Individual Strategic Management Report for JD Sports: Importance of Strategic Management, Internal and External Analysis, Competitive Strategies, and Expansion Methods

This report discusses the importance of strategic management for JD Sports and provides an analysis of the internal and external environment using PESTEL and Porter's five forces. It also identifies competitive strategies using Porter's generic strategies and suggests methods of expansion for the company. The report concludes with recommendations for JD Sports' expansion into the Indian market.

Strategic Management

Executive summary
Strategic management is the process of setting proper goals and objectives in respect to
accomplish desired and targets of the organisation and gain competitive benefits in the
marketplace. Proper strategic management plays an essential role in the global development and
development of the management and enhance their over all performance efficiently. It allows
organisation to improve their brand image in the marketplace. This report helps in determining
the importance of strategic management for achieving desired goals and objectives. The proper
analysis of Internal and external environment using PESTEL and Porter's five forces as well as
VRIO is determined in this report. In addition to this report also helps in analysing the
competitive advantage of the organisation using porter's generic strategy is also determined in
this report. In addition to this the various expansion method that can be considered by the
organisation to expand their business along with the recommendation is also highlighted in this
report.

Table of Contents
Introduction .....................................................................................................................................1
Main Body.......................................................................................................................................1
Overview .........................................................................................................................................1
External analysis .............................................................................................................................2
Internal analysis ..............................................................................................................................5
Identification of competitive strategies ...........................................................................................6
Strategic directions ..........................................................................................................................6
Methods of expansion .....................................................................................................................7
Recommendation ............................................................................................................................8
Conclusion ......................................................................................................................................8
References ......................................................................................................................................9

Introduction
Strategic management offers overall direction through developing plan and procedure
implemented to accomplish desired goals and then effectively utilising proper resources in order
to implement then plan (Aboramadan, 2019). Strategic management is also described as process
formulation and implementation of desired objectives of the management to make it more
competitive. For this report JD sport is taken as base company. The JD sports is one of the well
established retailers of fashionable sports and casual wear. It was founded in 1983 by John
Wardle and David Makin, having more than 56 stores in UK. The company is planning to
expand their business in the Asian market to continue to gain competitiveness. This report
highlights the detailed description of strategic management including internal and external
environmental analysis. Also the analysis of competitive strategies using porter's generic
strategies is also highlighted. In addition to this strategic direction and methods of expansion
along with the recommendation is also highlighted.
Main Body
Overview
Strategic management is termed as the procedure of setting targets and procedure leading
to develop the management more competitive in the marketplace. Proper implementation of
strategy allows the organisation to determine the path needed to be considered by the business or
enhance their performance and gain competitive advantage in the marketplace. In case of JD
sports, which is one of the growing and well established company in UK offering fashionable
sports and casual wears. It was founded in 1983 by John Wardle and David Makin, offering
quality services to their customers focusing on satisfying the needs and wants of the customers
effectively (Al Wazzan, 2018). The company is planning to expand their business in the Indian
market to grow and expand their market size. India is growing market offering large number of
growth and innovational opportunities for the organisation. It will support the business to gain
competitive benefits in the marketplace and increase their global performance. For the smooth
and effective expansion of the company the strategic management analysis is mentioned below:
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External analysis
It is refers to the process of analysing various micro and macro factors present exist
outside the management leading to directly effects the operating and profitability of the
management. (Aulaand Mantere, 2020). In order to determine the Macro and micro environment
the PESTEL and Porter's five forces in context to chosen company that are as follows -
PESTEL analysis: It is one of an important strategic frameworks that are utilised by the
management in order to identify several external factors directly influencing the functioning and
profitability of the management. In context to JD sports, the PESTEL analysis is mentioned
below:
Political factors: It refers to several government approaches and rules that directly
intervene in the operation and profitability of the management. The growing inequality in UK
can lead to fluctuation in the taxation policy. In case of JD sports, company operates in different
market and in order to continue to perform better company ensures the political changes. The
local government of the UK plays an essential role in making policy and regulation in UK. The
chosen company closely follows the state and territories policies in order to smoothly carry out
their work. Considering the government policies and rules of India will help company in their
smooth expansion of business.
