BMA6104 Organisational Strategy Assignment 2

Organisational Strategy

Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
What are the key external challenges and opportunities facing Severstal?.................................1
What are the most important aspects of the internal business situation of Severstal?.................2
What are some future strategic options and directions that Severstal should consider?.............4
What steps would you recommend for Severstal to take over the next decade?.........................5
CONCLUSION ...............................................................................................................................6
REFERENCES................................................................................................................................7

INTRODUCTION
Organizational strategy can be defined as a long term plan used by the entities for
carrying out their operations effectively by allocating their resources in the best possible way to
support the business activities. These strategies help companies achieve the aspired goals by
serving as guidelines to them (Alblooshi, Shamsuzzaman, and Haridy, 2020). Severstal is a
renowned company which operates in the steel and mining industry. The company has its
headquarters Cherepovets. It is the Russia's largest steel company and is listed on Moscow
Exchange. This report have PESTLE as well as SWOT analysis of Severstal along with Porter's
Five Forces. These are applied to analyse the external as well as internal situation of the
company respectively. Further, some future strategies that the company should adopt with some
recommendations are also discussed.
MAIN BODY
What are the key external challenges and opportunities facing Severstal?
PESTLE ANALYSIS
There are various external factors which impacts the working of the organization. These
factors may bring challenges or opportunities for the business. It depends upon the organization
as to how the entity deals with the same. Tackling a challenge and grabbing an opportunity at the
right time is an art and must be done properly to take the most advantage of it (Callander, 2020).
An analysis of these factors in relation to the company, Severstal, is discussed below:
Political factors – US has started to impose tariffs on the imported steel and steel
derivatives. Further, the annexation of Crimea by Russia is creating troubles for the business
(Gamede, and van der Westhuizen, 2020). Along with this, carbon border tariffs have been
introduced in Europe affecting the steel and mining industry highly. Severstal is trying its best to
tackle these challenges.
Economical factors – Covid-19 pandemic affected the businesses all over the globe.
Severstal too was affected and faced an economic downturn. Recessions in the economy of
Russia reduced the demand to a great extent.
Sociological factors – Urbanization plays an important role in providing the revenue to
the steel industry. Further, consumers now-a-days prefer cookwares made from iron and steel
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