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STRATEGIC ADVANTAGEPROFILE

SUBMITTED TO- MR. DEVENDRA DIXIT

SUBMITTED BY- PARVEZ AHMAD

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STRATEGIC ADVANTAGE PROFILE-

Every firm has strategic advantages and disadvantages. Forexample, large firms have financial strength but they tend tomove slowly, compared to smaller firms, and often cannot reactto changes quickly. No firm is equally strong in all its functions.In other words, every firm has strengths as well as weaknessesStrategists must be aware of the strategic advantages or strengthsof the firm to be able to choose the best opportunity for the firm.On the other hand they must regularly analyse their strategicdisadvantages or weaknesses in order to face environmental

threats effectively.In this session, we shall examine the strategic advantage factorsthat management analyses and diagnoses to determine theinternal strengths and weaknesses with which it must face theopportunities and threats from the environment.

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Preparing SAP

Strategic advantage profile is known as SAP. It showsstrength and weakness of an organization. Preparation ofSAP is very similar process to the ETOP.There aregenerally five functional areas in most of the organizations.These areas are Production or Operation, Finance or

Accounting, Marketing or Distribution, Human Resource &Corporate Planning, and Research & Development. Thesefunctional areas are listed to identify their relative strengthand weakness in SAP. Very similar to the ETOP, positive,

neutral,and negative signs are denoted and briefdescription is written in SAP profile. Each functional area isvery broad having many components inside.All theseabove described profiles provide a clear picture tounderstand thestrategic position of an organization.

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Capabilityfactor

Nature ofimpact

Competitive strengths or weaknesses

1. Finance High cost of capital; reserves and surplusposition unsatisfactory2.Marketing Fierce competition in industry; companysposition secure at present3. Operations Plant & machinery in excellent condition;captive sources for parts and components

available4. Personnel Quality of managers and workerscomparable with that in competitor

companies

5. Information

Advanced management information system

in place; most traditional functions such aspayroll and accounting computerised;company website has limited scope for e-commerce

6.Generalmanagement High quality and experienced topmanagement generally adopts a proactive

stance with regard to decision-making

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Strategic Advantage Factors: Marketing and

Distribution

1. Competitive structure and market share: To what extent hasthe firm established a strong mark share in the total market

or its key sub markets?

2. Efficient and effective market research system.

3. The product-service mix: quality of products and services.

4. Product-service line: completeness of product-service line

and product-service mix; phase of life-cycle the main

products and services are in.

5. Strong new-product and new-service leadership.

6. Patent protection (or equivalent legal protection for services).7. Positive feelings about the firm and its products and services on

the part of the ultimate consumer.

8. Efficient and effective packaging of products (or the equivalent

for services).

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9. Effective pricing strategy for products and services.10. Efficient and effective sales force: close ties with key

customers. How vulnerable are we in terms ofconcentratingon sales to a few customers?11. Effective advertising: Has it established the company's

product or brand image to develop loyal customers?12. Efficient and effective marketing promotion activitiesother than advertising.13. Efficient and effective service after purchase.14. Efficient and effective channels of distribution and

geographic coverage, including internal efforts.

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STRATEGIC ADVANTAGE PROFILE-

Every firm has strategic advantages and disadvantages. Forexample, large firms have financial strength but they tend tomove slowly, compared to smaller firms, and often cannot reactto changes quickly. No firm is equally strong in all its functions.In other words, every firm has strengths as well as weaknesses

Strategists must be aware of the strategic advantages or strengthsof the firm to be able to choose the best opportunity for the firm.On the other hand they must regularly analyse their strategicdisadvantages or weaknesses in order to face environmental

threats effectively.In this session, we shall examine the strategic advantage factorsthat management analyses and diagnoses to determine theinternal strengths and weaknesses with which it must face theopportunities and threats from the environment.