Applied Corporate Strategy

This study material focuses on applied corporate strategy, specifically conducting external analysis of business environment, analyzing organization's resources and key competences, and evaluating a recent strategy implementation. The case study revolves around the merger of Fiat Chrysler and Peugeot owner.

Applied Corporate
Strategy

Contents
INTRODUCTION.......................................................................................................................................3
MAIN BODY..............................................................................................................................................3
1) Conduct external analysis of business environment and industry in order to identify a different
opportunities and threats and assess industry attractiveness....................................................................3
2) Analyze an organization’s resources and key competences as well as identify its core competences
(key factors which gives a company competitive advantage)..................................................................6
3) Select one strategy that the company implemented recently and evaluate it using SAFe criteria......10
CONCLUSION.........................................................................................................................................12
REFRENCES............................................................................................................................................13

INTRODUCTION
Corporate strategy is determined as a strong systematic strategic plan for an organization.
Corporate is considered as the goal and direction that a company needed for the attainment of
desire aim by developing proper plan and strategy related to business operations and practices.
This is also determined as a long term vision that a company needs to attain for achieving the
desire goal (Ben-Amar, Boujenoui and Zéghal, 2014). Organization case selected for respective
is based on merger of Fiat Chrysler and Peugeot owner. Fiat Chrysler Automobiles (FCA) is
operating in automotive industry and they offer their products and services at the worldwide
level. Respective company is introduced in 2014, now they are announcing merger with its
United State Italian rival Fiat Chrysler but this merger will face political as well as financial
hurdles. The merger is consider that they come up with new idea and become world’s number
one automation industry. Respective report include several topics through numbers of models
such as PESTEL analysis, VRIO model analysis, Porter’s five force, value chain analysis as well
as resource analysis. This report will also include weaknesses and strengths of merger conducted
among Fiat Chrysler Automobiles and Fiat Chrysler.
MAIN BODY
1) Conduct external analysis of business environment and industry in order to identify a different
opportunities and threats and assess industry attractiveness.
PESTEL Analysis
 Political factor: It will include government policy, political stability, tax policy, tax
policy and so on. Political factor impact high impact on the business so it is essential for
firm to develop strategies according (Bereskin and Hsu, 2016). In respect of merger
among the Fiat Chrysler Automobiles and Peugeot owner, political impact is high. In
respect of both the companies it is essential to consider political factors like government
policy, tax policy, and political stability and so on while developing decision. It is so
because that will provide opportunity conduct business successfully in the world.

o Threat – In the merger of Fiat Chrysler Automobiles and Peugeot owner political
parties are highly involved due to which it is seem as the barriers as well as there
is also few office where there is hidden corruption which impact on business plan
related to merger.
 Economical factor: This factor will include economic condition of the nation and their
people as company need to develop strategies accordingly so that they can sustain in the
market successfully for long time. In respect of merger between the Fiat Chrysler
Automobiles and Peugeot owner they planning to become one of the largest automobile
company as well as they also want to offer number of brands vehicle under one roof such
as Alfa Romeo, Citroen, Jeep, Opel, Peugeot and Vauxhall (Churet and Eccles, 2014).
While this they need to consider economic condition of population. Merged companies
need to consider economic condition of the population in order to gain opportunities as
that will help them in more and more customers as well as they also able to increase sell
of their electronic vehicles successfully.
o Threat – Economic condition of the nations get fluctuate which impact on the
company business because buying power of people also get imbalanced. In
respect of merger among Fiat Chrysler Automobiles and Peugeot owner is that
when economy fluctuate their sales directly get impacted.
 Social factor: It is necessary for every firm to consider social factor developing decision
related to products and services. It is so because need, demand and expectation of society
get change according to time. In respect of this merged companies i.e. Fiat Chrysler
Automobiles and Peugeot owner are introduce electric and autonomous vehicles while
this they need to consider social aspects too.
o Opportunity – The opportunity for Fiat Chrysler Automobiles and Peugeot owner
through introduction of new electric and autonomous vehicle is that they able to
attract more and more customer around the world. Moreover it will also help
society in minimizing rate of increasing pollution around the surrounding.
 Technological factor: it is determined as one of the necessary factor which helps a
company in adopting new as well as advance technology so that they can develop more
innovative as well as creative products as that will help in increasing sales (Feizabadi,
Singh and Motlagh, 2014). In respect of merged firm Fiat Chrysler Automobiles and

