Applied Corporate Strategy

This document provides an analysis of applied corporate strategy, focusing on external analysis, resources, and key competencies. It explores the concept of competitive advantage and evaluates strategies using SAFs criteria. The document also discusses the merger of Fiat Chrysler and Peugeot as a case study.

APPLIED CORPORATE
STRATEGY

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
External analysis to identify set of opportunities and threats and assess industry attractiveness
.....................................................................................................................................................1
Analyse resources and key competencies of organisation to identify strength and weaknesses
and examine core competencies for gaining competitive advantage..........................................4
Evaluate given strategy using SAFs creteria ..............................................................................7
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Corporate strategy refers to a strategic decision making approach that is useful to gain the
most valuable results for company sustainability. This report involves analysis of external factor
for examine the opportunities and threats so that industry attractiveness is to be gained. Further it
involves the use of VRIO and value chain for identifying the internal resources and competencies
so that competitive advantage can be gained. At last it includes the evaluation by using SAFs
model so that evaluation can be done effectively and efficiently. To complete this report it
includes the Fait Chrysler that can merge with Peugeot that is French company for enhancing
their market growth and share. Fiat Chrysler is one of the leading auto mobile sector that sold
their products to their customers in all the world. Merger is effective as it provide the new ideas
to the business industry in the world (Alanssari, and Mihaylova, 2019).
MAIN BODY
External analysis to identify set of opportunities and threats and assess industry attractiveness
PESTLE Analysis
 Political factor- This factor is basically includes the several types of government
policies, political condition stability, tax policies and many more. Political factor is
highly impact the business enterprise for developing the strategies effectively and
efficiently. In this at the time of taking merger of Fiat Chrysler automobil and Peugeot
owner this external factor impacts more on both the companies. In this government
stability, tax policies are creating the risk for the organisation that is represent as a threat.
The threat that occur within the Merger of Peugeot owner and Fiat Chrysler auto
mobiles, political parties of both the countries affect the working of the business
enterprises. For effective merger corruption is to be required that highly impact on
developing strategy and plan that is useful for gaining profits(Arok, 2019).
 Economic factor- In this several factors are to be included such as economic condition of
the countries and people present in the nation. It is very significant for companies to
develops and build number of strategies so that company can sustain within marketplace
for a longer period of time. By focusing on merger between Fiat Chrysler automobiles
and Peugoet owner they both are focusing on attaining the market position within auto-
mobile industry. As company offer the number of several types of vehicles such as Jeep,
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Opel, Citroen, Alfa etc. To provide the number of offerings to their customers
organisation can focus on economic condition of country and people. It is essential to
capture the opportunities after merging of both the companies so that they can effectively
sales their cares in different market area. In this major threat for the company is that
every country have their own economic condition and it can fluctuate every time that will
affect the merger of both Fiat Chrysler automobiles and Peoguet owner. It is very
essential for the company to understand the several factors of the nations like GDP,
Foreign exchange rates, spending power of customers so that merger is to be successful.
 Social factor- This term includes the values, norms, perception of the people of society
that can impact the company and their operations. This factor is based on social and
cultural values of the community people who are the consumers of the business
enterprise. In case of merger of Fiat Chrysler automobiles and Peugeot owner it very
impactful for attracting the customers by fulfilling their expectation related to vehicles so
that high profitable results can be gained out. In this the company enjoy the
opportunities that can be included in this factor. In this they can focus on launching the
electric cars that are valuable to customers and also environment friendly because of this
pollution is to be reduced so that high base of customers are to be attracted towards it and
firm will gain high profitable results(Cappa, Cetrini, and Oriani, 2020).
 Technological factors- It is an effective factor in current business environment because
adopting the advanced technology is helpful for successful business enterprise. It
represent the new innovation and improved design in producing the products and
services. It helps in generating the high profitable results and market growth in the
business industry that also helps in gaining competitive advantage. In terms of merger of
both the companies that are Fiat Chrysler automobiles and Peugoet Owner it is required
for them to develops the innovation in their manufacturing of cars so that they can sold
out effectively in several countries by placing a positive image in the customers mind.
This aspect is very useful to fulfil the demand of customers so that organisation can gain
successfully. It includes the opportunity for the Fiat Chrysler automobiles by merging
with Peugoet Owner because of including the number of innovative technologies in their
products and promotion techniques so that it will effectively attracts the number of
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competitors and helps in increasing the customers and profits (Cardoni, Kiseleva, and
Lombardi, 2020).
