Difference between revisions of "AFI Strategy Framework"
m |
m |
||
(4 intermediate revisions by the same user not shown) | |||
Line 1: | Line 1: | ||
− | AFI [ | + | == What is AFI Strategy Framework?<ref>[https://quizlet.com/43586132/strategic-management-chapter-1-flash-cards/ Defining AFI Strategy Framework]</ref> == |
− | *Analyze: The | + | '''AFI Strategy Framework''' is a model that links three interdependent [[Strategic Management|strategic management]] tasks that together help firms conceive of and implement a strategy that can improve performance and result in [[Competitive Advantage|competitive advantage]]. The following are the 3 Tasks of the AFI Strategy Framework |
− | *Formulate: | + | *Analyze: The Strategic Management Process, External Analysis, Internal Analysis, and Firm Performance. |
− | *Implement: | + | *Formulate: Business Strategy, Corporate Strategy, and Global Strategy. |
+ | *Implement: Organization Design, Corporate Governance, Business Ethics, and Strategic Leadership. | ||
'''Diagrammatic Illustration of AFI Strategy Framework'''<br /> | '''Diagrammatic Illustration of AFI Strategy Framework'''<br /> | ||
[[File:AFI2.jpg|500px|AFI Strategy Framework]]<br /> | [[File:AFI2.jpg|500px|AFI Strategy Framework]]<br /> | ||
− | source: | + | source: Joe Mahoney |
− | + | == Practical Application of AFI Strategy Framework<ref>[https://fisher.osu.edu/sites/default/files/bellner_mhr_4490_mon_lec_4190_autumn_2017.pdf The Practical Application of the theory of AFI Strategy]</ref> == | |
− | In strategic | + | In strategic management, one often takes the perspective of the CEO or person responsible for the strategy of the organization. One would normally use an inductive approach to the analysis. The following is a helpful overview of the AFI Strategy — analysis, formulation, and implementation and its practical application. |
*Analysis | *Analysis | ||
**Perform an external environmental analysis of the: | **Perform an external environmental analysis of the: | ||
***Macrolevel environment ([[PESTEL Analysis|PESTEL]]) | ***Macrolevel environment ([[PESTEL Analysis|PESTEL]]) | ||
− | *** | + | ***Industry environment (Porter’s five forces) |
***Competitive environment | ***Competitive environment | ||
− | **Perform an internal analysis of the firm using | + | **Perform an internal analysis of the firm using RBV/RBT: |
− | ***Identify resources, capabilities and competencies ( | + | ***Identify resources, capabilities, and competencies (VRIO analysis) |
− | ***Identify | + | ***Identify value chain primary and support activities |
**Analyze competitive advantage and firm performance: | **Analyze competitive advantage and firm performance: | ||
− | ***Use financial and | + | ***Use financial and market-based measures |
− | ***Comparison of firm to competitors, peers, industry average | + | ***Comparison of the firm to competitors, peers, industry average |
***Assessment of achieving and sustaining competitive advantage | ***Assessment of achieving and sustaining competitive advantage | ||
− | *Formulation: Provide analysis of firm’s | + | *Formulation: Provide analysis of the firm’s business-level strategy and corporate-level strategy: |
− | **[[Business]] | + | **[[Business Strategy]] |
− | *** | + | ***Differentiation, cost leadership, integration |
− | *** | + | ***Innovation and strategic entrepreneurship |
− | **Corporate | + | **[[Corporate Strategy]] |
− | *** | + | ***Vertical integration and diversification |
***Potential acquisitions, alliances, networks | ***Potential acquisitions, alliances, networks | ||
**International strategy | **International strategy | ||
***Competing around the world | ***Competing around the world | ||
− | *Implementation: Explain how to put strategy into action and align strategy/ structure relationship: | + | *Implementation: Explain how to put the strategy into action and align the strategy/structure relationship: |
− | ** | + | **Organizational design, structure, culture, control |
***Functional, multidivisional, matrix structure | ***Functional, multidivisional, matrix structure | ||
***Control and reward systems | ***Control and reward systems | ||
− | ***Strategy/ structure relationship | + | ***Strategy/structure relationship |
− | **[[Governance | + | **[[Corporate Governance]] and [[Business Ethics]] |
− | *** | + | ***Agency theory |
− | *** | + | ***Shared value |
− | + | == See Also == | |
− | [[ | + | #[[SWOT Analysis]] |
− | [[ | + | #[[Five Forces Model|Porter's Five Forces Model]] |
− | [[ | + | #[[Balanced Scorecard]] |
− | [[ | + | #[[Value Chain Analysis]] |
− | [[ | + | #[[Blue Ocean Strategy]] |
− | [[ | + | #[[Strategic Leadership]] |
− | + | == References == | |
<references/> | <references/> | ||
− | + | == Further Reading == | |
− | * | + | *[https://www.strategicmanagementinsight.com/topics/strategic-planning-process.html Strategic Management & Strategic Planning Process - AFI Strategy Framework] |
− | * | + | *[https://www.youtube.com/watch?v=nXOVGMVNZ7Y Why Do We Need the AFI Strategy Framework?] |
+ | __NOTOC__ |
Latest revision as of 11:00, 23 August 2023
What is AFI Strategy Framework?[1]
AFI Strategy Framework is a model that links three interdependent strategic management tasks that together help firms conceive of and implement a strategy that can improve performance and result in competitive advantage. The following are the 3 Tasks of the AFI Strategy Framework
- Analyze: The Strategic Management Process, External Analysis, Internal Analysis, and Firm Performance.
- Formulate: Business Strategy, Corporate Strategy, and Global Strategy.
- Implement: Organization Design, Corporate Governance, Business Ethics, and Strategic Leadership.
Diagrammatic Illustration of AFI Strategy Framework
source: Joe Mahoney
Practical Application of AFI Strategy Framework[2]
In strategic management, one often takes the perspective of the CEO or person responsible for the strategy of the organization. One would normally use an inductive approach to the analysis. The following is a helpful overview of the AFI Strategy — analysis, formulation, and implementation and its practical application.
- Analysis
- Perform an external environmental analysis of the:
- Macrolevel environment (PESTEL)
- Industry environment (Porter’s five forces)
- Competitive environment
- Perform an internal analysis of the firm using RBV/RBT:
- Identify resources, capabilities, and competencies (VRIO analysis)
- Identify value chain primary and support activities
- Analyze competitive advantage and firm performance:
- Use financial and market-based measures
- Comparison of the firm to competitors, peers, industry average
- Assessment of achieving and sustaining competitive advantage
- Perform an external environmental analysis of the:
- Formulation: Provide analysis of the firm’s business-level strategy and corporate-level strategy:
- Business Strategy
- Differentiation, cost leadership, integration
- Innovation and strategic entrepreneurship
- Corporate Strategy
- Vertical integration and diversification
- Potential acquisitions, alliances, networks
- International strategy
- Competing around the world
- Business Strategy
- Implementation: Explain how to put the strategy into action and align the strategy/structure relationship:
- Organizational design, structure, culture, control
- Functional, multidivisional, matrix structure
- Control and reward systems
- Strategy/structure relationship
- Corporate Governance and Business Ethics
- Agency theory
- Shared value
- Organizational design, structure, culture, control
See Also
- SWOT Analysis
- Porter's Five Forces Model
- Balanced Scorecard
- Value Chain Analysis
- Blue Ocean Strategy
- Strategic Leadership
References