Development Tools for Competitive Strategy: Five Force Analysis, Resource Based View Analysis, PESTLE Analysis, and SWOT Analysis

This paper discusses the development tools for competitive strategy including Five Force Analysis, Resource Based View Analysis, PESTLE Analysis, and SWOT Analysis. It also provides examples of companies that have successfully implemented these tools.

Running head: Competitive strategy
Competitive strategy

Competitive strategy
Development tools
It has been analyzed that it is important to consider effective tools so that it can be simple
for the companies to achieve growth in competitive market. The tools help the company to show
proper direction to the employees. This paper will focus on the tools that will help to accomplish
goals and objectives.
Five force analysis
This tool focuses on the overall industry attractiveness that should be considered so that
profits can be attained. It is considered as the famous strategic tool that can assist in considering
the strategies related to business. Also, it has been seen that this tool helps to focus on the
rivalries present in the market. This tool also boosts the overall actions which should be
considered to manage the entire activities of the company. By considering this tool it can be
considered that improvisation can be made on the overall performance of the employees. It gives
positive impact on the employee’s productivity level and it is important to consider the strategies
so that it can be simple to manage the entire operations of the company. By considering the five
forces it has been that focus proper analysis can be made of the market environment (Mukherjee,
2018).
Figure 1
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Competitive strategy
(Source: Business to you, 2018)
Tesco Example
It has been seen that the substitution rate is high as the customer’s base is wide of the
company. In the present scenario, it has been analyzed that rivalry is high as there are many
firms who offer same products in the market. The power of suppliers is also low as there are
many outlets that are offering same products by the company. Power of buyers is also high as
buyers are many and they consume the products on the regular basis. As there are many small
units the threat of new entrants is high. Sales department have the major role in focusing on this
tool.
Resource based view analysis
This is considered as the management tool which focuses on considering the competitive
advantage. This tool is essential to be considered assist helps to emphasize on attaining the
competitive advantage. The company focuses on the entire resources so that advantage related to
competition can be achieved. The tool emphasizes on the internal resources like assets,
capabilities that should be attained (Harding, 2017).
The emphasis is given on the overall sales department by focusing on the strategic assets.
In this concept the resources are considered which can assist in minimizing the competition level
in the market. This tool also emphasize on controlling the performance of the organization.
In context to this model it has been seen that there are various attributes that should be
considered so that competitive advantage can be maintained. The resources which are considered
focus on tangible and intangible resources so that company can conduct the activities in effective
manner. The resources which are touched can be related to tangible resources and the resources
which cannot be seen are related with intangible resources. Tangible resources are machinery
and building and also intangible relates to the overall image of the company (Barbuto Jr, 2016).
Example of Ford
Ford is considered as the one of the biggest companies and it is necessary to focus on
maintaining the competitive advantage. It has been seen that company consider product
differentiation if comparison is made with the competitors. The competitive advantage can be
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Competitive strategy
maintained by considering effective services. Ford also takes into consideration high tech
technology which is important to be maintained so that proper services can be given. The focus if
the company is on learning and upgrading the resources and capabilities so that market share can
be enhanced.
Pestle analysis
This tool is a framework that focuses on the external environment and also it has been
seen that it consider proper strategic planning. It has been analyzed that there are many macro
environmental factors that emphasizes on the overall activities of the organization. This tool also
focuses on the managing the entire operations of the company which will give positive impact on
the goodwill of the company (Bailey et al., 2018).
There are various aspects which are taken into consideration in context to this tool. The
aspects are related to organizational change and also with proper planning. This evaluation is
taken into consideration so that external factors can be analyzed in a proper manner. It has been
seen that entire market situation can be taken into consideration by focusing on this management
tool (Shatskaya, Samarina and Nekhorosheva, 2016).
By focusing on this tool it has been seen that proper evaluation can be made of the
market. It provides accurate information to the companies so that they can consider effective
strategies which are beneficial for them. This tool emphasizes on the overall policies of the
company and gives direction to the managers to consider effective strategies (Elmes and Barry,
2017).
Example of Nestle
Nestle is known as the biggest corporation in the food sector. The company focuses on
considering proper rules and regulations so that in the high competitive market it can be easy to
profits. The factors are also concerned with the economic factor that helps to consider proper
evaluation of the economy. It has been seen that company focuses on analyzing the overall
consumption pattern of the customers. Also the overall position can be taken into consideration
of the market.
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Competitive strategy
Through this tool the company analyzes the present market situation which will help in
achieving goals and objectives. Also through this company analyzes the demand of the products
in the market. This tool assists the company in considering the overall objectives in an effective
manner.
SWOT Analysis
This tool is one of the important tools that help the company to analyze the weakness,
strength, threat and opportunities prevailing in the market. If company focuses on this concept it
has been seen that goals and objectives can be achieved in an effective manner. Through this the
company can take into consideration the advantage and can compete with the competitors
prevailing in the market. By considering this tool the company can easily focus on strategic
analysis which will positively impact on the overall profitability of the company. Through this it
can be simple for the company to consider proper marketing mix which will help the company to
focus on the overall marketing strategies which are considered (Friis, Holmgren and Eskildsen,
2016).
Example of Amazon
It has been examined that strength of the company is related with the goodwill in the
market. Amazon also possessed weakness that is concerned with the supply chain and also with
the ineffective distribution channel. This generates dissatisfaction between the people which can
negatively affect the image of the company in the market. Threat is related with the competitors
in the market like Flipkart and Ebay.
Opportunities of the company are concerned to achieve the competitive advantage. It is
important for the organization to focus on achieving competitive advantage and growth. To
compete with the other competitors in the market it is important for the company to analyze the
market so that success can be attained.
Therefore, by focusing on the paper it has been stated that companies should focus on
development tools so that it can be easy to earn profits and to grow in the competitive market.
These tools are beneficial or the company to sustain in the market.
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Competitive strategy
References
Bailey, C., Mankin, D., Kelliher, C. and Garavan, T., 2018. Strategic human resource
management. Oxford University Press
Barbuto Jr, J.E., 2016. How is strategy formed in organizations? A multi-disciplinary taxonomy
of strategy-making approaches. Journal of Behavioral and Applied Management, 3(1), p.822.
Business to you., 2018.Frameworks. [Online]. Available at:
https://www.business-to-you.com/frameworks/. [Accessed on 19 aug , 2018].
Elmes, M. and Barry, D., 2017. Strategy retold: Toward a narrative view of strategic discourse.
In The Aesthetic Turn in Management (pp. 39-62). Routledge.
Friis, O., Holmgren, J. and Eskildsen, J.K., 2016. A strategy model–better performance through
improved strategy work. Journal of Modelling in Management, 11(3), pp.742-762.
Harding, S., 2017. MBA management models. Routledge.
Mukherjee, I., 2018. Applying Porter’s Five Force Framework in Emerging Markets—Issues and
Recommendations. In Strategic Marketing Issues in Emerging Markets (pp. 307-316). Springer,
Singapore.
Shatskaya, E., Samarina, M. and Nekhorosheva, K., 2016. PESTEL analysis as a tool of strategic
analysis in international markets. Scope academic house b&m publishing, p.47.
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