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Chapter 6 (Part III)

Consolidating and Prioritizing of Strategies. Chapter 6 (Part III). Consolidation and Condensation of Strategies (1/4). The SWOT, SPACE, BCG and IE matrix would be able to generate about 20 strategies each. However, a firm cannot realistically carry out all the strategies generated.

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Chapter 6 (Part III)

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  1. Consolidating and Prioritizing of Strategies Chapter 6 (Part III)

  2. Consolidation and Condensation of Strategies (1/4) • The SWOT, SPACE, BCG and IE matrix would be able to generate about 20 strategies each. • However, a firm cannot realistically carry out all the strategies generated. • As such there must be a way to gather and group all the strategies for the same firm.

  3. Part 1:Consolidate and Condense Strategies (2/4) • List all strategies in a common table. (Table 10.1) • Group each strategy into a some rational criteria. • For example: To increase market share in a new market Increase budge for product promotion Find ways to increase the number of distributors Find new markets in the eastern region Recruit more sales personnel • These 5 strategies can be condensed into one as “increase efforts to increase market share and sales.”

  4. Part 1:Consolidate and Condense Strategies (3/4) • Ensure that all strategies that are to be condensed have the same direction. • E.g: • Increase sales through increasing control of downstream activities. • Growth by concentric diversification • Growth by controlling resources • Look for partner to diversity within the same sector Since 1 & 3 = forward and backward integration and 2 & 4 = concentric diversification, these strategies must be treated as separate strategies.

  5. Part 1:Consolidate and Condense Strategies (4/4) • From the handout, 29 strategies were condensed into 8 different categories. (Table 10.2) • Strategies with the same codes are placed together. • Provide appropriate strategic labels for each group. • Re-check and re-look at the agreed groupings and labels with your company’s strategic team.

  6. Part 2: Prioritizing the Consolidated Strategies (1/3) • The Company still cannot implement all 8 strategies. • Normally an organization would identify the top three strategies and submit it to the Board for approval. • Therefore, an organization needs to prioritize the strategies. • Models such as ROI, cost/benefit analysis or any other method that you are familiar with can be used to prioritize.

  7. Part 2: Prioritizing the Consolidated Strategies (2/3) • Prioritizing of strategies need to be done systematically and rationally. • In this example, the 8 strategies are evaluated based on 6 criteria: (Table 10.3) • High ROI 4. Low investment • Low risk 5. Employee compatibility • Acceptability 6. Short Time Taken

  8. Part 2: Prioritizing the Consolidated Strategies (3/3) • Rate all six criteria on a score of 1 (low/ detrimental) to 10 (high/good). • Total up the score for each strategy across the six criteria. • Choose the top 5 strategies with the highest total scores.

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