Strategic Planning and Analysis Assignment

This assignment involves analyzing and discussing the importance of strategic planning in business management. It requires students to examine different approaches to strategic planning, such as Porter's Five Forces, and apply them to real-world scenarios. The assignment also includes a review of relevant literature and research on strategic management and competitive positioning.

Strategic Analysis
Report

Table of Contents
INTRODUCTION...........................................................................................................................1
PART 1............................................................................................................................................1
Business background...................................................................................................................1
What industry is it.......................................................................................................................1
General environment analysis.....................................................................................................1
Industry environment..................................................................................................................2
Competitive environment............................................................................................................4
Opportunities and threats............................................................................................................5
PART 2............................................................................................................................................5
Firm’s resources, tangible and intangible...................................................................................5
Identification of capabilities........................................................................................................6
Core competency analysis...........................................................................................................6
Suitable information system solution that meets the chosen company needs.............................7
Evaluation of proposed system and recommendations...............................................................7
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Strategic analysis means to research about an organisation and its operating environment
to plan strategies and policies. Business includes activities such as production, buying, selling ,
marketing of product and services. There are many changes taking place in business environment
in order to make long run in industry it is important to accept these changes. Strategic analysis
means study of policies which are effective and significant for achieving targets, goals,
objectives of business. There are some internal and external factors which has to be considered
so targets can be achieved (Amankwah-Amoah, 2015). This report is based on Darrell Lea which
deals in Chocolate, Confectionery Food and Drink. In this report there is discussion about
external and internal analysis of business. There are some techniques which is used in order to
deal with external business changes is also covered in this report
PART 1
Business background
Darrell Lea is an Australian company manufactures and distributes chocolate, liquorice
and other confectionery things. This organisation has headquarter in Ingleburn, New South
Wales. This organisation was under Lea family. This organisation was found by Harry Lea. In
1927 in Sydney's Haymarket combined milk bar and confectionery shop. In 1935, they
established a factory at 1 York street. Darrell Lea has around 800 products such as chocolate
boxes, sugar free chocolates, etc. They produce around 60 seasonal products at the occasion of
Easter, Christmas.
What industry is it
Darrell lea falls under Confectionery industry. The functions carries in this industry is art
of making food items full of sugar and carbohydrates. In this industry, bakery products,
chocolates, pastries, cakes and other related items are involved. These days there are some
confectionery items which are sugar free. These are effective for special category people.
Confectionery items include sweet baked goods such as candies, dessert, cookies, doughnuts, etc.
General environment analysis
Economic- Australia has largest economy in world. GDP rate, inflation deflation rate,
taxes are included in economic factor. Revenue in the Confectionery segment amounts to
US$5,746m in 2018. The market is expected to grow annually by 4.0% (CAGR 2018-2021).
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(Confectionery, 2018)Australia has strong and stable financial system it helps in raising funds. It
is easy for managers of Darrell Lea to operate in Australia as there are less business restrictions.
Physical- In physical component consist of natural and man made elements such as
vegetation, land, air water, transport, etc. These factors get affected because of manufacturing
unit, transport, etc. Hence managers of Darrell Lea have to frame policies in order to protect
them and use optimally.
Sociocultural- In social factor people having different beliefs, custom, practices, are
considered. Social culture has much impact on sales of chocolates and other confectionery
items. Australia is a country where diverse population resides. But there is majority young and
educated generations, so they accept varieties of confectionery items, this is opportunity for
Darrell Lea.
Global- In global factor, possibilities of international trade are studied. There is
competition in global market, hence there is requirement of accepting new challenge such as
difference in demand of consumers to make Darrell Lea brand at international level (Fleisher
and Bensoussan, 2015). There are some competitors also at global level such as Mars, Cad-bury,
etc. due to which international may get affected.
Technological- There is more use of technological devices in Australia. In technological
changes machinery up-gradation, stock verification machinery are involved. These changes are
important for growth and development of Darrell Lea but these might be costly, so this affects
profits of association.
