STUDY UNIT 1

1. Critically differentiate between the concepts of strategy, strategic planning and strategic
management.
2. Describe the different levels of strategy in an organisation.
3. Critically discuss the importance, benefits and risks of strategy.
4. Describe the tests for a winning strategy.

Critically differentiate between the concepts of strategy, strategic planning and

strategic management.

Strategy

Strategy can be described as the long-term direction of the organisation, a pattern in a stream of
decisions, the means by which organisations achieve their objectives and the deliberate choice of a
set of activities to achieve competitive advantage.

Strategic Planning

Strategic planning or strategy formulation is the first phase of an integrated strategic management
process, based on the concepts of strategic thinking and strategy, and comprises the following three
main decision stages:
(1) Deciding on the future of the organisation
(2) Analyzing the organization’s external and internal environments
(3) Selecting appropriate competitive strategies – strategic choice

Strategic Management

Strategic management is ultimately about consistently aligning the organisation with its internal and
external environments

2. describe the different levels of strategy in an organisation.

Corporate Level

This is the top management level and it affects the strategic decisions of the organization as
managers and the board of directors makes decisions here from the top to the bottom, the ‘top-
bottom’, approach. Here CEO and the board of directors can be found. Neil Ritson, (2013), describes
the corporate level as ‘knowing what businesses we are in and what business should the organization
be in?’.

 The Business Level

This is where the staff and other middle and operational managers can be found. Here we can expect
to see divisional managers and the staff of separate business units.

The Functional Level

Finally the functional level, the staff on the floor implements the activities from the top managers. Here
we can expect to see the functional managers and the staff in each functional area in a business unit.
The line of bureaucracy and the chain of command takes place within these three levels.
3.0 The Importance, Benefit and Risk of Strategy

Though strategy is a coherent nature about the future direction of an organization, they provide an
actionable blue print for achieving organisation aspirations. Strategy critical show its importance to
organisation in the following areas;

 To provide a cohesive strategic thinking and an innovative and future oriented

decision framework for the organisation
 it puts the contribution by organisation members , thereby facilitating the
communication strategy to all
 Its help the organisation to verbalized its aspiration and serve as a sources of
motivation for everyone in the organisation.

However there are risk also associated with the strategy, this could be factors of external event and
trend that can have an impact on the company’s strategy and its shareholder value.

4.0 The Test for a Winning Strategy 

Though strategy severs as an aspiration for organisational goal, for strategy to have met it purpose as
a winning strategy, to be most successfully it must meet the following requirement;

 that goals are consistent and long term

 there is an in-depth understanding of the competitive environment
 and an objective appraisal of resources and effective implementation \

In meeting the above requirement, the organisation strategy as success and as a winning approach
there should complies with the following key fits,

 The goodness fit test, this measure looks at how well the organisation strategy fit in
the organisation situation in matching the industry and competitive environment.
 The competitive advantage test, which look at whether the strategy can help the
organisation achieve a sustainable competitive advantage.
 and finally the performance test, were the strategy is measured in terms of
profitability, financial strength, competitive strength and the market standing of the
organisation
STUDY UNIT 2

1. What is meant by the traditional process perspective on strategic management?  Provide a

critical analysis of this perspective
2. Critically differentiate between deliberate and emergent strategies
3. Explain what is meant by strategy as practice? Critically defend why is it an appropriate
approach to manage new strategic realities
4. Explain why strategic thinking is important in setting a strategic direction
5. Explain what is meant by strategising and critically explain the role of strategists and
managers in the context of strategy as practice

1.       What is meant by the traditional process perspective on strategic management?   Provide a
critical analysis of this perspective

The traditional process perspective is a rational, sequential, static, linear process with distinct
stages/phases to achieve strategic management. The three stages consist of:

Strategic Planning/Strategy Formulation – Environmental analyses & Formulation of

strategies (strategic direction, strategic choice) mostly by top management

Strategy Implementation – developing and implementing annual objectives & short-term

functional strategies & tactics that are compatible with long-term choices. Involves all staff.

Strategy Review, Feedback and Control – continuously evaluate the success of the strategic
management process as input for future decision-making. Aimed at monitoring progress and
providing feedback.

