Competitive Strategy Assessment 2022

Competitive
strategy

Competitive Strategy 1
Strategic management is the procedure of planning, analyzing, monitoring and assessment of all
which is required to meet its goals and objectives. It is important for the company to analyze the
market environment before implementing the strategies or expanding the business at the global
level. Organization uses the strategic tools to analyze the micro or macro environment in to
develop the strategies (Ansoff, Kipley, Lewis, Helm-Stevens, and Ansoff, 2018). In this report,
the discussion is based on “strategic management tools”. The tools are also implemented at the
Wesfarmers to analyze the environment. Wesfarmers is an Australian Conglomerate which
operates in Australian and New Zealand. The company offers the coal mining, retail, chemicals,
fertilizers and safety products. It is considered as the largest Australian company in terms of
revenue (Wesfarmers, 2018a).
PESTLE Analysis is a tool of strategic management that is used by the company to analyze the
external environment. This tool is used while expanding the business into the new market as it
helps to evaluate the environment of the country. PESTLE defines the factors such as political,
economic, social, technological, legal and environment (Lasserre, 2017).
Political: Australian Government restricts the trading hours due to which the business faces the
challenges in exporting or importing the business. The company has to implement the rules and
policies at the workplace which is developed by Australian and New Zealand government for
long time survival.
Economic: The GDP rate of the Australia is good $1.69 trillion due to which the willing power
of buyers is increases and that is beneficial for the company.
Social: In Australia, the wage rate is high and that’s becomes an issue for the organization in
terms of operation.

Competitive Strategy 2
Technological: Australia is the country which adopts the advance technology in order to
manufacture the product.
Legal: Government of Australia develops laws and acts in order to protect the consumers. It has
to follows the laws of government of Australia and New Zealand.
Environmental: Changing weather is an issue for Wesfarmers as they operate the business in
Coal mining industry.
Porter’s Five Forces Framework is the tool of evaluation of industry. This tool helps the
organization to analyze its industry so that it can develop their strategy. These five forces directly
affect the environment of the industry. These forces examine the structure and the level of
competition in the industry. The five forces are based on buyers, suppliers, new entrants,
competitors and substitutes (Rothaermel, 2015).
Threat of new entrants: It has been seen that Wesfarmers has high level of threat of new
entrants as the existing companies have high brand image in the market. It is tough for the new
companies to beat the existing companies and it also required high capital.
Bargaining power of Suppliers: The service provided by Wesfarmers is easily accessible in the
market as there is huge numbers of suppliers in the market that provides the resources to the
company. Due to great numbers of suppliers available in the market the negotiation power is low
as the company can switch to the other suppliers.
Bargaining power of Buyer: The negotiation power of customers is high as there are several
companies that provide the similar services to consumers. There are lots of companies due to
which the consumers have numerous options to buy the product.