Peugeot owner they want to become biggest cars maker around the world in respect of
this they may use technology.
o Opportunity – Opportunity related to merger of Fiat Chrysler Automobiles and
Peugeot owner is that they able to adopt new technology properly as well as they
also able to introduce new products or vehicle which is electronic and
autonomous based successfully.
 Environmental factor: In current time all the nations are facing environmental issues as
well as the main reason of increasing pollution at such rate is that there are too many
vehicles on road which increase air and sound pollution (Gazzola and Colombo, 2014). In
respect of this merger of Fiat Chrysler Automobiles and Peugeot owner are developing
new technology based cars that is electronic as well as autonomous based which help in
increase business.
o Threat – In order to develop products or vehicle which is eco friendly is
expensive as compare to the other one, this may impact on the overall budget of
the firm as well as if the vehicle not get succeeded in market then it leads to huge
loss for companies.
 Legal factor: It is essential for each and every company to conduct their business in legal
manner and for that they need to develop their strategies, plans and methods according to
nation rules and regulations (McManners, 2014). This may also help in avoiding legal
issues which arise when company conduct illegal practices. In respect of Fiat Chrysler
Automobiles and Peugeot owner they are conducting business at numbers of location
around the world.
o Threat – The threat of respective element is that Fiat Chrysler Automobiles and
Peugeot owner need to follow each and every legislation of every which is very
hectic for management as well as they also needs to develop new decision and
policies according to location.
Porter’s Five Forces
 Bargaining power of buyers – The bargaining power of customers for Fiat Chrysler
Automobiles and Peugeot owner is low because respective companies offer quality
vehicle as well as them also planning to provide all types of vehicle under one floor.

Along with this respective companies also planning to introduce new electronic as well as
automotive vehicles in order to minimize carbon emission and so on. This will help in
attract customers and retaining with their brand for long time.
 Bargaining power of suppliers – The bargaining power of supplier will be moderate
because both Fiat Chrysler Automobiles and Peugeot owner are well known companies
so they have quality relationship with supplier which helps them on gaining products at
proper price (Minár, 2016). But there are some products which suppliers are limited due
to which they ask for high amount sometime due to which power of suppliers are
moderate.
 Competitive rivalry – Both Fiat Chrysler Automobiles and Peugeot owner are operating
at the world wide level due to which they experienced competitions from both market
national as well as international. This shows that competitive rivalry is high for the
respective companies at the potential marketplace.
 Threat of substitutes – Fiat Chrysler Automobiles and Peugeot owner are operating in
the automatic industry which means that there are several other companies which offer
same types of products but that may include different features. On the other hand these
companies merger which will leads to enhance in the products quality as well as they also
planning to introduce electronic and automotive based vehicles which help them in
gaining market shares. This shows that threat of substitutes for respective companies are
moderate.
 Threat of new entry/ exit – The Fiat Chrysler Automobiles and Peugeot owner are
conducting merger through which they able to enhance their market coverage as well as
they also planning to introduce new electronic as well as autonomous based vehicle
which attract more and more customer around the work (Pantano, 2014). So threat of new
entry and exit will be low for the respective company as it is not easy for others to touch
respective company level.
2) Analyze an organization’s resources and key competences as well as identify its core
competences (key factors which gives a company competitive advantage).
VRIO Analysis
Resources Valuable Rare Inimitable Organized

