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Hitch-hiking: Developing an idea on which someone has worked before
Piggy-back: Improving mechanism
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Hey, today we are going to enter into a new chapter.
Designing a Competitive Business Model and Building a Solid Strategic Plan
Strategic Plan: It is a vital activity in business life duration activities.
Small and medium businessmen and entrepreneurs used to work on different strategic plans. Variation of strategic plans did not give them the strongest point rather it gave them a survival way.
A major shift has been observed from financial capital to intellectual capital.
Intellectual capital consists of three elements such as human capital, structural capital, and customer capital.
Human Capital: Skill, capability, creativity, talent, etc. Creativity creates a positive reflection on planning.
Structural Capital: Employee's knowledge and experience
Customer Capital: Loyalty, customer-base, brand value, reputation, relation with customers
Strategic Management keeps the strategic plan in the right track
Strategic Management accomplishes mission, goals, and objectives.
Strategic Management gives a competitive advantage.
Strategic Management is a sum of factors that give one different and superior position from one's competitors.
Building a Competitive Advantage
a. Products they sell
b. Service they provide
c. The pricing they offer
d. Way they sell
Core Competencies is a unique set of capabilities that an organization develops in its key area. Key areas of an organization are superior quality, superior way serve, innovative, working as a team, flexibility, and responsiveness.
Core competencies mean the best performing ability of a business organization.
Core competencies should not be greater than 5-6 capabilities.
Core competencies are comparatively durable. Changing core competencies increases costs.
The natural advantage is location. A core competency can be a strong human capital.
Core competency is linked to a company's smallness. A small organization has a natural advantage due to the size of the company. Small size gives better flexibility, innovation, and speed.
Building Core Competencies
Capabilities
Less Learned Core Competencies Sustainable Competitive Advantage
Skill
Sustainable Competitive Advantage: Today one has a competitive advantage is in this area, later competitors can duplicate this competitive advantage in that area. Sustainable competitive advantage gives continuity in the market. Superior value for customers is a sustainable competitive advantage.
Strategic Management Process
1. Developing a vision and translate it into a mission statement
2. Assessing strengths and weaknesses
3. Scanning environment for opportunities and threats
4. Identifying key success factors
5. Analyzing competitors
6. Creating goals and objectives
7. Formulating strategies
8. Translating plans into actions
9. Evaluation of actions
Click here to read SME-Part B-Lecture 5-Sub Lecture 5B
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