Strategic analysis is a process to understand the organization’s environment and competitive landscape to formulate informed business decisions, to plan for the organizational structure and long-term direction. Strategic planning is also useful to experiment with business model design and assess the fit with the long-term vision of the business.
Strategic Analysis
Description
Analysis
Implications
Applications
Examples
1. Overview
Strategic Analysis is a comprehensive process of examining an organization’s internal and external environments to formulate informed strategic decisions.
– Evaluate internal and external factors affecting the organization. – Identify strengths, weaknesses, opportunities, and threats (SWOT).
– Provides a holistic view of the organization’s position and potential. – Guides strategic planning and decision-making.
– Developing a new business strategy for growth and market expansion. – Assessing the competitive landscape in an industry. – Analyzing the internal capabilities of an organization before a merger.
Conducting a SWOT analysis to determine an organization’s competitive position. Assessing market trends and consumer preferences for product development.
2. Internal Analysis
Internal Analysis assesses the organization’s internal factors, including strengths and weaknesses, to understand its capabilities and limitations.
– Identify and evaluate the organization’s internal strengths and weaknesses, such as resources, processes, and skills. – Assess internal performance and capabilities.
– Highlights areas where the organization excels and can gain a competitive edge. – Identifies internal limitations that may hinder progress.
– Assessing internal processes for efficiency improvements. – Identifying core competencies that can lead to competitive advantages. – Evaluating employee skills and training needs.
Recognizing a company’s strong financial position and efficient supply chain as internal strengths. Identifying a lack of innovation and outdated technology as internal weaknesses.
3. External Analysis
External Analysis examines factors in the organization’s external environment, including opportunities and threats, to assess the impact on strategic decisions.
– Identify and evaluate external opportunities and threats, such as market trends, competition, regulatory changes, and economic conditions. – Assess market dynamics.
– Enables the organization to capitalize on favorable external conditions and navigate potential threats. – Helps anticipate and adapt to changes in the external landscape.
– Analyzing market trends to identify growth opportunities. – Assessing competitive forces and market entry barriers. – Monitoring changes in regulations affecting the industry.
Recognizing a growing demand for sustainable products as an external opportunity. Identifying increased competition and market saturation as external threats.
4. SWOT Analysis
SWOT Analysis combines internal and external assessments to create a matrix highlighting an organization’s strengths, weaknesses, opportunities, and threats.
– Create a SWOT matrix that aligns internal strengths and weaknesses with external opportunities and threats. – Identify strategic implications based on the matrix.
– Provides a clear visual representation of the organization’s strategic position. – Guides strategy development by aligning internal capabilities with external factors.
– Developing strategies that leverage strengths to exploit opportunities. – Addressing weaknesses to mitigate potential threats. – Identifying strategies to capitalize on strengths while managing threats.
Developing a SWOT matrix that shows the organization’s strong brand reputation (S), limited digital presence (W), emerging market opportunities (O), and increasing competition (T).
5. Competitive Analysis
Competitive Analysis focuses on evaluating competitors’ strengths, weaknesses, strategies, and market positioning to gain a competitive advantage.
– Identify key competitors in the industry. – Analyze competitors’ strategies, market share, strengths, and weaknesses. – Assess competitive threats and opportunities.
– Provides insights into the competitive landscape and opportunities for differentiation. – Helps identify potential areas for competitive advantage.
– Benchmarking against competitors to identify areas for improvement. – Analyzing competitor pricing strategies and market share trends. – Identifying gaps in the market where competitors are underserving customers.
Assessing a competitor’s strong distribution network and innovative product offerings. Recognizing a competitor’s limited online presence and customer service challenges.
6. Scenario Analysis
Scenario Analysis involves creating multiple future scenarios based on different variables and assessing the implications of each scenario on strategic decisions.
– Develop alternative future scenarios considering various economic, market, and industry conditions. – Assess the impact of each scenario on the organization’s strategy.
– Helps prepare the organization for different possible futures. – Allows for more informed and adaptive decision-making.
