1. Developing the strategy
Vision, Value Gaps, and Analysis
Seyed Mohammadreza Karbalaee Dr.David
Salman Farsian Oct 2011
3. Developing the strategy
• Defines the organization’s purpose and goals and carefully examines
the external and internal environment to identify opportunities and
constraints regarding that strategy.
• The strategy development practices followed by the most successful
organizations. (A 2006 McKinsey survey)
• The systematic strategic development process follow by four steps:
• Part 1
– Crafting mission , vision and value statement
– Strategic goals
– Strategic analysis
• Part 2
– Formulating and launching the strategy
4. These four strategy development steps address
the following four questions:
1. What business are we in and why?
2. Where are we going ?
3. What are the key issues that or strategy must address?
4. How can we best compete?
The mission is a brief , typically one-sentence , statement
that defines the fundamental purpose of the organization.
Defines what the organization provide to its clients and
Inform executives and employees about the overall goal that they
have to pursue.
• The value of a company prescribe its desired behavior
, character , and culture.
“selling the highest quality natural and organic products available “
“supporting team member excellence and happiness”
“caring about our communities and our environment “
• The vision is a concise statement that defines the mid-to long-
term(three to ten years) goals of an organization.
• Characteristics of vision :
– Market oriented
– Express preferably in clear, specific aspirational terms
10. Quantifying the vision
• A quantified vision provides a clear focus for the strategy by
including a measurable outcome and a targeted value.
• Three essential components of a good vision statement :
– A quantified success indicator
– A definition of niche
– A time line for execution
• Example 1 :
– The vision statement of CIGNA property & casualty :
“ to be a top quartile specialist within five years”
• Example 2 :
– John F. Kennedy vision for US space program
“to land a man on the moon and return him safely to earth before the
end of the decade”
• Example 3 :
– Leeds University (UK)
“by 2015 , our distinctive ability to integrate world class research
scholarship and education will have secured us a place among the top
50 universities in the world”
11. The benefits of vision
Increase the clarity of the message
Adds a discrete definition of success that can be cascaded to
lower organizational level
Establishes a time frame in which the success will occur
Sets an ambitious target for the strategy at the highest
organizational level and early in the planning process
Stability of mission, vision, and value
13. Strategic goals : define and decompose the
• The value gap represents the difference between aspiration and
reality; it becomes the goal for the new strategy to fulfill.
• The value gap represents the difference between the desired
outcome and what could be achieved by maintaining the status quo
with the existing strategy.
• The key financial measure is combined ratio
16. Strategic analysis
Assesses the macroeconomic environment.
Reflecting its political , economic , social , technological
, environmental and legal components.
• Michael porter’s five forces model
Industry level examination of industry economics using Porter’s
five force model:
The bargaining power of buyers and suppliers, the availability of
substitute , the threat of new entrants , and intensity of industry
17. Internal analysis
• The internal analysis examines and an organization’s own
performance and capabilities
• The value chain model
18. •SWOT analysis
Identifies the company’s
–Existing strengths and weaknesses (internal attributes)
–Emerging opportunities and worrisome threats (external attributes)
SWOT analysis help summarize the external and internal analysis
information into a brief list.
•BSC SWOT Matrix
-Created by performing a SWOT analysis for each of the BSC
perspectives, Provides a frame work that integrates the SWOT strategy
19. Formulating and lunching the strategy
• Strategy formulation
– The stage of strategic management that involves the
planning and decision making that leads to the
establishment of the organization’s goals and of a specific
1. Corporate ( What business are we in ?)
2. Business (How do we compete? )
3. Functional (How do we support the business-level strategy )
20. Strategy Implementation
• The stage of strategic management that involves the use of
managerial and organizational tools to direct resource toward
achieving strategic outcomes .
1. Leader ship/Culture
3. Human resource
4. Information and control system
For developing strategy we must follow steps
Mission Fundamental , Overall purpose
1. Defining Vision External, Market oriented, Measurable
Value behavior , character
2. Strategic the goals Transmit from aspiration to reality
3. Strategic analysis
4. Formulating the strategy