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Strengths & Weaknesses Strength: It is an inherent capability which an organization can use to gain strategic advantage. E.g.

. superior r&d skills which can be used for new product development Weakness: A weakness is an inherent limitation or constraint which creates a strategic disadvantage for an organization E.g. over dependence on a single product line, which could be risky in crisis Competencies Competencies are special qualities possessed by an organization that make them withstand pressures of competition in the market place. When a specific ability is possessed by a particular organization exclusively or in a large measure it is called as distinctive competence. Organizational capability It is the inherent capacity or potential of an organization to use its strengths and overcome its weaknesses in order to exploit opportunities and face threats in an external environment Strategic advantage These are the outcome of organizational capabilities. They are the result of organizational activities leading to rewards in terms of financial parameters Functional capabilities Strengths supporting Financial capability. Access to financial resources. Good relationship with financial institutions. High level of credit- worthiness. Low cost of capital compared to rivals. High level of share holders confidence Marketing capabilities Wide variety of products. Better quality of products.

Sharply-focused positioning. Effective distribution system. Effective sales promotion. Effective MIS. Operations capabilities

High level of capacity utilization. Favorable plant location. Reliable sources of supply. Effective control of operational costs. Good inventory control system. High caliber R&D people. Technical collaborations. General management capability

Effective system for corporate planning. Reward and incentives for top managers. Risk taking. Favorable corporate image. Effective management of organizational change. Opportunity

It is a favorable condition in the organizations environment which helps it to consolidate and strengthen its position. E.g. growing demand for the products or services that a company provides. Threats

It is unfavorable situation in the organizations environment which creates risk for, or causes damage to, the organization. E.g. emergence of strong new competitors who are offering stiff competition.

Grand strategies for implementation Stability strategy. Expansion strategy. Retrenchment strategy. Combination strategy Stability strategy Is adopted by on organization when it attempts at an improvement of its functional performance by marginally changing one or more of its business. E.g. A copier machine company provides better after sales service to improve its image and product image too. Expansion strategy This strategy is followed when a company aims at high growth by increasing the scope of one or more of its businesses in terms of their respective customer groups, functions and technology. Retrenchment strategy This is followed when a company aims at contraction of its activities through substantial reduction or elimination of its business. E.g. A pharmaceutical company may withdraw from its retail operations so that it can focus on institutional/bulk sales Combination strategy This is followed when a company adopts a mixture of all the strategies either at the same time in its different businesses, or at different times in the same business with the aim of improving its performance Functional Strategies Financial plans and policies: It means,

1) Sources of funds( borrowings, reserves & surplus) 2) Usage of funds( capital investment, loans, dividend decisions) 3) Management of funds (system of finance, accounting, budgeting)

Marketing plans and policies. Strategic use of Marketing mix. P: Product. P: Price P: Place P: Promotion Operation plans and policies These decisions are related to production system, operational planning and control, and R&D. Personnel plans and strategies These policies are related with the personnel system, organizational and employee characteristics and industrial relations. E.g. TISCO never had any industrial dispute for the past so many years Strategic evaluation and control The 4 basic type of strategic controls are,

1) Premise control: Necessary to identify the key assumptions, and keep track of any change in them so as to assess the impact on strategy. 2) Implementation control: It is aimed at whether the plans, programs, and projects are actually guiding the company towards its objectives. 3) Strategy for monitoring behavoir: It is designed to monitor a broad range of events inside and outside the company that are likely to threaten the course of a companys strategy 4) Special alert control: This is based on a trigger mechanism for rapid response and immediate reassessment of strategy in view of sudden and unexpected events.