Management: Strategic Tools for Business Development

This report discusses the strategic tools used in management for business development, including PESTEL analysis, SWOT analysis, and Ansoff matrix. It explains how these tools can help in decision-making and achieving organizational goals. The report focuses on the case of Toyota Motor Corporation and its use of these tools.

Management

TABLE OF CONTENTS
Management................................................................................................................................1
INTRODUCTION...........................................................................................................................3
MAIN BODY ..................................................................................................................................3
PESTEL Analysis........................................................................................................................3
SWOT Analysis..........................................................................................................................4
Ansoff matrix:.............................................................................................................................5
CONCLUSION ...............................................................................................................................7
REFERENCES ...............................................................................................................................8

INTRODUCTION
Management can be define as a process of controlling over the affairs of the organisation,
in terms of size, structure, type and nature. It is the activity of creating and maintaining an
enterprises. Management is the science and arts of getting things done by others to tin order to
achieve the desired objective and goal of the organisation with use of available resources
effectively and efficiently. It is a process in which planning, organising, leading and controlling
activities are continuously performed. It acts as a guide to the group of people working in the
firm and coordinate them to achieve common objective. This report is based on the Toyota
Motor Corporation. This firm is on of the largest manufacturer of auto mobiles in worldwide.
Toyota Motor Corporation deals in cars and produce vehicles under the five brands considering
Toyota, Hino, Lexus, Ranz and Daihatsu. This report will consider the decision on the PESTEL,
SWOT and Ansoff matrix to explaining the strategic development tools and its use for the
business.
MAIN BODY
Strategic tools are important and most popular business strategy tools using for
implementation of strategic plans and achieve a sustained competitive advantages. Following is
the comprehensive discussion of strategic tools:
PESTEL Analysis
PESTEL analysis is very essential tool which helps to understand the growth and losses
of a particular market and concentrating on the political, economical, social, technological, legal
and environmental factors of the organisation (Kreutzer, 2019). It shows an available
opportunities for Toyota Motor Corporation.
Political factor is very essential for the company which deals with an international
market like Toyota Motors (Nurmi and Niemelä, 2018). This factor will be guide the firm to
understanding the particular and specific requirements, rules, restriction and policies of the
country. This factors can measures the degree of government intervene in the economy.
Economic factor can be breaking down into two parts one is micro economic and second
is macro economical factor which deals in economic demand of any given economy. This
includes the growth, foreign exchange rates, interest rates and inflation and income of business
as well as consumer and so on which affects the decision making of the business.

Social factor considers the cultural aspects such as age distribution, population growth,
health and attitudes and more focus on safety (Strzelczyk and Chłąd, 2017). It helps to
understand the needs and wants of the consumer in a market. This factors can affects the
demand of Toyota Motor's products because of the high trends in such factor. For overcoming
this the firm may changes the different management strategies to adapt the social changes in the
organisation.
Technological factor includes the technological aspects of the firm such as research and
development, adaptation of new technologies. Toyota Motor Corporation is concentrating on
such factors because of the huge competition in auto-mobiles (Kreutzer, 2019). This factor will
determines weather the firm should outsource or manufacture the products and level of
production of the company. Technological shifts may affects the quality and cost of firm.
Environmental factors can helps to understand the environment that can affects the
production. It shows the level of scarcity of resources like raw material, pollution and carbon
footprint targets sets by the government. This factor will shows the environmental issues that can
be faced by the firm. This factor can affects the industries like tourism and agriculture.
Legal factor considers law like discrimination law, antitrust law, employment law and
health and safety law (He, 2015). This factors can affects the company's operation activity, its
costs and demand of the goods of Toyota Motor. It is becomes more tricky when the firm is deals
globally.
Use of PESTEL in Toyota Motors:
PESTEL analysis is used to makes an systematic evaluation of a business. This tools will
focus on the internal and external factors that can affects the firms (Nurmi and Niemelä, 2018).
By focusing on such factors provides an opportunity to see the image of industry and facilitates
to assess and minimise the threads of the business. PESTEL allows the firm to give detail
planning of the organisation and address the external challenges. It provides the better awareness
and understanding to the decision makers.
SWOT Analysis
SWOT analysis techniques is the technique which is helps to the individual or an
organisation to identify the strength, weakness, opportunities and threats relates to the firm

