Review The Strategic Analysis Process Commerce Essay Example

introduced to improve market effectiveness when existing ones proved ineffective. Throughout this process, there was a strong emphasis on formulating strategy rules and techniques. Scientists also focused on empirical research to categorize and analyze strategies.

The final phase of research included multi-dimensional intervention in administration schemes, focusing on strategic thought and seeking to construct strategic direction. The development of strategic direction helped understand methods and techniques used in strategic analysis, changes in its usage in company management, and how to handle creating strategic analysis as a separate category.The demand for these patterns is high as they help assess a company's current state, predict future operations, and understand its trajectory. The complexity of the environment and the need for long-term planning have increased the demand for strategic planning. This is particularly important in global corporations where analyzing the competitive and macro-environment is necessary to evaluate strategic position. Sudden changes in the global economy, technological advancements, and negative economic factors drive people to deeply engage in strategic analysis and planning. Companies use strategic analysis to improve performance, address crises, drive internal development, increase market shares, or target new markets. These changes are often influenced by board changes or new scheme development and execution. In the 1950s, Boston Consulting Group and McKinsey successfully implemented strategic analysis. By the late 1970s, seven schools of strategic thought emerged under two management paradigms: strategic reason and strategic behaviors. The first paradigm focuses on strategy's technical-economic dimension using a normative approach for rational behavior patterns and evaluations.The Harvard School, Strategic Planning School, Matrix Positioning School, and Quantitative School all fall under this paradigm. The Harvard School is renowned for its analysis of a

company's competitive position and the factors affecting its operation in different markets. They have developed three strategic analysis models: the LCAG model created by E.P. Learned, H.K. Christensen, K.R. Andrews, and W.D. Guth; the Eventuality model by A.D. Chandler, P.R Lawrence, J.W Lorsch; and the Industry Analysis Model proposed by Michael Porter.

The LCAG model investigates how a company's strengths and weaknesses, as well as opportunities and threats in the environment, influence strategic choices. It was widely used until more advanced methods of strategic analysis were developed.

The Industry Analysis Model suggests evaluating a company's situation by focusing on the competitive environment and assessing the attractiveness of operating within that sector.

On the other hand,the Strategic Planning School mainly focuses on strategic planning but does not provide any specific models or methods for strategic analysis to assist with strategic management.The Matrix positioning school uses qualitative and quantitative analysis tools to accurately measure a company's competitive positionThis text discusses different schools of thought within strategic planning and their approaches to analyzing company strategy. One approach focuses on examining the company's merchandise portfolio and how it has changed in the past and is expected to change in the future. Another approach, known as the Quantitative School, heavily relies on multi-criteria and statistics analysis using econometric modeling techniques.

There are also three schools that focus on socio-political scheme dimensions and strategic analysis. The Behavioral School emphasizes the actual processes involved in formulating and implementing company strategy, without relying solely on background information. The System School, founded by D. Katz, R.L. Kahn, and M. Crozier, places significance on individuals' roles in the strategic formulation process as well as highlighting the social context of

organizations.

Lastly, the Incrementalists School led by C.E. Lindblom, T.J Peters, and R.H Waterman promotes a pragmatic management approach that enhances quality by adopting proven patterns implemented by successful companies.Motivation among participants in the direction process as well as illustrating examples of successful corporations are crucial factors for determining future success according to Giermaszewska (2007). Overall, these schools have different approaches to improving analysis methods and strategic management (Giermaszewska 2007).The focus of strategic analysis schools like Harvard and positioning matrix schools is on specific details and practical application, while other schools prioritize theoretical analysis methods and strategy creation. French scientists have categorized strategic analysis models into a continuum that ranges from general sociological models to more complex microeconomic models. These categorizations, along with evaluations of schools and strategic analysis models, indicate the direction of analysis development. It should be noted that these categorizations may not include the latest schools and methodological propositions.

M.F. Gouillart presents a chronological order of well-known strategic analysis schools from the 1960s to the 1990s. According to Gouillart, SWOT Analysis was introduced in 1965, followed by portfolio analysis in 1970. In 1975, there was a Nipponese influence focusing on quality, production, and engineering. Stockholders' benefits analysis emerged in 1980, followed by Porter's Model (Porter's 5 forces) in 1985. The Price of perfection was introduced in 1990, along with concepts such as time-based competition, goal and strategic accomplishments, and strategic change.

In phase one of his analysis, Gouillart examines LCAG from the Harvard school while associating portfolio analysis with the matrix positioning school.The Porter model is a representation of the industry analysis model, with the "price of perfection" phase corresponding to the incrementalists school. Gouillart

expands on this by introducing two additional models: analysis of stockholders benefits and Nipponese influence. In addition, he identifies three emerging issues in the early '90s: time-based competition, goals, strategic accomplishments, and strategic changes.

