Effective organizations operate under the careful direction of their owners, directors and managers. These individuals set corporate-level strategic analysis operations to determine their efficiency.
Corporate level strategic analysis uses several tools, including political, economic, social and technological (PEST) analysis, scenario planning, five forces analysis and SWOT analysis. PEST analysis examines the company’s operating environment, while scenario planning involves creating different executable plans. Five forces analysis looks at the internal or external factors influencing business operations, and SWOT outlines the company’s strengths, weaknesses, opportunities and threats.
Strategic analysis can help a company plan which strategy it should employ in the business environment. These strategies include growing operations by diversifying operations, stabilizing operations to maximize profits or retrenchment, in which the companies may consolidate operations to improve functionality or longevity.
Analyzing business operations is a control measure that helps business owners and managers ensure their company is running as best as possible. Instituting strategies with measurable results helps to understand the return on investment and gauge the value added to the company.