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1、Entrepreneurship 06Business Strategythe function + - : and x are thereto let us know that values can changeonly through learning and function”YOU WILL NEVER FAIL?What if I say.Causes of business failuresYou risk failures when you:Start business with the wrong reasonsDo bad managementDo bad marketing

2、Dont consider competitorsLack of capitalSpend too muchChoose the wrong locationGet too big too fastDont have a website?Have a BAD BUSINESS PLAN!YOU NEED TO KNOW!Strategies.Strategic ManagementWhat is Strategy?it is an ARTin formulating, implementing, & evaluatingof decisions accross the different fu

3、nctions within an organizationto achieve its objectivesStrategy adalah seni dalam menformulasikan, mengimplementasikan dan mengevaluasiBerbagai keputusan lintas fungsional yang memungkinkan organisasi mencapai tujuannya.What?formulateimplementevaluateHow?Enviromental ScanningGathering InformationExt

4、ernal: Opportunities and ThreatsSocietal Enviromental: General ForcesTask Environment: Industry AnalysisInternal: Strengths and WeaknessesStructure: Chain of CommandCulture: Beliefs, expectations, valuesResources: Assets, skills, competence, knowledgeStrategy FormulatingDeveloping Long-range PlansSt

5、rategy ImplementationPutting Strategy into ACTION!Evaluation and ControlMonitoring PerformanceMissionReasons for existenceObjectivesWhat results to accomplish by whenStrategiesPlan to achieve the mission & objectivesPoliciesBroad guidelines for decision makingProgramsActivities needed to accomplish

6、a planPerformanceActual resultsBudgetsCost of programsProceduresSequence of steps needed to do the jobHow? (proses manajemen strategi)Feedback/Learning: Make correction as neededStrategic ManagementEconomicSocialCulturalDemographicEnvironmentalPoliticalLegalGovernmentalTechnologicalCompetitive trend

7、sEventsExternal Opportunities and ThreatsSocietal EnvironmentSociocultural ForcesEconomic ForcesPolitical-Legal ForcesTechnological ForcesTask EnvironmentShareholdersGovermentsSuppliersSpecial Interest GroupsEmployees / Labor UnionsCustomersCompetitorsCreditorsTrade AssociationsCommunitiesPorters Ge

8、neric StrategiesPoints:A firm positions itself by LEVERAGING its strengthsPorter argued that a frims strengths ultimately fall into 2 of 2 headings: cost advantage and differentiationIt is called “generic” because it is not firm or industry dependent, it is a strategy that everyone can apply with so

9、me measuresIf the primary determinant of a firms profitability is the attractiveness of the industry in which it operates, an important secondary determinant is its position within that industryCost Leadership StrategyThis generic strategy calls for being:Low cost producer in an industry for a given

10、 level of qualitySelling products either at average industry prices to earn a profit higher that that of rivals, or below the average industry prices to gain market shareIn price war, the firm can maintain some profitability while the competition suffers lossesAs industry matures and prices decline,

11、 firms that can produce more cheaply will remain profitable for a longer period of timeCost Leadership StrategyChoices that determine costs:If competing firms are unable to lower their costs by a similar amount, the firm may be able to sustain a competitive advantage based on cost leadershipEconomie

12、s of scaleAsset utilizationCapacity utilization pattern seasonal, cyclicalInterrelationshipsorder processing and distributionValue chain linkagesAdvertising & salesLogistics & operationsProduct featuresPerformanceMix & variety of productsService levelsSmall vs large buyersProcess technologyWage leve

13、lsHiring, training, motivationDifferentiation StrategyThis generic strategy calls for being:Development of a product or service that offers unique attributes that are valued by customers and that customers perceive to be better than or different from the products of the competitionThe value added by

14、 the uniqueness of the product may allow the firm to charge a premium price for it as the firm hopes that the higher price will more than cover the extra costs incurred in offering the unique productBecause of the products unique attributes, if suppliers increase their prices, the firm may be able t

15、o pass along the costs to its customers who cannot find substitute product easilyRisks on strategiesWith low cost strategy, as technology improves, the competition may be able to leapfrog the production capabilities, thus eliminating the competitive advantageEven with differentiation, risk may inclu

16、de imitation by competitors and changes in customer tastesIn focused market, even imitation and changes may ocur in target segments, furthermore, broad market cost leader may adapt its product in order to compete directlyFinally, other focusers may be able to carve out sub-segments that they can ser

17、ve even betterThreats of New EntrantsBargaining Power of SuppliersBargaining Power of BuyersThreat of Substitute Products or ServicesRivalry Among Existing CompetitorsPorter 5 forces VS GenericDevelop Vision and Mission StatementsEstablish Long Term ObjectivesGenerate, Evaluate and Select StrategiesImplement Strategies VS IssuesMeasure and Evaluate PerformancePerform Internal AuditPerform External AuditComprehensive Strategic Management Model / Strategic Pl

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