Strategic analysis– Every company needs a business plan . Many entrepreneurs are tempted to start up their business without analyzing anything previously and just cross their fingers waiting for it to go well. And it could be that yes, but most likely not. The idea is to carry out a detailed preliminary analysis of the sector and the market in which we intend to enter. There are numerous free strategic analysis tools that can help us to identify what distinguishes our brand from the rest and develop a good business plan for our future company. These are some of them. Strategic analysis tools to develop a good business plan
5 Ideal strategic analysis tools to develop a business plan
PEST analysis
With this strategic analysis tool, we can analyze the environment in which we want to create or establish our company, business or project. It allows us to identify possible scenario changes in our sector or in the region to detect and take advantage of possible growth opportunities. The name is an acronym of four factors:
Political: political stability, the possibility of a change of government that leads to changes in fiscal policies or in the matter of subsidies, possible changes in trade agreements, the existence or not of pressure groups …
Economic: a growing economy or recession, consumption trend, the situation of confidence or instability, exchange rates, level of inflation …
Horticultural: social habits, changes in the tastes or fashions of people, habitual forms of communication, demography, health, values …
Technological: current technology, possible advances, ongoing developments, knowledge, investment in R & D, information …
We must analyze to what extent each of these macro environmental factors could have a positive or negative influence on our company.
PESTLE Analysis
It is a variation of the previous one that adds two more factors to the four of the PEST analysis. In addition to taking into account political, economic, social and technological factors, factors will also be analyzed:
Ecological: for example, climate change can have consequences in various sectors such as tourism or insurance. Environmental protection laws or regulations on waste or energy management can also influence a company.
Legal: anti-discrimination laws, consumer protection laws, antitrust laws, licenses, labor legislation, health protection laws, sectors with special protection …
SWOT Analysis
It is a strategic analysis tool that allows us to analyze the internal and external situation of a company or project. It’s like taking a picture of the situation of our company. Therefore, given that this situation is not static, but evolves continuously over time, in addition to using it to develop the business plan of our company, it is good to repeat it later every so often . The objective is to know the real situation in which the organization, company or project is at each moment and, based on this, plan the most appropriate future strategy. The name of this analysis tool is an acronym of Strengths, Opportunities, Weaknesses and Threats. The strengths and weaknesses are part of the internal analysis, that is, of the things we can control, while the opportunities and threats are part of the external analysis, that is, things that are external to our company that we can not control because they do not depend on US. To analyze the data, a matrix is prepared:
Model of the 7 S
Unlike most strategic analysis tools that tend to focus on external analysis, the 7 Model, developed in the early 1980s by Tom Peters and Robert Water man, two consultants from McKinney & Company, aims to directly inside our company. The model analyzes , specifically, 7 factors, whose names in English begin with S (hence the name of the tool, the 7 S) and which, according to its authors, are the 7 fundamental factors of any organizational structure:
- Strategy ( Strategy )
- Structure ( Structure )
- Systems ( Systems )
- Style ( Style )
- Shared values ( Shared values )
- Personal ( Staff )
- Skills ( Skills )
The idea of the model is that organizations do not operate as a set of sealed silos, but rather as a network of interconnected pieces. That is why it is fundamental that the seven factors included in the model are aligned so that our company can succeed. In this sense, when implementing any new strategy, you should check previously all of them would maintain their alignment, once implemented. If the answer is not for all or part of the factors, it will be necessary to rethink part or all of the strategy before proceeding to its implementation. To see it more clearly, it is best to draw an octagon and place each of the S’s in one of its vertices. Except the shared values that, as they are shared, we will place them in the center of the octagon. Next, we will draw lines that go from each vertex to the others. The 5 forces of Porter
This tool of strategic analysis, devised by the engineer and professor Michael Porter in 1979, is still valid. The model defines a framework that allows us to analyze the level of competition within a sector in order to devise, thus, a business strategy that makes our company profitable. In this sense, it is ideal to prepare a business plan, since it is essential to analyze the competition before creating a company , so this model is especially interesting for entrepreneurs. The five forces of Porter are the following:
- Bargaining power of buyers or customers
- Bargaining power of suppliers or sellers
- Threat of new competitors
- Threat of substitute products
- Rivalry among competitors
EXTRA: Blue ocean strategy
This tool, more than to elaborate our business plan, is ideal to make us think and see how we want to focus our company. A blue ocean strategy is what can lead our company to success. That’s why every entrepreneur should know this tool and, before setting up his dream company, spend some time thinking about what his blue ocean strategy may be. This video explains perfectly what a blue ocean strategy consists of.
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