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Hi, Ken
I am trying to figure out link between different models in strategy formulation.
The texts say that after we have done internal or external analysis, we have SWOT.
From SWOT, we are supposedly to have strategies that focus on SW, SO, TW, TO.
But how is that related to so called strategic choice/options developed from ansoff model/bcg matrix?
How come after we have identified our position. We suddenly jump on the wagon and start to worry about product and market? It does not make sense to say the future strategic choice on market/product can directly solve our problem with our weaknesses and threats.
How about we don’t have problem with products or markets. Maybe SWOT tells us our management team is weak or our sales team is weak?
Even if our existing product range is weak. What’s the solution given by Ansoff?
We drop our existing market and go to look for a new market? We develop a new product? Is this really based on result of our SWOT analysis?Again, I feel CIMA text is poorly written and it does not bother to critically examine the relationship between models and clearly identify how to apply them in real life.
SWOT should summarise all good and bad things, OT are external and SW are internal.
SW can include our product range, brand and market share. OT can include competitor action and whether the market is shrinking or growing.
SWOT is just the evidence on which we must base our decisions.
Ansoff sets out the strategic options we have available as, ultimately our success depends on our products and markets – the source of our revenue. For example, if SWOT suggests our products are dated then perhaps we should withdraw from the market, or develop new products. If it tells us that our products are well-regarded but that our market is becoming saturated then perhaps we should consider the market development Ansoff option.
Have you looked at the OpenTuition notes and lectures?
My quesiton is how come the SWOT says anything about product. I think SWOT is supposed to conclude our competencies or resource and external conditions. Even if it does say something about our product, we have other whole bunch of stuff to worry about first, such as whether our information system is strong enough? Is our cost structure comparable or superior to our competitors?
Why suddenly we stop worrying about these key factors we summarised in our SWOT and start to look for product/market matrix?
I think before we start considering product/market combination. We should make sure that we have addressed the problems covered by SWOT as they are the underlying factors that support our product or market decision.
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