– Scenario planning for business continuity in the face of economic uncertainties. – Evaluating the impact of changing market dynamics on strategic initiatives. – Assessing the potential consequences of regulatory changes.
Preparing for a scenario where there is a sudden economic recession (Scenario A) or a scenario with sustained economic growth (Scenario B).
7. Strategic Planning
Strategic Planning is the process of formulating and implementing strategies based on the findings of the analysis, aligning the organization’s goals and actions.
– Develop a comprehensive strategic plan that incorporates the insights from the analysis. – Define clear objectives, strategies, and action steps. – Allocate resources effectively.
– Ensures that organizational goals and actions are aligned with identified strengths and opportunities. – Guides resource allocation for maximum impact.
– Creating a multi-year strategic plan for organizational growth. – Developing departmental strategies to achieve specific objectives. – Allocating budget and resources based on strategic priorities.
Developing a strategic plan that focuses on leveraging internal strengths to exploit external opportunities. Setting clear objectives to improve market share and innovation capabilities.
For the sake of this article, we’ll look at a set of business thinking tools which you can use to assess both the internal positioning, strategy and if it fits with long-term vision and to assess external, competitive forces.
In this article, I’ll focus on the Blitzscaling business model canvas. This is a model based on the concept of Blitzscaling.
That is a particular process of massive growth under uncertainty, and that prioritizes speed over efficiency. It focuses on market domination to create a first-scaler advantage in a scenario of uncertainty.
Pretotyping is a mixture of the words “pretend” and “prototype,” and it is a methodology used to validate business ideas to improve the chances of building a product or service that people want.
The pretotyping methodology comes from Alberto Savoia’s work summarized in the book “The Right It: Why So Many Ideas Fail and How to Make Sure Yours Succeed.”
This framework is a mixture of the words “pretend” and “prototype,” and it helps to answer such questions (about the product or service to build) as: Would I use it? How, how often, and when would I use it? Would other people buy it? How much would they be willing to pay for it? How, how often, and when would they use it?
A blue ocean is a strategy where the boundaries of existing markets are redefined, and new uncontested markets are created.
At its core, there is value innovation, for which uncontested markets are created, where competition is made irrelevant. And the cost-value trade-off is broken.
Thus, companies following a blue ocean strategy offer much more value at a lower cost for the end customers.
Growth hacking is a process of rapid experimentation, coupled with the understanding of the whole funnel, where marketing, product, data analysis, and engineering work together to achieve rapid growth.
The growth hacking process goes through four key stages of analyzing, ideating, prioritizing, and testing.
Venture capitalist, Dave McClure, coined the acronym AARRR which is a simplified model that enables to understand what metrics and channels to look at. At each stage for the users’ path toward becoming customers and referrers of a brand.
In the Lean Startup, Eric Ries defined the engine of growth as “the mechanism that startups use to achieve sustainable growth.”
He described sustainable growth as following a simple rule, “new customers come from the actions of past customers.”
The three engines of growth are the sticky engine, the viral engine, and the paid engine. Each of those can be measured and tracked by a few key metrics, and it helps plan your strategic moves.
The RTVN model is a straightforward framework that can help you design a business model when you’re at the very early stage of figuring out what you need to make it succeed.
A comparable company analysis is a process that enables the identification of similar organizations to be used as a comparison to understand the business and financial performance of the target company.
To find comparables, you can look at two key profiles: the business and economic profile. From the comparable company analysis, it is possible to understand the competitive landscape of the target organization.
Porter’s Five Forces is a model that helps organizations to gain a better understanding of their industries and competition.
It was published for the first time by Professor Michael Porter in his book “Competitive Strategy” in the 1980s.
The model breaks down industries and markets by analyzing them through five forces which you can use to have a first assessment of the market you’re in.
AIDA stands for attention, interest, desire, and action. This is a model which is used in marketing to describe the potential journey a customer might go through, before purchasing a product or service. Variation of the AIDA model is the CAB model and the AIDCAS model.
The PESTEL analysis is a framework that can help marketers assess whether macro-economic factors are affecting an organization.
