Friday, September 5, 2014


1.       Strategy specifies how an organization matches its own capabilities with the opportunities in the marketplace to accomplish its own objectives.

2.       In Formulating & making its strategy an organization must thoroughly understand the industry in which it operates.

       Industry analysis focuses on 5 forces:
·         Competitors
·         Potential entrants into the market
·         Equivalent products
·         Bargaining power of customers, &
·         Bargaining power of input suppliers.

3.       Strategy runs the operations of a organization & guides managers short-run & long run decisions. We will describe the” balanced scorecard approach” to implementing strategy & how to analyze operating income for purpose of evaluating strategy.

4.       The corrective effect of these forces makes an organization’s profit potential. In general, Profit potential decreases with greater competition, stronger potential entrants products that are similar, & more demanding customers & suppliers.

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