Strategic Management

I. SITUATIONAL ANALYSIS OF STRATEGIC FACTORS

A situational analysis of strategic factors is a process by which mission statements, objectives, strategies and policies of a company are analyzed and studied for relevance, functionality, and practicality. The end result would be a snap-shot of information that would allow executives to review and evaluate the current method of operations and make informed decisions on how to improve processes that are directly or indirectly tied to the execution of the company's mission statement. "SWOT is an acronym used to describe those particular Strengths, Weaknesses, Opportunities, and Threats that are strategic factors for a specific company" (Wheelen & Hunger, 2004, p.109).

Before any recommendations or changes are made, a company should undergo an objective analysis as such as this to ensure that they will achieve the desired end-result. If a company implements changes without completing this major step, you can guess where you would like to end up - but you can't really effectively be able to chart and follow a path. This whole process can be referred to as strategic planning.

There are both internal and external factors that need to be considered as part of any strategic plan. The external environment consists of variables such as opportunities and threats. Opportunities and threats generally are influenced by financial elements that are market-driven. They are factors that exist and influence the company's success but these influences are outside of the organization. The internal environment of a corporation consists of variables strengths and weaknesses that exist and/or driven from within the organization. One very effective way to organize/summarize data from a SWOT analysis is by compiling a Matrix. The following is a SWOT matrix for the Handspring Corporation based on information found in our textbook.

SWOT Matrix

STRENGTHS WEAKNESSES

Distribution: Increased alliances with telecommunication service providers. Inability to keep up with increasing costs of developing new technologies

Marketing Strategies: Dedicated resources to a costly marketing and advertising campaign. Limited resources compared to competition.

Research & Development: Ability to focus on resources used for