Economic factors: It refers to change in interest rate, inflation rate, employment rate,
spending capacity of consumers and to lead to effects the functioning and profitability of the
company. Operating in strong economy will allows organisation to increase their profitability as
consumers will spend more on buying products. In case of JD sports, UK is considered to be one
of the well developed economy enabling company to enhance themselves. Also India is
considered to be growing economy which will helps company to expand themselves and grab
large number of opportunities (Bailey, Mankin and Garavan, 2018).
Social factors: Any kind of change in the consumers attitude, behaviour and culture
creates direct impact on the functioning and profitability of the company. In respect to continue
to grow and develop in the marketplace, it becomes important for the organisation to determine
the changing requirements of the social groups and meet their requirement accordingly. In
context JD sports, company continuously determines the changing needs of their customers and
accordingly satisfy their needs.
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Technological factors: It refers to variations in the techniques or advancement of new
technology directly have an impact on the competitiveness of the company in the marketplace.
In case of JD sports, company use well advance technology to influence large amount of
consumer and increase their global performance. While expanding into Indian market, which is
an growing market in terms of technology and innovation, considering technology advancement
will help company to grow effectively (Bhattacharyya, 2020).
Environmental factors: It includes roles of all management to work towards welfare and
property of the situations. Considering environmental change helps the business organisation to
gain competitive advantage in the marketplace and enhance their overall performance. In case JD
sports, the company is effectively focused on fulfilling their environment responsibility including
reducing carbon emission and reducing waste. Continue focusing on their environment
responsibility in the expanding market that is India will help company is smooth expansion and
enhance their performance effectively.
Legal factors: It involves the legal laws and legislation that are executed and are required
to be followed by all management in respect to smoothly and effectively carry out their work. In
case of JD sports, the company follows employee/labour health and safety laws in some
countries which have strict regulation on ensuring the safety of their workers. Also company
effectively focus on offering secure work environment for their workforce as it is considered to
be ethical and moral obligation for the company. In addition to this, JD sports also focus on anti
discrimination laws to promote positive and effective work environment. Following all the
required legal laws will help company to smoothly expand into Indian market.
Porter's five forces
It is one of an important structure considered by the management in respect to identify the
business's competitive situation as effectively (Bozhanova and Kononova, 2018) . This
frameworks mainly determines and analyse five competitive forces that shape every industry as
well as determining their weakness effectively. In context to JD sports, the porter's five force is
mentioned below:
Competitive Rivalry: It define to the amount of competitors that are exist in the
marketplace that directly influence the profitableness of the business. If there are large amount of
competitors present company face huge competition. In case of JD sports, the level of business
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relation is high as the company has larger amount of challenger in the marketplace such as Foot
Locker, Zumiez, Academic sports and Kanui.
Threat of new entrant: It refers to the new firms entering into the market, but in case of
strict barriers to new entrants leads to creating barriers for them. In case of JD sports, the threat
of new entrant is low as it requires less capital for the new firm to enter into this market (Brown,
Bessantand Jia, 2018).
Bargaining power of buyers: It involves if the amount of buyers are less in the
marketplace, then in relation such they will have power to bargain high term of case. In case of
JD sports, the bargaining power of buyer is more as there are various options available for the
buyers to get shift from one buyer to another.
Bargaining power of suppliers: It termed to if the amount of suppliers are less in the
marketplace, then they have power to purchase more effectively. In relation to the JD sports, the
bargaining power of the suppliers is less as there are number of suppliers available in the
marketplace for the company to choose. Selected business also has effective goodwill in the
marketplace so suppliers has to follow the values that are set by the business as effectively.
Threat of substitute products: It refers to the business that provide same goods and
facilities of the other business that lead to develop threat for the chosen company. In case of JD
sports, the threat of substitute product is high as there are number of substitute products available
in the marketplace creating threat for the company (Dhir, 2019).
From the above frameworks it is analysed that effectively determining the macro and
micro environment of the chosen country for expansion will help them in their smooth
expansion. India is growing country, offering large number of innovational opportunities for the
business organisation. Expansion of business in the Indian market will help company to grow
and develop. Offering quality and unique product and services will helps company to tackle
competition and substitute factors for the company as well as attracting large number of
customers.
