Glossary of techniques for strategic analysis. This article provides a glossary of analytical techniques, страница 15

The value of the approach is that it summarizes the key issues from a complex corporate appraisal, and can reduce these to one piece of paper. The pitfall is that for many it becomes a useless shopping list of weaknesses, few of which are strategic, accompanied by a few platitudes in place of real strengths. I am always suspicious when the only strengths listed are `a strong chief executive' and a `professional and loyal management team'. This is not a ®ctional example!

For many it becomes a useless shopping list of

weaknesses

SWOT works best when it is tackled with the mind-set of:

*  strengths and weaknesses relative to market needs;

*  and compared with the competition.

Simple techniques are often best for a situation, and SWOT can be recommended to those who are aware of the possible pitfalls.

Hussey, D. E. (1991). Introducing Corporate Planning: Guide to Strategic Management, 4th edition, chapter 4, Pergamon Press, Oxford. Steiner, G. A. (1979). Strategic Planning: What Every Manager Must Know, chapter 8, Free Press, New York.

See also: equilibrium analysis and critical success factors.

Synergy matrix

This is a matrix framework to facilitate the quanti®cation of synergy in new strategic initiatives. The matrix analyses the effects on pro®t due to a pooling of competence, by functional areas. It is one of the ®rst generation techniques of strategic analysis, but has some of the strands of thought that reappear in value chains, and in the debate on shareholder value.

Ansoff, H. I. (1965). Corporate Strategy, chapter 5, McGraw-Hill, New York.

Technology-based resource allocation

This is a matrix approach to deciding technology strategies. It is the third step in a methodology that consists of an audit, an understanding of the strategic implications of the technology portfolio, an implementation plan and a monitoring programme.

Henry, J. P. (1990). Making the technology-strategy connection, International Review of Strategic Management, 1, Wiley, Chichester.

Technology grid

This is a way of analysing the portfolio by technology. One method uses a matrix showing technology position on one axis, and relevance of the technology on the other. It was designed to give added insight to the positioning of SBUs on the more traditional competitive position/market attractiveness portfolio chart. A variant of this approach uses market growth and competitive strength as the two axes. In this case what would be plotted would be the key technologies. In common with portfolio analysis, positions would be indicated by circles drawn proportionately to their importance to the company.

Clarke, C. J. and Brennan, K. (1990). Building synergy in the diversi®ed business. In: P. McNamee (ed.), Developing Strategies for Competitive Advantage, Pergamon, Oxford.

Neubauer, F-F. (1990). Portfolio Management, chapter D5, Kluwer, Holland.

See also: core competencies and portfolio analysis.

Trends projection

Most time series analyses and projections are poor for long-term forecasting, although useful in the short term. Trend projection is good for longer term forecasts. It designs and ®ts a mathematical equation to the data by, for example, measuring slope characteristics and using the results to project the curve.

Chambers, J. C., Satinedes, K. N. and Smith, D. D. (1971). How to choose the right forecasting technique, Harvard Business Review, July± August.

See also: Delphi technique, econometric model and historical analogy.

Value-based strategy

The debate about the need for strategic actions to add to shareholder value has led to the development of a mathematical technique that tries to ensure that all strategies are value adding, and that the business selects the options which add the most value. The method applies discounted ¯ow analysis concepts to all the strategies of the entire organization.