2.       Critically differentiate between deliberate and emergent strategies

Deliberate strategies: when planned strategies (termed intended strategies) become realised
Tend to emphasise central direction & hierarchy. Implemented & realised under 3 conditions:

Planned/intended strategies work well in stable business environments. Environments are today
becoming increasingly dynamic, turbulent & unpredictable leading to an increase of unplanned &
emergent strategies:

Emergent strategies: order in absence of intention; suddenly rationalising a strategy to mean

something very different from original intention;  strategies not explicitly intended, are unplanned &
emerge over time often due to changing environments / competitive circumstances…

3.       Explain what is meant by strategy as practice? Critically defend why it is an appropriate
approach to manage new strategic realities

Practice Perspective offers a broader view of strategic management, considering wider range of
strategists (board of directors, top- & middle managers, consultants) but also allows for the messy
realities of doing strategy in practice.

Strategy-as-practice: non-linear/-sequential process enabling organisation's to cope with new

competitive realities. Integrates activities & forces with strategising - That strategy is done by people
and influenced by their context.
Interaction between strategy praxis (the work), strategy practitioners (workers), strategy practices
(tools of strategy). Organisation  will customise strategising practices to suit own unique
circumstances
Strategy no longer a mainly deliberate, top-down process but all levels of management & employees
deemed strategic actors especially when coping with emergent strategies

4.       Explain why strategic thinking is important in setting a strategic direction

Strategic thinking relates to the conceptual nature of strategy and requires a strong foundation of
critical thinking. Strategic thinking is the ability to see the total enterprise, to spot trends and
understand competitive landscape, to see where business needs to go and lead it into the future. All
of which is critical factors when setting an organisation's strategic direction.

5.       Explain what is meant by strategising and critically explain the role of strategists and managers
in the context of strategy as practice

Strategising: "essentially what strategists do; described as devising or influencing strategies." Action
performed by strategists (people) who guide strategic planning & management process.
 

Strategists ('doer' of strategy): Individual, group or an object in an organisation that controls key or
precedent-setting actions. Can also be external role players.

Types of strategy worker includes detail-conscious, Big Picture-conscious, Non-Discerning and

Cognitively Versatile.

Top managers as strategists are responsible for setting overall strategic direction, allocation
resources etc.
-  Role as social craftsperson ensures buy-in from employees, deals with tensions & conflict, creating
positive atmosphere
-  Role as artful interpreter contextualises strategy that other can identify own roles in it
-  Role as known stranger ensures balance between distance & closeness in interaction between
strategists & other parties to maintain objectivity while cultivating trust

Board of Directors as Strategists: Focal point & custodians for corporate governance thus
influences strategising & overall strategic direction. Monitors relationship between management &
stakeholders to ensure organisations long-term sustainability.

Middle managers as Strategists: roles include implanting deliberate strategy; synthesising

information; reshaping strategic thinking of top management; managing change and facilitating
adaptability.

Consultants as Strategists: a valuable source of expertise, available to organisations in need of

specialised info & guidance
Study unit 3

1. Explain the various methods for macro-environmental analysis

2. Analyse the structure, dynamics and attractiveness of the South African mining
industry.
3. Discuss the importance of performing a competitor analysis

Explain the various methods for macro-environmental analysis

Four important techniques which can be employed when analysing the external environment:
1. Scanning: Early signals of environmental changes and trends are identified
2. Monitoring: Meaning of environmental changes & trends is detected through ongoing
observation.
3. Forecasting: based on monitoring changes and trends, projections of anticipated outcomes are
developed.
4. Assessing: timing and importance of environmental changes and trends for organisations
strategies and their management are determined.

_____________________________________________

Analyse the structure, dynamics and attractiveness of industries

Industry Structure

The first and fundamental determinant of an organisation’s profitability is industry structure. The
general types of industry structure are monopoly, duopoly and oligopoly −and the competitive
implications of major types of competition, namely monopolistic and perfect competition.

A monopoly player, such as a state-owned enterprise, serves in a closed domestic environment and
normally has a total advantage, while it retains government support. In a monopoly there are high
barriers to exit and entry into the market for firms. A low degree of competition is evident and the
market is stable and predictable.

An oligopolistic structure is characterised by a few large organisations, each with substantial shares of
the market. They try to maintain their own long-term competitive advantage through crafting largely
defensive strategies. In an oligopoly there are significant barriers to exit and entry into the market,
there is a moderate degree of competition and the market share is stable.

Monopolistic competition has more rivals of a similar size, which can result in less stability and short-
term competitive advantage. This leads to aggressive strategic approaches and more intense
competition. There is also a moderate to high degree of competition. A low to moderate degree of
market stability is evident.

