A pragmatic and holistic approach to strategic formulation through adopting balanced scorecard, SWOT analysis and blue ocean strategy – a case study of a consumer product manufacturer in China

Abstract

This paper introduces a holistic approach to strategic formulation as practiced by a large consumer product manufacturer in China. This approach combines the application of a few powerful strategic tools to reap synergetic benefits. Innovative strategic approaches are regularly invented, introduced and adopted with mixed outcomes. It is important to be able to accurately, flexibly and systematically ascertain the internal corporate status and evaluate its business environment. Borrowing from the quality management practices, i.e., failure mode and effects analysis (FMEA), a parallel analogy termed success mode and effects analysis (SMEA) is introduced to supplement the scanning of external environment. Two indexes [i.e., risk priority number (RPN) and opportunity priority number (OPN)] are introduced in the strategic formulation process to estimate the quantum of favourableness or unfavourableness of various external factors. The holistic strategic formulation approach as adopted by the consumer product manufacturer deploys the application of SWOT, balanced scorecard (BSC) and blue ocean strategy (BOS).