Tutorial 6

Question 1

The six generic criteria that can be used for evaluating strategy options

Answer 1

1. Plausibility
2. Consistency
3. Performance impact
4. Business risk
5. Stakeholder compatibility
6. Internal readiness

Question 2

Criterial 1: plausibility

Answer 2

Plausibility means to be appropriate for dealing with the company’s external environment given the organisations internal resources and capabilities

Identifier: a portfolio analysis can be used to support the evaluation whether a strategy option is plausible or not

Question 3

Criteria 2: consistency

Answer 3

A strategy needs to fit in the overall strategic context of the organisation. It has to be evaluated whether the proposed strategy option is directly or indirectly contributing to making the vision come true

Identifier: analysis of the consistency between the street option and the vusionF mission and values of the company

Question 4

Criteria 3: performance impact

Answer 4

The proposed strategy needs to satisfy the performance objectives of the company.

Identifier: financial analysis
Return on capital employed

Payback period (time)

Question 5

Criteria 4: business risk

Answer 5

In this context, risk means the degree of unnecessary hazards or damages that an entire company will be exposed by pursuing a strategy option. A strategy option is attractive when it entails a low amount of risk

Identifier:
Scenario analysis
Sensitivity analysis

Question 6

Criteria 5: stakeholder compatibility

Answer 6

A strategy otption is compatible if it is in line with expectations of the key stakeholders

Identifier: stakeholder anayalys + stakeholder dialogue

Question 7

Criteria 6: internal readiness

Answer 7

It needs to be chekced whether a company is actually capable making the proposed strategy option come true

Identifier: execution plan
Identifying internal constraints of making a strategy happen

Question 8

Six barriers to strategy execution

Answer 8

1) vision barrier - vision and strategy too vague and generic
2) people barrier - missing link between goals of organsiationAl units, departments, teams or individual people and related incentives with the overarching strategy
3) resource barrier - missing link of resource allocation to strategy - managers don’t get the time, funds or people to excel strategies
4) management barrier - lack of comprehensive strategy reveiww by management teams
5) system barrier - strategy doesn’t have a focal framework
6) skill barrier - strategic competencies are missing

Question 9

6 barriers of strategy execution

Answer 9

Vision barrier 
People barrier
Resource barrier 
Management barrier 
System Barrier
Skill Barrier

Question 10

Seven generic elements that are supposed to drive straft orientated behaviour of people

Answer 10

Goals
Actions
Skills
Resources
Incentives 
Attitudes
Information

Question 11

7 barrier to drive strategy orientated behaviour of people - what people should do

Answer 11

Strategic priorities of the company:

Goals
Actions

Question 12

Seven drivers - ability to act and contribute to strategic priorities of the company (what people can do)

Answer 12

Skills

Resources

Question 13

Seven drivers - motivation to help make the strategy happen (what people actually want to do)

Answer 13

Incentives
Attitudes
Information

Question 14

BCG Matrix

Answer 14

Question mark - high market growth, low market share

Eg Fanta cocoa cola

Strategy: selective strategy

Poor dogs: low market growth low market share

Strategy : harvest / disinvestment strategy

Eg Coca Cola green

Stars -high market growth, high market share

Strategy: investment/growth strategy

Eg kinley

cash cows, low market growth high market share

Strategy: milking for cash strategy
Eg normal coke