A process of creating a set of different steps which increase the company\'s fin

Question

A process of creating a set of different steps which increase the company's financial status as well as driving the companies economic departments is called strategic management of the company. How company is going to be in different kind of working environment and by working in different environment how the company is producing benefits by using proper strategies over the economical as well as the financial system is the main job of strategic management for a company.

A structured process to overcome different problems or to create an efficient and productive working pattern by achieving their main goal is called a strategy.

By introducing the strategic management to the Hi-Tech Industry we can easily forecast the upcoming problems and can also create a problem tackling capability. There are different forecasting system available which are also hi tech, so we can easily Use technology against the technology to compete more efficiently.Hence saying that formal strategic planning is a irrelevant for the Hi-Tech come would be wrong.

Organisational strategic management can be defined as a continuous effort of planning, monitoring, analysis as well as assessing internal factors of the company for achieving their goal. Strategic management for an organisation is very very important at as it defines the way of working as well as the goal efficiency of the organisation. Buy a proper strategic management a company can work more efficiently and produce better productivity with the same resources. Strategic planning can be done to define anything in the organisation from economics to the human resource management everything is based on strategic planning.

Stakeholders can be defined as a group of person or an organisation that is interested in other organisation and is directly affected by the organisations actions. Employees ,directors, owners as well as suppliers all the unions can be the stakeholders for a company. In other words, from where the company draws its resources its called the stakeholders.
Without stakeholders a company will fall and there will be no working staff available for the company. As there would be no working people available for the company there would be no financial support as well which would result in a non productive company. Hence stakeholders are very important for the firms.

By having a relationship with the stakeholders, it is meant that company has proper management as well as a valuable born between the company and its stakeholders. This relationship can be very complicated as well as very simple in terms of marketing strategy and they are the core drivers of a company.

Environmental analysis is one of the main constituent of strategic analysis. Environmental analysis provides extensive support to the world structure of the organisation by having an analysis of the specific situation in which the company is directly supporting the environment.
Strategic group analysis can be very beneficial for an organisation to develop specific Strategies for certain groups. By developing group oriented strategy a company can easily increase their overall sales and capture bigger segment of the market.
Stakeholder analysis provides extensive support to the organisation and it also determines the best available possibilities for the stakeholders to analyse the specific situation inside the organisation structure. Stakeholder analysis also helps in determining strategies for maintaining there influence in the organisation.

Porter's five forces analysis is a very useful methodology to analyse the external environment effect on any organisation or industry. By applying the external five forces we can easily determine the after effects of those forces on the specific organisation.

Five forces of porter's analysis are as follows.

Competition rivalry
Supplier Bargaining
Customer bargaining
Threat of new entrants
Substitute threats

Benchmarking is done to see the maximum level of work capacity of an organisation. Why benchmarking some organisation, top level of the specific activities are measured.

A value chain is a tool with which competitive analysis as well as strategies are created and its main goal is to provide a value to the customers and profits for the organisation as well. Supply chain manager is the overall flow of product as well as cash in direction from company to the customer where value chain help in generating in demand of the product and the return cash flow from the customer. Value chain is required for the revenue generated by return flow and is its very important to be a part of the supply chain management system.
By analysing is specific value chain flow of the find inside an organisation from the organisation to the customer and back to the organisation is analysed.

Ansoff matrix is directly based on analysing the situation and watching the possible growth Strategies for the specific organisation. It works on directly analysing the market Penetration of the organisation.

Competencies as well as increasing market environment with the customer buying capabilities directly increases the price war. Increasing competencies have different factors such as differentiation in prices as well as new innovation in the same specific field. The specific factor directly increase the price war in the given industry.

For price analysis on airline industry we'll do five forces analysis on airline industry.

Five forces of porter's analysis are as follows.

Competition rivalry
Supplier Bargaining
Customer bargaining
Threat of new entrants
Substitute threats

Five forces analysis on the airline industry

Airline industry is a very big market and has been producing huge revenues as well as facing the huge competition in each and every aspect. As the new competence are entering the markets they are increasing the overall competition and affecting the structure.

Competition rivalry

Because there are so many operators available in the same region with the same route. As the low cost Carriers entered the market, start to find the most profitable way to surpass the safety regulations of the industry. This specific Innovation and ideation is driving extreme changes in the airline industry. Airline industry is mainly fuelled by the regulator and they decide what should airline industry do. Low cost Airlines are having their full authority over the domestic transportation but in international trade premium carriers are only id and they are driving the industry. By having extreme diversity in the field we can say it is one of the most competitive businesses in the country.

Supplier bargaining

As the Companies are increasing number of plane manufacturers @ the plane suppliers are also increasing. Everything from labour to the fuel has a supplier and the suppliers usually bargain with the companies for getting a better price and a better profit. Geo political factors also influenced the condition of supplying and labour is also fuelled by the power of unions who usually bargain for the costly concessions from the Airlines. Airbus and Boeing both are the biggest companies in providing aircrafts to the different airline industry and plays a major role in bargaining with those industrial companies.

Customer bargaining

As the online ticketing has introduced, customer has power to compare multiple ticket fares from different Airlines which gives in the authority to choose between the lowest available fare. This is specific revolution in the Information Technology has bring a bigger problem for the airline Industries to be more competitive. This specific power of the customer is driving the industr, hence airlines are helpless to reduce their affairs and work accordingly to the customer.

Threat of new entrants

Airline industry is going very fast and multiple new companies are putting off their planes in the industry every day. By having different competitors in the same field the number of increased competition also produces a threat for the existing airline companies as well as the new companies who is entering the industry. New entrants also increase the competition by reducing their affairs and implementing new strategies to attract the customer.

Threat of substitution

In United States America there is no threat of substitution as people prefer applying rather than going into the buses are the trains for long distances. Has been in the culture for a long time that's why there is no threat from the substitution of the airline industry that's why the airline industry has been growing since then. Airlines are providing different services like Wi-Fi and free food which is also attracting the customer towards them and they don't go for any other substitute.

Explanation / Answer

1.a. Define the concept of strategy and discuss the model of strategic management?
b. What is the role of environment analysis in strategy formulation?
c. Characterize 5 forces model, strategic group analysis and stakeholder analysis?

2. a. What is the role of organizational analysis in strategy formulation?
b. Characterize benchmarking analysis, comb analysis, and value chain analysis?
c. What are the possible applications of Ansoff's growth matrix?

3. a. Which factors increase the risk of a price war in a given industry? You may use airline industry as a point of reference.
b. Critically evaluate different market entry strategies?

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