The strategic thinking of modern business organizations has been shaped by militant strategists since 400BC when Sun Tzu wrote the Art of War scenario planning. Sun Tzu wrote the Art of War, which has been adopted into a business strategy book. In Sun Tzu’s Art of War, he spoke about several fundamental factors in military strategy and each of these factors relates to a popular concept of business strategy. Sun Tzu’s thoughts about the factor of terrain, if we were to take that into the context of companies competing today, translates to scenario analysis example, industry structures, value propositions, and Porter’s Five Forces.
Various sized organizations naturally go through different growth challenges and thus, take on different strategies to managing their business strategy scenario analysis example. Some businesses companies may be in the beginning growth stages, whereas more established Fortune 500 companies are in the sustain phase. A SME may be more entrepreneurial in its approach to business growth and its operations is usually more nimble and lean.
Skimming the market involves introducing the new product at a relatively higher price scenario planning. Next, as competition increases, the pricing is dropped. As more the market becomes more competitive and drive up product supply, pricing will organically lower. This pricing strategy allows the organization to quickly capture share of the market and top line growth via capturing to the early majority. Price skimming scenario planning allows the company to maximize its profit margin by charging the maximum price customers are willing to pay. Price skimming is many times called riding down the scenario planning curve.
Strategy development has gone through several defining phases since the early 1900s scenario planning. Business strategy development started with a focus on financial planning in the 1950s, moving to long-term corporate planning in the 1960s, to strategic planning in the 1970s and eventually to a focus on strategic management in the present day. Today, the strategic development theme is on integrating strategic planning and execution with a stress on the primary notions of core competencies, strategy planning and execution, and balance scorecard analysis. Much of business scenario planning is also hinged on ideas in the 1970s, where the core theme was around thinking strategically to beat competition and the scenario planning business frameworks of alternative strategies, portfolio analysis, and the BCG Growth Share Matrix were actively used for the first time. There are several types of scenario planning challenges that can be ascertained from our discussion thus far scenario analysis. There is the strategic challenge of aligning execution context, so that strategy can materialize. Setting strategic intent involves setting objectives, developing business battlefields, and choosing the required scenario planning. A noteworthy strategic challenge is ambiguity, as it relates to both the challenge and strategy development approach.
Source
http://learnppt.com/powerpoint/67_Scenario-Planning.php
http://en.wikipedia.org/wiki/Simulation_game
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