This is a critical step that helps organizations identify potential threats and weaknesses. That can be used in other frameworks such as SWOT or to gain a broader and better understanding of the overall marketing environment.
The technology adoption curve is a model which goes through five stages. Each of those stages (innovators, early adopters, early majority, late majority, and laggard) has a specific psychographic that makes that group of people ready to adopt a tech product.
A Business Model Essence, according to FourWeekMBA, is a way to find the critical characteristics of any business to have a clear understanding of that business in a few sentences.
That can be used to analyze existing businesses. Or to draft your Business Model and keep a strategic and execution focus on the key elements to be implemented in the short-medium term.
An effective business model has to focus on two dimensions: the people dimension and the financial dimension. The people dimension will allow you to build a product or service that is 10X better than existing ones and a solid brand.
The financial dimension will help you develop proper distribution channels by identifying the people that are willing to pay for your product or service and make it financially sustainable in the long run.
Understanding your TAM, SAM and SOM can help you navigate the market you’re in and to have a laser focus on the market you can reach with your product and service.
Brand building is the set of activities that help companies to build an identity that can be recognized by its audience. Thus, it works as a mechanism of identification through core values that signal trust and that help build long-term relationships between the brand and its key stakeholders.
A value proposition is about how you create value for customers. While many entrepreneurial theories draw from customers’ problems and pain points, value can also be created via demand generation, which is about enabling people to identify with your brand, thus generating demand for your products and services.
Marc Andreessen defined Product/market fit as “being in a good market with a product that can satisfy that market.” According to Andreessen, that is a moment when a product or service has its place in the market, thus enabling traction for the company offering that product or service.
An organizational structure allows companies to shape their business model according to several criteria (like products, segments, geography and so on) that would enable information to flow through the organizational layers for better decision-making, cultural development, and goals alignment across employees, managers, and executives.
As pointed out by Eric Ries a minimum viable product is that version of a new product which allows a team to collect the maximum amount of validated learning about customers with the least effort.
A SWOT Analysis is a framework used for evaluating the business’s Strengths, Weaknesses, Opportunities, and Threats. It can aid in identifying the problematic areas of your business so that you can maximize your opportunities. It will also alert you to the challenges your organization might face in the future.
Revenue modeling is a process of incorporating a sustainable financial model for revenue generation within a business model design. Revenue modeling can help to understand what options make more sense in creating a digital business from scratch; alternatively, it can help in analyzing existing digital businesses and reverse engineer them.
Business experiments help entrepreneurs test their hypotheses. Rather than define the problem by making too many hypotheses, a digital entrepreneur can formulate a few assumptions, design experiments, and check them against the actions of potential customers. Once measured, the impact, the entrepreneur, will be closer to define the problem.
Business analysis is a research discipline that helps driving change within an organization by identifying the key elements and processes that drive value. Business analysis can also be used in Identifying new business opportunities or how to take advantage of existing business opportunities to grow your business in the marketplace.
Key Highlights
Strategic Analysis and Planning:
Strategic analysis is the process of understanding an organization’s environment and competitive landscape to make informed business decisions.
Strategic planning involves structuring the organization, long-term direction, and experimenting with business model design.
Business Model Canvas:
Provides insights into customers, products/services, and financial structure.
Aids in making better business decisions by understanding the business model.
Blitzscaling Canvas:
Based on the concept of Blitzscaling, a process of rapid growth under uncertainty.
Prioritizes speed over efficiency and focuses on market domination.
Pretotyping:
Combines “pretend” and “prototype” to validate business ideas.
Helps understand potential customer usage, preferences, and willingness to pay.
Value Innovation and Blue Ocean Strategy:
Redefines existing market boundaries and creates uncontested markets.
Focuses on value innovation and breaking the cost-value trade-off.
Growth Hacking Process:
Rapid experimentation involving marketing, product, data analysis, and engineering.
Aims to achieve rapid growth through iterative testing and optimization.
Pirate Metrics:
AARRR framework for tracking user journey stages.
Helps identify metrics and channels for customer acquisition and retention.
