QUEZON MEMORIAL ACADEMY
Progreso St. Poblacion West Umingan, Pangasinan
Trends, Networks, and Critical Thinking in
the 21st Century Culture
Week 4- Second Semester
I. Title: UNDERSTANDING LOCAL NETWORKS
II. Objectives:
After going through this module, students are expected to:
A. Define analytical tools;
B. Explain analytical tools SWOT and PEST analysis; and
C. Describe key components of strategic analysis.
III. Anticipatory Guide:
This module discusses analytical tools that is used in making strategic decisions, and explains the two
most commonly used analytical tools which is SWOT and PEST analysis. Along with this topic is the key
concepts of strategic analysis.
IV. Lesson Content:
ANALYTICAL TOOLS
A variety of analytical tools can be employed in the conduct of strategic analysis. The purpose of an analytical tool is
to sharpen the focus of the analysis and to ensure a methodical and balanced approach. This means that the analysis
will center only on the questions being raised by the organization and will follow step – by – step, logical, and
integrated procedures.
The tools are also used in making strategic decisions.
TWO MOST COMMONLY USED ANALYTICAL TOOLS
1. SWOT Analysis
2. PEST Analysis
ANOTHER POPULAR ANALYTICAL TOOL
1. Value Chain Analysis
SWOT Analysis is applied particularly in phase I where situational scanning is undertaken. The internal and external factors
which are favorable and unfavorable for the attainment of objectives and priorities are identified. It focuses on the
organization’s strengths and weaknesses and the opportunities and threats it faces.
STRENGTHS – these are the internal attributes of the organization that can contribute to the attainment of its objectives
and priorities.
WEAKNESSES – these are the internal attributes of the organization that can obstruct the attainment of its objectives and
priorities.
OPPORTUNITIES – these are external factors that can contribute to the attainment of its objectives and priorities.
THREATS – there are external factors that can obstruct the attainment of the organization’s objectives and priorities.
EXAMPLE:
Alyssa inherited his family’s business of silkscreen T – shirt printing. Being a young entrepreneur, Alyssa wanted to
introduce digital T – shirt printing through heat transfer. In the planning stage, she had to answer the following framework
questions:
1. Who are we and where are we now? (Phase I: Identity and current location)
2. Where do we want to be? (Phase I: Mission and vision)
3. How will we get there? (Phase II: Plans and programs)
4. How will we know how we are doing? (Phase III: Measurement)
STRENGHTS: The strengths of the business included the equipment and manpower the shop already has. Alyssa has
contacts with various visual artists, mostly her friends, to help him with the new designs that he wants. The shop has regular
patrons who can be its customer base.
WEAKNESSES: To pursue the digital printing side of the business, the shop has to invest in buying new equipment like
computers, printers, and heat press machines.
OPPORTUNITIES: The opportunity of online shopping gives the shop a venue to market its services, designs, and new
apparel line to more customers. The shop can expand its silk screen printing services, which means it is not only limited to
customers visiting the physical shop. It can take orders from many parts of the country, provided that it sets up an easy
cashless payment scheme.
THREATS: This new venture is a huge risk in itself, as much as being a success. It is up to the marketing arm to get a
considerable number of new customers to keep the business running smoothly. Additionally, there are many competitors
offering the same services.
PEST ANALYSIS surveys the bigger environment where the organization operates. It scans the political, economic,
sociocultural, and technological factors in the environment affecting the existence of the organization. For a business enterprise,
PEST Analysis conducted to evaluate its standing in the market, whether it experiences growth or decline and what direction the
business is heading to.
POLITICAL FACTORS include the rules, regulations, laws, and policies imposed by a government which all affect the
organization. Political factors also include political stability and peace and order in the area where the organization
operates.
ECONOMIC FACTORS cover purchasing power, capital outlay, interest rates, tariff rates, inflation, currency, currency
exchange rates, and employment – unemployment rates, among others.
SOCIOCULTURAL FACTORS include people’s preferences, needs, demographics, attitudes toward using a product or
service, and cultural backgrounds and diversity, among others.
TECHNOLOGICAL FACTORS cover those related to technological innovation as well as their positive and negative
impacts on the organization. Technological factors also include incentives for investments and pace of technological
transformation.
EXAMPLE: Newspaper publishing company
P The newspaper company advocates truth, justice, and responsible journalism. Since democracy is valued in the
country, the newspaper is generally free to report even the corrupt practices of government officials.
