12. Morgan’s Societal Environment
• Populations figures
and automobile
buying capacity
• Level of economic
activity
• Automobile Designs
• Automobile
Manufacture
• Technological
Development
• Life-style and
preference of
people
• Social norms
• Political climate
• Stability of
Government
• Taxation policy
Political-Legal
Environment
Socio-cultural
Environment
Economic
Environment
Technological
Environment
13. Morgan’s Analysis of Task Environment
Threat of New Entrants
Bargaining Power of Buyer
Threat of Substitute product
Bargaining Power of Supplier
Competitors
• Switching cost
• Economies of scale
• Capital requirement
• Number of buyer Company
• Purchasing industries purchase behavior
• Number of competitors
• Rate of industry growth
• Product or service Characteristics
• Amount of Fixed Cost
•Number of supplier company
•Uniqueness of supplied product
•Availability of substitute
•Access
•Prices
•Switching cost
14. Morgan’s analysis of Resources & capabilities
• Private partner ownership
Organizational
structure
• Dedicated & hard working
• Efficient Management team
Human Resources
• Japanese Quality control
• German technology
Technologies
Corporate Culture •Friendly
15. Morgan’s Analysis of value chain
Firm Infrastructure
HRM
Technological Development
Procurement
•Planning & control
•Finance & accounting
•R & D and strategic Decision
•Less in number but highly
experienced employee
•Continuous Development
outsourcing
•Clear Contracts
•Talented employees
•Negotiation skills
Inbound logistics
•High quality raw
materials &
engines
Operations
•Unique
Product
•Customization
Facility
Outbound
Logistics
•Shipping
Efficiency
•Single
Production
Plant
Marketing &
Sales
•Less
Marketing
activities
•High demand
Volume
Service
•1 Year free
Service
•Installation
after sales
SupportActivities
Primary Activities
16. SWOT analysis
Strength
Unique niche
Highly skilled labor
High Quality manufacturing
Strong survival mentality
Strong Brand image
Durability
Diversified car ranges
Weakness
Slow production
Expensive process
Technological Barrier
Large capital Investment
High risk in transactions
Opportunities
Reducing waiting list
New operational areas
New car designs
New target segments
Attractive brand image
Customers retention
Threats
Strong Competitive market
Better substitutes
High bargaining power of suppliers
Technological obsolesces
Changes in customer preferences
17. Internal Strategic Factors
Factors weight Rating Weighted
score
Comments
Strength
S1-Unique niche
S2-Highly skilled labor
S3-High Quality manufacturing
S4-Strong survival mentality
S5-Strong Brand image
S6-Durability
S7-Diversified car ranges
.15
.15
.1
.04
.06
.07
.03
5
5
5
4
2
3.75
2.2
.75
.75
.5
.16
.12
.2625
.066
Should be maintained
Good Performance
Need Improvement
Good But decreasing
Need Build more
Need Improvement
Satisfactory
Weakness
W1- Slow production
W2-Expensive process
W3-Technological Barrier
W4-Large capital Investment
W5-High risk in transactions
Total Score
.08
.15
.05
.06
.06
3.8
4
4
3.2
3
.304
.6
.2
.192
.18
Slow on new car
High overhead cost
Technical problems
Huge investment
Technological threats
4.0845
1
18. External Strategic Factors
Factors Weight Rating Weighted
Score
Comments
Opportunities
O1-Reducing waiting list
O2-New operational areas
O3-New car designs
O4-New target segments
O5-Attractive brand image
O6-Customers retention
.15
.08
.07
.1
.2
.15
4
4.5
3.3
3
2.8
2.5
.6
.36
.231
.3
.56
.375
Faster production
Increase areas
Increase design
Focus on new group
Diversification
Focus on customer preference
Threats
T1-Strong Competitive market
T2-Better substitutes
T3-High bargaining power of suppliers
T4-Technological obsolesces
T5-Changes in customer preferences
Total Score
.05
.05
.05
.05
.05
4
3
4
3.6
3.2
.2
.15
.2
.18
.16
Increase Brand loyalty
Introduce Better design
Smooth supply chain
Advanced technologies usage
Identify needs
1 3.316
19. Strategic Factors weight Rating Weighted
score
Duration Comments
S
H
O
R
T
M
I
D
LO
N
G
S1-Unique niche
S2-Highly skilled labor
S3-High Quality
manufacturing
W1- Slow production
W2-Expensive process
O1-Reducing waiting list
O2-New operational areas
T1-Strong Competitive
market
T2-Better substitutes
