Business Strategy of Giordano International | Report

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BUSINESSSTRATEGY
TABLE OF CONTENTSINTRODUCTION...........................................................................................................................1TASK 1: THE PROCESS OF STRATEGIC PLANNING.............................................................11.1 Assessment of how business missions, visions, objectives, goals and core competencies inform strategic planning................................................................................................................11.2 Analysis of the factors that have to be considered when formulating strategic plans...........21.3 Evaluation of the effectiveness of techniques used when developing strategic businessplans.............................................................................................................................................3TASK 2: FORMULATION OF A NEW STRATEGY...................................................................42.1 Analysis of the strategic positioning of a given organisation by carrying out anorganisational audit......................................................................................................................42.2 Environmental audit of Giordano..........................................................................................52.3 Significance of stakeholder analysis when formulating new strategy...................................72.4 Presentation of new strategy..................................................................................................9TASK 3 APPROACHES TO STRATEGY EVALUATION..........................................................93.1 Analysis of possible alternative strategies relating to substantive growth, limited growth orretrenchment................................................................................................................................93.2 Justification of an appropriate future strategy for Giordano................................................11TASK 4 IMPLEMENTATION OF STRATEGY.........................................................................124.1 Explain the different roles and responsibilities needed for strategy implementation.........124.2 Evaluating resource required to implement a new strategy.................................................154.3 Discussing targets and timescales for achievement in organisation to monitor a givenstrategy.......................................................................................................................................16CONCLUSION..............................................................................................................................19REFERENCES..............................................................................................................................20
INTRODUCTIONCompany need to frame varied set of strategy for the purpose of fulfilling the objectivesand also to attain its specific aim. It initiates with strategic planning and developing strategiesfor the same. This aids in reducing the impact of any unforeseen event and also helps in gettingrid of risk and uncertainty. With a motive to gain deep knowledge regarding business strategy,present report has been prepared. For this purpose, Giordano International has been taken intoaccount which is a Hong Kong based clothing retailer. In this, discussion is incorporated forstrategic planning, formulation of new strategy, evaluation and implementation of strategy.TASK 1: THE PROCESS OF STRATEGIC PLANNING1.1Assessment of how business missions, visions, objectives, goals and core competencies inform strategic planningMission and visionGiordano Internationala is a Hong Kong based clothing retailer that was founded in 1981(Corp.giordano.com.hk 2015).The brand embodies contemporary lifestyle choice by providingsuperior apparels for men, women and children. The vision of the brand is to be the best andbiggest brand in the world(Bryson, 2011).The company maintains a cosmopolitan touch bythinking global. The mission of the brand is to make people feel good and look great. Giordanohas over 2400 store operations in the Middle East region and beyond(Corp.giordano.com.hk2015). The brand believes in providing corporate values with trendy fashion regardless ofnationality, ethnicity or culture and illustrates the message of a world without strangers(Corp.giordano.com.hk 2015).Goals and objectivesThe core objective of the brand is to provide maximum customer satisfaction. The brandaims at providing excellent customer service by keeping in contact with customers and solicitingfeedback on an on-going basis. Giordano focuses on exceeding the expectations of customers interms of merchandise and service (Steiner, 2010). The brand aims to be a pioneer in customerservice by focusing on five corporate values QKISS- Quality,Knowledge, Innovation, Service,and Simplicity(Giordano-me.com 2015).Core competencies1