 Environment factor- It involves the laws related to environment that impact the
companies operations. In this organisation can focus on not to contributes more that
impact negatively to the environment. By focusing on this term company can introduce
the new launching that is technology based vehicle that specialise in not harming the
environment so that it will mainly attracts the number of customers. In this the major
threat for the company related to this factor is that it includes high cost by focusing on
the products and services that are environmental friendly which impact the business
overall operating cost. Due to this price of the vehicles are to be increased that impact the
overall sales volume of Fiat Chrysler auto-mobiles.
 Legal factor- In this factor legal laws and regulations are to be included that are imposed
by government for employees and consumer welfare. It is very significant at the time of
developing strategies and plans because it helps in adopting the essential laws that are
imposed by government. At time of merger between Fiat Chrysler automobiles and
Pioguet owner they belongs to different countries and at the time of merger including the
laws and regulations effectively. It is the major threat that a company can face.
Porter's five forces model
It refers to that strategy which is used to analysed the competition within business
industry. This term includes the five determinants that can helpful for merger of Fiat Chrysler
automobiles and Peugeot owner that can be shown below:
 Bargaining power of buyers- In case of Fiat Chrysler automobiles and Peugeot owner
merger the bargaining power of customers are to be reduced because both offers the
quality vehicles as compare to any other rival firms. The company also focus on
introducing the new set of vehicles that are quite difficult for another company to copy
and because of this buyers can loose their bargaining power because of qualitative
products company offer after merger(Feldman, 2020).
 Bargaining power of suppliers- It refers to that aspect that reflects the bargaining power
in relation to Fiat Chrysler automobiles and Peugeot owner merger. Because of merger
good relation is to be developed with the suppliers due to this their bargaining power is
moderate for both the companies. In this organisation can develops the strong relation
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with suppliers. As in this suppliers of both the companies are same because of this
suppliers cannot charge the high amount from them.
 Rivalry of the firm- By taken into relation this determinant both the companies that are
Fiat Chrysler auto-mobiles and Peugeot owner as they can face the major competition
because both have strong brand position in global and domestic market due to this power
of this aspect is high for Fiat Chrysler auto mobiles.
 Threat of substitutes- Fiat Chrysler auto mobiles and Peugeot owner both are working
in auto mobile sector and provides the high quality services and vehicles to their
customers. After the merger of both, it reflects the high quality and innovation in the
products that helps in reducing the substitute because they offers the differentiate
products related to auto-mobile sector which attracts the large number of customers
attractions(Foucault, and Frésard, 2020).
 Threat from new entrant- In auto-mobile industry the threat of new entrant is low. In
case of the merger of their companies that is Fiat Chrysler automobiles and Peugeot
owner they can cover the large market due to which entry of new firm is quite more
difficult. Because for entering into the market new firm focus on their capital and market
share for sustaining in market and for attracting customers offering new innovative
products so that they can give the competition. Hence, it is proved that power of this
determinant is low.
Analyse resources and key competencies of organisation to identify strength and weaknesses and
examine core competencies for gaining competitive advantage
Resources
And
Capabilitie
s
Valuable Rare Costly To
Imitate
Organised What is the result
Human
Resources
Yes - - - Competitive
disadvantage
Physical
Resources
Yes Yes - - Competitive
equality/parity
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Intangible
Resources
Yes Yes Yes - Temporary
competitive
Advantage
Product
Innovation
Yes Yes Yes - Unused competitive
Advantage
Customer
Satisfaction
Yes Yes Yes Yes Long-term
competitive
advantage
 Valuable Resources – It is a resource that grants high-end pricing, or enables price to be
modulate relative to its competitor. In context of Fiat Chrysler and Peugeot human
resources are valuable assets which helps in attaining the competitive advantage which
facilitate the delivery of tangible resources thus services for the better productivity of
company. In this organization physical resources are rare as it hires skilled workforce and
adapts innovative technologies which is making the great strength of company. Company
created a good reputation and credibility of its brand into market which helps in
increasing its customer base which makes it imitable hence it is a great strength. Fiat
Chrysler introduced innovative product strategies thus which provides advantages to firm
to launch its new products and enhanced its quality to increase overall performance of
organization thus fulfilling needs and wants of consumers creates customer satisfaction.
Its weakness are it decreased surplus net profit of conveyance due to fleet
selling(SAJJAD, 2019).
 Rare Resources – These are resources which can be procured by few organizations are
known to be as rare resources. In perspective of Fiat Chrysler human resources are
valuable as they are necessary for running a business thus to accomplish set targets. In
this organization physical resources are rare as it has introduced innovative technologies
thus resources are non-substitutable in nature thus creates its own customer base into
market. Strengths of the organization is its strong branding created global sales of its
products into marketplace. The company has lack of captive financing which is making it
a huge weakness of firm(Shahidan, Pandya, and Minh Thu, 2019).
