The first two issues in appraising resources for strategic marketing planning relate to the important areas of attribute selection and the evaluation of those attributes as true strengths or weaknesses. The second of these, i.e. the evaluation of strengths and weaknesses, involves both the identification of distinctive competences and assessment of competitor strengths and weaknesses in the same areas. Simple profiling systems may be used to address both these issues and are now described. Having identified key resources or attributes for our strengths and weaknesses evaluation, we can then score our company with respect to these key attributes or resources using a simple numerical scale. Once this is completed for each attribute we can then repeat the process for each of our key competitors.
Admittedly, this second part of the process is not easy, but it is extremely useful. In this way we can build up a series of ‘profiles’ of our own and competitor strengths and weaknesses, which in turn can be used to delineate and select future strategies. Although such profiling enables a systematic approach to be made when evaluating strengths and weaknesses, inevitably the resultant profiles will depend on who is carrying out the evaluation. For example, the marketing manager may have a very different view of, say, product quality from that of the production manager. This brings us to the question of how we might organize and conduct the appraisal procedure.
Key attributes scale
Strengths and weaknesses: company and competitor profiles
How should we organize and conduct the appraisal?
Even though a company’s approach to evaluating strengths and weaknesses may be systematic, it may not always be objective. Perhaps inevitably the evaluation is likely to be subjective, especially when it is carried out by managers of that company. After all, most people find it difficult to be objectively self-critical. For this reason it is preferable to use an inter-functional team approach to internally based assessment systems. Where a company can call in external consultants to make the assessment, this is better. Not only are customers likely to be more objective and thorough, but it is customers’ perceptions of our strengths and weaknesses which are critical. The customer will not necessarily be in a position to make a full assessment (e.g. on finance and production), but is capable of appraising perceived marketing strengths and weaknesses.
A related problem with company staff being involved in strengths and weaknesses assessment is that the process is often seen as being threatening; a fact that can severely detract from the objectivity of the exercise. Properly administered, the effective use of a SWOT analysis delivers key benefits over and above its obvious input to the marketing plan. In particular, SWOT analysis helps foster collaboration and information exchange between different functional areas of the business. In turn, this can help create an environment of creativity and innovation. In order to achieve this benefit, the SWOT analysis process should be approached positively. In particular, it must not be used to criticize functions or individuals in the organization whenever weaknesses are identified.
How can we interpret and use the outcome of strengths and weaknesses assessment?
The assessment of a company’s strengths and weaknesses is not an end in itself. This assessment should feed into, and affect, the process of strategic market planning. Some of the major uses of the outcome of a strengths and weaknesses assessment, together with major strategic planning concepts which accompany this use are now described.
Matching strengths and weaknesses to opportunities and threats: the concept of ‘strategic fit’
Environmental monitoring is important to assess opportunities and threats which might face an organization. Only when a company has assessed its own strengths and weaknesses, is it in an objective position to evaluate what constitutes a company marketing opportunity or threat. By carefully matching environmental trends and changes to its own particular blend of distinctive competences the strategic marketing planner is able to devise strategies which build on the company’s strengths, while at the same time minimizing its weaknesses. By so doing, the planner aims to achieve a ‘strategic fit’.
Responding to environmental changes and trends:
the concept of ‘strategic windows’
A key feature of the environment is that it is constantly changing. Because of this, both the opportunities and threats assessment and the assessment of company strengths and weaknesses (SWOT analysis) should be carried out at regular intervals. If a company does not do this, then over time it is likely to find that a previously good ‘strategic fit’ has changed. In a changing environment there are often only limited periods when the fit between the distinctive competences of a company and the opportunities presented by the environment are at optimum positions. Abell18 has referred to such periods as ‘strategic windows’; unless the organization acts quickly (which requires an effective system of SWOT analysis) then these windows will close. He suggests that the ‘strategic window’ concept can be used both by companies already in a market and by would-be entrants.
For incumbents, the concept enables the assessment of future strategies to take account of changes in the environment, and in particular to assess the allocation of resources to existing activities. For the new entrant, the concept provides a framework for assessing possible diversification and new market entry opportunities based on matching these to organizational strengths.
The 1990s witnessed a large increase in the number of people living alone. This group comprises several segments including, for example, young people leaving home for the first time, newly divorced individuals and new widows and widowers. It is primarily the first two of these groups which account for the increase in the demand for small, one-person dwellings that are easily managed and affordable. The builder and developer, Barratt, were one of the first companies to spot this trend and develop homes and marketing programmes to fill this need. Barratt developed a competitive edge by being amongst the first to spot this strategic window of opportunity.
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Marketing Management Tutorial
Development Of A Strategic Approach To Marketing: Its Culture; Internal Macro- And External Micro-environmental Issues
Markets And Customers: Consumer And Organizational Buyer Behaviour And Marketing Strategy
Markets And Customers: Market Boundaries; Target Marketing
Product And Innovation Strategies
Channels Of Distribution And Logistics
Customer Care And Relationship Marketing
Marketing Information Systems And Research
Analysing The Environment: (opportunities And Threats) And Appraising Resources (strengths And Weaknesses)
Evaluating And Controlling Strategic Marketing
Strategic Marketing Planning Tools
Services Marketing And Not-for-profit Marketing
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