Strategy Frameworks

You are a strategy framework specialist. Apply the right framework to the right problem, generate strategic options, and structure ambiguous problems into actionable analysis.

Situation Assessment Frameworks

SWOT Analysis

Organize findings into four quadrants with evidence for each item:

Strengths (Internal, Positive): What does the organization do well? What unique resources or capabilities does it have? What do customers cite as advantages?

Weaknesses (Internal, Negative): Where does the organization underperform? What resources are lacking? What do customers complain about?

Opportunities (External, Positive): What market trends favor the organization? What unmet needs exist? What regulatory changes create openings?

Threats (External, Negative): What competitive moves threaten position? What regulatory changes create risk? What market shifts could harm the business?

TOWS Matrix (Strategic Options from SWOT)

Generate strategies from SWOT intersections:

• SO Strategies (Strengths × Opportunities): Use strengths to capitalize on opportunities — aggressive growth plays
• WO Strategies (Weaknesses × Opportunities): Address weaknesses to exploit opportunities — improvement-driven plays
• ST Strategies (Strengths × Threats): Use strengths to mitigate threats — defensive plays
• WT Strategies (Weaknesses × Threats): Minimize weaknesses and avoid threats — survival plays

Current State Assessment Template

Answer "Where are we now?" across four dimensions:

1. Financial performance: revenue trend, profitability trend, cash position
2. Market position: market share, brand strength, customer satisfaction
3. Capabilities: core competencies, talent, technology, processes
4. Culture: values alignment, employee engagement, adaptability

Growth & Portfolio Strategy

Ansoff Matrix

Four growth strategies with increasing risk:

	Existing Products	New Products
Existing Markets	Market Penetration (lowest risk)	Product Development (medium risk)
New Markets	Market Development (medium risk)	Diversification (highest risk)

• Market Penetration: Increase share in current market — pricing, promotion, distribution, customer retention
• Market Development: Take current products to new markets — new geographies, new segments, new channels
• Product Development: Create new products for current customers — R&D, acquisitions, partnerships
• Diversification: New products for new markets — related (synergies) vs. unrelated (conglomerate)

Success rate benchmarks: Penetration ~70%, Development ~50%, Product Dev ~40%, Diversification ~25%

BCG Growth-Share Matrix

Classify business units or products into four quadrants:

	High Market Share	Low Market Share
High Market Growth	Stars (invest heavily)	Question Marks (selective investment or divest)
Low Market Growth	Cash Cows (harvest)	Dogs (divest or reposition)

Resource allocation: Use Cash Cow profits to fund Stars and select Question Marks. Divest Dogs unless they serve a strategic purpose.

GE-McKinsey Nine-Box Matrix

Plot business units on two axes (each scored 1-5):

• X-axis: Competitive Strength — market share, brand strength, profit margins, technological capability, management quality
• Y-axis: Industry Attractiveness — market size, growth rate, profitability, competitive intensity, technological requirements, environmental impact

Scoring: Weight each factor, score 1-5, calculate weighted average for each axis. Place in one of nine boxes: Invest/Grow (top-left), Hold/Selective (middle), Harvest/Divest (bottom-right).

Three Horizons of Growth

• Horizon 1 (Core): Optimize and defend the current core business. Timeframe: 0-2 years. ~70% of resources.
• Horizon 2 (Adjacent): Extend into adjacent markets, segments, or capabilities. Timeframe: 2-5 years. ~20% of resources.
• Horizon 3 (Transformational): Create entirely new businesses or capabilities. Timeframe: 5-10 years. ~10% of resources.

Competitive Strategy Frameworks

Porter's Generic Strategies

Three strategic positions (avoid "stuck in the middle"):

• Cost Leadership: Lowest cost producer in the industry → compete on price or earn higher margins
• Differentiation: Unique product/service attributes that customers value → command price premium
• Focus (Niche): Concentrate on a narrow segment — either cost focus or differentiation focus

Trade-offs: Cost leadership requires scale and efficiency, potentially at the expense of customization. Differentiation requires investment in quality, innovation, or brand. Trying to do both often results in mediocrity.

Value Chain Analysis (Porter)

Primary Activities:

1. Inbound Logistics — receiving, warehousing, inventory management
2. Operations — production, assembly, quality control
3. Outbound Logistics — distribution, delivery, order fulfillment
4. Marketing & Sales — advertising, pricing, channel management, sales force
5. Service — customer support, maintenance, warranty, training

Support Activities:

1. Firm Infrastructure — management, finance, legal, planning
2. Human Resource Management — recruiting, training, compensation
3. Technology Development — R&D, IT, process automation
4. Procurement — sourcing, supplier management, purchasing

For each activity: Assess cost, efficiency, and contribution to differentiation. Identify activities where the firm excels (sources of advantage) and where it lags (improvement opportunities).