Engines of Growth:
Mechanisms startups use to achieve sustainable growth.
Sticky, viral, and paid engines are the key types.
RTVN Model:
Framework for designing an early-stage business model.
Sales Cycle:
Steps taken to sell products or services.
Helps plan sales team strategies for closing deals.
Comparable Analysis:
Identifies similar companies for comparison.
Understands business and financial performance of target company.
Porter’s Five Forces:
Analyzes industry and competition through five forces.
Helps gain a better understanding of market dynamics.
AIDA Model:
Attention, Interest, Desire, and Action model in marketing.
Concepts for efficient product development, analysis, and revenue planning.
Concept Name
Description
When to Use
Advantages
Drawbacks
Business Model Canvas
The Business Model Canvas is a visual tool that provides a comprehensive view of a business model. It helps in understanding key components such as customers, value proposition, channels, and revenue streams. It aids in making strategic decisions by identifying strengths and weaknesses.
When organizations need to analyze and improve their business model, identify areas for innovation, or communicate their business model effectively to stakeholders.
Provides a structured and visual representation of the business model, fosters strategic thinking, and assists in identifying areas for improvement.
May oversimplify complex business models, and the effectiveness depends on the quality of data and analysis.
Blitzscaling Canvas
The Blitzscaling Canvas is a model designed for businesses focused on rapid growth under uncertainty. It emphasizes speed over efficiency and aims for market domination. It helps in prioritizing key aspects of blitzscaling strategy and aligning efforts for rapid growth.
When organizations pursue aggressive growth strategies in highly competitive and uncertain markets, and prioritize speed to capture market share quickly.
Offers a framework for strategic planning in high-growth, competitive environments, and emphasizes the importance of speed and market domination.
May not be suitable for all businesses, as it prioritizes speed over efficiency and may involve higher risks. Requires careful consideration of market dynamics and competition.
Pretotyping
Pretotyping is a methodology to validate business ideas by creating simplified, low-cost versions of products or services. It helps in understanding customer preferences and demand before investing in full-scale development. It focuses on answering critical questions about the product or service.
When organizations want to reduce the risk of building products or services that do not meet customer needs or preferences, validate ideas quickly, and make informed decisions about development.
Enables cost-effective validation of ideas, provides insights into customer preferences, and helps in making data-driven decisions before significant investments.
The effectiveness of pretotyping depends on the accuracy of assumptions and may not cover all aspects of product development or market dynamics.
Value Innovation and Blue Ocean Strategy
Blue Ocean Strategy involves creating new, uncontested markets by delivering superior value at lower costs. It focuses on breaking the cost-value trade-off and making competition irrelevant. It is used when organizations seek to redefine market boundaries and create new market space.
When organizations want to pursue growth by offering innovative products or services that create uncontested markets, reduce competition, and provide superior value to customers.
Can lead to the creation of new markets and reduced competition, offering unique value propositions to customers. It encourages innovative thinking and differentiation.
Requires innovative thinking and may involve significant changes to existing business models. Implementation can be challenging, and market acceptance may vary.
Growth Hacking Process
Growth hacking is a process of rapid experimentation and iterative testing to achieve rapid growth. It involves cross-functional collaboration between marketing, product development, data analysis, and engineering teams to optimize the entire customer acquisition funnel.
When organizations aim to achieve rapid and sustainable growth, optimize customer acquisition, and improve conversion rates by using data-driven experimentation and collaboration across teams.
Accelerates growth by optimizing the entire customer acquisition funnel, encourages data-driven decision-making, and fosters cross-functional collaboration.
Requires access to data and resources for experimentation, and success depends on the effectiveness of experimentation and collaboration across teams.
Pirate Metrics
Pirate Metrics, represented by the acronym AARRR (Acquisition, Activation, Retention, Referral, Revenue), provide a simplified model for tracking and analyzing user behavior through various stages of the customer journey. It helps organizations focus on key metrics for growth.
When organizations want to track and analyze user behavior at different stages of the customer journey, improve user acquisition, activation, retention, referrals, and revenue generation by focusing on key metrics.