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 Costly to imitate – The resources which are hard to imitate or difficult to create its
substitutes thus which are tough to copy by its competitors. In context of Fiat Chrysler,
intangible resources are valuable as they helps in creating brand building to enhance its
profitability. They are rare in nature as competitors not been able to make substitutes of
its products. Intangible resources are organised into nature which helps in better
development of products. Its weakness are organization delays and lacks in electrification
strategies thus to make an impact margins(Shavruk, 2019).
 Organised – It is last and final step of VRIO model that explains whether a capability or
its structure are source of competitive benefit recognizes that control is important but not
that sufficient to attain an advantage. Alternatively, it shall cost heavily to copy resources
or capabilities in terms of cost and money both. In Fiat Customer satisfaction is valuable
as it helps in knowing customers and wants for better delivery of services. Its products
are rare in nature because competitors are not able to make substitutes of its products thus
not able to copy them. As the organization is growing it is organised in its working
process for better proficiency. Its weakness are company product recalls which is causing
enormous financial losses. Its manufacturing process is weak because of merging of two
companies as both have different manufacturing and selling patterns.
Value Chain Analysis is a way to conduct a visually analyses of the company's business
operations and activities. The main purpose of it is to increase its production efficiency to deliver
adequate product at the minimum pricing.
Primary Activities
 Inbound logistics – In context of Fiat Chrysler and Pengeot, the company has merged for
the delivering better services to its clients. Company obtains goods from its suppliers the
raw material for manufacturing and producing final product. It is the first stage of
activities which helps in producing final products as raw material are been consumed to
manufacture the set patterns(Vukovic, 2020).
 Operations – In perception of Fiat Chrysler and Pengeot, its raw materials are converted
into final product. The value is added to the goods as it carry out through the product line.
After converting raw material the goods are been added to the distribution cycle to reach out to
its customers.
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 Outbound Logistics – In Fiat Chrysler and Pengeot, the manufactured products are
ready to be dispersal to distribution centres, wholesalers, customers and retailers thus
organisation performs distribution of final goods to deliver it to its customers.
 Marketing and Sales – The merging of two companies of Fiat Chrysler and Pengeot, has
helped in gaining the more customer base because of two companies coming together to
achieve its set targets and to increase the sales and profitability of organization. Company
attracts more customers by performing its branding by innovative strategies to make a
credibility of its products into market between its competitors.
 Services – Company has provided certain services to its consumers for achieving
customer satisfaction thus it has offer warranties and guarantees to it customers for
satisfying its customers for increasing its profits. Fiat Chrysler and Pengeot, offers
innovative technologies to its customers to full fill their needs and wants(Zhu, and
Westphal, 2020).
Evaluate given strategy using SAFs creteria
Suitability
Internal factors
External
factors
Strengths Weaknesses
Opportunitie
s
In this the merger of both the
companies that are Fiat
Chrysler automobiles and
Peugeot owner, displaying
strength because of advanced
technology is adopted by
organization in combined
way. In this workforce and
other essential resource are
the major strength that
present the brand value for
both companies. It helps in
attracting the more new
customers that helps in
By focusing on the
weakness related to merger
of both the companies is
their manufacturing
process because it is weak
in the organizations. For
this it is vital to focus on
developing the
manufacturing activities.
Because of same
manufacturing process
after merger they face the
issue of copying it by the
rivals. In this firm need to
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increasing the market share
and growth in their long term
survival(Helmold, 2020).
enhance their technical
aspects so that large base
of customers are to be
attracted and
manufacturing process is to
be developed.
Threats
This merger i.e. Fiat Chrysler
automobiles and Peugeot
owner involves the strength
related to technology that is
easily adopted by them for
producing the products and
offers it to the customers.
This helps in fulfilling the
firm objectives of attracting
the customers. In this
company can take the benefit
related to environment by
offering the electric cars. It
will increase the brand image
in market and also profits of
the business enterprise.
In this after merger of the
companies Fiat Chrysler
automobiles and Peugeot
owner they can highly
focus on improving their
manufacturing process. In
this economic and political
factor is creating the
biggest threat for the
company and impacted
their overall operations. In
this they can effectively
understand and study these
factors so that threats can
be easily overcome. In this
because of not properly
adopting the laws and
regulations they can face
negativity that are not
beneficial for company
survival and their
merger(Hunter, 2020).
By developing the TOWS company can easily understand the opportunities and strength
that helps in developing the several strategies. Due to this present situation can be easily
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identified. In this merger between Fiat Chrysler automobiles and Peugeot owner is done
successfully by capturing the number of several opportunities and overcoming threats. In this
they can adopts the new technologies and services that helps in satisfying the customers demand
so that high profitable results can be gained.
