Enterprise Strategy:

Business Environment

Business Space / Strategic Landscape

Selecting the Playing Field for Your Business

By: Vadim Kotelnikov

Founder, Ten3 Business e-Coach Inspiration and Innovation Unlimited!

 

 

"The choice of what Business Space to occupy is the single most important decision a firm must take."

~ Bruce A.Pasternack and Albert. J. Viscio

 

Business Environment Business Ecosystem Strategic Landscape Business Designs Enterprise Business Process Management

 

Differentiation Strategies

 

 

Two Varieties of Business Spaces1

  1. Old and Occupied Business Space has a well-established order and congested with competitors

  2. New and Unoccupied Business Space wild, unprotected, lots of opportunity, and lots of risk

Business Space Defined

Business Space, also referred to as Strategic Landscape, is the playing field you occupy. The term "Business Space" derives from the notion that firms occupy market positions that can be delineated by a set of dimensions.

How much shareholder wealth your company creates is determined by how much of the business space your organization occupies and how valuable your position is.

Creating Sustainable Profit Growth: 9 Questions

 Case Study  Cisco

Cisco Systems Inc. defined its business space and market segments in three overlapping target areas:

 

  1. Big corporations, educational institutions, government agencies, and utilities who have complex networking needs that involve multiple locations and several different types of computer systems

  2. Small- and medium-scale enterprises (SMEs) who want their own Intranet data networks, as well as connections to the Internet and intimate data links with business partners

  3. Information service companies that include telecommunication carriers, Internet service providers, cable companies, and wireless communication providers.

SPACE Matrix Strategic Management Method

The Strategic Position & ACtion Evaluation matrix or short a SPACE matrix focuses on strategy formulation especially as related to the competitive position of an organization.

Surprise To Win: 3 Strategies

The SPACE matrix is a strategic management tool used to analyze a company and determine what type of a strategy it should undertake. It can also be used as a basis for other analyses, such as the SWOT analysis, BCG matrix model, industry analysis, or assessing strategic alternatives

The SPACE matrix can be created using the following seven steps2:

  1. Choose a set of variables to be used to gauge the sustainable competitive advantage (SCA), industry strength (IS), environmental stability (ES), and financial strength (FS).

  2. Rate individual factors using rating system specific to each dimension. Rate sustainable competitive advantage (SCA) and environmental stability (ES) using rating scale from -6 (worst) to -1 (best). Rate industry strength (IS) and financial strength (FS) using rating scale from +1 (worst) to +6 (best).

  3. Find the average scores for sustainable competitive advantage (SCA), industry strength (IS), environmental stability (ES), and financial strength (FS).

  4. Plot values from step 3 for each dimension on the SPACE matrix on the appropriate axis.

  5. Add the average score for the sustainable competitive advantage (SCA) and industry strength (IS) dimensions. This will be your final point on axis X on the SPACE matrix.

  6. Add the average score for the SPACE matrix environmental stability (ES) and financial strength (FS) dimensions to find your final point on the axis Y.

  7. Find intersection of your X and Y points. Draw a line from the center of the SPACE matrix to your point. This line reveals the type of strategy the company should pursue.
     

 

 

 

 

References:

  1. The Centerless Corporation, Bruce A.Pasternack and Albert. J. Viscio

  2. "SPACE Matrix Strategic Management Method," Maxi-Pedia

  3. 3 Strategies of Market Leaders, Vadim Kotelnikov

Enterprise Strategy

Strategy Management

Business Strategies

Competitive Strategies

Strategic Intent

Blue Ocean Strategy

Strategy Innovation

Strategy Formulation

Strategic Planning

Business Environment

3 Generic Business and Marketing Strategies

The Strategist's 15 Rules

Working On Your Business

SWOT Analysis

Critical Question Analysis

Strategic Management

Strategic Thinking

Strategic Leadership

Strategic Achievement