Perfect competition implies that an organisation would require an aggressive strategic approach. The
market would be volatile, with frequent entry and exit of players. There exist a large number of
identical firms with no barriers to entry and exit. There is also a high degree of competition and a low
degree of market stability.

SA's mining industry is characterised by substantial regulatory factors and barriers in that it requires
sizable investments of resources, and entities depend on concessions, permits and other government
issued documents. From this perspective, the mining industry is made up of mostly a few large
organisations (such as De Beers, Transhex and Alexkor) each with substantial market shares, giving
it a oligopolistic structure.

However, recent times has seen a move towards what can be considered as artisanal mining –
smaller entities approach mines that was established long ago but since then have been abandoned.
These smaller entities appropriate the necessary mining rights as they believe that there is still ore to
be gained from the so-called 'depleted mines.' In this context structure moves towards monopolistic
competition as it sees more competition from similarly sized rivals aggressively seeking competitive
advantage.

Industry Dynamics

Refers to the rate of competitive and structural change in an industry over time. Management
challenge of dynamic industries is to know at all times the rules of the industry, who their competitors
are and why change takes place. Change can be due to
- external factors (e.g. technological change),
- change in one or more of the industry forces,
- internal factors (e.g. new product and/or process development),
- or some other factors.

As already mentioned, recent times has seen a change in structure of the mining industry causing
large firms to consider if they have to change their strategies to try and maintain market share or
whether the threat that minor entities pose in buying up discarded plots is small enough to be ignored.

Mining itself is a long process and even before that a lot of time is required for the necessary
investments and documents to be acquired to utilise a mine. In this sense the nature of the industry is
not disposed to change, however the effects of the economy and new technologies should be closely
monitored.

Analysing Industry Attractiveness

Responsible for industry attractiveness (in terms of both nature of competition in an industry & its
profitability).

To be able to analyse industry attractiveness appropriately a distinction has to be made regarding the
market segments. In the mining and supplying of for example iron ore, the Chinese has substantial
buying power as they are in a position to change suppliers (option of different countries) from which
they buy in bulk. This makes for high industry competitiveness and low profitability.

The mining industry require great amounts of electricity or fuel to operate. Here suppliers such as
Eskom are considered powerful because
- they are a monopoly, there are no other electricity suppliers that can be used;
- fuel sources are very specific (if the organisation would want to move away from electricity to
combustible fuels)
- albeit a large part, the mining industry is not Eskom's only source of total income.
This this leads to increased industry competitiveness with the effect of lower industry profitability

As resources become scarcer, so also does the rivalry between existing industry members increase.

It is not easy for potential or new competitors to enter into the mining industry due to intensive capital
requirements, access and infrastructure often required for distribution, and government regulation and
legislations. Hardship of entry therefore leads to decreased competitiveness which has a positive
effect on profitability.

Providers of substitute products & services: as the providers of raw material, there are very few, if
any, substitutes available to the mining industry.

Government intervention as already indicated, is a big influence in the mining industry.

Complementors as additional forces: the leasing of equipment can be seen as a service that can
enhance an the industry member's own products as the mining industry saves on capital investments
in this way.

___________________________________

Describe the importance of and approach to competitor analysis

Competitive analysis: transforming incisive information (competitors & nonmarket factors) into usable
& actionable intelligence for strategic planning purposes. Involves the following two issues:
- identification of the organisation's competitors
- prediction of competitor behaviour

Defined industry / market segment will indicate who the competitors are. Next gather info on identified
competitors regarding their strategic intentions, long-term objectives, strategies & capabilities, the
assumptions on which their strategies are based, and their expected competitive behaviour.

As info is highly confidential, value of conventional analytical techniques is limited thus organisations
started using competitive intelligence (CI), a highly specialised approach derived from the field of
military intelligence.
STUDY UNIT 4

1. Critically differentiate between resources, capabilities and competencies.

2. Explain the role of the resource-based view in the internal analysis.
3. Critically discuss the concepts of competitive advantage and sustainable competitive
advantage. Explain the requirements for a sustainable competitive advantage and
support each requirement with an example from a company/organisation of your
choice.
4. Explain the role of value chain and resource based view in internal analysis.

1 Critically differentiate between resources, capabilities and competencies.

 
Resources:
Resources are assets owned by an organisation,static and generally depreciate in value over time.
Resources are categorised as Financial capital, human capital, physical capital, organisational capital
and technology capital and are unique to each organisation. 
 
