Impact of Macro and Micro Environment on Strategic Management Plan of ASOS
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This report discusses the impact of macro and micro environment on the strategic management plan of ASOS. It covers the SWOT analysis of strategic management decision-making process, assessment of the competitive environment using Porter’s Five Forces model, and industry's possible competitive benefits.
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TABLE OF CONTENTS INTRODUCTION...........................................................................................................................3 MAIN BODY..................................................................................................................................3 Part1.................................................................................................................................................3 Impact of macro environment in business strategy development................................................3 SWOT analysis of strategic management decision- making process..........................................5 Micro environment factor impact business activity and their benefits for strategic plan............7 Assessment of the competitive environment using Porter’s Five Forces model.........................8 Industry's possible competitive benefits......................................................................................9 Policies objectives to reach overall strategic objectives............................................................10 Strategic direction......................................................................................................................10 CONCLUSION..............................................................................................................................12 REFERENCES..............................................................................................................................13
INTRODUCTION Strategic management plan refers to the term where organization manager develop apply strategic methods. Models, analysis, research for growth and development. Small, medium, large every type of organization has to follow strategic decision-making approach because it influences new opportunities and also beneficial for survives in the competitive market (Addae-Korankye and Aryee, 2021)ASOSis all above retail industry in UK. They provideserviceslikeshoes,beautyproducts,accessories,shoesetc.Almostevery organization has to consider and follows new strategic approaches and analysis of internal external forces which influence the overall business plan. On the basis of recent market trend various company consider digital marketing strategy for their effective growth but the management of strategic approaches require effective knowledge. This report clearly gives idea about how company manage multiple aspects with the analysis and research of external and internal forces and how it will affect the management strategy. Also, it manly gives idea thatknowledgeofPorterfiveforcesandstrategicplanobjectdevelopefficiencyin organization. MAIN BODY Part1 Impact of macro environment in business strategy development External forces influence the overall business strategy but when company wants them to increase their business in international level, or they want to expand their business activity. The have to know about external forces because analysis of this factors company can easily identify andfruitfulforstrategydevelopment(Alchammari,AliandAlshammare,2021).ASOS company consider they mainly want to develop their business activities in international or global level with effective manner. They also sales their services on international level, but they want to consider new approaches, so they consider that which strategic approach can influence their business activities in the large competitive market. Eternal forces impact on the strategic management plan are ads followees, Political: Political factor influence their long term profitably, and diversification in the other countriespoliticalsystemhighlydevelopriskanditdirectlyimpactsontheproduct transportation. Asos company services mainly influence by the product services and their supply
chain management provides into the other place. So analysis of this factor company consider that they supply their goods according to the knowledge and analysis of political environment. So its clear that when the company develops strategic approach with the analysis of this factor they mainly consider transportation charges and according to charges they provide their services like they increase their product shipment charges. Economic: Diversification in the government taxes policies are major challenging aspects of the company services and business expansion. It directly impacts on the organization productivity and profit because variations in the policies impacts on the individual quality of life, so many so consumer wants to buy product and services but the higher tax charges directly impacts on the business activities (Hadid and Al-Sayed, 2021). Solution and for strategic plan for this issue is that company's analysis experts search and study on the other country taxes policy. Social: One of the major essential factor and almost every company has to consider this aspect without knowledge of this factor organization not survives in the long term in market. Asos company mainly provides services in clothes so on the basis of strategic plan they have to focuses on the social cultural activities of different countries. They understand bout culture with the utilization of social media they apply this approach and strategic plan that other countries people which product like the most and their social beliefs and values knowledge can gives proper idea for the strategic decision- making process for the company. Technological: On the basis of recent trend almost very organization development their activities with the utilization of technological tools. Because innovation expansion makes the business quality and productivity efficiently. If the any company wants to develop effective strategy for growth in their business plan at global level, they have to follow and applies digital innovation in the business because it helpful to reach new audience and attract more people with the product and services (Jovanoska, Nechkoska and Mancheski, 2021). So effective expansion of the business with new strategic manner its essential that company consider technology advancement for productivity improvement. Also, technology factor influences the product offering in market because new machines require large cost and development of new advance technology require
