MGT602 Technical Article Theme 8

Author: Sara Hussain, Lecturer Business Administration, Virtual University of Pakistan

Technical Articles Theme 08

Title: Strategic Management in Entrepreneurship and E-Commerce

Videos: 87-104

Topics Covered

87. Strategic management in entrepreneurship
88. Strategic Management Process
89. Clear Vision and mission of business venture
90. Assessment of strength and weakness of yourself and venture
91. Scan environment for potential opportunities and threats
92. Create short term and long term long
93. Select appropriate strategies
94. Building competitive advantage for new venture
95. analysis competition
96. Strategy review, evaluation and control
97. Innovation logic: the blue ocean strategy (Part 1)
98. Innovation logic: the blue ocean strategy (Part 2)
99. Innovation logic: the blue ocean strategy (Part 3)

Q100. The interview with an entrepreneur 1: How to lead the competition or making competition irrelevant?

101. E-commerce and the entrepreneur
102. Myths of E-commerce and challenges
103. Tech entrepreneurship and academia linkage

Q104. The interview with an entrepreneur 2: What are the challenges of online businesses?

Strategic Management and its Role in Entrepreneurship

Strategic management and entrepreneurship are somehow related to each other. Strategy is an action plan that synchronizes the tangible and intangible resources and for achieving a set target for superior performance. A person might have a unique business idea but he cannot grow properly if he is unable to execute it with proper strategy. Strategic management is a branch of management. It is essential for managing organizational tangible and intangible resources to achieve its long term and short term goals and objective for sustainable competitive advantage in industry. There are three main phases of strategic management namely Strategy formulation, strategy implementation, Strategy evaluation and control. The main areas covered under strategic management are business vision and mission, internal and external environmental scanning, strategies formulation, analyzing the multiple strategies, sustainable competitive advantage for sustainable growth, implementation and operational execution of strategies, Strategies review, measures and control.

Strategic management can be divided in three broad categories i.e. strategy formulation, implementation and evaluation. Vision, mission, long term and short term goals and objectives, environmental scanning, strategies analysis and choices, business models and competitive advantage are all part of strategy formulation. Structures, designs and polices development, managing and allocating resources, functional areas e.g. marketing, finance, R&D and HR along with putting strategies into real time operations are part of strategy implementation. Strategy review, quality and control, corrective measures and revisiting strategies are all part of strategy evaluation. Creation and growth, diversification, performance of firms, industry dynamics, competitive advantage Mergers, acquisitions, alliances innovation and product ecosystems are some overlapping areas of strategic management and entrepreneurship.

Strategic management process is a method by which entrepreneurs assess their idea’s viability and implement an appropriate strategy that can ensure to a sustainable competitive advantage of venture. This process starts with initial assessment which includes vision and mission. Next comes situation analysis which includes SWOT analysis i.e. analysis of strengths, weaknesses, opportunities and threats. When it comes to strategy formulation there is need to have a look at objectives, business level, corporate level, and global strategy selection. At the phase of strategy implementation policies, resource allocation, change management, organizational chart and structure are designed and redesigned. After design and implementation strategic monitoring comes in action through which performance is measured.

Vision statement defines the anticipated future orientation of the business venture whereas mission statement outlines the company’s business, objectives and its approach to reach those objectives.

A good mission and vision statement must have a philosophy. Vision and mission statement must be aligned with each other. These must be customer and market oriented. Technology must be reflected. Competitive advantage, concern for society, concern for employees and future orientation must also be reflected in vision or mission statement. Main questions to be asked while planning for a business are:

 What is your general business description?

 What is your business model?

 Is it sustainable viable business idea?

There are a lot of benefits of defining vision and mission statement. Clear vision and mission statement brings unanimity of purpose and direction among strategic partners. It provides standards and procedures for execution plan. Brings focus in allocation of resources. Establish a culture and tone of your venture. Serve as a direction and quality standard. Set rule to deter those strategic partners who cannot from participate for further growth. Facilitate in translating the longterm and short-term goals and objectives into a work structure. It also motivates for future growth.

For starting a new venture SWOT analysis of the business and individual himself must be done. SWOT stands for strengths, weaknesses, opportunities and threats.

Strengths are the positive internal factors that a business venture can use to achieve its vision, mission, goals and objectives. Weaknesses are the negative internal factors that inhibit the business venture’s capability to achieve its vision, mission, goals and objectives. It adversely affect the sustainable competitive advantage of a venture. Following is the checklist of own/individual assessment:

 Am I clear about my destination?

 Are my skills sufficient for kick start or growth?

 What are my limitations?

 In which area I am lacking that could adversely/positively affect my venture establishment or growth?

 Is my network worthy for establishment/growth?

 What level of commitment I can bring in my venture?

Following is the checklist of venture assessment: