Welcome to IGNOU MBA MS-11 Solved Assignment 2014 Section. All Students can find here Indira Gandhi National Open University (Ignou) Master of Business Administration (MBA) MS-11 Solved Assignment online.
Course Code: MS-11
Course Title: Strategic Management
Assignment No.: MS-11/TMA/SEM-I/2013
Note: Attempt all the questions and submit this assignment on or before 30th April, 2013 to the coordinator of your study center.
Q1. Explain how does the SWOT analysis helps in formulation of strategies for different business situations. Illustrate your answer with the help of examples.
Solution: SWOT Analysis is a useful technique for understanding your Strengths and Weaknesses, and for identifying both the Opportunities open to you and the Threats you face. What makes SWOT particularly powerful is that, with a little thought, it can help you uncover opportunities that you are well placed to exploit. And by understanding the weaknesses of your business, you can manage and eliminate threats that would otherwise catch you unawares. More than this, by looking at yourself and your competitors using the SWOT framework, you can start to craft a strategy that helps you distinguish yourself from your competitors, so that you can compete successfully in your market.
SWOT is an acronym that stands for "strengths, weaknesses, opportunities and threats." SWOT is an analytical tool that allows you to identify internal factors, strengths and weaknesses of your company, along with external factors, opportunities and threats. Once you have identified the various components in a SWOT analysis, you can use each item to formulate a strategy to take action.
•Identify the overall goal and purpose of the analysis. You'll want to define this clearly before beginning the SWOT analysis. For example, one objective might be to determine how to expand your business to a wider market.
•Write down a list of strengths that can be attributed to your existing organization for the
objective you defined in Step 1. For example, if your company has run successful marketing campaigns in the past, this may be a strength.
• Write down a list of weaknesses that can be attributed to your existing organization. For example, your company may not have the manpower to complete the work that needs to be completed to expand the business.
•Write down list opportunities that are external to your existing organization. These opportunities will have a positive impact on your objective. For example, if a competitor changes its focus and may no longer be a direct competitor.
•Write down a list of threats that are external to your organization. For example, the economy being in a recession can be an external threat.
•Analyze and write down strategies to take advantage each strengths and opportunities and to minimize weaknesses and threats. Use these strategies to take action towards your overall goal or objective
A start-up small consultancy business might draw up the following SWOT Analysis:
•We are able to respond very quickly as we have no red tape, and no need for higher management approval.
•We are able to give really good customer care, as the current small amount of work means we have plenty of time to devote to customers.
• Our lead consultant has strong reputation in the market.
•We can change direction quickly if we find that our marketing is not working.
•We have low overheads, so we can offer good value to customer
Q2.An organization can choose from different types of Growth Strategies”. Explain any two of
the growth strategies you have studied and highlight the conditions under which each is the most
Solution: The term strategy means a well planned, deliberate and overall course of action to achieve
specific objectives. According to chandler, “strategy is the determination of the basic long term goals
and objectives of an enterprise and the adoption of courses of action and the allocation of resources
necessary to carry out these objectives”. The concept of strategy has been derived from military
administration wherein it implies ‘Grand’ military plan designed to defeat the enemy. As applied to
business, strategy is a firm’s planned course of action to fight competition and to increase its market
The following are the main growth strategies available to firms:
1. Intensive Growth Strategy (Expansion)
4. External Growth Strategy
Intensive Growth Strategy:
Intensive growth strategy or expansion involves raising the market share, sales revenue and profit of the
present product or services. The firm slowly increases its production and so it is called internal growth
strategy. It is a good strategy for firms with a smaller share of the market.
Three alternative strategies are available in this regard. These are:
(a) Market Penetration – This strategy aims at increasing the sale of present product in the presented
market through aggressive promotion.
The firm penetrates deeper into the market to capture a larger share of the market.
For example, promoting the idea of cold coffee during the summer season, also the idea of instant
coffee, instant tea and tea bags.
(b) Market Development – It implies increasing sales by selling present products in the new markets. For
example selling electronic goods in rural areas or sale of chocolates to middle aged and old persons.
Market development leads to increase in sale of existing products in unexplained markets.
(c) Product Development: In this, the firm tries to grow by developing improved products for the
present market. For example, A.C. with remote control, Refrigerator with automatic refreezing and
The firm which is concerned with production and is completely dependent on production for its profits
and development should adopt the strategies like intensive growth so that they can improve their
production which would indirectly result in increase in the profit.
A firm may use the strategy of modernization to achieve growth. Modernization basically involves up
gradation of technology to increase production, to improve quality and to reduce wastages and cost of
production. The worn-out and obsolete machines and equipment are replaced by the modern machines
and equipment. Modernization plans can have the following implications:
A firm may go for modernization at a low pace to maintain its position in the market. Thus, it
may be considered a stability strategy.
Modernization may be used with full strength to achieve internal growth. Thus, it is used as an
internal growth strategy.
This type of growth strategy is basically used in the firm who are widely connected with development
and modernization. Firms like telecommunication and mobile firms must really accept this type of
strategies as they need to be in connected with the modern market and the time.
Q3.List out the steps involved in a decision making process. Explain using a hypothetical example how
a decision making process can be followed using the steps listed by you.
Solution: Decision making can be regarded as the mental processes resulting in the selection of a course
of action among several alternative scenarios. Every decision making process produces a final choice.
The output can be an action or an opinion of choice.
What are the Steps Involved in Decision-making?
Step 1: The first step is to understand the importance of making the decision. You would have to make a
list of some important factors like -
Time required to make the decision
Result of making a good and a bad decision
People who would help you
Who will face the consequences of the decision?
Affect of the decision on you and the people around you
What will happen if the decision is not made?
Step 2: Every decision is made to achieve some kind of goal or objective. So, the next step would involve
charting down the goals that you want your decision to achieve
Step 3: For a person to make a decision, he or she has to be confronted with two or more options. If
there is no option, making a decision would be impossible. So, the third step requires you to make a
draft stating the options that are available to you
Step 4: Step 4 is where you have to analyze the different options in detail. Your analysis would be on the
basis of what would be the result of each option available to you.
Step 5: At this step, you have to develop some criteria, according to which you have to compare the
various options available to you. These criteria are conditions that would help you in evaluating the
different options and would aid you in taking the decision.
Step 6: Once you have decided on the criteria, it is time for analysis of each option according to the set
conditions. Make a table, where the criteria appears in columns and options appear in rows. Rate each
option with a numerical digit, as per how it would be beneficial for each criterion.
Step 7: After rating the available options according to criteria, at the seventh step, try to combine
different options that are available to you and see whether you can come up with a better solution,
instead of just choosing one option
Step 8: This is the final stage, where you have to make the ultimate decision. Before you do this it is
important to go through all the steps and recheck all the information. This would be beneficial for
delaying the time of taking the final decision, if you find any missing information. One very important
thing that you have to keep in mind is that every decision you take would have some level of risk.
Knowing the potential risk involved in the decision one makes would aid in preparing for the problem
that arises with the decision.
For Example: Military system.
Step1. Receipt of Mission.
Step 2. Mission Analysis.
Step 3. Course of Action Development.
Step 4. Course of Action Analysis
Step 5. Course of Action Comparison.
Step 6. Course of Action Approval.
Step 7. Orders Production.
Step 8. Recheck Everything.
Q4.Explain the concept of Critical Success Factors (CSF’s). Discuss with the help of an example the role
of CSF’s for an organization in a highly competitive market.
Solution: Critical success factors (CSFs) have been used significantly to present or identify a few key
factors that organizations should focus on to be successful. As a definition, critical success factors
refer to "the limited number of areas in which satisfactory results will ensure successful competitive
performance for the individual, department, reorganization. Identifying CSFs is important as it allows
firms to focus their efforts on building their capabilities to meet the CSFs, or even allow firms to decide if
they have the capability to build the requirements necessary to meet critical success factors (CSFs).
Critical Success Factors (CSF’s) are the critical factors or activities required for ensuring the success
your business. The term was initially used in the world of data analysis, and business analysis.
Most smaller and more pragmatic businesses can still use CSF’s but we need to take a different, more
Critical Success Factors have been used significantly to present or identify a few key factors that
organizations should focus on to be successful.
As a definition, critical success factors refer to “the limited number of areas in which satisfactory results
will ensure successful competitive performance for the individual, department, or organization”.
Role of CSFs:
CSFs are the essential areas of activity that must be performed well if you are to achieve the mission,
objectives or goals for your business or project.
By identifying your Critical Success Factors, you can create a common point of reference to help you
direct and measure the success of your business or project.
As a common point of reference, CSFs help everyone in the team to know exactly what's most
important. And this helps people perform their own work in the right context and so pull together
towards the same overall aims.
The idea of CSFs was first presented by D. Ronald Daniel in the 1960s. It was then built on and
popularized a decade later by John F. Rockart, of MIT's Sloan School of Management, and has since been
used extensively to help businesses implement their strategies and projects.
Inevitably, the CSF concept has evolved, and you may have seen it implemented in different ways. This
article provides a simple definition and approach based on Rockart's original ideas.
CSFs are best understood by example. Consider a produce store "Farm Fresh Produce", whose mission
"To become the number one produce store in Main Street by selling the highest quality, freshest
farm produce, from farm to customer in under 24 hours on 75% of our range and with 98% customer
The strategic objectives of Farm Fresh are to:
Gain market share locally of 25%.
Achieve fresh supplies of "farm to customer" in 24 hours for 75% of products.
Sustain a customer satisfaction rate of 98%.
Expand product range to attract more customers.
Have sufficient store space to accommodate the range of products that customers want.
In order to identify possible CSFs, we must examine the mission and objectives and see which areas
of the business need attention so that they can be achieved. We can start by brainstorming what the
Critical Success Factors might be (these are the "Candidate" CSFs.)