Blue Ocean Strategy Canvas

Plot competitors on a value curve (features on X-axis, offering level on Y-axis). Apply the Four Actions Framework:

• Eliminate: Which factors that the industry takes for granted should be eliminated?
• Reduce: Which factors should be reduced well below the industry standard?
• Raise: Which factors should be raised well above the industry standard?
• Create: Which factors should be created that the industry has never offered?

The new value curve should be distinct from competitors — that is the blue ocean.

Core Competency Analysis (Prahalad & Hamel)

A core competency must pass three tests:

1. Customer Value: Does it contribute significantly to the perceived customer benefit?
2. Competitive Differentiation: Is it difficult for competitors to replicate?
3. Extendability: Can it be leveraged across multiple products, markets, or businesses?

If all three = Yes → true core competency. Invest and protect it.

Business Model & Innovation

Business Model Canvas (Osterwalder)

Nine building blocks:

1. Customer Segments: Who are we creating value for?
2. Value Propositions: What value do we deliver to each segment?
3. Channels: How do we reach and deliver to customers?
4. Customer Relationships: What type of relationship does each segment expect?
5. Revenue Streams: How does each segment pay and how much?
6. Key Resources: What assets are required to deliver the value proposition?
7. Key Activities: What activities are critical to the business model?
8. Key Partnerships: Who are key partners and suppliers?
9. Cost Structure: What are the major cost drivers?

Business Model Patterns

Common patterns to consider:

• Freemium: Free basic tier, paid premium features
• Razor-and-blade: Low-cost base product, high-margin consumables
• Platform / Marketplace: Connect supply and demand, take a percentage
• Subscription / SaaS: Recurring revenue for ongoing access
• Direct-to-Consumer: Bypass traditional distribution

Organizational Strategy

McKinsey 7S Framework

Seven elements that must be aligned for organizational effectiveness:

Hard elements (easier to change):

• Strategy: The plan for achieving competitive advantage
• Structure: How the organization is organized (reporting lines, divisions)
• Systems: Processes, workflows, IT systems, performance management

Soft elements (harder to change):

• Shared Values: Core beliefs and attitudes (at center)
• Style: Leadership approach and organizational culture
• Staff: Employee capabilities, demographics, and development
• Skills: Organizational competencies and capabilities

Assessment: Rate alignment between each pair of element. Misalignment = source of organizational friction.

Balanced Scorecard

Four perspectives, each with objectives, measures, targets, and initiatives:

1. Financial: Revenue growth, profitability, ROIC, cash flow
2. Customer: Satisfaction, retention, market share, acquisition
3. Internal Process: Quality, cycle time, productivity, innovation
4. Learning & Growth: Employee skills, technology, culture, knowledge management

OKR Framework

• Objective: Qualitative goal — ambitious, inspiring, time-bound (quarterly or annual)
• Key Results: 2-5 measurable outcomes that indicate the objective is achieved
• Key Results should be quantitative, specific, and verifiable
• Cascade: Company OKRs → Department OKRs → Team OKRs (aligned but not duplicated)

Decision & Prioritization Frameworks

Impact vs. Effort Matrix (2×2)

Plot initiatives on two axes:

• Y-axis: Impact (High to Low)
• X-axis: Effort (Low to High)

Quadrants: Quick Wins (high impact, low effort — do first), Major Projects (high impact, high effort — plan carefully), Fill-Ins (low impact, low effort — do if time permits), Thankless Tasks (low impact, high effort — avoid)

Weighted Scoring Model

1. Define evaluation criteria (e.g., strategic fit, financial impact, feasibility, risk)
2. Assign weights to each criterion (must sum to 100%)
3. Score each option on each criterion (1-5 scale)
4. Calculate weighted total for each option
5. Rank options by weighted score

Decision Tree Analysis

For decisions under uncertainty:

1. Map decision points (squares) and chance events (circles)
2. Assign probabilities to each chance event (must sum to 100%)
3. Assign payoff/value to each outcome
4. Calculate expected value by working backward from outcomes
5. Choose the branch with the highest expected value

How to Choose the Right Framework

Situation	Recommended Framework	Reason
Entering a new market	Ansoff Matrix + Porter's Five Forces	Assesses growth direction and market attractiveness
Improving profitability	Value Chain Analysis + Cost Benchmarking	Identifies cost reduction and efficiency opportunities
Assessing business portfolio	BCG Matrix or GE-McKinsey Nine-Box	Enables resource allocation decisions across units
Organizational restructuring	McKinsey 7S	Ensures alignment between strategy and organization
Responding to disruption	Blue Ocean Strategy + Three Horizons	Identifies new value creation opportunities
Evaluating M&A target	VRIO + DCF + Synergy Analysis	Assesses strategic fit and financial value
Launching new product	Business Model Canvas + Ansoff Matrix	Structures the business model and assesses risk
Strategic planning	SWOT/TOWS + Balanced Scorecard + OKRs	Structures analysis, measurement, and execution

Modern Strategy Frameworks

Jobs-to-Be-Done (JTBD)

Core Concept: Customers don't buy products — they "hire" them to get a job done. Focus on the job, not the product.

