Key Strategy Development Tools in Business

Running Head: HI6006
Essay-Key Strategy
Development Tools
Student’s Name:
Student’s ID:
Subject:

Competitive Strategy
Introduction
The primary purpose of the paper is to explain the four strategy development tools
used in business along with practical examples from industry. It will discuss the
tools or framework that helps an organization to evaluate their performance.
Therefore, the paper will help in relating the tools with current practical business
examples.
PESTEL Analysis
A PESTEL analysis is determined to be a tool which is utilized to monitor as well as
analyze the macro-environmental factors that put an impact on the performance of
an organization. This particular tool is useful when entering into a foreign market or
starting a new business. It provides a clear understanding of the related and
situational external and internal factors. PESTEL refers to an acronym that stands
for Political, Economic, Social, Technological, Environmental and Legal factors.
Political factors determines to be the impact of administration and its policy on an
organization. Whereas, Economic factors put an impact on the performance and
economy of a firm that affects the profitability of an organization. On the other
hand, social factors help in identifying emerging trends and focuses upon the social
environment. Moreover, Technological factors determine the rate of development
and technological innovations that impacts an industry or market (Song, Sun and
Jin, 2017). Moreover, the environmental factors related to the impact of ecological
aspects and influence of the surrounding environment. While the legal factors
comply with the government policy that needs to be acknowledged by the
organizations.
For example, Woolworths Supermarkets is an Australian retail business and
grocery chain founded in 1924, in South Wales, Australia. It operates 1000 stores
across Australia where it specializes in selling grocery products. The company
operates its business in an energetic environment where it is impacted by weak
trajectory growth due to the unstable political environment and increased
liberalization of trade policy because of lower economic performance. Whereas,
consumer spending behavior and collective social trends are impacted by social
factors while the environmental factors lead to increasing regulatory framework
(Woolworths.com.au, 2019).

Competitive Strategy
Figure: PESTEL Analysis
(Source: Aithal, 2017)