Competitive Strategy

This essay discusses the role of strategy development tools such as SWOT analysis, PESTLE analysis, and Porter's Generic Strategies in meeting company objectives and enhancing business-related goals. It explores the importance of these tools in understanding the business environment and formulating appropriate courses of action. The essay also provides examples of how Tesco, a retail company, utilizes these tools to improve its position in the market.

Running head: COMPETITIVE STRATEGY
Competitive Strategy
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COMPETITIVE STRATEGY
Introduction
In the current scenario of business, there are different types of opportunities
and threats that influences growth of the business both in a positive or negative
manner. In such scenarios, the strategy development is known as strategic planning,
which is known as the fundamental aspect for creating as well as running the
business. It is treated as the game plan which sets specific goals along with
objectives and it is capable of changing in respect to the shifting dynamics of the
market (Vahdati, Nejad and Shahsiah 2018). There are different strategy
development tools which includes SWOT, PESTLE and Porter’s Generic Strategies
which will be acting as the game plan and help in understanding the situation of the
environment in which the companies are operating their business. Additionally, as
commented by Veselovsky et al. (2015), the proper formulation of the strategy
development tools is defined as process of shaping appropriate courses of action
that is suitable in achieving the organizational goals and accomplish the
organizational purpose. The clarifying of the vision is the most appropriate aspect
that needs to be understood by the organizations for formulating strategy and
evaluate the same appropriately. Moreover, the main aim of the essay is to
understand the role of the respective strategy development tools in meeting the
objectives of the companies and enhance the business-related objectives in a
suitable manner.

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SWOT Analysis
Through the implementation of SWOT analysis, it is suitable for identifying the
different kinds of strengths as well as weaknesses along with understanding the
broader perspectives of the threats and opportunities. It is effective in development
of the fuller awareness of the respective situation which will be suitable for decision-
making prospects and strategic related planning as well (Stavroulakis and Riza
2015). In the initial stages, SWOT analysis was being incorporated by the different
businesses, however presently, it is used by the community health as well as
development, education and personal growth.
Strengths- There can be different strengths which include high morale of
employees along with increase in the market share. Weaknesses- The different
weaknesses comprise of lack of the system of strategic management along with
legal suits which are not resolved (Salavou 2015). Opportunities- There can be
different opportunities related to consciousness among the different individuals which
will be beneficial for the company to incorporate such changes appropriately.
Threats- There can increased level of competition that can be a huge threat which
will be influencing the growth of the companies in contrast to other competitors.
For instance- SWOT analysis of Tesco can be suitable for understanding the
situation effectively. Strengths- The company has won number of awards which is
suitable for the retail kind of excellence and it helps in solving the different needs of
customers. Weaknesses- There are few subsidiaries of the company which are not
performing well that can affect growth of Tesco. Opportunities- Tesco has various
opportunities in the retail label market which will be enhancing their growth and there
can be inclusion of strategic alliances which will be suitable. Threats- There is high
level of the pressure from the different stakeholders which affects the cost basis of
Tesco (Tesco.com 2019). There is high competition in retail market that affects the
growth of the company.

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PESTLE Analysis
PESTEL Analysis is defined as the tool that assists in monitoring the different
macro-environmental factors which will be effective in understanding the impact of
the different macro environmental factors on the performance of the company that
can be effective or ineffective for the growth of the company (Pulaj, Kume and Cipi
2015). It can be useful for the different businesses which can be starting their
business in new country and it can be suitable for entering the competitive business
environment and gain sustainable advantage.
Political- It incorporates the government stability or instability present in the
business environment of the company. There can be different regulations or tax
policies which needs to be incorporated by the companies. Economic- There are
different monetary or fiscal policies which can be varying and it can be inefficient in
managing the effectiveness (Martin and Javalgi 2016). Social- The various factors
include changes in buying habit that can play a crucial role. Technological- It
includes changes in infrastructure level or the spending on research and
development that can be differentiating in nature. Environmental- The change in
climate and different laws which are relating to regulating the environmental pollution
can be suitable for understanding the scenario effectively. Legal- The different laws
such as health and safety along with laws related to protection of data can be
suitable (Kim et al. 2018).
For instance- PESTEL Analysis of Tesco can provide a brief overview on the
efficiency of company. Political- The political stability and the stable governmental
policies play a vital role in managing operations. Economic- Tesco needs to focus
on increasing costs and prices which will decrease profits that is suitable for growth
of company. Social- There are changes in trends in shopping, therefore Tesco
needs to implement the different health conscious food items which will be suitable
for improving growth. Technological- The other competitors such as Woolworths
have introduced the different aspects such as self-service and self-check-out which
needs to be adopted by Tesco for gaining strong customer base (Tesco.com 2019).
Environmental- There are various environmental laws which needs to be adopted
by the company through following the laws related to environment can be enhancing

