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Strategic Planning Models in Business: 'Model Accountants'

Business Aspects of Management Accounting

Strategic models

This is intended to make you think about the use of strategic planning models in businesses. These models were devised to help businesses analyse their strategic position and to help them formulate successful strategies.

To undertake this work you should first read the article "Model Accountants". For details of the article see the reading list at the end of this brief.

After reading the article you should select one of the models discussed in it. For the model you select you should:

1. Explain the purpose of the model and how it was envisaged that it would inform business strategic decision making.
2. Assess the extent to which the model provides a useful tool for businesses
3. Comment on the usefulness of the model to businesses in the current business environment.
4. Use specific examples from the literature to illustrate the use of the model

In order to answer the questions you should refer to high quality reference and research papers. When discussing your chosen model, you should refer to the original publication and not the summary in "Model Accountants". In addition to any items listed below in the reading for this assignment you should chose up to 8 additional sources. For each of these additional sources you should complete the Article Choice sheet attached to this assignment.

Reading List:

Ansoff I H (1957) Strategies for Diversification Harvard Business Review; Sep/Oct57, Vol. 35 Issue 5, p113-124, 12p,
Henderson B (1970) The Product Portfolio BCG Perspectives. Available on-line at (registration required for access)
Johnson S (2006) Model Accountants ACCA Student Accountant April 2006
Porter M (2008) The Five Competitive Forces That Shape Strategy Harvard Business Review January 2008

Assessment Criteria:

Has the student explain in a coherent and accurate manner the way in which the chosen model helps businesses make strategic decisions?

Has the student produced a well constructed assessment of whether the model provides a useful tool for businesses?

Has the student made a clear assessment of how the selected model relates to businesses in current market conditions?

Has the student given appropriate, current examples to back up their analysis?

Has the student chosen appropriate sources upon which to base their analysis and provided clear reasons for their choices and displayed an understanding of how to assess the quality of sources?

Evaluation of sources: Article Choice Sheet

Article Title and full citation

Why did you choose this article for your work? How did it help you answer the questions set?

How did you use the contents of the article to help answer the questions set?

How did you assess the reliability of the article, its contents and any conclusions in it?

Solution Preview

Effective organizational strategies

The future of an organization is inevitably the greatest asset that a corporation can have. To secure this prospect, the organization has to create company strategies that will encompass the purpose and mission of the organization. The models provide important sources of information that are utilized by the organization to create effective organizational strategies and comprehensive execution styles. The model transforms the varied business aspects by ensuring that the strategies formulated by the organizations are complementing both the internal and external organizational environments. The organization hence will hold the capability of establishing a well devised company strategy that will attain an efficient implementation process. Organizational strategies can be reviewed as the building blocks towards the company competitive advantage is established. This enables the organization to find a great position in the industry. Through great company strategies, the company has the capability of influencing the key forces in the industry leading to the creation favorable organizational structures (Wind et al, 1993).

Selected Model

Through the three stated models, there are well defined factors which have great influence in the development of the organization. The organizations can be able to analyze their strategic positions in the market share and this will make the corporations to create strategies that are effective and efficient. Organizations will hence be competent enough to accomplish market domination through the set strategies. The incorporation of the strategy models into the strategy making process of the company permits the corporation to build effective strategies that keep an organization at the forefront (Greaves, 2006).

The Porter's Five Forces Model

This model has varied concepts that are applicable in the organization. It is one of the most influential analytical models that is paramount in the organization to ascertain the nature of the business environment. The model ensures that an organization understands the competitors present in a new market and copes with them strategically to attain the set company goals. The demand of the organizations might waver at certain levels of the market economy but through great market entry strategies an organization can manage to enter another market (Strategy: Porter's, 2011).

Explanation of the purpose of the model

Strategic planning in the organization has often been looked at as a waste of time and company funds. This lie has captured many corporations in state of stagnation where an organization fails to advance in the market. This selected model influences the business strategic decision making since it enables an organization to measure the profit potential of all the alternative product- market strategies. The model equips the company with the favorable trends that are present in the company and the contingencies that the company has to follow towards the attaining of the organizational set goals. It is through the understanding this model and successfully implementing it the company operations, that the company can be in a position to incorporate industry conditions in the organizational strategies. The organization has the sole opportunity that will enable it establish an organizational strategy that reflects the overall corporate mission. This model also propels the organization to enter into a market that will make it succeed be achieving of the set objectives. The model propels the company to be secure and successful in a competitive market.

The other significant force that is a subset of porter's five models is the 'threat of substitution'. An organization gains great insight on the concept that the product to product substitution of commodities leads to the creation of high rates of threats for substitution. The competition rates of the organization are maintained when measures are taken to reduce the threats for substitution (Greaves, 2006).

The competitive rivalry force facilitates the growths of an organization when the competitive nature of the market is tough. When the rate of the market growth is slow, the ...

Solution Summary

The solution discusses strategic planning models in business and reviews 'model accountants.'