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Strategies to Avoid and Selecting the Best Strategy - Finance Marketing, Human Resource, Management Information Systems and logistics
Strategic Management - Functional Strategy
Strategies to Avoid and Selecting the Best Strategy - Finance Marketing, Human Resource, Management Information Systems and logistics
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Perhaps the most important criterion is the ability of the proposed strategy to deal with the specific strategic factors developed earlier in the SWOT analysis.
Strategies to Avoid
If managers lack analysis and creativity they may get trapped into weak strategies leading to failure. The following strategies should be avoided.
Follow the Leader
Imitating a leading competitor’s strategy might seem to be a good idea, but it ignores a firm’s particular strengths and weaknesses and the possibility that the leader may be wrong.
Hit Another Home Run
If a company is successful because it pioneered an extremely successful product, it tends to search for another super product that will ensure growth and prosperity. Like betting on long shots at the horse races, the probability of finding a second winner is slight. Polaroid spent
Arms Race
Entering into a spirited battle with another firm for increased market share might increase sales revenue, but that increase will probably be more than offset by increases in advertising, promotion, R&D, and manufacturing costs. Since the deregulation of airlines, price wars and rate “specials” have contributed to the low profit margins.
Do Everything
When faced with several interesting opportunities, management might tend to lead at all of them. At first, a corporation might have enough resources to develop each idea into a project, but money, time, and energy are soon exhausted as the many projects demand large infusions of resources.
Ex:- Walt Disney
Losing Hand
A corporation might have invested so much in a particular strategy that top management is unwilling to accept its failure. Believing that it has too much invested to quit, the corporation continues to throw” good money after bad”.
Ex:- Indian Airlines is one such company.
Selecting the Best Strategy
Perhaps the most important criterion is the ability of the proposed strategy to deal with the specific strategic factors developed earlier in the SWOT analysis. IF the alternative doesn’t take advantage of environmental opportunities and corporate strengths / competencies, and lead away from environmental threats and corporate weaknesses, it will probably fail.
Another important consideration in the selection of a strategy is the ability of each alternative to satisfy agreed – on objectives with
Tags : Strategic Management - Functional Strategy
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