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higher cost. According to this aspect company has to prepare for this that innovation is continues process, so they save extra amount for technology advancement application. Environment: Environmental factor badly impacts on the strategic management plan and expansion of decision-making process of the organizationbecause economicfactorsare unwanted and unknown situation which company not know about this factor that it comes in the future, and they badly impact on the product and services. Every country has different environmental laws and policies but ASOS company services influences by the climate changes because unwanted weather and climate impacts the customer behaviour. Legal: Its essential when company enter the new market they evaluate and analyse the product services they have to consider and follow the consumer protection and e-commerce which means ASOS company not develop overall factory and stores in the other country they only provides services via online and with the help of mediator, so they provide services in the other country people. On the basis of this process company has to follow e-commerce activity because when organization wants to develop their business in the other place they have to hire and approach services providers are knowledgable and trustworthy. SWOT analysis of strategic management decision- making process Organizationcaneasilyanalysevariousfactorsandidentifythecompany's performance and activity with the application of SWOT analysis because it gives clear about company's strength that which product is beneficial for company's strength, next one is to identify the weaknesses which means it gives idea about weak points those are influences the strategic decision of the management (Krasnostanova, and et.al., 2021). Next one is the best and effective analysis approach which provides idea about new opportunities and the last one is threat, so overall this analysis process can give effective idea about company's productivity improvement are as follows, StrengthWeakness Their brand image in market. Innovation product display technique on social media platform. Freeshippingchargesonproduct services. Somanypeoplereturnedtheir
Differentanduniqueproductso peoplemoreattractswiththeir services. Customereasilyconnectswiththe productknowledgewiththesocial media pages, like they have websites, Instagram, Facebook etc. New strategy: The company have to maintain their strength for long time so its important that company develop innovation tools and techniques and develop effective strategy like they develop efficiency and improvement in their services, productofuniqueproduct,effective communication with customer is the best way to maintain strength of the company. producttothecompany,soits includestheadditionalshipping charges. New strategy: Company has to focuses on some charges on shippingadsomepoliciesonthereturn policy like they consider and applies like without any problem people not return their product if any damage or different goods then it can be changes. So this policy and strategic approach can beneficial for reduce weaknesses. OpportunityThreats On the basis of recent trend people morefocusesonuniquequalityof product,andtheymainlyconsider fashion products. Impressive advertising technique son mobile apps because it develops more engagementandexpandattraction towards with the product (krátky, and svidroňová, 2021). Business expansion in different place andjointnewpeopleforproduct supply. New strategy: Othermultipleretailindustryalso provides fashion product within the lower prices, so the other multiple retailcompaniesarethebiggest threat. Uncertainchangesineconomic government policies is major threat for transportation services. The Biggest threatsfor the ASOS retail industry like Marks & Spencer, Tesco,new-look,Forever21and many more companies. New strategy:
Unique product and impressive brand name with good prices is the best way to develop newopportunity,becausecustomerhighly influence by the company who gives their services on low price. Time management in production process with expansionofnewdesignerfordifferent productproductivityandeffectivedigit marketing concept strategy is helpful for to reach attraction towards with the business. Management can follow new strategy for the product services higher new employee from existingcountrybecausetheyhavemore ideaabouthowtocommunicatewith customer and their way of interaction can be beneficial for reducing threats. Also,theycanreducethreatsfromthe analysisofeconomiccondition,andthen theyprovideservicesaccordingto government tax. Overall study from this analysis its clear that SWOT analysis is beneficial for the maximizing profit and productivity and minimizing the challenges. It is mainly useful for the identification of how company can prepare strategic management decision for global product and services development (Mitchell, 2021). Micro environment factor impact business activity and their