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growth of company. Legal- Different laws suitable for enhancing growth of the firm
and it will be suitable for growth of company in comparison to other competitors.
Porter’s Generic Strategies
It is considered as the useful framework that will be suitable for understanding
the resources of gaining competitive advantage in the market. The three concepts in
the generic strategies are interconnected with one another and it is being used by
the different companies for using the development of key operating processes and it
will be outmaneuvering the different competitors which are present in the market
(Chimhowu, Hulme and Munro 2019). It is one of the easiest aspects which can be
used by the companies for understanding their position in comparison to the other
competitors which will be effective for showcasing their position.
Cost Leadership- It allows the competitive edge through manipulating the
costs related to production wherein the companies will be charging low costs and
increase the share in the market. It includes the aspect wherein the costs are being
reduced for increasing the level of profitability appropriately (Bakoğlu et al. 2016).
Differentiation- In the respective aspect, there are different aspects in which the
companies follow the aspect related to differentiation which will be allowing the
companies to emphasize on their uniqueness that plays a crucial role in
incorporating the respective aspects and improve their competitive aspects. It
includes the delivery of the products which are of high quality through the ongoing
kind of innovation and research which will be suitable for growth (Grant 2016).
Focus- It includes the two factors which are the cost focus and differentiation focus.
As per the cost focus, the different companies are looking to find the cost advantage
in the market segment which is intended (Altamony et al. 2016). On the contrary, the
differentiation focus is the other aspect in which the different companies work as to
find the unique of the market which will be beneficial in gaining strong share in the
market.
For instance- From the entire analysis, it can be seen that Tesco follows the
differentiation and cost focus approach which assists them in becoming competitive.
Tesco tries to offer the customers with the different kinds of retailing products and
services at a cheaper rate that enhances their growth aspects and satisfies the need
of customers (Tesco.com 2019).

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Conclusion
It can be determined from the above examples and the definitions, it can be
seen that the strategy development tools which are suitable for bringing out the
desired future which includes achievement of the desired goals and attain the
effectiveness of the companies. The proper vision and mission of the company can
be attained through incorporating the strategy development tools which will be
suitable for improving the position and it satisfies the requirements of customers. The
SWOT analysis assists in analyzing the strengths, opportunities, threats and
weaknesses that can be accepted by the companies which will be suitable for
attaining a solution which will be effective for the company’s growth. Furthermore,
from the analysis of Tesco, it can be seen that the political stability is present in the
market which enhances their growth and it helps them in developing long-term
strategy which will be beneficial for reaching the appropriate goals. Lastly, through
the help of the Porter’s Generic Strategies, Tesco follows the cost focus and
differentiation aspect that helps them in gaining competitiveness and it has helped in
improving the position in the competitive business environment which is effective in
managing the position and improve the effectiveness in the near future. The proper
development of the long-term strategy is the major tool which is effective in
monitoring and evaluating the different aspects that helps in focusing on actions that
will be helpful in maintaining direction of the policies and prevent the respective
policies from being affected by the short-term political kind of interests.

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References
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Tesco.com 2019 Tesco - Supermarkets | Online Groceries, Clubcard & Recipes
(online) Retrieved from https://www.tesco.com [Accessed on 27th August 2019]

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VAHDATI, H., NEJAD, S.H. and SHAHSIAH, N., 2018. Generic Competitive
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