26.04.2022

What is the ASTRA method used for?

Key information

  • ASTRA method is a type of strategic analysis, which consists of the evaluation of the previously adopted management strategy and diagnosis of the internal and external situation of the organization and the subsequent modification, rejection or development of a new strategy.
  • We start the execution of the astra analysis by diagnosing the actual state of the organization and determining the viability of the previously adopted strategy.
  • The second phase of the ASTRA method is the analysis of the companies' competitive environment. This phase boils down to determining the company's position relative to competitors and identifying opportunities and threats inherent in the company's external environment.
  • The next step of the ASTRA method is to examine the organization and operation of the company.
  • The last step is to collect the information obtained in the previous stages, prepare options for further operation of the company and choose one of them

What is the ASTRA method?

The ASTRA method is type of strategic analysis, which is aimed at 2 main areas of the organization's activities. The first is the evaluation of the previously adopted management strategy and the diagnosis of the internal and external situation of the organization. The second area is the modification of the existing strategy, its rejection or the development of a new concept of operation.

ASTRA analysis can be divided into 4 major phases:

  • Evaluation of the implementation of the adopted strategy,
  • Analysis of the competitive environment,
  • Study of the organization and operation of the enterprise,
  • Strategic options design.

ASTRA Method Helps to decide on the further long-term strategy of the company's operations Based on the current situation of the company. This analysis is most often used by the top management of large organizations, but can also be used successfully in smaller businesses.

There are 4 stages of astra analysis:

  • Evaluation of the implementation of the adopted strategy,
  • Analysis of the competitive environment,
  • Study of the organization and operation of the enterprise,
  • Designing strategic options

ASTRA method - how to apply it?

In the first phase of the ASTRA method, it is necessary to assess the effectiveness of the implementation of the strategy adopted earlier, in other words make a diagnosis of the actual state of the organization. An important action to be taken is the so-called public needs survey, i.e. Identify the needs of society that the organization can meet. It is important to assess whether the company's mission statement actually reflects real social needs, both those that the company can meet with its core operating activities (production, service or sales) and those that relate to corporate social responsibility (CSR).

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    In the first phase, it is also important to determine the profitability of the adopted strategy. It is therefore necessary to look at the financial results achieved, calculate the financial indicators of profitability, liquidity and solvency of the company, and then assess whether they reach the optimal value. If a company is in an unfavorable financial situation, it is forced to focus on corrective actions, and the company's mission and goals cannot be realized until the situation improves.

    The second phase of the ASTRA method is analysis of the company's competitive environment. This stage boils down to determining the company's position relative to competitors and identifying opportunities and threats inherent in the company's external environment. The following can be used to determine market position Porter's 5 forces analysis and metrics such as:

    • market share,
    • The volume of revenue from the sale of products or services,
    • profit achieved,
    • brand value,
    • The share of exports and domestic production in the total value of sales,
    • Quality and production indicators of products.

    On the other hand, in order to determine opportunities and threats in the external environment can be applied SWOT analysis or PEST analysis.

    The next stage of the ASTRA method is examine the organization and operation of the company. This phase refers to the assessment of the company's internal situation, identifying the organization's strengths and weaknesses in the following areas:

    • economic and financial situation,
    • Marketing,
    • employment and wages,
    • quality control system,
    • Organizational structure and management process.

    SWOT analysis can again be used in this phase. At this stage of the ASTRA method, you should look for ways to to level and eliminate errors and malfunctions in specific areas, with the first consideration being whether problems can be eliminated with internal company resources that do not require additional financial outlays.

    The final phase of the ASTRA analysis is design a strategic option, that is, to gather the information obtained in the previous stages, prepare options for further operation of the company and choose one of them. This can be both a modification of the existing concept of action, its rejection or the adoption of a completely new strategy. This is an extremely important stage of the ASTRA analysis, because the implementation of the selected variant of action will involve the commitment of time, energy and financial resources often in the long term. Therefore, it is necessary to carry out A sound assessment of the effectiveness of each of the available options for action, so that the ASTRA analysis will not have to be repeated soon.

    Summary

    ASTRA analysis is an effective yet relatively simple tool to determine further business strategy based on an assessment of the effectiveness of the company's existing operating program and market situation.

    Its undoubted advantage is that it can be carried out with extensive research work, as well as simplifying the process by focusing on obtaining the most important data on the company's conditionality. The use of the ASTRA method may prove to be the key to a company's market success.

    Wojciech Majek

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