Identify the information needed to evaluate the overall market and industry, as part of the situational analysis.

Leakage of information may put the company at a competitive
The top management top down approach plan the directions for the whole
organisation. A match – strategic fit between the organisation and its
environment (e.g.: if a competitor opens, thus you have to redesign
your advertising campaign etc.)
Strategic planning is a continuous approach because it is carried out
step by step. Strategic planning relies on a clear mission, goals and
Where as contingency plans are their as an emergency so when trying to
reach an objective and something goes wrong the contingency plan may
come into action.
Strategic planning affects other plans of the organisation through
examples in the following diagrams.
The main operation of a company is the core business. The corporate
strategy is a direction for the whole organisation, which wishes to
maintain the same profits of the market. This is a diversification
which takes time and can last between 5 to 10 years. Business strategy
refers to the individual strategy of SBU’s
Outline the importance of a situational analysis in strategic
The situational analysis is part of one of the starting points of the
strategic planning. These are:
1. Situational Analysis – Where are we now?
2. Objectives – Where do we want to go?
3. Strategies – How to arrive there?
The advantages of a situational analysis are:
· It provides information about:
o Its current position – internal analysis of the company itself.
o Its industry, present/forecasts – industry analysis (NSO)
o Its competition, present/forecasts – competitive analysis (porters 5
competitive forces)
The disadvantage of a situational analysis is that:
· You have an uncertainty and no accurate information.
In a situational analysis, it is important to:
· Recognise the importance of performing a situational analysis.
· Identify the information needed to evaluate the overall market and
industry, as part of the situational analysis.
· Identify elements of an effective competitive analysis.
· Identify the stages of the product life cycle as they pertain to the
situational analysis
It is important to conduct a comprehensive situational analysis. In
conducting such an analysis, the economic and institutional conditions
and their effect on the alternatives available must be considered.
Among the conditions that should be taken into consideration are the
state of the economy including, current monetary and fiscal policy;
the state and structure of the financial system; the legal framework;
the state of the regulatory and supervisory systems; and accounting
and disclosure regimes. Although it is understood that in many cases
conditions are not perfect, it is important to have a process to
evaluate the system available and how these alternatives are affected
by the economic and institutional structure of the country. Through a
situational analysis, gaps between existing conditions and
more-desirable situations can be identified.
What are and list the functions of objectives?
· Objectives help you to develop different courses of action.
· Objectives help you to plan.
· Objectives help you to allocate resources.
· Objectives help in controlling, and
· Objectives help out in the setting of targets for individuals, and
Lecture Notes

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