Strategic group analysis is very necessary

Strategy group, also called strategy cluster, refers to a group of enterprises sharing the same or the similar strategic characters in an industry (Bensoussan, 2004).In an industry, if all the enterprises are following the same strategy, then there is only one strategic group in the industry. Strategic group analysis is to divide enterprises into different strategic groups according to their strategic position and analyze the inter-relationship among theses groups and relationship among enterprises, so that to know more about the enterprises and their competitive conditions (Hennessey, 2010). Strategic group analysis includes organizational diagnosis and environment analysis and it is conducted through collecting materials and analyzing the internal and external environment. If an enterprise only has clear strategy without the means and management measures of the strategy, the strategy is just an empty slogan. The purposes of strategic analysis are: to get scientific competition strategy through comprehensive and systematic analysis; to have clear developing direction and business developing procedures; strategic of the enterprise gets an agreement and exchange in the organization; to have the same developing direction and work together to realize the strategic goal; to let the employees to recognize and support the strategy and goal of the enterprise and to strengthen their sense of responsibility; to build strategic decision making mechanism and to make the strategy scientific and forward-looking; to value long term development as well as short term performance; to constantly improve the overall achievement and core competitiveness of the enterprises (Hennessey, 2010).