Resources can be classified as tangible (physical, quantifiable and observable, such as land, money,
inventory, equipment) or intangible (such as knowledge, Intellectual Property, Human capital,
reputation)
 
Capabilities:
Capabilities are the capacity of an organisation to deploy these resources for a specified end result. It
is what the organisation does really well, compared to other organisations. It is the
procedures/processes (clusters of activities) that interact between tangible and intangible resources
and is embedded in routines. Capabilities are gained through experience (tacit knowledge) and
becomes more valuable over time.
 
Competencies:
Competencies differ from capabilities in that it is a combination of certain resources and capabilities
and is a process of accumulating and learning how to use unique combinations of resources and
capabilities. It involves communication and commitment to work across organisational boundaries and
involves co-ordinating (diverse skills), integrating and harmonising multiple streams of technology.
 
2 Explain the role of the resource-based view in the internal analysis.
 
It is a model for analysing internal strengths and weaknesses in terms of resources and then links
these resources to opportunities in the external market. RBV also determines where to company can
build competitive advantage, superior performance and customer value.
 
3 Critically discuss the concepts of competitive advantage and sustainable competitive
advantage. Explain the requirements for a sustainable competitive advantage and
support each requirement with an example from a company/organisation of your
choice.
 
An organisation is considered to have a competitive advantage when it is more profitable than its
competitors and is achieved by producing products or services that are superior in value to those of
competitors or by having a lower production cost (higher profit margins) compared to its competitors,
known as cost leadership.
 
A competitive advantage can be achieved by combining resources capabilities and core
competencies to produce superior quality products or services. Production efficiency is the focus for
cost leadership strategies.
 
A sustainable competitive advantage is dependent on the durability and inimitability of those
resources and capabilities.
Durability refers to the length of time a core competency can contribute to the competitive advantage
of an organisation.
Inimitability refers to how easy a competency can be copied by a competitor, and is determined by
transferrability and replicability.
 
 
The following capabilities are required to achieve a competitive advantage:
1. Ability to produce high quality products - high brand value, reliable, durable and
consumers are willing to pay a premium for these products. Levi jeans provide clothing at
a price much higher than other brands because it has a perceived superior brand
reputation of quality, reliability and durability.
2. Ability to innovate - design new products or processes, improve existing products or
services, new marketing strategies. Owning trademarks and patents for these innovative
products or processes ensures inimitability. Apple are an example of providing innovative
products and processes that aren't easily copied by competitors.
3. Responsiveness to customers - to be competitive an organisation must provide better
customer service . An organisation needs to identify and satisfy customers wants and
needs better than competitors to have a competitive advantage.Discovery Insure’s car
insurance is an example of such
4. Efficiency - involves transforming inputs, such as raw materials, production methods,
labour into outputs (products and services). The level of efficiency is calculated by
dividing outputs by inputs. An efficient organisation is one that needs less input to
produce an output required. Employee productivity also plays a role, as does lower cost
production compared to competitors due to production efficiencies. These production
efficiencies are achieved by various means, economies of scale, economies of learning,
products designed for economical production, product line design using technologies and
other means for reducing costs, leveraging location for cost reduction and reducing
superfluous costs. An example of efficiency is found at VW motor corporation in
Uitenhage that use a combination of robotics and timing of components produced for
competitive advantage.
 
 
4 Explain the role of value chain and resource based view in internal analysis.
It is not an easy task to identify and assess capabilities and core competencies and managers can
use the resource based view or look to production and the value chain (value chain analysis).
Both involve determining and organisation’s strengths and weaknesses and how the strengths
contribute to its competitive advantage.Thereafter, the performance of the organisation can be
compared and evaluated against competitors.
 
In order to identify core competencies within an organisation the process of the value chain can be
followed to determine the resources and capabilities that add value and are therefore strategic in
nature, bearing in mind that not all resources and competencies are considered strategic.
 
The internal analysis will help the organisation to determine:
 how the components of its value chain add worth to its performance
 how resources/capabilities contribute to competitive advantage
 how its financial performance compares to competitors
 how customers and staff benefit from it.
STUDY UNIT 5

1. Critically discuss the obstacles and drawbacks in doing business in Africa. Use
practical examples to support your answers.
2. Critically assess the role of government in enhancing business conditions in Africa.
3. Describe suitable approaches for strategies in emerging markets, specifically the sub-
Saharan Africa.

