Strategic Mangement Part-1

So what is Strategy, it is a word that is used a lot, but often in a wrong context. Essentially, a strategy is a roadmap of how you are going to win, where you are, is your “as-is” state, and where you want to be is your “to-be” state, how you are going to fill this gap is your strategy.  If you want to make it more simple relate it with a video-game race, now to win this race, either you can walk straight to a finish line at a speed of 5km/h, or you may extend your route, take more time as you travel more, but collect speed boost on the way so that you can go faster at the speed of 20km/h, collecting these speed boost to win, would be your strategy.

In business, we have 3 major layers of strategy,

We can try to understand, strategy layer with an example.

Suppose you have 5 million US$, and you want to invest this money in one particular industry, deciding the industry is a corporate decision, let say you decide to invest in auto industry, so the corporate decision is selecting auto industry.

There are different segments in the auto industry, suppose we select to invest in electric car segment, this decision is our business strategy.

Each segment requires different functional strategies, like Finance, Marketing, acquisition, logistics and many more. Decisions regarding this function come in functional strategy.

Strategic Tool

Now, let’s talk about the strategic tools. The purpose of tools is to help us make the decision and finding the competitive advantage

Some of the Strategic tools are as follows:

1) Boston consulting group matrix

2) Value curve or strategy canvas

3) VRIO

4) Porter's five force model

5) Resource-based view