(Lurati and Zamparini, 2018). This tool helps to scan the internal and external environmental
factors. It is the essential part of the strategic planning process of the organisation.
Strength of the firm can be defined by its resources and capacity of production which can
be used for making a company more capable in order to achieve high profitability (Sarsby,
2016). Toyota Motors are having internal strength are strong brand image, cost advantages, high
grade natural resources, good distribution network, attractive market image and so on.
Weaknesses mean absences of some strengths are viewed as a weaknesses of the
organisation. Toyota Motor having weaknesses like lack of customer satisfaction, lack of assess
of distribution channels, few protection against patent and scare of resources availability may the
major weaknesses of the firm.
Opportunities that the firm have are fall under the external environmental analysis. It may
reveals some new opportunities for business growth and increase the profitability and
productivity (Phadermrod, Crowder and Wills, 2019). Toyota Motors are considers such as
unfulfilled needs and wants of the consumers is an opportunity to makes them satisfy by
provides such goods and reaching of new technology, reduction of trade barriers and so on.
Threats can be defined as an fear of change in external environment that can directly or
indirectly affects the profitability of the firm. Toyota Motors having threat of increase in the
trade barriers, formation of new regulations, entrants of substitute goods and change in the nature
and preferences of the buyers.
Use of SWOT analysis:
The SWOT analysis is focused on assessing and addressing the strength, weaknesses,
opportunities and threats of the Toyota Motors (Dawes, 2018). It is used to assess the particular
goods and its marketing methods. It provides the summary of evaluation on external and internal
factors which can be useful to the company to prepare for the strategic options for the business.
SWOT Analysis can identify the actual internal strengths and weaknesses or the organisation and
also helps to understand the market opportunities and threats of the business.
Ansoff matrix:
Ansoff matrix is a strategic tool that gives a frameworks to supports the management and
marketers to makes an effective plan for the future growth of the business. This model is applied
to identify the opportunities to increases in the revenues of Toyota Motors and introduces new

goods and services in the new market. This matrix is also called product market matrix. Ansoff
matrix considers the four strategies which are discussing below:
Illustration 1: Ansoff matrix
(source:Ansoff matrix, 2010)
Market penetration is a strategy in which the organisation is try to increase the growth by
offering the existing goods and services in the existing market. It is an action that facilitates
higher market share in present market with the same products. It can be achieve by selling more
and more goods and services provided by the Toyota Motors in the current market segment and
creating new buyers within the current market (Sammut‐Bonnici and Galea, 2015). Firm has to
decrease the price of their goods and ensures the promotion and distribution support for achieve
such goal.
Market development strategy in which Toyota Motors tries to expand the new market
like geographic or countries by offering the existing products. It may achieve only when the firm
have foreign market to trade and having the wider range of customer segments.

In Product development strategy the Toyota Motors organisation tries to launch a new
product in the current market to generates more and more profitability and increases the growth
of the company (Dawes, 2018). It considers to extending the range of products in front of
existing market.
Diversification is the plan in which firm tries to increases the market share of the comp-
any by introduces the new product in the new market (Kreutzer, 2019). It is one of the risky
factor for Toyota Motors because both the market as well as the product are newly created.
Use of Ansoff matrix:
Ansoff matrix can be used in the strategic stage of marketing process. It helps to identify
and explore the possible growth of the business (Schawel and Billing, 2018). The matrix can
helps the management team of Toyota Motors to decide how to demonstrating the option and
determines that which is the best strategy for the business in order to achieve high growth.
CONCLUSION
From the above study it has been concluded that the management is an essential activity
for all the business to meeting with the goal. An effective managements leads to intimation of
efficient goal. This report has been summarised the main tools of strategic development used by
the organisation and its usefulness to the business. Tools are PESTEL analysis, SWOT analysis
and Ansoff matrix. Such tools are determine the internal and external factors of market as well
as organisation and provide an effective evaluation that may helps to decision maker of the firm.

REFERENCES
Books and Journals
Dawes, J., 2018. The Ansoff Matrix: A Legendary Tool, But with Two Logical Problems. But
with Two Logical Problems. (February 27, 2018).
He, Z., 2015, August. External Environment Analysis of Commercial-use drones. In 2015-1st
International Symposium on Social Science. Atlantis Press.
Kreutzer, R.T., 2019. Tools for the Strategic Analysis. In Toolbox for Marketing and
Management. (pp. 89-142). Springer, Cham.
Lurati, F. and Zamparini, A., 2018. Communication SWOT Analysis. The International
Encyclopedia of Strategic Communication. pp.1-8.
Nurmi, J. and Niemelä, M.S., 2018, November. PESTEL Analysis of Hacktivism Campaign
Motivations. In Nordic Conference on Secure IT Systems. (pp. 323-335). Springer,
Cham.
Phadermrod, B., Crowder, R.M. and Wills, G.B., 2019. Importance-performance analysis based
SWOT analysis. International Journal of Information Management. 44. pp.194-
203.
Sammut‐Bonnici, T. and Galea, D., 2015. SWOT analysis. Wiley Encyclopedia of Management.
pp.1-8.
Sarsby, A., 2016. SWOT analysis. Lulu. com.
Schawel, C. and Billing, F., 2018. Ansoff-Matrix. In Top 100 Management Tools. (pp. 31-33).
Strzelczyk, M. and Chłąd, M., 2017. Use of PESTEL Analysis for Assessing the Situation of
Polish Transport Enterprises (Part I). Zeszyty Naukowe Politechniki
Częstochowskiej. Zarządzanie. (27, t. 2). pp.161-168.
Online
Ansoff matrix. 2010. [online] available through
<http://www.quickmba.com/strategy/matrix/ansoff/>