HI6006 | Competitive Strategy | The Main Strategy Development Tools

Write an essay explaining what the main strategy development tools are and how they are used in business.

Pestle analysis

It is considered as a framework that impacts the overall strategic planning of the workplace. It has been seen that through this there are various macro environmental aspects that focuses on the factors that give influence to the overall operations of the company. The factors related to macro environment give long term impact on the operations of the company. This tool is considered for business operations and also for the strategic planning so that success can be achieved (Shatskaya, Samarina and Nekhorosheva, 2016).

Also there are factors related to organizational change, development of products and also proper planning which will help to understand the external environment. Through this it has been seen that companies can enhance the opportunities and reduce the threats in context to the companies’ objectives (
2">Harding, 2017).

Political factors refer to the pressure and opportunities related to political institutions and also the factors are considered which will impact the business. Economic factors also focus on the policies of the economy and also with the economic structure which affect the business. The social factors are concerned with the cultural aspects, attitudes and beliefs that will impact the overall demand of the products. The factors also focus on giving impact on the overall operation of the company (Barbuto Jr, 2016).

Practical example related to Vodafone

The political factor influences the overall progress of the company and also the affect is also seen on the infrastructure. The company also focuses on the political instability which gives direct impact on economy. For example: according to the recent conflict in Europe the impact is seen on the company. In economic factor the affect is also seen on the overall profits of the company. Technological factor also impact the process of innovation which will help to launch new models and devices in the market. Legal factor is also related to the pirated issues which give impact on the activities of the company.  Environmental factor of the company is related with following ethics so that growth can be maintained of the company in society.

Porter five force analysis

This tool is considered by the company so that industry attractiveness can be considered and also overall profitability can be achieved.  It is one of the popular strategic tools that help the company to focus on the business strategies so that operations can take place in the right manner. Porter also considered this concept so that proper watch can be kept on the rivalries in the market (Porter and Heppelmann, 2014). This concept encouraged that actions in relation to the competitors can be analyzed in a proper manner. It has been seen that these concepts have given an opportunity to the company to analyze the environment and take corrective actions. It is important to analyze the competitors in the market so that companies can easily attract the customers with price cut and can give impact on the market campaigns. Also in the market it is important to focus on the power of suppliers so that prices can be maintained in the market. Next is related with threat of new entry in which overall analysis is made if the new entry into the market (Friis, Holmgren and Eskildsen, 2016).

Example of Amul

It has been investigated that there are small business who are giving same types of products in the market. The threat of entry in the market is high and also the substitution rate is high as products can be substitutes easily in the market. Power of buyer is also high as there are many customers who are availing the services or the products of the company. So, it can be analyzed that there is high rivalry in the market which is giving high competition in the market.

Ansoff strategy

It is one of the strategies that focus on corporate growth strategies and also this framework focuses on the recent products and customers. This strategy is beneficial for the company and it is considered by the top management so that operations can take place in the right direction. There are four growth strategies like market penetration, market development, product development and diversification. Market penetration is related with the overall growth with the products which exist in the present market segments and also it aim in enhancing the share of the market (Ramdani et al., 2018). Market development also targets the existing products to the new market segments. The next is related with the product development in which the companies create new products that target the present market segments. The last is related with diversification in which company grows into the market so that new products can be developed. In this framework the market penetration strategy is risky as it leverages many of the resources and capabilities which are present in the market (Loredana, 2016).

Example of Ansoff strategy in reference to Starbucks

By considering this strategy it has been seen that this helps the marketers to grow the organization with the products and services that exist in the market.  In reference to market penetration the examples of the company are related to Espresso, Mild and Cappuccino. Product development is also related to Starbucks via ready brew and also the Starbucks card. In relation to the market development Frappuccino blended coffee and also Frappuccino light blended coffee can be an example. In the diversification factor mugs, tumblers and also coffee machines are related to it. These factors help the company to grow in the market and also focus on considering the overall goals and objectives in an effective manner.

Resource based view analysis

This tool is considered as a framework that is considered to focus on the strategic resources with the potential to offer comparative advantage of the firm. These resources if taken into consideration can exploit by the company to achieve the overall advantage of the company. This tool is beneficial for the company to achieve and focus on considering the advantage so that it can be simple to accomplish goals and objectives in the right manner. Resource based view focuses on the resources of the company which are tangible and also intangible. This tool is considered by the management team of the company as they focus on maintaining the resources in the workplace so that activities can take place smoothly (Elmes and Barry, 2017).

Example of resource based view

In context to the apple company it has been seen that company take into consideration tangible and intangible assets. The tangible resources are related to physical resources in which there are apple stores which focuses on sales locations and also advertisement strategy so that goals can be achieved. Next is related with human resources in that the employees are highly skilled and also consider the creative problems so that solutions can be considered effectively. Intellectual factor is also one of the factor in which the companies emphasizes on the overall brand, patent and partnerships.  The company also focused on considering the latest technologies so that consumers can avail the products in a proper manner. There are many competitors in the market like Samsung so it is important to maintain the services so that growth can be achieved in the right way. It has been seen that the company should focus on maximizing the customer satisfaction so that growth can be achieved.

References

Barbuto Jr, J.E., 2016. How is strategy formed in organizations? A multi-disciplinary taxonomy of strategy-making approaches. Journal of Behavioral and Applied Management, 3(1), p.822.

Elmes, M. and Barry, D., 2017. Strategy retold: Toward a narrative view of strategic discourse. In The Aesthetic Turn in Management (pp. 39-62). Routledge.

Friis, O., Holmgren, J. and Eskildsen, J.K., 2016. A strategy model–better performance through improved strategy work. Journal of Modelling in Management, 11(3), pp.742-762.

Harding, S., 2017. MBA management models. Routledge.

Loredana, E.M., 2016. The Use Of Ansoff Matrix In The Field Of Business. In MATEC Web of Conferences (Vol. 44, p. 01006).

Porter, M.E. and Heppelmann, J.E., 2014. How smart, connected products are transforming competition. Harvard business review, 92(11), pp.64-88.

Ramdani, D., Primiana, I., Kaltum, U. and Azis, Y., 2018. Business Growth Strategy: Collaboration-Literature Review. Sustainable Collaboration in Business, Technology, Information and Innovation (SCBTII), 1(1).

Shatskaya, E., Samarina, M. and Nekhorosheva, K., 2016. PESTEL analysis as a tool of strategic analysis in international markets. Scope academic house b&m publishing, p.47.