E The newspaper company experiences higher production cost due to inflation. Competition with other newspapers,
still, is healthy.
S Readers seem to allot less time in reading the articles. They have been exposed to visual culture, meaning they
prefer information presented more visually.
T Smartphones and connectivity allow people to access news content anywhere, anytime without buying a printed
newspaper.
The PEST factors can be classified as opportunities or threats in SWOT Analysis. For a better understanding of a situation,
it is recommended to accomplish the PEST Analysis first before conducting the SWOT Analysis.
Another popular analytical tool, especially among business firms, is the VALUE CHAIN ANALYSIS (VCA). It promotes
the idea that an organization exists to produce value to its clients; that the organization’s reason for being is creating something
of worth to its customers. The VCA is concerned with understanding how the organization’s sets of activities produce added
value and satisfy clients. Each activity that adds value serves as a source of competitive advantage, which is being able to
maintain performance superiority over rivals. The competitive advantage may be in terms of product, cost, niche, or
sustainability. A company that offers products or services that, for example, have lower cost, better quality, unique features, or
outperforming attributes is usually preferred by customers over the rival companies. This is how brand loyalty or sustained
patronage is developed.
Strategic planning can be utilized for renewing your organization, leading to the enhancement of the organization in the
next years. Remember the summary of procedures using the acronym SPADE.
S – Start by organizing to plan and to engage commitment of affected parties.
P – Purpose, objectives, targets to guide everyone involved.
A – Analyze the organization’s strengths, weaknesses, opportunities, and threats and lay down options.
D – Decide and choose strategies from the options or alternatives.
E – Execute, evaluate, and monitor the strategies.
USING INTUITIVE THINKING IN SITUATION
1. Interpreting the meaning of one’s body language or facial expression.
2. Saving lives in the battlefield.
3. Coming up with a new or a more efficient way of doing things.
4. Hiring the head of the Human resource department.
5. Choosing a song for competition.
(Present pictures showing intuitive thinking on each item.)
KEY COMPONENTS OF STRATEGIC ANALYSIS
1. COMMITTED PEOPLE. The initial step in strategic planning is getting the right people at the right time. They are
essential in effectively carrying out a strategy. These people comprise the management staff, officers, and stakeholders.
They are also called engagers.
2. LONG TERM STRATEGIC OBJECTIVES. The objectives are poised to enhance the organization’s performance. There
is a need to identify the beneficiaries (owners, stakeholders, members) who will receive the benefit from the gains brought
by improved efficiency in the operations and delivery of services of the organization. The people involved in setting the
objectives are referred to as aimers.
3. STRATEGIC ALTERNATIVES. The planning should be to derive options from brainstorming and SWOT Analysis.
These alternatives may be of higher quality than the current strategy or may enable the organization to respond with ease,
speed, and effectiveness when changes occur in the environment. (Discuss Religious Organization who wants to evangelize
more and expand its membership)
4. EVALUATION AND CHOICE OF STRATEGIES. The process of formulating a strategy involves evaluating and
picking out which strategies could facilitate the attainment of long term improvements. It should include all those revealed
by the SWOT Analysis of the organization. From the evaluation of alternative strategies, options which are superior to the
current approach may be found, and change for the organization’s improvement can be undertaken. Those who participate in
searching for and selecting strategic alternatives are called option generators.
5. MEANING OF STRATEGY IMPLEMENTATION. There should be a plan for formal and regular reporting and other
measures of plan implementation. These will enable the organization to know whether or not the plan is carried out properly
and the objectives are met. The monitoring system should provide ample room for correction when improper
implementation of the strategies is observed and when objectives are not being met. Strategizers are those who implement
and monitor the strategy. An organization can produce semiannual and annual reports to monitor any improvements.
V. Activity
1. Do you aspire to become a leader of an organization someday? What can you do to prepare yourself toward
realizing this?
2. The officers of a youth organization are wondering why membership is not increasing. How can SWOT analysis
be applied?
VI. PERFORMANCE CHECK #1:
You are a speaker for an environment advocacy group. One of your activities is to inform the people about the ill
effects of climate change and how each individual can help mitigate these effects. A barangay chairman invited you
talk about the topics on climate change in a barangay assembly of residents next week. The following are the topics:
Choose one.
1. Consequences of personal and local actions to global warming and climate change.
2. Contribution of production and consumption habits of people to global warming.
Prepared by:
LORIELE P. LANTION
Subject Teacher