benefits for strategic plan Internal business activity management require knowledge of multiple aspect which means humanresourcedepartment,operationtermwork,marketingactivities,productstrength, company growth, sales expert, stakeholders, buyers and many more. Almost every organization faces challenges from them because their activity and work behaviour highly impacts on the overall business strategic plan, but the management of effective organization internal environment manager and owner can take decision and analysis or research on the problems so that they can prepare new strategy on the basis of major problem which influence the overall business activity (Mitra, 2021). ASOS company has so many employees and every individual has their different way of work behaviour, so it impacts on the overall supply chain management. Variations in the customer choice and preference generate wastage and it generates financial problems and various things influences when it happens. Development of strategic plan
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for this aspect manger and analysis experts has to focuses on the that they analyse what customer mainly require and expect from the organization product. Assessment of the competitive environment using Porter’s FiveForces model Porters fives forces is the most beneficial concept which provides clarity that which product company's activities inference the profit generate and development of new opportunities. But it mainly gives idea as well that how company can manage their various activities with the analysis of these forces because each and every aspect of this model can gives clarity which thingsareessentialfor the expansionof businessproductivityand developmentof new opportunities (Panda, 2021). Evaluation of strategic management plan for new decision-making process with the help of porter fives forces are as follows, Threat of New Entrants: New entrance of retail industry is one for the biggest threat for the multiple retail industry because every individual organization when they develop their product they analyse multiple aspects because they enter the new market, they more efficiently develop their services and product into the market. ASOS company threat of new entrants is not much higher because the businessbrandnameisoldandalmosteveryUKpeoplehaveknowledgeabouttheir organization position. But they face issues from the new retail industry as well they influence by the small retailer because they provide some product on lower cost. The Best resolution of the new organization expansion is that company provides their survives with limited margin, fixed cost and applies effective pricing strategy can beneficial for the long term. Bargaining Power of Suppliers: The company supplies power is higher because company require various range of raw material and Supplier dominating nature influence the supply chain management of the company (Rasila, 2021). Its essential that company develop strategic approach like they buy require raw material with multiple retail and maintain good relationship with them is the best technique for the reduction of supplier bargaining power. Also, when individual supplies develop argument company consider and prepares design of the product without material. Bargaining Power of Buyers: Almost every company faces this particular challenge because it impacts on the overall business result. The other company provide their services at lower prices and same product then
people attraction directly influences by this type of organization product. That's the reason every company has to focuses on the product pricing decision and brands prices decision because its is the only option to develop attraction of buyer, unique price, different design, quality, services they all are the best technique to reduce bargaining power of buyers. Threat from Substitute Products: ASOS company threat of substitute is higher because multiple retail companies provides services like cloths, shoes etc. So it influences and generate threat for the organization. So its essential that company develop some unique things in their goods and services, or they improve their quality of product. Substitute is the major thereat because customer and audience has multiple options, and they more attract with the unique and good cost of product. Rivalry among the existing players: The company has so many existing rivalry because UK country has so many retail seller who provides services into the market, Tesco, Mark and Spencer, Sainsbury and many more companies provides same services in the market, but application of innovation techniques and business expansion in different country improves their reputation and build powerful position. On the basis of strategic decision company has to consider sustainable differentiation because this is one of the best strategy which beneficial to services in the competitive market. Industry's possible competitive benefits Survives in the competitive market and grow business at international level requires strategic approaches and its important that company develop analytical aspect to identify the various factors are as follows, Build effective culture: Managementofeffectivecultureintheorganizationprovidesideaandgenerate efficiency in individual performance (Wasliman, Hilman and Syauri, 2021). ASOS company mainly consider that they develop smooth and powerful environment and promote team work with the help of leader so individual performance and their motivation highly improve the business culture as well and it improves the relationship within the sales and customer. Clarify the strength:
