional level strategy

And this is where the actual elements of the strategy are implemented in daily processes within the organization

So collectively, this is how you use strategic ysis to develop a competitive strategy with the hopes of achieving the organizational objectives of the firm