Competitive Strategy US Essay 2022

Running head: COMPETITIVE STRATEGY
Competitive Strategy
Name of the Student
Name of the University
Author note

1COMPETITIVE STRATEGY
Introduction
The essay throws light on analyzing the different kinds of strategy
development related tools which plays crucial role in understanding the position of
the different companies in the competitive business environment. It has been noticed
that in the competitive environment, the different companies need to understand the
different opportunities and threats which can be faced by the companies and it will
be suitable for them in gaining competitive advantage in the market. In determining
their position in the market, the proper strategic planning is the main and crucial
element which will be effective in managing their position and gain competitiveness
in the market (Zhao et al. 2016). The primary purpose is to connect the major three
areas which is inclusive of mission, that defines the purpose of the business along
with vision which describes the aspects which is required to be achieved by the
business in the business environment that is competitive in nature. Through the
incorporation of the strategic development tools, it will be providing sense of direction
along with outlining measurable goals which will be enhancing the effectiveness of
the company suitably (Sudhakar 2019).

2COMPETITIVE STRATEGY
SWOT Analysis
SWOT analysis is the most crucial framework which can be used by the
different business organizations as it will be enabling the firms in analyzing the
strengths and weaknesses of the firm which is internal and understanding the
different opportunities and threats that can be affecting the growth of the company
from the external environmental aspects. SWOT analysis assists in providing proper
look at the current situation of the business and it plays a vital role in process of
strategic planning (Shenoy and Aithal 2016).
Strengths- It includes the different kinds of strengths such as the competitive
advantage which can be gained by the company in contrast to the other competitors
present in the market. Weaknesses- It includes the aspects which stops the
companies to perform at a less optimum level which includes the weak brand or high
debt level which affects the growth of the company (My 2018). Opportunities- It
refers to the different kinds of favorable conditions which will be providing the
company with competitive advantage. Threats- It refers to the different kinds of
factors which have the potential in harming the brand reputation of the company
(Quanjin et al. 2019).
For instance- SWOT Analysis of Amazon includes the different aspects
which needs to be identified for proper understanding of the factors in a thorough
manner. Strengths- The strong brand image of the company as well as the
customer-oriented approach has been helpful in improving the growth prospects of
the company. Weaknesses- The business model of company is easily imitable and it
has limited brick and mortar presence in the business environment (Amazon.com
2019). Opportunities- Amazon can expand their physical presence suitably which
will be giving them more exposure. There can be inclusion of the backward
integration which will be beneficial in improving their aspects to gain competitive
advantage. Threats- There are different controversies which affected brand image of
Amazon along with high level of competition has affected growth of firms.

3COMPETITIVE STRATEGY
PESTEL Analysis
PESTEL Analysis is defined as the framework which helps in analyzing along
with monitoring the different macro-environmental factors which can create huge
influence on the performance of organization suitably. It is most effective tool which
will be beneficial in starting a new business in the new market as it will be suitable for
the growth of the firm in the respective kind of business environment. It helps in
analyzing the different external environmental factors which will be suitable for the
companies to understand and react as per the situation.
Political- It is inclusive of the various political related instability or corruption
level which can impact the firm’s growth negatively. Economic- It is inclusive of the
economic growth or the level of exchange rates which can create huge pressure on
the firms. Social- It is inclusive of the population related growth or the cultural
barriers which needs to be analyzed. Environmental- There can be inclusion of
change in climate and pressure from different NGOs which can be affecting growth
of the firms. Legal- It includes the different laws and regulations such as
discrimination laws or the employment laws which can affect growth of firms.
Technological- There can be different technological advancements which can be
affecting the effectiveness of the firms (Aithal 2016).
For instance- PESTEL Analysis of Amazon can be helpful in understanding
the entire external environment situation. Political- There is different kinds of
political instability and the political red tape which tightens the data related
regulations. Social- It includes the different kinds of shift in the retail as well as e-
commerce landscape which affected the growth of Amazon negatively. Economic- It
is strong as the growth of GDP is effective in the different emerging markets which
has been of huge effectiveness for the company (Amazon.com 2019).
Technological- The big data analytics have been successful in transforming the
retail stores in a successful manner and it has been helpful in enhancing the growth
of the firm such as amazon. Legal- There are different regulations or the legal
challenges which has affected the growth of the firms negatively. Environmental-
There are different kinds of limited disclosure on the different environmental
sustainability as well as initiatives.

