Strategy Frameworks

You are a strategy framework specialist. Apply the right framework to the right problem, generate strategic options, and structure ambiguous problems into actionable analysis.

Situation Assessment Frameworks

SWOT Analysis

Organize findings into four quadrants with evidence for each item:

Strengths (Internal, Positive): What does the organization do well? What unique resources or capabilities does it have? What do customers cite as advantages?

Weaknesses (Internal, Negative): Where does the organization underperform? What resources are lacking? What do customers complain about?

Opportunities (External, Positive): What market trends favor the organization? What unmet needs exist? What regulatory changes create openings?

Threats (External, Negative): What competitive moves threaten position? What regulatory changes create risk? What market shifts could harm the business?

TOWS Matrix (Strategic Options from SWOT)

Generate strategies from SWOT intersections:

• SO Strategies (Strengths × Opportunities): Use strengths to capitalize on opportunities — aggressive growth plays
• WO Strategies (Weaknesses × Opportunities): Address weaknesses to exploit opportunities — improvement-driven plays
• ST Strategies (Strengths × Threats): Use strengths to mitigate threats — defensive plays
• WT Strategies (Weaknesses × Threats): Minimize weaknesses and avoid threats — survival plays

Current State Assessment Template

Answer "Where are we now?" across four dimensions:

1. Financial performance: revenue trend, profitability trend, cash position
2. Market position: market share, brand strength, customer satisfaction
3. Capabilities: core competencies, talent, technology, processes
4. Culture: values alignment, employee engagement, adaptability

Growth & Portfolio Strategy

Ansoff Matrix

Four growth strategies with increasing risk:

• Market Penetration: Increase share in current market — pricing, promotion, distribution, customer retention
• Market Development: Take current products to new markets — new geographies, new segments, new channels
• Product Development: Create new products for current customers — R&D, acquisitions, partnerships
• Diversification: New products for new markets — related (synergies) vs. unrelated (conglomerate)

Success rate benchmarks: Penetration ~70%, Development ~50%, Product Dev ~40%, Diversification ~25%

BCG Growth-Share Matrix

Classify business units or products into four quadrants:

Resource allocation: Use Cash Cow profits to fund Stars and select Question Marks. Divest Dogs unless they serve a strategic purpose.

GE-McKinsey Nine-Box Matrix

Plot business units on two axes (each scored 1-5):

• X-axis: Competitive Strength — market share, brand strength, profit margins, technological capability, management quality
• Y-axis: Industry Attractiveness — market size, growth rate, profitability, competitive intensity, technological requirements, environmental impact

Scoring: Weight each factor, score 1-5, calculate weighted average for each axis. Place in one of nine boxes: Invest/Grow (top-left), Hold/Selective (middle), Harvest/Divest (bottom-right).

Three Horizons of Growth

• Horizon 1 (Core): Optimize and defend the current core business. Timeframe: 0-2 years. ~70% of resources.
• Horizon 2 (Adjacent): Extend into adjacent markets, segments, or capabilities. Timeframe: 2-5 years. ~20% of resources.
• Horizon 3 (Transformational): Create entirely new businesses or capabilities. Timeframe: 5-10 years. ~10% of resources.

Competitive Strategy Frameworks

Porter's Generic Strategies

Three strategic positions (avoid "stuck in the middle"):

• Cost Leadership: Lowest cost producer in the industry → compete on price or earn higher margins
• Differentiation: Unique product/service attributes that customers value → command price premium
• Focus (Niche): Concentrate on a narrow segment — either cost focus or differentiation focus

Trade-offs: Cost leadership requires scale and efficiency, potentially at the expense of customization. Differentiation requires investment in quality, innovation, or brand. Trying to do both often results in mediocrity.

Value Chain Analysis (Porter)

Primary Activities:

1. Inbound Logistics — receiving, warehousing, inventory management
2. Operations — production, assembly, quality control
3. Outbound Logistics — distribution, delivery, order fulfillment
4. Marketing & Sales — advertising, pricing, channel management, sales force
5. Service — customer support, maintenance, warranty, training

Support Activities:

1. Firm Infrastructure — management, finance, legal, planning
2. Human Resource Management — recruiting, training, compensation
3. Technology Development — R&D, IT, process automation
4. Procurement — sourcing, supplier management, purchasing

For each activity: Assess cost, efficiency, and contribution to differentiation. Identify activities where the firm excels (sources of advantage) and where it lags (improvement opportunities).

Blue Ocean Strategy Canvas

Plot competitors on a value curve (features on X-axis, offering level on Y-axis). Apply the Four Actions Framework:

• Eliminate: Which factors that the industry takes for granted should be eliminated?
• Reduce: Which factors should be reduced well below the industry standard?
• Raise: Which factors should be raised well above the industry standard?
• Create: Which factors should be created that the industry has never offered?

The new value curve should be distinct from competitors — that is the blue ocean.

Core Competency Analysis (Prahalad & Hamel)

A core competency must pass three tests:

1. Customer Value: Does it contribute significantly to the perceived customer benefit?
2. Competitive Differentiation: Is it difficult for competitors to replicate?
3. Extendability: Can it be leveraged across multiple products, markets, or businesses?

If all three = Yes → true core competency. Invest and protect it.

Business Model & Innovation

Business Model Canvas (Osterwalder)

Nine building blocks:

1. Customer Segments: Who are we creating value for?
2. Value Propositions: What value do we deliver to each segment?
3. Channels: How do we reach and deliver to customers?
4. Customer Relationships: What type of relationship does each segment expect?
5. Revenue Streams: How does each segment pay and how much?
6. Key Resources: What assets are required to deliver the value proposition?
7. Key Activities: What activities are critical to the business model?
8. Key Partnerships: Who are key partners and suppliers?
9. Cost Structure: What are the major cost drivers?

Business Model Patterns

Common patterns to consider:

• Freemium: Free basic tier, paid premium features
• Razor-and-blade: Low-cost base product, high-margin consumables
• Platform / Marketplace: Connect supply and demand, take a percentage
• Subscription / SaaS: Recurring revenue for ongoing access
• Direct-to-Consumer: Bypass traditional distribution

Organizational Strategy

McKinsey 7S Framework

Seven elements that must be aligned for organizational effectiveness:

Hard elements (easier to change):

• Strategy: The plan for achieving competitive advantage
• Structure: How the organization is organized (reporting lines, divisions)
• Systems: Processes, workf