Business frameworks are known to be excellent tools for analyzing issues and structures in business. In order to provide clear suggestions to the clients, such frameworks are used quite often by business analysts as well as strategy consultants.
There are many Business Strategy Certification courses that preach different business frameworks to impart an in-depth knowledge of how businesses can become successful. Such certification programs also cover global strategy and leadership.
In the past decade, many experts in the field of science and business have tried to develop helpful frameworks related to business, management as well as strategy. There are five frameworks mention below that are considered to be the most useful ones in the world of business.
- Porter’s Five Forces Model
It is one of the best strategy frameworks for analyzing industries. The Five Forces Model is designed to determine the competitiveness of an industry based on five diverse factors.
- The conflicts among current competitors
- The threat of potential competitors
- The treat of alternate products
- The power of bargaining of the suppliers
- The power of bargaining of the buyers
Competition can be considered solid in a case where these forces are firm. During that time, it becomes troublesome for someone to enter the industry. It is easier and more beneficial to enter an industry with less competition as it allows for larger margins.
- Hambrick and Fredrickson’s Strategy Diamond
It is an incredible model that explains the relevance of strategy and is very useful in distinguishing the factors that compose a great strategy. As per Hambrick and Fredrickson’s Strategy Diamond, a strategy has five crucial parts:
- Economic Logic
For every component, detailed choices are made on what to be done and especially what not to be done. And the choices made in a single component should be emphasized and matched with choices made in the rest of the components. Only in that particular case, organizations can accomplish a sustainable strategy.
- Treacy and Wiersema’s Value Disciplines
This framework exhorts that an organization has to be clear about the fact what they want to do and excel in. Any company that wants to excel in various disciplines would end up finding itself somewhere the middle. The model talks about 3 value disciplines. According to Treacy and Wiersema’s, organizations can select one out of these three disciplines for becoming a market leader.
- Product Leadership
- Operational Excellence
- Customer Intimacy
Every discipline has effects on how the organization should operate with regards to processes, structure as well as culture.
- Ansoff Matrix
In this model, four strategies have been determined for the growth of a business. They have been summarized in a matrix which is called the Ansoff Matrix. With the help of this matrix, it becomes easier for managers to sum up the 4 potential growth strategy. So that they can be conveniently compared in terms of the risk associated with each one of them. The growth strategies are:
- Market Penetration
- Market Development
- Product Development
- BCG Growth-Share Matrix
The BCG Growth-Share Matrix is constructed to assist companies in considering growth opportunities analyzing its portfolio of business units and products for the sake of deciding where to put the investment in and where to disinvest from. Based on two factors, the matrix has been divided into parts. Market growth along with relative market share are the two factors. And the business units are:
- Question marks
- Cash cow
Most of the business units begin with question marks. When they have a comparatively small share in a booming market. An industry and the unit can be considered as a star or a dog, depending on how great they are doing. The unit is called a cash cow when its growth starts to flatten. That is milked for investing in more profitable businesses.