What is strategy? What is the usage? What is the history? What are the various Points of view to strategy? One of the classic articles which is written by Michel Porter and usually Strategy Lesson starts with reviewing it in Harvard University is called “What IS Strategy”.
Of course it is emphasized on this point that Porter’s view is not the only view, though it is one of the most common ones in many years.
It is one the important parts in strategy field. Analyzing political, economic, social, technological, etc. affairs can have a serious effect on strategic decisions of organization managers. Environment is like a land which the organization is vegetating and growing on it like a plant. Environmental factors can make it faster or stop it. Sometimes, a kind of business which was successful in the U.S.A can fail in European. Or even a kind which is successful in Tehran, may fail in Khorasan. Environmental changes can predetermine the destiny of a strategy which is failure or victory.
In fact the strategic way of industry analyzing, is a part of analyzing environment and because of its importance usually assigned a separated subject in strategy subjects. In peoples common words, there are a lot of shallow analyzes about different industries. In parties, we hear a lot that industry went bankrupt or that industry prospers and money is transferring from this industry to that one. But strategy experts know industry analyzing cannot be without a frame or template and it has to be searched for answers to special questions.
A company analyzing or in more scientific words an economic firm is another important lesson in strategy. Similar to the thing was explained in industry strategy, sometimes company analyzing is limited to probing foibles and fortes. But the other important topics in this field should be considered which analyzing value chain and sources strategic analyzing are only two parts of it. BCG Matrix Portfolio Theory is another topic in the field of strategy.
Every company may render a collection of products or services. Which product requires more energy? Which product requires more advertisement? Which service must be deleted from company services basket? Is the variety of products and services useful to my organization? Or it is better to focus on a special product? Or be active in a limited geographical area? Or is it better to be active in different fields? All of these are the questions which are discussed as strategic Portfolio. BCG Matrix is a kind of these analyzes. Some products and marketing development are discussed in this classification. As Game Theory, there is an undeniable truth in which the companies are not working in vacuum. There are the other companies tendering products and services on my market and try to attract the same customers who I want. Normally those companies react to my company’s decisions. There is a weak possibility I increase my product’s guaranty from 12 months to 18 months and the other companies continue the same routine. Game Theory investigates the other companies’ reactions against my decisions and specifies the best decision for my company based on possible scenarios.
Anyway, all the internal and external analyzes and theories and calculations and scenarios layout should cause a suitable decision.
Deciding bases, every decision’s cost, assessing risks of decisions, choosing suitable horizon for deciding, using new sources or retiring old sources, entering new markets or exiting some current markets, developing new products or services, all are the choices which end up forming as a strategy output.
In international markets, strategy is one of the discussions added to standard topics in strategy course in all the MBA courses in recent decades. Presence of China and south eastern Asia in international markets, beginning new markets in developing countries, glut on the old markets, production expenditure increase, Chinese products low prices compering with the other countries’ products, and all these makes most of the businesses need a better knowledge from international markets.
Knowing the atmosphere of international markets is not only needed by exporters or importers, but also needed by the people who have the least communication with foreign countries and they are influenced by economic and business strategic conditions chosen by the other countries. Maybe it is the reason of which strategy became an important topic for strategy course in international markets.
Author: Amir Salemizadeh
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