Political/legal- Political factors includes role of government in effective running of
business. While legal factors includes legal, ethical norms such as environmental protection act,
safety and security act, etc. Australia has liberal capitalist policy which helps to perform business
with less political interference. There are some legal laws which has to be followed by Darrell
Lea to perform business activities smoothly.
Demographic- Age, Sex, religion, occupation, income, etc. factors are considered in
demographical factor. In Australia diversified population is residing, so this is fruitful for growth
and development of Darrell Lea business (Tan and Carrillo, 2014).
Industry environment
Industry environment can be understood with the help of Porter's Five forces model. This
model was established by Michael E. Porter for analysing competition for a business.
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Rivalry among existing competitors- There is high competition in confectionery sector,.
There are many big brands such as Hershey's, Cad-bury, Mars, etc. This makes growth of
business slow and it is important for Darrell Lea to accept technological changes to compete with
them (Cunningham, Everton and Murphy, 2016).
Bargaining power of supplier- There is few suppliers in Australia market, so there is less
bargaining to Darrell Lea. Because they do not have much suppliers from which they get raw
material.
Bargaining power of Buyer- There are many consumers in Australia having demand of
chocolates. There is more bargaining power to buyer because of various brands available in
market.
Threat of substitute- In confectionery industry, there are many substitutes available for
consumers (Horkoff and et. al., 2014). If product of Darrell Lea are not up to the mark, then this
affects brand image and consumer shifts to other substitute. In case available substitute are
cheap, customers will shift to it and this affects sales of Darrell Lea.
Threat of new entry- There is low threat of new entrance because there are some legal
and formal barriers which affects new entrances in industry. There are some license which has to
be taken from government of Australia such as Food License.
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(Source: Porter’s Five Forces of Competitive Position Analysis, 2018)
Competitive environment
There is core competition in confectionery and related food items. Cad-bury is major
competitor of Darrell Lea. It is the company which operate at large scale and world wide level.
This organisation has target market of lower, middle and upper middle class consumers. This
organisations have varieties of products such as Temptations, Oreo, Perk, Silk, etc.
Capabilities
Cad-bury have good brand value in industry. It has good work force which helps in
performing activities in better effective way. Cad-bury has strong distribution channel such as
departmental stores in all over world such as Australia, U.S., etc. it has world wide reach, so they
have good sales and brand image in industry (Min and Joo, 2016).
Strategies
This brand use different market strategies such as social media, special editions in
chocolate, etc. which helps to create knowledge about new products. Cad- bury give more
emphasise on research and development, so this helps to analyse consumer demand. Manager of
cad-bury make innovations in their product and services. This helps to maintain long and good
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Illustration 1: Porter’s Five Forces of Competitive Position Analysis

relations with customers. These days quality is one of the important concept which is taken care
by this organisation. Managers perform timely activities to quality check of cookies and
chocolates. Due to innovative ways ODF marketing of products by Cad- bury there is negative
impact on Darrell Lea.
Opportunities and threats
Opportunities Threats
Darrell Lea can change their ownership which
helps in growth and development of business.
People are getting aware of ill- effect of
chocolates which affects sales and profits of
organisation.
Managers of Darrell Lea can launch low
calories sugar free cookies and chocolates
because consumers are more quality conscious.
Competition in confectionery sector is one of
the biggest threat for Darrell Lea.
Organisation can diversify business in
beverages.
Alteration through innovation in technology
makes hem obsolete frequently.
PART 2
Firm’s resources, tangible and intangible
Darrell Lea has different resources such as use of natural resources, labour, etc. which
helps to perform business operations in more effective and efficient manner. It is important for
Darrell Lea to use these resources optimally, so best result can be achieved.
Natural- Raw stuff for manufacturing chocolates, cookies, etc. gets from earth, rain, air,
sunlight, etc. so natural resource is used for making choco-beans, fruits, nuts, etc. These are part
of tangible resources (Morán‐Ordóñez and et. al., 2017).
Labour- This is one of the important component which helps to perform business
operations in appropriate manner. There is requirement of physical and mental energy of
workers. Farmers, tuck drivers, etc. are involved in this. This is tangible resources.