.1
.1
.1
.15
.1
.1
.1
.15
.1
5
4
3.8
3.8
3.2
3.3
3
3.8
1.8
.5
.4
.38
.57
.32
.33
.3
.57
.18
X
X
X
X
X
X
X
X
X
Utilize the unique niche
Empower the labor force
Strategic Alliance
Faster production technologies
Large funding & financial supports
Meet Customer demands early
Expansion of plants
New marketing policies
Build customer loyalty
1 3.55
SFAS Matrix
20. TOWS Matrix Internal Factors
Strength(S)
S1-Unique niche
S2-Highly skilled labor
S3-High Quality manufacturing
S4-Strong survival mentality
S5-Strong Brand image
S6-Durability
S7-Diversified car ranges
Weakness(W)
W1- Slow production
W2-Expensive process
W3-Technological Barrier
W4-Large capital Investment
W5-High risk in transactions
ExternalFactors
Opportunities(O)
O1-Reducing waiting list
O2-New operational areas
O3-New car designs
O4-New target segments
O5-Attractive brand image
O6-Customers retention
SO Strategies
• Emphasis on the new, diversified &
faster production process
• Focus on better Branding & marketing
Strategies
WO Strategies
• Introduce advanced technologies
• Looking for large investment sources
Threats (T)
T1-Strong Competitive market
T2-Better substitutes
T3-High bargaining power of
suppliers
T4-Technological obsolesces
T5-Changes in customer
preferences
ST Strategies
• Build strategic alliances with the supply
chain partners
• Ensure high quality product & services
through unique features
WT Strategies
• Reduce the production time
• According to the customer
preferences reinstallation technical
processes
21. Corporate Strategy Formulation
Industry Attractiveness Strong Average Weak
High 1. Growth
Vertical growth via
concentric diversification
2. Growth 3.Retrenchment
Medium 4. Stability 5. Growth 6. Retrenchment
Low 7.Gowth 8. Growth 9.Retrenchment
The company is expanding it activities with the current
demand and on the basis of market position
attractiveness it can be define that it has Vertical growth
via concentric diversification.
22. Porter's Generic Competitive Strategies
Technological
Leadership
Technological
Followership
Open
Innovation
Cost Advantages
Differentiation Pioneer in
Unique
Craftsmanship
car Production
with the unique
global
operational area
As we produce handmade car with superior qualities & meet a
unique niche market segments we have the competitive position
of Technological Leadership & Differentiation Focus
24. Strategy Implementations
Implementation criteria Morgan’s activities
Who Implement strategy Management teams, Managers & Head of all SBU’s, Employee
of all divisions
What must be done? Program-Restructure the work divisions
Budget- 5% efficiency in increase within 3 years according the
program
Procedures- Online standardized daily task routine for all the
plants
How everything is going to work together? Pre-Implementation analysis, Feasibility, Sequence of
execution, Locations, nature of change & stakeholder’s
evaluation analysis
How strategy is to be implemented Reengineering the organization structure, Redesigning the jobs
International strategy Issue International Strategic Alliances with supply Chain partners,
Decentralizations of organization power
27. Evaluation & Control
Primary Measures of Performance
Return on
investment
(ROI)
Earnings per
share (EPS)
Return on
equity (ROE)
Operating
cash flow Free cash flow
28. Evaluation & Control
Evaluating Top Management & Board
• Chairman-CEO Feedback Instrument
• Management Audit
• Strategic Audit
Divisional & Functional Performance
• Standard cost centers. Based on historical data
• Revenue centers.
• Expense centers profit centers
• Investment centers. Difference between revenues and cost.
29. Evaluation & Control
Three Basics of Morgan’s Strategy Review
Examining the
underlying basis of
Morgan’s strategy
Comparing actual
to expected
results
Taking corrective
action to address
performance gaps
30. Evaluation & Control
Review Bases of Strategy
Key Questions in Evaluating Morgan’s Strategy:
• Are our internal strengths still strengths?
• Have we added other internal strengths?
• Are our internal weaknesses still weaknesses?
• Do we now have other internal weaknesses?
• Are our external opportunities still opportunities?
• Are there now external opportunities?