Simplifies tracking and analysis of user behavior, provides a structured framework for growth metrics, and helps in identifying areas for improvement in the customer journey.
May not cover all aspects of customer behavior and may require customization based on specific business models and objectives.
Engines of Growth
The Engines of Growth framework, as defined in the Lean Startup, identifies three mechanisms for achieving sustainable growth: the sticky engine, viral engine, and paid engine. It helps in measuring and tracking key metrics associated with each engine and planning growth strategies accordingly.
When organizations want to understand and measure the mechanisms that drive sustainable growth, whether through user retention, viral marketing, or paid acquisition channels, and plan their growth strategies accordingly.
Provides a clear framework for identifying and measuring different engines of growth, allowing organizations to focus on the most effective strategies for their specific context.
Requires accurate measurement and tracking of key metrics associated with each engine of growth. The effectiveness of each engine may vary based on the business model and target audience.
RTVN Model
The RTVN Model is a straightforward framework for designing a business model. It helps in identifying the key elements required for business success, particularly in the early stages. It focuses on defining the right target audience, value proposition, and necessary resources.
When organizations are at the early stage of defining their business model and need a simple framework to identify the critical elements required for success, including the target audience, value proposition, and resources.
Offers a simple and structured approach to business model design, particularly useful for startups and early-stage businesses. Helps in defining the fundamental components needed for business success.
May not cover all aspects of business modeling and strategy, and it may need to be complemented with more detailed analysis as the business evolves.
Sales Cycle
A sales cycle is the process that a company follows to sell its products or services. It involves a series of steps and interactions between sales representatives and prospects, leading to the closing of a sale. Planning the sales cycle helps in growing business revenues by improving sales effectiveness.
When organizations want to improve sales effectiveness, enhance revenue generation, and provide a structured approach for sales representatives to engage with prospects and close deals.
Provides a structured approach to sales activities, improves sales team efficiency, and ensures a systematic process for converting prospects into customers.
May vary based on the complexity of the sales process and the type of products or services offered. Effectiveness depends on sales team training and execution.
Comparable Analysis
Comparable Company Analysis is a process used to identify and analyze similar organizations that can be used as benchmarks for understanding the business and financial performance of a target company. It helps in assessing the competitive landscape and valuation.
When organizations need to assess the financial and competitive position of a target company, perform valuation analysis, or gain insights into industry dynamics by comparing the target company with similar organizations.
Provides valuable insights into the target company’s financial performance, competitive positioning, and industry benchmarks. Supports informed decision-making in mergers, acquisitions, and investments.
Requires access to relevant financial and market data and may involve challenges in finding truly comparable companies in certain industries or market conditions.
Porter’s Five Forces
Porter’s Five Forces is a model that analyzes the competitive forces within an industry to assess its attractiveness and profitability. It examines the bargaining power of suppliers, buyers, threat of new entrants, threat of substitutes, and competitive rivalry. It helps organizations understand industry dynamics.
When organizations want to gain a better understanding of their industry’s competitive forces, assess market attractiveness, and make strategic decisions based on industry dynamics and competitive positioning.
Provides a structured framework for industry analysis and helps organizations identify competitive advantages and potential threats. Supports strategic planning and decision-making by assessing market dynamics.
May require extensive research and data collection to assess each of the five forces accurately. The model’s effectiveness may vary depending on the industry and market conditions.
AIDA Model
The AIDA Model (Attention, Interest, Desire, Action) is a marketing model that describes the stages a customer goes through before making a purchase decision. It helps organizations understand and optimize the customer journey by focusing on attention, interest, desire, and action.
When organizations want to understand the customer’s decision-making process, improve marketing effectiveness, and optimize the customer journey by tailoring messaging and strategies to different stages of the AIDA model.
Provides a structured framework for understanding and optimizing the customer journey, aligns marketing efforts with customer behavior, and improves messaging and conversion strategies.
May not capture all aspects of the customer decision-making process and may require adaptation to specific industries or target audiences. The effectiveness depends on the relevance of the AIDA model to the business context.