1. Critically discuss the obstacles and drawbacks in doing business in Africa. Use practical
examples to support your answers.

THE LACK OF INFRASTRUCTURE. Generally, governments that are unwilling or unable to maintain or
improve existing infrastructure, let alone providing new, much needed infrastructure, are a significant damper
on investment and business in Africa. For the economic activity of a country in general and business in
particular, lack of infrastructure invariably translates into inadequate supply chains which adversely affect the
sourcing of strategic raw materials for production as well as the distribution of much-needed products to
markets, especially those in rural areas.

POLITICAL INSTABILITY. Political instability typically results from uncertain and unpredictable
government actions. These may include social and economic disruption or even armed conflict, as well as
nationalisation of industries or expropriation of property and assets of business organisations, all of which, for
investors and business alike, translate into uncertainty and risk.

HIGH LEVELS OF POVERTY. In most African countries and in many other developing
countries, a large proportion of the population lives on less than two US dollars a day,

CORRUPTION. The effect of corruption on business and society can be disastrous. According to various
international indices such as Transparency International's Corruption Perception Index, 90% of the countries in
Africa, on average, scored 33, well below the symbolic pass mark of 50.

AN INEFFICIENT PUBLIC SECTOR. In the prescribed book it is stated that the disappointing
economic growth of the African economy in recent years can be largely attributed to
an inefficient public sector.

LACK OF KEY SKILLS. Countries in Africa have generally been characterised by a lack of key
business and especially managerial skills, and an ample and often over-supply of a
semi-skilled and unskilled workforce.

2. Critically assess the role of government in enhancing business conditions in Africa.

Governments can enhance or deter economic growth and development through their
strategies, policies and investment decisions, but their main purpose, apart from ensuring political stability is,
inter alia, to create an environment conducive to economic growth, foreign investment, export promotion, job
creation and poverty alleviation, especially in the context of countries in Africa.

3. Describe suitable approaches for strategies in emerging markets, specifically the sub-
Saharan Africa.

The approach adopted by the PIR is based on breaking the forces that have perpetuated poverty,
while promoting income, wealth and opportunity. It is based on the following assumptions:

•economic growth and human development are linked, and should enhance quality of life;

•this is best achieved through advancing the capabilities of disadvantaged communities, households
and individuals by improving their access to assets, both physical and social;
•having established a framework for short-term macroeconomic stability, government should place
increasing emphasis on redistributive measures;

•to achieve this, a more assertive role will be required by government in facilitating the transfer of
assets and services from the wealthy to the poor, matched by market, institutional and spatial reforms
benefiting the less well-off;

•the collection of social, economic and demographic information to monitor the extent and nature of
change is a priority in managing the reduction of poverty and inequality.

Expansion of capabilities focuses on the relationship of people to the resources they have and the
commodities they require when meeting their basic sustenance requirements. The important elements
in this are: (1) the assets, claims and resources that are available to people; (2) the activities they
have to undertake in order to generate a sustainable livelihood; and (3) the commodities and services
they require for an acceptable standard of living. Different policy options can impact on different
elements within this system: for example, land reform could increase the availability of land for small-
scale farming, while reforming financial markets could facilitate the actions required to produce a crop.
STUDY UNIT 6

1. Describe the four pillars of corporate sustainability.

2. Explain what sustainable organisations are and why they are important.
3. Discuss the “triple-bottom line” and explain why it is important.
4. Explain what is meant by corporate social responsibility (CSR) is and give examples of CSR
activities in a company.
5. Explain the role of corporate governance in corporate sustainability.

1. Describe the four pillars of corporate sustainability.

 SUSTAINABLE DEVELOPMENT (Economic, Social, Environmental)

 CORPORATE SOCIAL RESPONSIBILITY
 ETHICAL BUSINESS
 STAKEHOLDER RELATIONSHIPS
STUDY UNIT 7

1. Differentiate between the different types of business level strategies. Give an example
of an organisation, product or service in each business level strategy discussed.
2. Critically discuss the advantages and disadvantages of each business level strategy.
3. Explain how organisations can evaluate business level strategies.

1. Differentiate between the different types of business level strategies. Give an example
of an organisation, product or service in each business level strategy discussed.

Cost leadership strategy involves the organisation having the lowest production cost compared to its
competitors. Typically targets a broad spectrum of buyers, and does not necessarily imply low price.
An example can be typical household items.
 