Manufacturing
process
Yes - - -
Technology Yes Yes - -
Brand popularity Yes Yes Yes -
Employees Yes Yes Yes Yes
Valuable – It is considered as those factors which are valuable for the firm as by it they can
attain their desire goal as well as competitive advantage at market. In respect of merged
companies i.e. The Fiat Chrysler Automobiles and Peugeot owner their various resources are
valuable.
 Manufacturing process – The manufacturing process of respective company is effective
as they use quality products which help in gaining competitive advantage (Parawansa,
2015).
 Technology – Respective companies are going to introduce new vehicles based on
electronics as well as autonomous which attract customers and achieve advantage.
 Brand popularity - Both the companies have strong presence in local as well as
international market which is advantage for the firm.
 Employees – The staffs of both firms are skilled, experienced and knowledgeable which
is effective resource for firm.
Rare – It refers to those which are rare for the company as that is not available by other
competitive company at the marketplace. In respect of Fiat Chrysler Automobiles and Peugeot
owner their manufacturing process is not rare but there some other resources are rare which help
in attracting customers and investors.
 Technology – Respective company is going to introduce all types of vehicle under one
roof as well as they are also planning to introduce electronic as well as autonomous
vehicles for attracting customers (Park, 2014).
 Brand popularity – Both Fiat Chrysler Automobiles and Peugeot owner are famous
around the world which help them in attracting more and more customers and increase
sales.
 Employees – The employees of respective company are highly skilled and they get
trained regularly so they are considered as rare resources.

Inimitable – It is determined as those resources which cannot be copied by other companies
around the world. In respect of Fiat Chrysler Automobiles and Peugeot owner their some
resources can be easily imitable by others companies such as manufacturing process and
technology. But there are few resources which are inimitable-
 Brand popularity – The market presence of both respective companies is strong which
help them in gaining competitive advantage as well as it cannot be copied by others.
 Employees – Staff of Fiat Chrysler Automobiles and Peugeot owner are highly skilled
and loyal to firm which make them inimitable.
Organized – It is determined are those resources which are need to be organized after some time
so that it can remain same (Puranam and Vanneste, Purce, 2014). In respect of Fiat Chrysler
Automobiles and Peugeot owner their several resource are need to be organized after short
duration of time such as manufacturing process, technology and brand popularity. On the other
hand there is some resource which not required same.
 Employees – Employees of Fiat Chrysler Automobiles and Peugeot owner are skilled and
they didn’t require much training for conduct any particular work.
Value chain
Primary Activities
 Logistics – In is considered as centre through which a company manages their
distribution work or practices so that customers get proper products as well as proper
time. it is essential for firm to manage their warehouse or logistic process in best manner
as that will help in determine demand at the potential market according to which supply
can be done at the proper time. in respect of Fiat Chrysler Automobiles and Peugeot
owner their management need to determine demand of electric as well as autonomous
vehicle according to which they need to develop strategies and plan as that will help in
fulfilling need as well as expectation of customers successfully (Rugman and Verbeke,
2017).
 Marketing – It is essential to for company to conduct marketing activities for promoting
its business in effective manner. In respect of Fiat Chrysler Automobiles and Peugeot

owner they conduct proper marketing campaign through digital and non digital platform
for attracting customers.
 Operations/ Sourcing – It is considered as supply chain practices of a company for
supply products and services at proper place timely (Samarasinghe, 2016). In respect of
respective companies they open stores at different locations so that as well as they also
manage their warehouse in proper ways so that there will be no shortage of products.
 Products design – It is essential for companies to deign quality product and service
according to demand of customers. In respect of Fiat Chrysler Automobiles and Peugeot
owner the develop products according to requirement of current time like vehicle with
electric as well as autonomous feature.
Support Activities
 Firm infrastructure – It is determined as factor which ensures that a company must
follow legal structure, proper structure of management and financial structure as that lead
to accomplishment of operations properly for attaining desire goal. In respect of Fiat
Chrysler Automobiles and Peugeot owner they conduct merger and they are designing
infrastructure in effective ways so that they can offer all types of vehicles under one
floor.
 Human resource management – Respective department plays major role in a company
as they help in hiring, training, development, promotion, and appraisal and so on.
Through this employees feel motivate and encouraged to conduct work in effective
manner for attaining desire goal (Spear and Roper, 2016). In respect of Fiat Chrysler
Automobiles and Peugeot owner they have effective HR management which encourages
staff to adopt new technologies for enhancing their sales and profit.
 Systems – It is considered as method which is adopted by an organization in order to
conduct business operation and functions in effective manner. In respect of Fiat Chrysler
Automobiles and Peugeot owner they develop proper system for conducting their work
in so that they can attain desire goal of introducing new vehicle with feature of electric as
well as autonomous.