PESTEL Analysis
PESTEL Analysis is a framework used to assess the macroeconomic factors affecting an organization. It examines Political, Economic, Social, Technological, Environmental, and Legal factors. It helps organizations identify potential threats and opportunities in the external environment.
When organizations need to evaluate the impact of external factors on their business, identify potential threats and opportunities, and make informed strategic decisions based on a comprehensive analysis of the macroeconomic environment.
Offers a systematic approach to analyzing external factors, enhances strategic planning by considering a broad range of influences, and helps organizations adapt to changing market conditions.
May require extensive data collection and analysis, and the relevance of specific factors may vary across industries and regions. External factors can change rapidly, requiring ongoing monitoring and adaptation.
Technology Adoption Curve
The Technology Adoption Curve classifies users into five stages: innovators, early adopters, early majority, late majority, and laggards. Each stage represents a psychographic profile of users willing to adopt technology products. It helps in targeting the right audience for tech products.
When organizations want to identify the target audience for technology products, plan marketing strategies, and understand the psychographic characteristics of users at different stages of technology adoption.
Provides a simple framework for targeting the right audience, tailoring marketing efforts, and understanding the adoption patterns of technology products. Helps in aligning product strategies with user preferences.
The adoption curve may not apply universally to all technology products, and user behavior can vary based on product type and context. It may require additional research to validate the adoption stages for specific products.
Business Model Essence
Business Model Essence, according to FourWeekMBA, is a concise description that captures the critical characteristics of any business in a few sentences. It helps analyze existing businesses or draft business models with a focus on key elements for short to medium-term execution.
When organizations want a concise and clear understanding of the critical characteristics of a business, whether for analysis of existing businesses or for creating a strategic focus on key elements for short to medium-term execution.
Provides a simple and focused description of the essential components of a business, facilitating clear communication and strategic alignment. Helps in prioritizing key elements for execution.
May oversimplify complex business models, and its effectiveness depends on the accuracy of the essence in capturing critical characteristics. It may not cover all nuances of the business model.
FourWeekMBA Business Model Framework
The FourWeekMBA Business Model Framework emphasizes two dimensions: the people dimension and the financial dimension. It highlights the importance of creating a product or service that is significantly better than existing offerings and ensuring financial sustainability through effective distribution channels.
When organizations want to develop a comprehensive business model that focuses on delivering superior value to customers, building a strong brand, and achieving financial sustainability through targeted distribution channels.
Emphasizes the dual importance of creating a superior product and achieving financial sustainability. Provides a holistic view of business modeling by considering both people and financial aspects. Helps in strategic planning and execution.
May require careful consideration of brand-building and distribution strategies to ensure success. Effectiveness depends on the ability to deliver a product or service that is significantly better than existing offerings.
A failure mode and effects analysis (FMEA) is a structured approach to identifying design failures in a product or process. Developed in the 1950s, the failure mode and effects analysis is one the earliest methodologies of its kind. It enables organizations to anticipate a range of potential failures during the design stage.
Agile Business Analysis (AgileBA) is certification in the form of guidance and training for business analysts seeking to work in agile environments. To support this shift, AgileBA also helps the business analyst relate Agile projects to a wider organizational mission or strategy. To ensure that analysts have the necessary skills and expertise, AgileBA certification was developed.
Business valuations involve a formal analysis of the key operational aspects of a business. A business valuation is an analysis used to determine the economic value of a business or company unit. It’s important to note that valuations are one part science and one part art. Analysts use professional judgment to consider the financial performance of a business with respect to local, national, or global economic conditions. They will also consider the total value of assets and liabilities, in addition to patented or proprietary technology.
A paired comparison analysis is used to rate or rank options where evaluation criteria are subjective by nature. The analysis is particularly useful when there is a lack of clear priorities or objective data to base decisions on. A paired comparison analysis evaluates a range of options by comparing them against each other.
The Monte Carlo analysis is a quantitative risk management technique. The Monte Carlo analysis was developed by nuclear scientist Stanislaw Ulam in 1940 as work progressed on the atom bomb. The analysis first considers the impact of certain risks on project management such as time or budgetary constraints. Then, a computerized mathematical output gives businesses a range of possible outcomes and their probability of occurrence.
