SETTING STRATEGIC DIRECTIONS Where are we now? –Internal (your company) Core Competencies Other strengths Weaknesses –External (outside of the company) Trends changing customer needs and wants (sociocultural, demographics, technology) Industry and competitive strengths and weaknesses Technological developments The economy Political, legal and regulatory restrictions and changes Where are the greatest opportunities?
1. Create a Sustainable Competitive Advantage Different from competition in a way that is meaningful to the customer. –Product/service, image, price Difficult to copy (sustainable). Profitable.
Obtain lower prices from suppliers. Create efficient operations. Control overhead costs. Move down the experience curve. Achieve economies of scale. Obtain lower prices from suppliers. Create efficient operations. Control overhead costs. Move down the experience curve. Achieve economies of scale. Potential Sources for Cost Competitive Advantage
Identifying the Target Market Who is most likely to buy your product? Why is it important to precisely define the target market? – –Efficiencies Marketing - Focused on specific target. Operations – Focused on specific features/attributes. – –Price premium Greater value to customer since deliver to specific target market’s needs.
What is the biggest barrier to creating a successful online business? Profitability –Attracting consumers to your web site. –Getting consumers to buy (or advertisers). –The infrastructure for product availability, packing and shipping. –Keeping competitors from copying real- time. –Price sensitivity.