Accessibility
To ensure that company can manage and organize the several strategies successfully for
that can affect the stakeholders as per their interest and power. In this stakeholders are looking
forward to minimize risk that are connected with strategy. This strategy is useful to differentiate
the strategies as per the stakeholder power and interest. It is very essential at the time of merger
between iat Chrysler automobiles and Peugeot owner because it helps in providing the successful
results. In this several stakeholders are to be included that are customers, shareholders,
employees etc. By this merger customers can get the low choices because of merger along with
this shareholders interest is to be enhanced related to high profit earning and company maintains
transparency with them for investing funds. In this employees contains low interest but
containing high power related to completing the activities so that valuable results are to be
enjoyed and firm cannot face the risk related to sustainability(Hunter, 2020).
Feasibility
It is last aspect of this model that helps in providing the practical overview related to
accomplishing the strategy. In this company can focus on skilled and experienced candidates so
that strategies can be attained successfully. By merging of Fiat Chrysler automobiles and
Peugeot owner they can focus on introducing new technological car for satisfying customers and
saving the environment from harmful effects. In this they highly focus on price that they charges
from their customers so that they can get the successful results. The companies having strong
financial resources that helps in attaining their targets effectively(Muhanguzi, 2019).
CONCLUSION
From above explanation it is concluded that corporate strategy is one of the prominent
term that helps in gaining the profitable results and taking the best decision that are useful for
organisation to longer sustainability. To take the best decision business enterprise can use to
identify the external and internal analysis that helps in analysing the opportunities and threats so
that developing best strategy can be done successfully. To analyse the resource and competence
VRIO and value chain analysis is the best source as it gives the best results in identifying the
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resources that helps in developing the strategy effectively. At last SAFs model helps in
identifying suitability, accessibility and feasibility so that an evaluation can effectively
completed that is profitable to organisation.
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REFERENCES
Books and Journals
Alanssari, S. and Mihaylova, L., 2019. Corporate strategy tendencies–a case study on Kuwait
Businesses. Journal of Entrepreneurship and Innovations, (11), pp.27-32.
Arok, D.A., 2019. Corporate strategy and management innovation among entrepreneurs in
south Sudan: a case study of small and medium enterprises in Juba city (Doctoral
dissertation, KeMU).
Cappa, F., Cetrini, G. and Oriani, R., 2020. The impact of corporate strategy on capital structure:
evidence from Italian listed firms. The Quarterly Review of Economics and Finance, 76,
pp.379-385.
Cardoni, A., Kiseleva, E. and Lombardi, R., 2020. A sustainable governance model to prevent
corporate corruption: Integrating anticorruption practices, corporate strategy and business
processes. Business Strategy and the Environment, 29(3), pp.1173-1185.
Feldman, E.R., 2020. Corporate strategy: Past, present, and future. Strategic Management
Review, 1(1), pp.179-206.
Foucault, T. and Frésard, L., 2019. Corporate strategy, conformism, and the stock market. The
Review of Financial Studies, 32(3), pp.905-950.
Helmold, M., 2020. Negotiations as Integral Part of the Corporate Strategy. In Successful
International Negotiations (pp. 45-57). Springer, Cham.
Hunter, P., 2020. Corporate Strategy (Remastered) I: High Performance Strategy and
Leadership in a Volatile, Disrupted World. Routledge.
Hunter, P., 2020. Corporate Strategy (Remastered) II: A Fieldbook Implementing High
Performance Strategy and Leadership. Routledge.
Muhanguzi, K.B., 2019. Country Risk, Corporate Strategy and Profitability: A System GMM
Estimation for Multinational Banks in Sub Saharan Africa. Corporate Strategy and
Profitability: A System GMM Estimation for Multinational Banks in Sub Saharan Africa
(May 2, 2019).
SAJJAD, P.F., 2019. Grounding Corporate Strategy in Planetary Health.
Shahidan, M., Pandya, K. and Minh Thu, V.T., 2019. Corporate Governance Feature on Capital
Structure Decision of Vietnamese'firms.
Shavruk, Y.A., 2019. Corporate Strategies in Tourism: Curriculum for the specialty of higher
education of the second degree (master's programme) 1-25 80 01 «Economics».
Vukovic, N., 2020. Aligning BI with Corporate Strategy in SME: A case study based on the
BISC Framework.
Zhu, D.H. and Westphal, J.D., 2020. Structural power, corporate strategy, and
performance. Strategic Management Journal.
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