The analysis of stockholders benefits involves evaluating a company's position through financial analysis such as growth projections and capital market forecasts. During scheme preparation influenced by Japanese practices, the company focuses on adding value and conducting financial analysis. The term "Nipponese influence" originated from Western companies admiring Japan's economic success in the '70s. This approach aligns with the concept of "just-in-time" inventory management, which emphasizes accuracy and promptness as crucial factors for success.

Time-based competition is another advantage for companies that prioritize innovation and efficiency. This stage utilizes techniques that explore various phenomena, processes, and organizations' dynamics. Time plays a vital role in determining competition outcomes among companies.

Establishing strategic accomplishments involves defining the mission and important goals of the company. Utilizing these strategic accomplishments effectively is critical for achieving success.Strategic change involves executives and the organization adapting to environmental changes. However, it is crucial to not lose sight of the goal of strategic management while excessively focusing on these changes. Useless methods are rejected and useful ones are improved and adjusted to meet the company's needs, including technical and information capabilities. Consulting companies and business schools still rely on older methods from the 50s and 60s. Beginning analysts find valuable tools in the LCAG method, product life-cycle analysis, and BCG matrix. According to Krzysztof Obloj, a renowned Polish economist, strategic management schools can be categorized as Traditional (planning), Evolutionary (behavior and politics), and Positional (competitive advantage). These categorizations consider the company's situation in

the environmental sector. Development strategies are built upon key capabilities and resources of the company. Modern strategic analysis draws from scientific methodologies in sociology, psychology, economics, and management.The interdisciplinary approach utilized in strategy analysis incorporates financial analysis methods, which have become more accessible due to technological advancements. This strategic financial analysis evaluates various aspects such as the company's financial condition, capital structure, competitive position, sector barriers, and production portfolio assessment. It also takes into account strategic costs, price strategy, and planning strategic alliances.

Moreover, Gierszewska (2007) explains the concept of quality factors that aims to increase the company's awareness of soft elements like culture, qualifications, people's motives, strategic mission, ecological management aspect, and ethical side of strategic analyses. These elements play a crucial role in competition information used for decision-making processes.

To focus on upcoming processes and interpret analysis results without pre-selected tools and assessments, the company adopts a situational attack approach. Analysis serves as a tool utilized by directors in their daily work. To facilitate this process further, strategic planning sections are dissolved while information is decentralized. A special group is formed to handle this task effectively.

The company considers both internal and external factors from all subsystems and environments while examining their relationship with each other during the analysis process.The Strategic Planning Methodology factor focuses on establishing information requirements and methods for conducting strategic analysis within the company. It is essential to analyze the external environment and internal background of the company, including strengths, weaknesses, staff development, and potential for new strategy development. Understanding the past, present, and predicting the future of both the company and its environment aids in developing a strategy that can adapt

to reality. A strong strategic plan enables a company to utilize its potential and strengths to address market threats and seize opportunities. During implementation, directors can establish the strategic direction and translate it into concrete programs; however, they may face challenges in clearly defining action goals. Strategic planning involves implementing previously made decisions in a correct sequence for effective coordination across different management levels and areas. The methods presented by Gierszewska et al (2007) are valuable in aligning company strategy, planning various operations, and managing functions. According to Romanowska (2007), there are different levels of strategic management: The Management Board responsible for company development strategy and section management involved in crucial decision-making processes.According to Gierszewska et al (2007), portfolio operations rely on factors such as future activity sectors, technology type, and geographic sales scope. The corporate strategy serves as the initial step towards internal solutions and is responsible for various sectors, engineerings, and markets. It includes two sub-groups: supplier strategy and competition strategy. The goals and hierarchy implemented in the company's development process constrain the strategy-making process. In companies operating in a single sector, there are no separate strategic planning levels; they are treated as a single strategic plan by the management board. However, when entering a new sector, separate strategic plans are created.

Another type of strategy is functional strategy which evaluates goals and methods in areas including financial management, marketing, HR policy, organizational structure, management processes, and technological development (Gierszewska 2007). Functional strategies monitor all strategic plans across the organization.

Strategic analysis within strategic management involves distinguishing between internal events/phenomena from external ones. Managers primarily focus on investigating internal issues rather than external ones (Gierszewska

2007). Environmental analysis often gets neglected by managers who rely on consultants for assessing external issues.Despite this, the corporation maintains a focus on environmental concerns and is ready to address any possible risks. The current market conditions enable the company to develop effective strategies and future plans, receiving guidance on essential measures required for accomplishing these objectives.