A cost-benefit analysis is a process a business can use to analyze decisions according to the costs associated with making that decision. For a cost analysis to be effective it’s important to articulate the project in the simplest terms possible, identify the costs, determine the benefits of project implementation, assess the alternatives.
The CATWOE analysis is a problem-solving strategy that asks businesses to look at an issue from six different perspectives. The CATWOE analysis is an in-depth and holistic approach to problem-solving because it enables businesses to consider all perspectives. This often forces management out of habitual ways of thinking that would otherwise hinder growth and profitability. Most importantly, the CATWOE analysis allows businesses to combine multiple perspectives into a single, unifying solution.
It’s possible to identify the key players that overlap with a company’s business model with a competitor analysis. This overlapping can be analyzed in terms of key customers, technologies, distribution, and financial models. When all those elements are analyzed, it is possible to map all the facets of competition for a tech business model to understand better where a business stands in the marketplace and its possible future developments.
The Pareto Analysis is a statistical analysis used in business decision making that identifies a certain number of input factors that have the greatest impact on income. It is based on the similarly named Pareto Principle, which states that 80% of the effect of something can be attributed to just 20% of the drivers.
A comparable company analysis is a process that enables the identification of similar organizations to be used as a comparison to understand the business and financial performance of the target company. To find comparables you can look at two key profiles: the business and financial profile. From the comparable company analysis it is possible to understand the competitive landscape of the target organization.
A SWOT Analysis is a framework used for evaluating the business’s Strengths, Weaknesses, Opportunities, and Threats. It can aid in identifying the problematic areas of your business so that you can maximize your opportunities. It will also alert you to the challenges your organization might face in the future.
The PESTEL analysis is a framework that can help marketers assess whether macro-economic factors are affecting an organization. This is a critical step that helps organizations identify potential threats and weaknesses that can be used in other frameworks such as SWOT or to gain a broader and better understanding of the overall marketing environment.
Business analysis is a research discipline that helps driving change within an organization by identifying the key elements and processes that drive value. Business analysis can also be used in Identifying new business opportunities or how to take advantage of existing business opportunities to grow your business in the marketplace.
In corporate finance, the financial structure is how corporations finance their assets (usually either through debt or equity). For the sake of reverse engineering businesses, we want to look at three critical elements to determine the model used to sustain its assets: cost structure, profitability, and cash flow generation.
Financial modeling involves the analysis of accounting, finance, and business data to predict future financial performance. Financial modeling is often used in valuation, which consists of estimating the value in dollar terms of a company based on several parameters. Some of the most common financial models comprise discounted cash flows, the M&A model, and the CCA model.
Value investing is an investment philosophy that looks at companies’ fundamentals, to discover those companies whose intrinsic value is higher than what the market is currently pricing, in short value investing tries to evaluate a business by starting by its fundamentals.
The Buffet Indicator is a measure of the total value of all publicly-traded stocks in a country divided by that country’s GDP. It’s a measure and ratio to evaluate whether a market is undervalued or overvalued. It’s one of Warren Buffet’s favorite measures as a warning that financial markets might be overvalued and riskier.
Financial accounting is a subdiscipline within accounting that helps organizations provide reporting related to three critical areas of a business: its assets and liabilities (balance sheet), its revenues and expenses (income statement), and its cash flows (cash flow statement). Together those areas can be used for internal and external purposes.
Post-mortem analyses review projects from start to finish to determine process improvements and ensure that inefficiencies are not repeated in the future. In the Project Management Book of Knowledge (PMBOK), this process is referred to as “lessons learned”.
Retrospective analyses are held after a project to determine what worked well and what did not. They are also conducted at the end of an iteration in Agile project management. Agile practitioners call these meetings retrospectives or retros. They are an effective way to check the pulse of a project team, reflect on the work performed to date, and reach a consensus on how to tackle the next sprint cycle.