Its important that company identify the individual strength, and they knowledge about individual skills and knowledge when organization owner or strategic management planner has great sense of individual work or external forces information then it develops proper strength. Establish unique and different product: Its essential that company mainly consider and develop strategy for unique product development because it is the only option which influence the business at global level or in existing market. Survives in the competitive market company has to follow new regulations and approaches. On the basis of overall strategy can give powerful strategic management plan for international business expansion of the company. Policies objectives to reach overall strategic objectives Improvement in quality of business behaviour and work process. Because it develops quality of business and creates new opportunities. Unique product strategy to reach attraction form the existing customer or new audience. Different product policy can develop efficiency (Wirtz, Müller and Weyerer, 2021). Technological advancement and application of innovation tools is the most useful technique and policies which improves the business work behaviour which means adverting of product can be attractive and their website development highly influence the sale. Effective transportation services build the attractiveness towards with the organization servicesanditincreasesthepeopleinteresttowardswithproductbecauseevery individual when they want to buy any product they mainly consider that online product comes on given time. So this activity is helpful for the new customer expansion. One and last is that when company prepares provide their survives in international level for long term they analyse the external aspects of the other counties because it is the only option which gives idea how product can survive in the market or not. Strategic direction Strategic direction is necessary in order to motivate the organisation to move ahead with all the approaches that are in regard to bring aboard the essence of development. Development is a common factor for every organisation and that can be attained with proper enthusiasm that every organisation usually move ahead with. This is portrayed upon the strategic solution to all the problems that arise in the organisation (Waslimanand et.al, 2021). The Ansoff growth matrix is
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used to determine the product as well as its expansion to stop it will bring about an analysis towards the strategies that will determine growth of the organisation as well as the business forces. The Ansoff growth Matrix will explain about the business in four stages. They are as follows: Market penetration: the market penetration in this particular strategy is used to determine the product in the existing market race. There are certain shapes that will determine the penetration strategy which will help to execute number of waste that will fall in regard to decreasing prices promotion as well as the distribution efforts that are the part of Marketplace. Product development: the product development that is in regard to the organisation will help its to move ahead with the development and expansion. With this product development strategy the organisation has kept the head in innovative solutions and that is brought about by a research and development. The organisation is also into investing for research and development processes such that they can get to understand the existing market and the competitors that are in the race (Rasila, 2021). Market development: through market development strategy the organisation has acquired a grip over the existing products. The expansion that is in regard to the geographic regions as well as the customer segments is also known by the organisation. The assessment towards the profitable standard and how far it can character different customers and segment them accordingly are known. The consequences of entering into a new domestic market is also known to the organisation and the pace of foreign market is also understood. Diversification: through this method the organisation will acquire the process of diversification that will bring about entire revenue to the company (Wirtzand et.al, 2021). Through this the organisation has acquired two types of diversification one is related diversification and the other is unrelated diversification. The potential after which the synergies can be utilised in the product market will all fall under related diversification. The unrelated diversification will deal with the realisation of to which the existing business can move ahead with the potential strategies. Ansoff growth matrix is a phenomenal aspect that is a part of bringing about the strategic orientation to the organisation can be attained. The factors that will fall in regard to market penetration, product development, market development and diversification are all explained in the growth matrix that is being displayed.
CONCLUSION It has been summarized form the above reflective strategy that company has followed and consider strategic plan for their growth and expansion of new opportunities and application of models, analysis tools and techniques provide efficiently result and beneficial for the analysis of external and internal forces of they impact on the business strategic plan. This study has been clearly provided information about that how company can develop decisions with the help of SWOT analysis and PESTEL analysis for the business expansion and growth, and they clearly give idea that which goods and services can beneficial for the business expansion at international level, and the unique product, different goods and services and effective production work is the only portion to smoothly run in the huge competitive market as well as international market. This report has been mainly given idea that if organization follow and apply strategic management plan so it definitely useful for the overall business growth.
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