The concept of situational analysis. Situational Analysis Study

2024 Author: Howard Calhoun | [email protected]. Last modified: 2023-12-17 10:16

Situational analysis is an attempt to analyze how external factors (for example, the instability of the state's economy as a whole) affect the activities of a company. Moreover, the firm (or enterprise) itself cannot influence these circumstances in any way - this is not within its competence.

What is this technology good for? And, the fact that it is suitable not only for one single situation, but for their whole complex. This is the universality of the method and its simplicity.

Why analysis is needed

It is necessary to conduct it so that the business can successfully develop further. In the process of analysis, all negative factors that affect the activities of the enterprise are first determined, and then ways to eliminate the consequences of these critical circumstances are found. Of course, it is unlikely that it will be possible to completely eliminate the repetition of such cases in the future, but you can try to minimize the costs and expenses of the company in the course of its activities. This is exactly what professionals who specialize in situationalanalysis. Moreover, it is necessary to carry out such events on an ongoing basis in order to be constantly aware of the resources of not only your enterprise, but also your competitors. The analysis allows you to evaluate the objective data of almost all subjects that have entered the market: suppliers, manufacturers, customers, and so on.

What is the essence of the procedure

A situational analysis study conducted in a specific period of time allows you to analyze all the changes that have occurred in the market; activities of the enterprise in these new market conditions, as well as to develop the right tactics and strategy for the future, so that the company maintains its competitiveness, favorable pricing policy, as well as the decent quality of its products or services.

Note! The purpose of the situational analysis is to create not only new strategic techniques, but also to improve the "old" ones. That is, those that already exist, simply by increasing their efficiency.

Problems of situational analysis

Competent and timely analysis helps to solve the following tasks:

• Show in all its subtleties to the director and heads of various departments a picture of the position the company is in at this particular moment.
• Determine the strengths and weaknesses of the company's economic and production activities. That is, to soberly assess the current state of affairs and give an objective assessment.
• Explore the prospects for the development of the enterprise in the future. How realistic are the chances of overtaking your competitors.
• To enable the management of even a prosperous company to “go down from heaven to earth” and “outline new horizons” (that is, even more promising than they are at the moment) with the help of a situational analysis of an organization, since “there is no limit to perfection”.
• Become an impetus to determine the ways and methods of overcoming the crisis; and develop new strategic solutions.
• Reveal the contingent of your consumers; to characterize them, it is better to know their desires in the acquisition of a particular product (or service); as well as assess the demands of the market and the speed of its development.
• Understand, using a system-situational analysis, the prospect of your competitiveness. This can only be done by having information about the strengths and weaknesses of your business rivals. Moreover, the analysis will be more effective if not only current, but also potential competitors are taken into account.

Important! The result of the study should certainly be the emergence of new ideas and goals (the situational analysis will certainly become a real impetus for this).

Proceedings

Theoretically, in the course of research, a thorough study of such basic areas of activity of any enterprise as production itself, personnel service, supply, sales, finance and much more takes place.

Note! In practice, situational (marketing) analysis is carried out only in those areas that are the most important andvulnerable. Moreover, the full range of research will cost the enterprise "a pretty penny". Not everyone can afford it.

The situational analysis method involves several stages:

• Defining and articulating the problem situation.
• Establishing the main factors that determine the development of a particular situation.
• Developing a unified research concept.
• Defining the object to be parsed.
• The study itself.

Important! The analysis can be carried out exclusively under the direction of the director (or general director) of the company. It is he who appeals to marketers with a request to conduct the necessary research on all aspects of their activities.

In the process of work, questionnaire sheets and various questionnaires are often used. Conducting situational monitoring ends with the preparation of a report that reflects all the problems of the company; ways out of them, including a new strategy that would allow the administration of the enterprise to adequately respond to all the changes taking place in the market, and ways to help achieve positive results in the economic and production activities of the company in the current conditions.

Application Features

If you think that analysis is used only in moments of crisis that happen to every company from time to time, then you are very mistaken. It's not like that at all. In international practice, the situational analysis method is used without fail once (at least) every six months. Andthis is in no way connected with the current state of affairs at the enterprise.

Note! The use of such research allows even successful firms to see new opportunities for further prosperity and problematic points that may arise in the future.

Technological methods for establishing the main factors influencing the situation

The following methods are used today:

• so-called brainstorming;
• questionnaire consisting of two stages;
• factorial analysis (that is, the study of the main points that affect a particular situation);
• scaling;
• modulating the situation;
• case method.

Brain Attack

When using this method, a significant role is assigned to the director of the company, who heads each meeting of the expert commission. In practice, this looks like an ordinary production meeting, at which one or another problem that has arisen is discussed; the main factors that led to the critical situation; and how to fix them.

