Applied Corporate Strategy Assessment

Applied Corporate
Strategy Assessment
Strategic Analysis Report

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY..................................................................................................................................1
External analysis..........................................................................................................................1
Internal analysis...........................................................................................................................4
Strategy evaluation......................................................................................................................8
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................13
APPENDICES...............................................................................................................................14

INTRODUCTION
Corporate strategy is mentioned to companywide plan for selecting addition to developing
specific markets to compete as well as make improvements in wide units or divisions of
business. Moreover, it entails long term together with clearly defined vision which is set by
company that is seeking to generate values and influence employees to execute proper actions
that helps in attaining advantages and satisfactory outcomes in competitive world (ArAs, 2016).
The report is about Sainsbury which is leading supermarket that offers groceries and various
other products in its supermarket, forecourt shops, superstore and convenience shops. The report
involves external analysis through relative frameworks of PESTLE analysis and Porter’s Five
Force Analysis. Further, it includes internal analysis and resource capabilities with the
application of VRIO analysis to identify core competence of the company. At last, strategy of
Sainsbury - Asda merger is evaluated by using SAFe Test that includes Suitability Acceptable
and Feasibile.
MAIN BODY
External analysis
It refers to examining extrinsic environment of business which involves factors like social,
technological, competitive structure and hence forth (Bailey and Burch, 2017). The main
objective of external analysis is to identify opportunities along with threats in any segment of
factor that drives volatility, growth as well as profitability of company. The manager of
Sainsbury uses the following frameworks for the purpose of external analysis:
PESTLE analysis
It refers to the framework related to macro environmental factors that is used for the
environmental scanning. In case with Sainsbury, following are the factors that impacts the
business and either create opportunities or results in threats:
Political factors: These explain about the intervention of government in particular
industry. In UK, it is seen that there is stable and strong political system that provide numerous
opportunities to companies working in it (Basu and Miroshnik, 2018). For example, the
government of the nation makes contractual agreement with various other countries that is an
opportunity for Sainsbury to diversify and grow the business in other countries also. However,
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decision of the government for the occurrence of Brexit impacts on organisational shops and
prices which is a threat for Sainsbury as it has to close its various shops or stores in cities of
European Union that impacted negatively on it sales and revenues.
Economic factors: These are related with fundamental elements that are interest rates,
business cycle, wages, unemployment level, consumer disposable income and hence forth
(Bravo, Reguera-Alvarado and del Pilar Pérez, 2018). Economic environment of UK is
developed along with market oriented. It is also analysed that the employment rate in the nation
are hitting hard. There are various changes experiences within economic cycle of UK that creates
threats for Sainsbury. For example, when situation like inflation is experienced that company has
to cut its cost in order to increase sales and improve bottom line. This results in threat of
reduction of costs for Sainsbury due to some changes within economic cycle.
Social factors: Variable that arises from community, culture, religion, belief, ideology,
attitude, communication and lifestyle of an individual is termed to social factor. The society of
UK changes their actions and way of thinking rapidly which creates threats for companies. For
example, when audiences make some perception about offered products of Sainsbury and
switches to another companies. The situation creates threat of intense competition for Sainsbury
as various tactics are implemented by rivals to attract and retain customers with them.
Technological factors: Dimensions that are part of automation, upgradation, existence and
availability of technology are said to technological factors. Within UK, technology change
rapidly as companies prefers to work with updates and advance technologies. This provides
opportunity to Sainsbury for market expansion through online collaboration by using
technological analytics. Moreover, technological advancements within analytics including Big
data Usage as well as Artificial Intelligence allows entities to learn about operations so that they
can execute practices around the world in easier an convenient manner.
Legal factors: Factors that shows the aspects in which legislations impacts business
operations are said to legal factors (Dixon, 2017). Industry specific law, immigration regulations,
discrimination acts, employment laws and consumer protection tax are some of legal factors
which requires special attention from companies that operates in UK. When some company do
not adhere these legislations then they have to face huge uncertain situations. In case with
Sainsbury, it operates by in various nations and adhering all the legislations implied by the
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