Internal analysis
VRIO Analysis: It is refers to essential frameworks tool used by the business organisation to
determine their internal capabilities and resources effectively. It is one the important strategic
framework of the organisation to enhance their internal capabilities and effectiveness. In context
to JD sports, to analyses their internal capabilities the VRIO analysis is mentioned below:
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Resources Valuable Rare Inimitable Organised
Brand image Brand image Brand image Brand image Brand image
Financial
resources
Financial
resources
Financial
resources
Financial
resources
Human resource Human resource Human resource
Supply chain Supply chain
Valuable resources: A product or resources of the organisation is considered to be
valuable if they allows the organisation to grab new opportunities and gain competitive
advantage in the marketplace. In context to JD sports, the company's brand image, financial
resources, human resource, financial resources and supply chain of the company are considered
to be valuable for the company allowing company to perform better and effective in the
marketplace (Ferchand Roe, 2019).
Rare: It refers to kind of resources which is not generally possessed by the other
competitors. A resources is considered to be rare when it is difficult to find such products by
others. In context to chosen company, the company has strong brand image in the marketplace
which is considered to be rare product for the company. Also financial resources of the company
and strong human resource is also considered to be rare resources of the company.
Inimitable: A product or resources of the organisation is considered to be inimitable
when it is difficult to be copied, imitate or create by others easily. In context to JD sports,
company's brand image is difficult to be copied by others specially by their competitors. Also the
financial resources of the company is also difficult to be copied by others.
Organisation: The last element of the frameworks is organisation, a resources is
organised effectively leading to capture the value for them. In context to JD sports, the goodwill
of the business that are considered to be resource that are organised and will enable to business to
gain competitive benefits in the marketplace and enhance their overall performance and
effectiveness (Haghighiand Jalali, 2018).
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Identification of competitive strategies
Porter's generic strategies: It is a method which shows that how company gain
competitive advantage from its chosen market scope. In context to JD Sports PLC management
used this authority for gaining organizational growth and profitability. Mainly it includes four
strategies which are described below -
 Cost leadership – It refers to in which price organisation manufacture their products
from other competitors products. In this stage consumers mainly focused on products
price from other competitors before purchasing. For customers price is the very important
concept. In context to JD Sports and PLC, authorities must fix the average price. Because
with help of average prices leads to purchasing the product by all categories of customers.
 Differentiation – It refers to in which way organization manufacture unique product
which was create differentiation from other competitors. In this stage consumers mostly
focus on specification comparison. In comparison if customer find any unique feature in
the product, then consumer did not care about price. In context to JD Sport and PLC,
management are responsible provide best quality product with uniqueness to consumers.
And uniqueness is very important to attract customers.
 Cost focus – It refers to facilitate services in a narrow segment to consumers at
affordable or lowest price. This strategy is used to develop low cost benefits in narrow
market according to customer requirements. The other purpose of cost focus is to increase
the sale of product with maintaining lower price. In context to JD Sports and PLC,
management must ensure that price was maintained consistently low and facilitate
specification high before selling the product.
 Differentiation focus – It refers to in which way products and services are totally
provided different to consumers. Different type of products are manufactured by the
organization for specific customer segment. And in this section unique and wide range of
organization are available from one organization. Because in this stage pieces are high
and product demand are limited. In context to JD Sports and PLC, management must
implement unique changes in their product according to customer needs and wants. This
leads to attract the customers easily.
From the above analysing strategies, in context to JD Sports and PLC cost focus will be
the most suitable strategy for expansion in the Indian market as it will help in development of
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low cost benefits. It will lead towards enhancing the present profitability market share of JD
Sports and PLC. It will further provide competitive advantage in long run. (Todorovand Akbar,
2018)
Strategic directions
Strategic direction is defined as the plan or procedure that needs to be considered and
implemented by the business organisation to effective move towards its vision and accomplish its
goals and objectives. It allows the organisation to effectively communicate the desired task and
roles to the employees motivating them towards achieving business objectives. In case of JD
sports, to expand their business in India, the strategic plan is mentioned below:
Executive summary: The JD sports is one of the growing and well-established organisation
offering quality sportswear products to their target customers effectively. The company is
planning to expand their business into Indian market in order to enhance their performance
effectively.
Vision: The vision statement of the company is to offer long term sustainable earning growth to
enhance their total shareholders return
Mission: The mission statement of JD sports is to continue to motivate their employees towards
inspiring their employees and workforce towards offering quality services (Molnar, 2018) .
Objective: The objectives of the company is to expand their market size through expanding their
business into Indian market. Also increase their sale by 15% by end of this year.
