Evaluation and Selection of Strategies Essay

2080 Words9 Pages
Evaluation and selection of strategies- Basic Notes 1. The nature of strategic options 2. Evaluation criteria 3. Tools for evaluating options After identifying the options available, classical prescriptive strategy has always argued that the next strategy task is that of selection. In evaluating strategic options, it is useful to distinguish between the content of the option (what strategy will we select?) and the process by which the selection will be undertaken (how will we undertake the selection task?). 1. The nature of strategic options Strategic decisions involve: a. decisions on products and markets; b. decisions on generic strategy; c. decisions on growth and development options. This could be explained by discussing: a. Product - market decisions. Key considerations: product life cycle (and phasing of); product and market portfolio; product mix. b. Generic strategy decisions Questions on the emphasis between cost and distinctiveness (i.e. differentiation) and questions of market scope. This, in turn, will determine the way that value chain activities are configured. c. Growth and development decisions Decisions on the directions and mechanisms of growth, for example: increase or decrease in size; Ansoffian directions; the use of internal or external growth mechanisms. If decrease in size is appropriate, methods are a bit more complex (e.g. demerger, divestment, MBO, equity carve-outs, etc) 2. Evaluation criteria What are they? Suitability; Feasibility; Acceptability; Advantage Suitability Does the strategy promise to achieve strategic objectives? Does the proposed strategy capitalise on strengths? Does it promise to address and overcome or avoid weaknesses? Is it responsive to environmental threats and opportunities? Feasibility Is the strategy possible? Can the proposed strategy be resourced? (i.e. are human, financial, etc.
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