In essence, a root cause analysis involves the identification of problem root causes to devise the most effective solutions. Note that the root cause is an underlying factor that sets the problem in motion or causes a particular situation such as non-conformance.
A break-even analysis is commonly used to determine the point at which a new product or service will become profitable. The analysis is a financial calculation that tells the business how many products it must sell to cover its production costs. A break-even analysis is a small business accounting process that tells the business what it needs to do to break even or recoup its initial investment.
Stanford University Professor Ronald A. Howard first defined decision analysis as a profession in 1964. Over the ensuing decades, Howard has supervised many doctoral theses on the subject across topics including nuclear waste disposal, investment planning, hurricane seeding, and research strategy. Decision analysis (DA) is a systematic, visual, and quantitative decision-making approach where all aspects of a decision are evaluated before making an optimal choice.
A DESTEP analysis is a framework used by businesses to understand their external environment and the issues which may impact them. The DESTEP analysis is an extension of the popular PEST analysis created by Harvard Business School professor Francis J. Aguilar. The DESTEP analysis groups external factors into six categories: demographic, economic, socio-cultural, technological, ecological, and political.
The STEEP analysis is a tool used to map the external factors that impact an organization. STEEP stands for the five key areas on which the analysis focuses: socio-cultural, technological, economic, environmental/ecological, and political. Usually, the STEEP analysis is complementary or alternative to other methods such as SWOT or PESTEL analyses.
The STEEPLE analysis is a variation of the STEEP analysis. Where the step analysis comprises socio-cultural, technological, economic, environmental/ecological, and political factors as the base of the analysis. The STEEPLE analysis adds other two factors such as Legal and Ethical.
Activity-based management (ABM) is a framework for determining the profitability of every aspect of a business. The end goal is to maximize organizational strengths while minimizing or eliminating weaknesses. Activity-based management can be described in the following steps: identification and analysis, evaluation and identification of areas of improvement.
PMESII-PT is a tool that helps users organize large amounts of operations information. PMESII-PT is an environmental scanning and monitoring technique, like the SWOT, PESTLE, and QUEST analysis. Developed by the United States Army, used as a way to execute a more complex strategy in foreign countries with a complex and uncertain context to map.
The SPACE (Strategic Position and Action Evaluation) analysis was developed by strategy academics Alan Rowe, Richard Mason, Karl Dickel, Richard Mann, and Robert Mockler. The particular focus of this framework is strategy formation as it relates to the competitive position of an organization. The SPACE analysis is a technique used in strategic management and planning.
A lotus diagram is a creative tool for ideation and brainstorming. The diagram identifies the key concepts from a broad topic for simple analysis or prioritization.
Functional decomposition is an analysis method where complex processes are examined by dividing them into their constituent parts. According to the Business Analysis Body of Knowledge (BABOK), functional decomposition “helps manage complexity and reduce uncertainty by breaking down processes, systems, functional areas, or deliverables into their simpler constituent parts and allowing each part to be analyzed independently.”
The multi-criteria analysis provides a systematic approach for ranking adaptation options against multiple decision criteria. These criteria are weighted to reflect their importance relative to other criteria. A multi-criteria analysis (MCA) is a decision-making framework suited to solving problems with many alternative courses of action.
A stakeholder analysis is a process where the participation, interest, and influence level of key project stakeholders is identified. A stakeholder analysis is used to leverage the support of key personnel and purposefully align project teams with wider organizational goals. The analysis can also be used to resolve potential sources of conflict before project commencement.
Strategic analysis is a process to understand the organization’s environment and competitive landscape to formulate informed business decisions, to plan for the organizational structure and long-term direction. Strategic planning is also useful to experiment with business model design and assess the fit with the long-term vision of the business.
Gennaro is the creator of FourWeekMBA, which reached about four million business people, comprising C-level executives, investors, analysts, product managers, and aspiring digital entrepreneurs in 2022 alone | He is also Director of Sales for a high-tech scaleup in the AI Industry | In 2012, Gennaro earned an International MBA with emphasis on Corporate Finance and Business Strategy.
