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Business Plan Competition

By Wendy Diaz,2014-05-16 23:59
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SWOT Analysis &. Strategic Positioning. In stable industries, the Strengths Weaknesses Opportunities Threats analysis remains one of the best ways to think

    Business Planning Tools

    Products of The Fox School’s

    Innovation & Entrepreneurship Institute

    SWOT Analysis &

    Strategic Positioning

In stable industries, the Strengths Weaknesses Opportunities Threats analysis remains one of the

    best ways to think about strategy. The goal is to find a sustainable strategic position in which the

    firm can use its strengths to take advantages of the opportunities available in its industry and

    markets while defending itself from threats and masking or correcting its weaknesses.

    Internal Strengths (S) Weaknesses (W)

    Factors--------------------------- ------------------------

    List 5-10 internalList 5-10 internalExternalstrengths hereweaknesses hereFactors

     Opportunities (O)SO StrategiesWO Strategies

    --------------------------------------------------------------------------

    Use strengths to Offset weaknessesList 5-10 externaltake advantage of to take advantage opportunities hereopportunitiesof opportunities

     Threats (T)ST StrategiesWT Strategies

    ---------------------------------------------------------------------------

    Use strengths toMin. weaknesses List 5-10 external

    avoid threatsto avoid threatsthreats here

    When doing such an analysis, it’s best to work from the outside in, to do an OTSW analysis.

Start by defining the markets in which your firm will sell, the competition that you will face, and Contact: Chris Pavlides, Executive Director, Innovation & Entrepreneurship Institute, 201 Speakman Hall (006-00),

    Philadelphia PA 19122-6083. Phone: 215-204-1035 or 215-204-3080. Email: iei@temple.edu. the larger industry structure (power relations, business norms, etc) in which your firm will Web: www.fox.temple.edu/iei.function. Then push further and consider the larger trends demographics, technological shifts,

political shifts that may affect your industry and markets. Finally, summarize your analysis in

    a list of opportunities and another of threats. This is the context in which you must operate.

Once you know what the world gives you, look inside to inventory your strengths and

    weaknesses. What skill sets, resources, networks, etc do you have at your disposal? What are

    you lacking? Summarize these into a list of strengths, and one of weaknesses. This is what you

    have to work with.

Finally, map out your OT and SW in a matrix like the one above and study it to develop a

    strategy that uses your strengths to take advantage of opportunities, block or avoid threats, and

    overcome weaknesses. Alternately, brainstorm a bunch of strategies and run each through the

    matrix, looking for flaws (such as exposing a weakness say lack of cash to a threat such as

    a legal trend that requires deep pockets to overcome.

Some of the strategic positions that you might consider are:

    ? The low-cost firm that churns out good enough services or products at the lowest possible

    cost.

    ? The highly differentiated firm that creates the highest quality, best designed, best supported,

    most attractive products or services in their area.

    ? The narrowly focused firm that ties itself to a very specific market and serves its needs

    assiduously, typically with segmented products and services or niche, often customized,

    products or services.

    ? The broadly focused firm that serves a wider market, either with a standardized product or

    through mass customization.

    ? The firm that elaborates a previously chosen position, by penetrating deeper, developing new

    markets or niches, developing new products, carving out space at the edge of a niche, or

    raising barriers to competitors wanting to do what your firm does.

Some more dynamic strategies to consider are:

    ? Finding loose bricks or beachheads that will allow your firm to expand into a tightly

    controlled opportunity. Honda snuck up on the US motorcycle firms by specializing in small

    engines first, then minibikes, then four-cylinder bikes, etc.

    ? Changing the terms of engagement, by sidestepping barriers to entry or developing news

    ways of doing what your competitors are doing. Dell is the classic example here.

    ? Collaborating and learning by licensing, outsourcing, entering into joint ventures until

    your firm knows enough to make its own way.

     Contact: Chris Pavlides, Executive Director, Innovation & Entrepreneurship Institute, 201 Speakman Hall (006-00), Philadelphia PA 19122-6083. Phone: 215-204-1035 or 215-204-3080. Email: iei@temple.edu. Web: www.fox.temple.edu/iei.

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