3) Select one strategy that the company implemented recently and evaluate it using SAFe
criteria.
TOWS Analysis
Internal factors
External factors
Strengths Weaknesses
Opportunities
Fiat Chrysler
Automobiles and
Peugeot owner is
conducting merger
and it is their
strengths that they
have effective
resources like
technology,
employees and brand
popularity which help
them in gaining
opportunity by
attracting people or
society as well as
implementing best
technology (Park,
2014).
The manufacturing
process is weak of
respective company
so it is essential for
them to improve it
properly as through
that they can able to
attain opportunities
related to the social as
well as technological
factors (Zhu and
Chen, 2015). Through
this they also able to
attract more
customers.
Threats
The strengths of
respective company
are technology,
employees and brand
popularity which
those in facing threat
Fiat Chrysler
Automobiles and
Peugeot owner
management need to
improve their
manufacturing

related to legal,
environmental,
economical and
political. As they able
to perform their task
in best way for
attaining their desire
goal and mission (Zhu
and Chen, 2015).
procedure as through
that they able to
overcome threats
which are related to
political, economical,
environmental and
legal in successful
manner.
SAFe Analysis
For understanding effectiveness of the strategies developed through analyzing strengths
and weaknesses management of merged Fiat Chrysler Automobiles and Peugeot owner adopt
SAFe analysis, which is mentioned below:-
 Suitability – At this factor an organization management will evaluate opportunity as well
as stabilities of a specific strategy which is developed according to the situation, strengths
and weakness (Minár, 2016). In respect of Fiat Chrysler Automobiles and Peugeot owner
they conduct merger and in order to attain opportunity at the marketplace they need to
adopt new as well as advance technology as through that they can develop innovative
product. Through this they can attract more and more customers towards their business
around the world as well as it will also leads to increase in business and profitability
ration successfully.
 Acceptability – In respect of this a company’s management need to develop strategies as
well as plans that must be accepted by their stakeholder as well as they also need to
determine risk which incurred in the specific strategies or plans. It is so because
suggestions of stakeholders are important for the company growth. In respect of merged
company Fiat Chrysler Automobiles and Peugeot owner they must showcase their plan in
front of stakeholders that they want to launch new vehicle based on autonomous as well
as electric as well as they also planning to become world largest automotive brand. In the

plan respective company management also need to determine risk so that they can
develop strategies at the initial stage successfully.
 Feasibility – This is the last aspect of the respective analysis in which management need
to determine whether the strategy which they proposed is real as well as practical in
nature. Moreover they also evaluate whether firm able to attain their desire goal of
growth at market will be attain or not (Parawansa, 2015). In context of merged firm Fiat
Chrysler Automobiles and Peugeot owner they need to determine practicality of the plan
of launching electric as well as autonomous vehicle as well as developing store where all
type of vehicle are available under a roof. Furthermore if management determine plan as
a fruitful then the plan will be executed.
CONCLUSION
Through the analysis of above mentioned topics it can be determined that for conduct
business in successful manner a company need to consider several factors and for that they may
implement numbers of theories such as PESTEL as through that external environment may
evaluate. They also need to adopt porter’s five force model as that will help in determining
market situation and their situation at similar market. Moreover company also need to conduct
VRIO analysis for evaluating resources as well as they also required to analyze internal
environment and for that they may conduct SWOT analysis. Through this management able to
understand situation proper and develop decision accordingly which leads to attainment of desire
goal successfully.

REFRENCES
Books and Journals
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