Differentiation strategy involves uniqueness along some dimension that is sufficiently valued by
customers thereby allowing a premium price. For Example, Apple uses this strategy by offering smart-
products (phones, tablets) at a premium price. Customers are willing to pay the premium price as they
see the product as being unique.
 
Focus low-cost leadership this is a low-cost leadership strategy that is focused on a specific target
market. Eg, Samsung introduced smartphones in the under R1000 price range to attract a younger
and lower income market
 
Best-cost provider strategy involves giving customers more value for their money by offering
upscale product attributes at a lower production cost than its rivals. Toyota’s Lexus is an example. It
offers all the luxuries and superior attributes of an elite motor vehicle (Mercedes Benz) but at a lower
cost.
 

2. Critically discuss the advantages and disadvantages of each business level strategy.

COST LEADERSHIP STRATEGY

ADVANTAGES:
 an increasing in competitiveness and market share through sustainable cost advantages
 protection for the organisation against competition as a result of its durable cost advantage
 protection against powerful suppliers because of large-scale purchases and the resultant
potential of discounts
 protection against the power of buyers because of the low-cost advantage and competitive
pricing possibilities
 durable cost advantages serving as barriers to imitation, barriers to the threat of substitute
products and barriers to the threat of new entrants to the market, which should be evident
from analysis of the organisation's competitors

DISADVANTAGES :
 not keeping up with changes in the external environment,
 not being aware of changing consumer needs and preferences with regard to products and
services in the low-cost market sector that could seriously affect competitive market position
 not being aware of industry dynamics, changing industry competitive forces, and the actions
of competitors as far as imitating, or even worse, improving on an organisation's low-cost core
competencies, is concerned the so-called ``curse of complacency''.

DIFFERENTIATION STRATEGY

ADVANTAGES
  They could safeguard an organisation against competition as a result of brand loyalty.
 They could enhance profit margins by slightly higher pricing than their competitors.
 Powerful suppliers are rarely a problem.
 Differentiators are unlikely to experience problems with powerful buyers.
 Threats of substitute products really depend on competitors' products to meet or exceed
customer needs before customers would be willing to switch products.
 Effective differentiation and brand loyalty could act as barriers to entry.

DISADVANTAGES

 relate to the organisation's inability to maintain uniqueness from a customer perspective - not
fully responding to the durability challenge of competitive advantage.
 Another danger stems from the design or physical features of a product, which are much
easier to imitate than uniqueness, which stems from intangible sources like innovation, quality
of service, reliability, brand and prestige.

FOCUS LOW-COST LEADERSHIP AND DIFFERENTAIATION STRATEGIES

ADVANTAGES

 protection from competitive rivals owing to the uniqueness of product(s) or service(s)

 power over buyers because of significant uniqueness and exclusivity
 passing supplier price increases on to customers
 customer loyalty as a protection against substitute products as well as new entrants

DISADVANTAGES
 high production costs, basically because of the inability to realise economies of scale
 not being aware of changing technology and consumer preferences
 not being able to effectively ward off an attack by rival differentiators

BEST-COST PROVIDER STRATEGY

ADVANTAGES

 Protects the industry from competitors by its cost advantage and keeps the organisation safe
as long as it can maintain this advantage because low prices are important for consumers.
 It uniquely combines low cost and differentiation, while maintaining quality and providing good
value at a reasonable price compared to competitors.

DISADVANTAGES

 could result from not being aware of a changing competitive industry environment
 the risk that the cost leadership and/or differentiation features that underlie this strategy do
not measure up to market expectations, leaving this strategy ``stuck in the middle'', and
therefore uncompetitive.

3. Explain how organisations can evaluate business level strategies.

Strategies can be evaluated in terms of their:

 SUITABILITY. This is the degree to which an organisation's strategy deploys its core
competencies to exploit external opportunities and overcome external threats and internal
weaknesses. Methods that are available to test suitability include SWOT analysis, the five
forces industry analysis, and scenario analysis and planning.
 ACCEPTABILITY. This requirement relates to the ability of the strategy to produce the
expected results over both the short and the long term in line with stakeholder expectations. It
also considers the evaluation of factors such as benefits, risks and stakeholder reactions.
Sensitivity analysis, financial analysis and break-even analysis, inter alia, can be used to
assess acceptability.
 FEASIBILITY. Feasibility implies that the organisation is capable of executing the strategy. or
the feasibility measure, the organisation's financial and human resources as well as resource
integration need to be evaluated.