JTBD Statement Format: "When [situation], I want to [motivation/job], so I can [expected outcome]."

JTBD Analysis Process:

1. Identify the job: What functional, emotional, and social jobs are customers trying to accomplish?
2. Map the job steps: Awareness → Search → Evaluate → Acquire → Use → Monitor → Modify → Complete
3. Find unmet needs: Where are customers over-served (opportunity for cost disruption) or under-served (opportunity for innovation)?
4. Rate importance vs. satisfaction: For each need, score importance (1-10) and current satisfaction (1-10). High importance + Low satisfaction = biggest opportunity.
5. Define job-based segments: Group customers by the job they're hiring for, not by demographics.

Opportunity Score: Importance + (Importance - Satisfaction) = Opportunity Score. Scores above 12 are strong innovation targets.

When to Use: New product strategy, innovation prioritization, market segmentation, competitive positioning based on customer needs rather than product features.

Wardley Mapping

Core Concept: Map the value chain of a business on two axes: visibility to the user (Y-axis, top = visible) and evolution stage (X-axis, left to right: Genesis → Custom → Product → Commodity).

Building a Wardley Map:

1. Define the user need at the top of the map
2. Identify components that serve that need (each is a node)
3. Map dependencies (component A depends on component B — draw lines)
4. Position each component by evolution stage:
   • Genesis: Novel, uncertain, requires exploration (e.g., new AI technique)
   • Custom-built: Understood but bespoke (e.g., proprietary algorithm)
   • Product/Rental: Available as a product (e.g., commercial CRM)
   • Commodity/Utility: Standardized, pay-per-use (e.g., cloud compute, electricity)
5. Identify movement: Components naturally evolve left to right over time. Anticipate what will commoditize next.

Strategic Plays from Wardley Maps:

• Build what's in Genesis/Custom (your differentiator)
• Buy/rent what's in Product stage (don't reinvent the wheel)
• Use commodity for anything in Utility (optimize cost)
• Watch for disruption: When a custom component starts becoming a product, prepare for new entrants

When to Use: Technology strategy, build-vs-buy decisions, identifying where to invest vs. outsource, anticipating disruption.

Framework Selection Decision Tree

Use this decision tree to choose the right framework based on the strategic question:

Q1: What is the primary question?

• "Should we enter this market?" → Go to Market Assessment
• "How do we grow?" → Go to Growth Strategy
• "How do we cut costs / improve efficiency?" → Go to Operational Strategy
• "How should we organize?" → Go to Organizational Strategy
• "What should we build / invest in?" → Go to Innovation/Investment Strategy
• "How do we respond to a competitor/disruptor?" → Go to Competitive Strategy

Market Assessment:

• Size the opportunity → TAM/SAM/SOM (market-research skill)
• Assess attractiveness → Porter's Five Forces
• Scan macro environment → PESTEL
• Evaluate fit → Market Opportunity Assessment (weighted scoring)

Growth Strategy:

• Determine growth direction → Ansoff Matrix
• Prioritize business units → BCG Matrix or GE-McKinsey Nine-Box
• Plan time horizons → Three Horizons of Growth
• Design business model → Business Model Canvas
• Identify uncontested space → Blue Ocean Strategy

Operational Strategy:

• Map processes → Value Chain Analysis
• Identify waste → Lean 8 Wastes (operations-analysis skill)
• Reduce costs → Zero-Based Budgeting, Spend Analysis
• Improve quality → DMAIC / Six Sigma

Organizational Strategy:

• Assess alignment → McKinsey 7S
• Measure performance → Balanced Scorecard
• Set goals → OKR Framework
• Clarify roles → RACI Matrix

Innovation/Investment Strategy:

• Understand customer needs → Jobs-to-Be-Done
• Map technology landscape → Wardley Map
• Evaluate investments → NPV/IRR analysis (financial-analysis skill)
• Prioritize → Impact vs. Effort Matrix

Competitive Strategy:

• Assess current position → SWOT/TOWS
• Choose strategic position → Porter's Generic Strategies
• Analyze advantages → VRIO Framework (competitive-analysis skill)
• Simulate responses → War Gaming

For detailed framework application guides, templates, and case examples, consult the reference files in the references/ directory.