Giordano believes in modern simplicity and style. The brand maintains a competitiveedge by providing world class customer service; timeless quality product; strategic locations foreasy accessibility of customers and providing additional services such as alteration and globalexchange policy(Spee and Jarzabkowski, 2011).It is the primary objective of any company toaddress the customer needs. The brand provides consistent exceptional shopping experience toits customers. The additional services such as customer service toll free hotline, complimentaryalterations and global exchange policy programs are core competencies of the business(Corp.giordano.com.hk 2015).Refer to Appendix1.2Analysis of the factors that have to be considered when formulating strategic plansGiordano is a successful company but it has confronted some important strategicplanning process issues. The current positioning of the brand is customer satisfaction. The mainobjective of the brand is to provide maximum customer satisfaction. The current positioning ofthe brand is to provide trendy clothes at inexpensive prices(Allison and Kaye, 2011). The brandsells at discounted casual unisex appeal. The issue with brand positioning is that the strategyworks in Asia but in other economies, people might appreciate a more affluent brand. Esprit is atough competitor, as a part from being value for money, the brand also specializes in chains formen and women. Giordano must reposition itself to suit as a global image for achieving itsmission(Wirtz 2011, pp 1-13).Refer to Appendix1.3Evaluation of the effectiveness of techniques used when developing strategic business plansWith the blue ocean strategic tool, Giordano starts with the identification of the majorfactors that define competitive differentiation with the given industry today. This includes price,quality, breadth of product, availability of product etc.(Kim and Mauborgne 2005).PESTLE Analysis: The PESTEL Analysis is also one of the most popular techniques throughwhich the strategy is formulated. The PSTEL technique enables the strategist to analyze the mostimportant Macro factors which can affect the business and which have the direct impact on thestrategy. The PESTEL factors are Political, Economic, Sociological, Technological, Legal andEnvironmental which are defined as follows:Political Factors: The political factors are very important to be considered whiledeveloping the strategy. The political factors may be defined as those factors which2
determine the attitude of the government towards the industry and thus the business inparticular(Allison and Kaye, 2011).These factors are the factors like the policies relatedto the trade, or tariffs etc.Economic Factors: The economic factors like the inflation or deflation also need to beconsidered. The economic factors have a direct impact on the industry as these factorsdetermine the state of the economy of the country the business is operating in. Theeconomic factors also affect the demand of the consumers.Sociological Factors: The societal factors of the customers are also very important. Thesocial factors like the demographics, the trends and analysis of the population are alsovery important as these are directly related to the purchase pattern of the consumers.Technological Factors:This is a well-known fact that this is the technological era andwithout the latest technology adoption the survival of the company in the internationalmarket is not possible(Poister, 2010). Thus the latest technology must be adopted by thecompany.Legal Factors: The Company like Giordano and Adidas must also take into considerationthe legal factors like the laws and regulations that have to be followed by the companies.Environmental Factors: The business does not act alone and it is surrounded with theenvironment. These factors affect directly the strategy of the company. Thus theenvironmental factors are also very important for Giordano and Adidas (PESTLEAnalysis, 2016).TASK 2: FORMULATION OF A NEW STRATEGY2.1Analysis of the strategic positioning of a given organisation by carrying out an organisationalauditSWOT AnalysisThe strength of the brand is that its product caters to all age groups of both men andwomen. The professional service provided makes the customers feel comfortable andimportant. The brand sells value-for-money through careful selection of suppliers. Thestores are located at strategic locations for convenience of consumers(Woo and Jin 2014,pp 5).3
The weakness of the brand lies in the fact that their product range is limited. The adaptedIT strategies are not feasible for all organizations. The brand also fails to differentiatecore brands from the mainstream(Mittal and Arora, 2014).The opportunity of the brand lies in the fact that there is scope for expansion in continentsother than Asia. Their brand image can be strengthened through greater advertising andcustomer service. The brand image can be maintained and even improved through theseefforts(Woo and Jin 2014).The brand has threats of intense competition like GAP, Esprit etc. The competitors havebetter strategic locations and technology in the design process(Mittal and Arora 2014).Refer to Appendix2.2 Environmental audit of GiordanoPESTLE analysisPolitical Forces-Hong Kong has a democratic government that makes the politicalsituation of the country positive. The government does not provide any subsidy to apparelindustries. Due to free trade, Hong Kong is the sixth largest exporter of apparel andtextiles that makes the market attractive(Wirtz 2011).Economic Forces-Hong Kong was ruled by the UK government, prior to its takeover byChina. People spend large amounts on apparel in Hong Kong than in UK. Hong Kong hasa fashion conscious culture with highest clothing expenditures(Wirtz 2011).Social Forces-Giordano provides both business and casual clothing for men and womenof all ages in addition to kids wear. A combination of both US and Chinese cultures arefollowed in HongKong (Gopinathan, Nouraldeen and Wilson, 2010).Technological Forces-With rapid transition in technology, Giordano has adapted the ITstructure of Walmart. The speed of technological transfer makes the company feasible forcustomers.Legal Forces-The import and export regulations of Hong Kong state that operations ofapparel industry are free to trade. There are reduced barriers to US export(Trade.gov2015).Environmental Forces- Giordano supports a number of CSR events such as “ProjectHope” and “World Without Strangers” for handling crisis in the environment(Wirtz2011).4
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