STP Analysis: It is one of the essential frameworks used by the organisation in order to divide
their market into equal segment and target them effectively. In case of JD sports, the STP
analysis is mentioned below:
Segmentation: It refers to dividing the large market into small segment by the business
organisation on the basis on various factors such as demographic, geographic and psycho-
graphic. In case of JD group, in order to expand their business the Indian market is taken into
account by the company. The segmentation is done on the demographic basis to enhance their
market size (Nathan, 2019).
Targeting: Another factor is targeting, under this the chosen segment is targeted
effectively in order to attract large number of customers. The chosen company is targeting the
sports group in Indian market in order to gain competitive advantage.
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Positioning: The last element is positioning, this focus on using various tool and
techniques in order to make consumers aware of the their brand image leading to create strong
image of the product in the mind of the consumers. In case of JD sports, the company will focus
on advertising and social media marketing in order to attract large number of customers and
make them aware of their brand (Phornlaphatrachakorn, 2019).
Ansoff matrix: It is refers to the tools or technique used by the business organisation in order to
determine and plan their strategy for growth and development effectively. In case of JD sports,
the Ansoff matrix is mentioned below:
Market penetration: It refers to the strategy that allows the business organisation to grow
through offering existing product into existing market. It can be done through using advance
promotional or advertising techniques leading to attract customers.
Product Development: Another strategy that can be used by the organisation to grow can
be product development strategy. This strategy allows organisation to offer new products into
existing market, this can be done through analysing the changing needs of the consumers and
accordingly offering them quality products. This will helps company to increase their customers
base.
Market development: Another strategy is market development strategy, this will allows
company to grow and enhance themselves through expanding their business into new and
emerging marketplace. This will help company to increase their market size.
Diversification: The last strategy is diversification, under this in order to grow and gain
competitive advantage, the company will focus on offering new products into new market. This
will help company to grow and improve their overall performance (Roe, 2019).
From the above it is analysed that in case of JD sport, the market development strategy is
taken into consideration in order to grow and enhance their performance. The company is
planning to expand their business into the Indian market to enhance their market size and grow
effectively. This will allow company to gain competitive advantage in the marketplace.
Methods of expansion
It refers to those methods which is used by organization to expand their product and
services in various countries. These methods includes concentration, cooperation,
internationalisation and so on. In context to JD sports, various expansion method can be
considered in order to expand into Indian market as mentioned below:
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Exporting: It refers to the process of selling of the companies product and services into
international market. It is considered to be most used form expansion method by the business
organisation. It allows organisation to directly sale their products into the international market
with out involving any intermediaries (Sahota and Bennett, 2019).
Licensing: Another method that can be considered by the organisation to enter into the
internation market effectively can be through licensing. This method allows the organisation in
the target country to utilise the property or product of the licensor. In this case the licensor in the
main home country makes reserved rights to the licensee in the host country to carry out their
business operations.
Merger and acquisition: Another essentila method that can be considered by the business
to expand their business into the international market can be through merger and acquisition. The
merger is the process which involves one company merging with other company to smoothly
carry out their work. In case acquisition, one strong company acquires the another company to
collaboratively work towards enhancing their efficiency (Singhand Srivastava, 2018) .
From the above, it is analysed that in case of JD sports to expand their business into the
Indian market the company will use Exporting method of expansion. This will allows company
to directly sale their product into the international market without involving any intermediaries.
Recommendation
In order to grow and continue to gain competitive advantage in the marketplace in the
competitive environment it is essential for the business organisation to continue to enhance their
performance and re-evaluate their strategy as per requirement. In case of JD sports, in order to
continue to grow and enhance their performance it is recommended that company regularly scan
their environment and implement required strategy. In addition to this it is also recommended
that with growing user of technology and social media platform the company can also focus on
using various social media platforms to attract large of customers and enhance their performance
and increase their customers base. The company can also use advance technology like AI in
order to smoothly carry out their operations (Stoyanova, 2018).
Conclusion
From the above report, it has been concluded that the proper strategic management plan
helps the business organisation to accomplish desired goals and objectives and enhance their
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overall performance. This report helps in analysing the importance of strategic management in
setting proper goals and objectives of the organisation. This report also helps in analysing the
external environment of the chosen company including macro and micro environment using
PESTEL and Porter's five forces. Also the internal environment along with company's resources
and capabilities using VRIO frameworks. Additionally, to determine the company's competitive
strategy the porter's generic strategic is also analysed in this report. Also various expansion
methods such as exporting, licensing and merger and acquisition is also analysed in this report
along with various recommendation for further growth.
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