Capital- Financial resource is one of the important component which helps Darrell Lea to
achieve goals and targets. With the help of capital building, equipments, technology, etc. can be
purchased. This is tangible resources.
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Intellectual rights- There are patents, copy right of Darrell Lea which helps to make
product unique from competitors. Logo, trademark, etc. are part of intangible resources.
Identification of capabilities
Darrell Lea has good labour strength which helps to deal with consumers in effective and
efficient manner. There are different departments such as sales, marketing, etc. in organisations
headed by managers. In order to improve this skill managers has to motivate personnel to give
best. This can be done with the help of monetary or non- monetary benefits to workers. Through
this managers of Darrell Lea is able to increase brand value and sales in near future (Oliveira,
2015).
Darrell Lea analyse market and modify chocolates according to demand of consumers.
Managers of organisation emphasise on use of innovative techniques through which commercial
operations can be performed in easy manner. Darrell Lea has USP of soft eating liquorice and
iconic Milk Chocolate Rocklea road. This is because they have good research and development
department. This can be improved with launching different flavours to it. Innovative approaches
and research and development department are capabilities for Darrell Lea. Through this they are
able to make new flavours in soft eating liquorice and hence satisfaction of consumer can be
achieved.
Techniques used by managers for marketing are effective. Managers of Darrell Lea are
using social media in order to expand knowledge about their product and services. This is
effective for creating brand image in industry. In order to improve this managers can launch their
own application through which online delivery of product is possible. They are more using
renewable sources of energy such as solar heaters, etc.
Manufacturing unit of Darrell Lea are also strong. They have different steps in order to
complete formation of chocolate. There is different department for every step such as
fermentation, grinding, pressing, stirring, sealing, packing, etc. This helps to avoid duplication of
activities and it is easy to ascertain accountability (Palia, De Ryck and Mak, 2014).
Core competency analysis
Activities used by managers of Darrell Lea are as under. This helps managers to increase
their efficiency and actions are taken to improve working style.
Relevance- There is important role of technology up- gradation which are effective and
signifiant for business growth. It is important that managers of Darrell Lea has to know relevance
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for future growth and operations are performed. Online mobile application is effective for
increasing sales of Darrell Lea.
Difficulty in imitation- There are many competitors of Darrell Lea such as Mars so it is
important to take actions through which there are less possibilities of duplication. As in
chocolate industry innovation are taking place very frequently, so it is important to take actions
in order to avoid duplication.
Breadth of application- Young generation is target market for Darrell Lea, so there are
much growth prospects because mainly population of Darrell Lea is youngsters there is
requirement of technological changes so good quality product can be served to customers
(Radetzki, 2017).
Suitable information system solution that meets the chosen company needs
Management information system is used by managers of Darrell Lea to perform business
operation in effective and efficient manner. Management information system is used especially
for supporting planning, controlling business operations. This is the software which collect data
of all departments and then according to decision outcomes decisions are taken. In this system,
input is result of transaction processing data. There are mismanagement in data collected from
different departments of Darrell Lea so management information system is most suitable and
effective for growth of organisation. With the help of this software, managers are able to take
fast decisions because all information are stored at one place. Management information system is
effective for managers of Darrell Lea as they can use information in more effective manner. For
instance as per closing stock, manufacturing has to be done. As per demand in manufacturing
unit, purchase of raw material is performed. Hence in this case, management information system
helps managers to collect data from various departments and store it properly. This helps to
control business operations and positive results can be achieved (Sotiriadis and Varvaressos,
2015).
Evaluation of proposed system and recommendations
Functioning of management information system which helps in running business
operations of Darrell Lea are-
Data capturing- Firstly managers of Darrell Lea has to capture data from different
departments. This helps managers to restoring data at single place.
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Processing of data- After collection, processing of data is done by managers which is
effective and significant for collection of data.
Storage of information- After processing, data which is important has to be stored for
future purposes.
Retrieval of information- At last there is retrieving of information. This is the last step
which helps to make decision s in effective and efficient manner.
