Business Strategic Management

This document discusses the internal and external factors affecting business strategic management. It includes a SWOT analysis, PESTEL analysis, and 5 forces model. The document also provides insights into the media industry in Australia. References are included for further reading.

Business Strategic
Management
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Table of Contents
Internal Factor- SWOT Analysis...................................................................................................................2
External Factor- PESTEL...............................................................................................................................3
Industry Factor- 5 Forces Model..................................................................................................................4
References...................................................................................................................................................5

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Internal Factor- SWOT Analysis
Strengths Weaknesses
 Strong brand recognition
 Leadership position in the market od
Australia
 High cost for replacing the current
experts
 Local monopolies and niche markets
Opportunities Threats
 Low rates of inflation
 Trends of the customers to migrate
towards high-end products
 Commoditization product segments
 Changing demographics
Strengths
 Both Fairfax Media and Nine Entertainment has strong brand recognition in the media
industry. It will allow the companies to charge a premium rate in comparison to their
competitors
 Both organizations have a strong leadership position in the market of Australia. It will help
them to scale their new products rapidly in the market
Weaknesses
 Both the companies have to face high cost for replacing the current experts. Few staffs are a
responsible knowledge base for both the companies and replacing them would be extremely
challenging in the present situations
 Local monopolies and niche markets that both the companies are able to exploit are rapidly
disappearing. The customer networks promoted by both the companies are proving to be less
effective
Opportunities
 Low rates of inflation bring more stability in the Australian market and enable credit at low-
interest rates to the clients of both the companies. It will help them to increase the consumer
products and services of both the companies

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 Trends of the customers to migrate towards high-end products will provide opportunities to
both companies to increase their profits.
Threats
 Growing commoditization product segments in the media industry will face the most
significant challenge both the companies
 The new generation is finding it difficult to replace their buying powers. It might lead to high
profits in the short run for both the organizations but will reduce the margins in the long term
External Factor- PESTEL
Political - Both the organizations get a dynamic atmosphere to work where it is highly
influenced by political aspects such as governmental policies. These policies have a crucial role
in shaping the working environment of both companies.
Economic - Economic performance, inflation rate, rate of exchange, and market conditions of
Australia will help both the organizations to expand their operations.
Social - Social factors will help both the organizations to understand their ways of operations in
the context of the community’s preferences (Engert, Rauter and Baumgartner, 2016).
Technological - Technological development will lead to the protection of intellectual property
and patents of both the organizations against cyber-attacks and copyrights infringements.
Technological progress will provide opportunities to both the companies to tap in new methods
of distribution like social media.
Environmental - Customer awareness for the sustainability of the environment will compel both
organizations to implement new policies for increasing their sustainable practices.
Legal - Environmental laws, laws of intellectual property, employment laws, health, and safety,
and corporate laws of Australia can affect the operations of both the companies. Both Fairfax
Media and Nine Entertainment have to ensure that they comply with all these laws for effectively
operating in the business environment.

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Industry Factor- 5 Forces Model
Threats of New Entrants - Both Fairfax Media and Nine Entertainment faces the low threats of
entrants as both are dynamic organizations. They can restraint the risks of the new entrants by
being innovative, investing in the research and development, and building the economic scale.
Bargaining Powers of the Buyers - Both the companies has a strong customer base, and thus,
both the companies have low bargaining powers of the buyers. They can face the challenges by
quickly innovating in accordance with the development in technology and presenting new
products.
Bargaining Power of the Suppliers - The media industry of Australia has several suppliers, and
so it limits the bargaining power of the suppliers. It will be easier for both the companies to
switch between the suppliers. It can allow both Fairfax Media and Nine Entertainment to
negotiate their prices between the suppliers due to low switching cost
Rivalry among the Competitors - The media industry of Australia works in a competitive
atmosphere. Both Fairfax Media and Nine Entertainment faces stiff competition from other
organizations like News Corp, ProSiebenSat.1 and Seven West Media. Each of the company has
their own strategies with highly differentiated operations. It can increase the level of competition
for both the companies as all the companies will run head-on with one another.
Threats of Substitution - The development of technology has created several new methods of
the distribution of data like social networking sites. Both the companies face high threats of
substitution, particularly from online platforms like Facebook and Twitter as they have become
essential mediums of information.

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References
Engert, S., Rauter, R., and Baumgartner, R.J., 2016. Exploring the integration of corporate
sustainability into strategic management: a literature review. Journal of cleaner production, 112,
pp.2833-2850.