"Brainstorm" consists of two stages:

First. Includes generating a variety of ideas and opinions. The main goal of this stage is to establish a friendly environment that allows absolutely everyone to speak out and convey their point of view to others. As a result, the most complete picture of the main circumstances influencing the development of the situation as a whole should be formed. In the process of speaking, the chairman (i.e.director) of the commission should not show support for one or another speaker. Every opinion (or idea) must be discussed, even if at first glance it seems obviously unpromising or absurd

Note! If, during the brainstorming, the chairman of the expert commission supports only what he thinks "has the right to life", then, most likely, the value of such meetings will be reduced to zero.

Second. Discussion of statements and opinions, their analysis and development of a common position on a specific problem. At this stage, having analyzed all the factors that were originally identified, leaving only those that seem to be the main ones. In order to do this in the best possible way, it is advisable to divide all the specialists participating in the "brainstorming" into two camps: supporters of the idea, who provide certain evidence in favor of the expressed point of view; and opponents who also zealously refute it. The chairman of the commission, after carefully listening to everyone, makes his verdict on the importance of this or that factor in terms of its effect on the current situation

Important! If, in the course of a situational analysis conducted in this way, the commission comes to the conclusion that some points were completely unjustifiably ranked as fundamental, then they are immediately excluded from the general list. And vice versa, if specialists in the process of discussion reveal the presence of additional factors that significantly affect the state of affairs in the company, then they are immediately included in the list,subject to further discussion.

Two-stage survey

At the first stage of this technology, each of the specialists invited to the expert commission fills out a questionnaire (questionnaire) specially designed for such situations. In it, the participants indicate all the factors that, in their opinion, affect the state of affairs in the company; and also give their own rationale for why they consider these points to be among the most important. Moreover, all circumstances are arranged according to the degree of their influence on the situation (in descending order of importance).

At the second stage of the situational analysis of the enterprise, the review of previously completed questionnaires begins, which is carried out in a cross mode. This means that questionnaires filled out by some participants in the study are analyzed by other specialists. That is, they either agree with the version put forward, or reasonably reject it, making a mandatory ranking of all the factors presented.

With this technology, the commission also includes an analytical group that processes the received personal data. At the end of their work, analysts submit a report to the head of the enterprise, who makes a decision about the main factors influencing the situation.

Note! Both "brainstorming" and two-stage questioning can absolutely be classified as universal technologies that can be perfectly used not only to determine the main points that affecteconomic and production situation of the company, but also to quickly solve other situational problems.

Factor analysis

Similar technology can be used for marketing research and situational analysis. The method is based on the assumption of the analytical dependence of statistical data on planned and actual indicators reflecting the current situation. In the process of factor analysis, not only a list of circumstances and their classification (that is, internal or external; essential or insignificant; main or non-basic) are determined, but also coefficients (or loads) that characterize the impact of each of the declared moments on indicators that reflect the true state and development of the situation as a whole. The results obtained make it possible to rank the factors according to their degree of importance in terms of their impact on the state of affairs in the company.

Scaling

Great information flow is not always a blessing. So in this case: too many factors can lead to a decrease in the effectiveness of the analysis. To prevent this from happening, it is necessary to differentiate all incoming data on the current situation, that is, to reduce their number and increase their content. With the help of the multidimensional scaling method, all these issues can be solved. As a result of the research, all circumstances are carefully analyzed and ranked. The result is a kind of scale.

Modeling the situation

This method allows you to get a more complete picture of the current state of affairs anddetermine what is driving the process. No one will argue that the main indicator of the economic activity of any company is exclusively profit. It is.

And on what factors does profit depend? Of course, on the volume of production, the cost of production, its current demand in the market, as well as on competitiveness. If each of the indicators is multiplied by the corresponding coefficient, then it is easy to calculate the expected value of profit in the presence of certain factors, depending on which it is.

Using this method, one can carry out either long-term (for example, five years) forecasting or short-term forecasting. Much depends on the economic stability of the country as a whole.

Case method

The purpose of this technology is to identify a problem situation, analyze it and determine the way out of it. The case method itself is not research, the problem is presented through a certain set of facts-difficulties that had to be faced in the process of economic and production activities of the enterprise. Case method is the ability to work in a team.

Swot analysis

SWOT-analysis (situational analysis), which was developed by the American professor Kenneth Andrews, helps to obtain more complete information about the strengths and weaknesses of the company and launch new goals and objectives. The abbreviation SWOT stands for:

• S - strength (strength).
• W - weakness (weakness).
• O - opportunities (opportunities).
• T -troubles (problems).

The very name of the method contains the fundamental principles of any entrepreneurial activity.

This method says that it is not necessary to "get hung up" on the analysis, but it is worth immediately moving on to identifying the main tasks, that is, determining the level that you would like to achieve in the process of implementing the plan. And there is no need to “hover in the clouds” and wish for the unrealizable. The goal should be specific, simple and achievable. All efforts should be focused on achieving it.

Important! Remember that secondary factors are not important at all in such an analysis.

In closing

In addition to the above technologies, you can use other methods for conducting a situational analysis (an example is the methods of qualimetric research or the formation of generalized criteria). Dare! And you will succeed!