As recommendation for the use of management information system, managers must train
employees, so they have knowledge about working with software (Stead and Stead, 2014). As
per up-gradations in software managers must use to operations also. This helps them to learn
about new techniques. In order to implement management information system, there is
requirement of capital. In this case managers has to analyse market and then best alternative must
be used. This helps to make management information system, cost effective for Darrell Lea.
CONCLUSION
From the above discussion it is clear that business environment affects business growth
rate. It is essential for managers to alter business policies according to competitors. External
environment of business can be understood through Political, legal, socio- cultural analysis, etc.
Porter's five force model helps to identify competitive analysis. There are some threats and
opportunities such as diversification off business, core competition, etc. Organisation has some
resources such as employees, advertisement etc. which helps to achieve targets. There is
discussion about capabilities of organisation and then four test to make them core competencies.
Lastly there is discussion about information system i.e. management information system which
helps to deliver information among workers. There are some recommendations related to it in
order to improve outcome of operations.
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REFERENCES
Books and Journals
Amankwah-Amoah, J., 2015. Against All Odds!: A Strategic Analysis of the Failures of Three
State-Owned Firms. In The Rise of Multinationals from Emerging Economies (pp. 115-
132). Palgrave Macmillan, London.
Cunningham, D., Everton, S. and Murphy, P., 2016. Understanding dark networks: A strategic
framework for the use of social network analysis. Rowman & Littlefield.
Fleisher, C. S. and Bensoussan, B. E., 2015. Business and competitive analysis: effective
application of new and classic methods. FT Press.
Horkoff, J., and et. al., 2014. Strategic business modeling: representation and reasoning.
Software & Systems Modeling. 13(3). pp.1015-1041.
Min, H. and Joo, S. J., 2016. A comparative performance analysis of airline strategic alliances
using data envelopment analysis. Journal of Air Transport Management. 52. pp.99-110.
Morán‐Ordóñez, A. and et. al., 2017. Analysis of trade‐offs between biodiversity, carbon
farming and agricultural development in Northern Australia reveals the benefits of
strategic planning. Conservation Letters. 10(1). pp.94-104.
Oliveira, E. H. D. S., 2015. Place branding in strategic spatial planning: A content analysis of
development plans, strategic initiatives and policy documents for Portugal 2014-2020.
Journal of Place Management and Development. 8(1). pp.23-50.
Palia, A. P., De Ryck, J. and Mak, W. K., 2014, March. Interactive Online Strategic Market
Planning With the Web-Based Boston Consulting Group (BCG) Matrix Graphics
Package. In Developments in Business Simulation and Experiential Learning:
Proceedings of the Annual ABSEL conference (Vol. 29).
Radetzki, M., 2017. Uranium: a strategic source of energy. Routledge.
Sotiriadis, M. D. and Varvaressos, S., 2015. A strategic analysis of the Greek leisure tourism:
competitive position, issues and challenges. Mediterranean Journal of Social Sciences.
6(1 S1). p.319.
Stead, J. G. and Stead, W. E., 2014. Sustainable strategic management. Routledge.
Tan, Y. R. and Carrillo, J., 2014, July. The agency model for digital goods: strategic analysis of
dual channels in electronic publishing industry. In Management of Engineering &
Technology (PICMET), 2014 Portland International Conference on (pp. 646-657).
IEEE.
Online
Porter’s Five Forces of Competitive Position Analysis. 2018. [Online]. Available
through:<https://www.cgma.org/resources/tools/essential-tools/porters-five-forces.html >.
Confectionery. 2018. [Online]. Available
through:<https://www.statista.com/outlook/40100000/107/confectionery/australia >.
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Amankwah-Amoah, J., 2015Cunningham, D., Everton, S. and Murphy, P., 2016Fleisher, C. S.
and Bensoussan, B. E., 2015Horkoff, J., and et. al., 2014Min, H. and Joo, S. J.,
2016Morán‐Ordóñez, A. and et. al., 2017Oliveira, E. H. D. S., 2015Palia, A. P., De
Ryck, J. and Mak, W. K., 2014Radetzki, M., 2017Sotiriadis, M. D. and Varvaressos, S.,
2015Stead, J. G. and Stead, W. E., 2014Tan, Y. R. and Carrillo, J., 2014
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