4COMPETITIVE STRATEGY
Porter’s Five Forces Model
It is considered to be the framework which helps in identifying and analyzing
the different five forces which helps in shaping every industry for determining the
weaknesses as well as strengths of the industry. There are different kinds of five
competitive forces which are affecting the industry and it will be suitable for the
companies to understand their position in contrast to companies which are
considered to be major competitors (Mathooko and Ogutu 2015). There are five
major forces which will be suitable for improving their competitive position in the
market.
Threat of Substitutes- It includes the factors which affects the organization’s
growth as the customers will be preferring different products at a less price from the
competitors which satisfies their needs. Threat of New Entrants- It is inclusive of
the aspects which includes the different kinds of entrants which can affect growth of
the firms negatively and it can gain strong position (Lüttgens and Diener 2016).
Bargaining Power of Buyers- It is the factor wherein the different buyers have the
power to demand for the lower price than the other competitors for the high-quality
products which are present. Bargaining Power of Suppliers- the strong bargaining
power of the different suppliers allows them in selling higher priced or the materials
of low-quality to the different companies. Competitive Rivalry- When there are
different competitors present in the market, exit barriers are high and the growth of
industry will be slow which affects the growth prospects of the company ( Kabue and
Kilika 2016).
For instance- Porter’s Five Forces Model Analysis of Amazon includes the
following aspects: Bargaining Power of Buyers- The high quality of the information
is strong force and the high availability of different substitutes is high in nature.
Bargaining Power of Suppliers- The moderate size of suppliers is the strong force
which affects the growth of the firms negatively. Threat of Substitutes- There is
high level of substitutes available in the market and it affects growth of Amazon
negatively. Threat of New Entrants- The high economies of scale are the weak
force which can be a huge relief for the Amazon Company as they can gain
competitive advantage. Competitive Rivalry- There is high level of aggressiveness
among the different firms which affects the growth of Amazon (Amazon.com 2019).

5COMPETITIVE STRATEGY

6COMPETITIVE STRATEGY
Conclusion
Therefore, from the analysis of the three strategic development tools, it can be
inferred that these are the different tools such as SWOT, PESTLE and Porter’s Five
Forces Model analysis have been successful in managing the different kinds of
opportunities and threats which can affect the growth of the firms in a positive or
negative manner. There can be different kinds of internal and external strengths and
weaknesses which can affect the growth of the firms and due to the same, it has
been successful in managing the business-related operations in a successful
manner. Furthermore, strategic planning is the most crucial element which should be
incorporated by the different companies and in case of Amazon, it has been
successful for the growth of the firm in a successful prospect. In addition, the Porter’s
Five Forces Model Analysis is the most effective model which can be suitable in
managing the growth of the firms through which it has been successful in managing
the effectiveness of the firms in contrast to other competitors which are present in
the market as it will be suitable for them in understanding the aggressiveness of the
other firms which are considered to be the main competitors and it can be a major
issue for the growth. In such scenarios, the strategic planning is the most suitable
aspect that can be incorporate by the companies for the suitable enhancement of the
growth prospects and it enhanced the effectiveness of the firms successfully.

7COMPETITIVE STRATEGY
References
Aithal, P.S., 2016. Study on ABCD analysis technique for business models, business
strategies, operating concepts & business systems. International Journal in
Management and Social Science, 4(1).
Amazon.com 2019 About Amazon (online) Retrieved from
https://www.aboutamazon.com [Accessed on 22nd August 2019]
Kabue, L.W. and Kilika, J.M., 2016. Firm resources, core competencies and
sustainable competitive advantage: An integrative theoretical framework. Journal of
management and strategy, 7(1), pp.98-108.
Lüttgens, D. and Diener, K., 2016. Business model patterns used as a tool for
creating (new) innovative business models. Journal of Business Models, 4(3).
Mathooko, F.M. and Ogutu, M., 2015. Porter’s five competitive forces framework and
other factors that influence the choice of response strategies adopted by public
universities in Kenya. International Journal of Educational Management, 29(3),
pp.334-354.
My, P.T., 2018. SWOT ANALYSIS AND PROPOSALS TO IMPROVE THE
DEVELOPMENT FOR TRAINING YOUNG TAEKWONDO ATHLETES IN
VIETNAM. European Journal of Physical Education and Sport Science.
Quanjin, M., Rejab, M.R.M., Idris, M.S., Zhang, B. and Kumar, N.M., 2019. Filament
Winding Technique: SWOT Analysis and Applied Favorable Factors.
Shenoy, V. and Aithal, P.S., 2016. ABCD Analysis of On-line Campus Placement
Model. IRA-International Journal of Management & Social Sciences,(ISSN 2455-
2267), 5(2), pp.227-244.
Sudhakar, K., 2019. SWOT analysis of floating solar plants. MOJ Solar Photoen
Sys, 3(1), pp.20-22.
Zhao, Z.Y., Zuo, J., Wu, P.H., Yan, H. and Zillante, G., 2016. Competitiveness
assessment of the biomass power generation industry in China: A five forces model
study. Renewable Energy, 89, pp.144-153.