Strategic Analysis Tools

This article discusses the importance of strategic analysis tools in understanding an organization's environment and improving efficiency. It explores four key tools: SWOT analysis, input and output model, PESTEL analysis, and Porter's 5 Forces.

Running head : STRATEGIC ANALYSIS TOOLS
STRATEGIC ANALYSIS TOOLS
Name of the Student
Name of the Organization
Author Note

1STRATEGIC ANALYSIS TOOLS
Introduction
Strategic analysis tools are used by an organization in order to understand the
environment in which the particular organization is operating coupled with the understanding of
the organization’s interaction with its surrounding environment. This helps the company in
improving the organizational efficiency and its effectiveness. Thus the company increases its
capacity to deploy and redeploy its limited natural resources intelligently. The aim of the
research paper is to analyze the four important strategic tools likely the SWOT Analysis, Input
and Output Model, PESTEL and the Porter’s 5 Forces. The paper will identify and evaluate the
necessities of these tools and how they are used in a business organization.
Strategic Model 1 – SWOT Analysis
A SWOT Analysis is a very simple way but also widely used tools, which helps in
understanding the company’s strength, weakness, opportunities, and threats which are involved
in the projects of the business activity.
The SWOT analysis starts with a clear definition of the project and identifies the internal
and external factors which are important in achieving the objectives of Tesco. The internal
objectives of the organization are mainly highlighted with its strengths and weakness. Whereas
the external factors mainly deals with the opportunities and threats faced by it. The SWOT
Analysis is often plotted in a 2*2 matrix, which is provided below.

2STRATEGIC ANALYSIS TOOLS
STRENGHTS
 How Tata Steel performs better than the
other competitive companies
 The unique selling points
 How the company perceives its market
by properly analyzing its strengths.
 Competitive edge of the organization
 It clearly defines the unique selling point
of the organization.
 Unique or lowest cost resources which
the company can draw upon but others
cannot
 The best reliable sources of financial
growth
 Strong relationship with the customers
and partners of the company
 Culture and workforce development of
the company (MADRASI 2018)
OPPORTUNITIES
 The political, economic, socio –
culture, and technological analysis or
the PEST analysis changes which are
taking place in the company.
Implementing new strategic plans in
order to accommodate the necessary
changes in the company.
 Identify the currently added gaps in the
market and determine whether they are
fulfilled or not.
 New innovative techniques Tata Steel
can implement in order to capture
more market. Develop innovative
plans.
 Identifying the latest and interesting
trends in the market
 Identify the government policies.
WEAKNESS
 How other competitive organizations
perform better.
 The elements of the business which adds
less or no value in the development.
 How do the customers in the market and
competitor brand perceive the
organizations as a weakness?
 The ways and process, which can be used
in further improvement of the
organization.
 The factors, which can be avoided to
order to implement the change factors.
 Which are the factors involved which is
leading the organizations to lose sales.
 The products and services which are
offered are mostly in the lowest profit
margin.
THREATS
 Identifying from the economic,
political, technological and socio-
cultural factors which best suits the
company.
 Restraints, which are faced by the
company.
 Identifying out what the other
competitive organizations are
performing which is lowering down
the sales of the present company, or is
negatively creating an impact upon the
company.
 Is the change in the technology
threatening the positioning of the
company.

3STRATEGIC ANALYSIS TOOLS
Fig 1. Represents the SWOT Analysis
( Source – Self made )
Strategic Model 2 – Input and output model
The Input and Output model of the selected company mainly deals with the Management
input resources, which includes varies types of process in the middle and ends with the managing
output results. The input resources mainly include the company facilities, equipment, staffs,
customers, suppliers, transportation vehicles included in the process. The managing process
mainly include the process in work flow, work in progress, designing the working process and
methods which will be implemented in the working process, planning and scheduling the process
and team efforts. Lastly the Managing output deals with the products and services which the
company produces, customer satisfactions and environmental impacts of the products
(MASOUMI 2016).

4STRATEGIC ANALYSIS TOOLS
Fig 2. Represents the Input/ Output Resources model of Tata Steel and Company
(Source – Self made)
INPUT
 Facilities
 Equipment
 Staffs
 Customers
 Suppliers
 Transport
Process
 Process flow
 Work in progress’
 Process Design
 Planning and Scheduling
 Progressing and controlling
 System improvement
Output
 Products and services
 Customer satisfaction
 Unit costs
 Environmental impacts

5STRATEGIC ANALYSIS TOOLS
Strategic Model 3 – PESTEL Analysis
The PEST analysis is a scan of the external macro environmental factors which exists in a
business organization. It is a very useful tool for understanding the political, economic, socio
cultural and technological environmental analysis of a business organization.
 Political Factors – These factors includes the government regulations such as the
employment law, environmental regulations, and other tax pay policies. Tata Steel might
face some high risk investment in countries like US, Australia, England. The plan set up
inn these countries are delayed just because of the gas supply issues and mining issues of
iron ore. The company can also improve its infrastructure of the mentioned countries and
save a huge amount of money. They would not have to spend much money in the freight
and transportations business (Rani and Gundavajhala 2016).
 Economic Factors – Due to the subprime crisis in the countries like Europe and US the
company is facing various problems with the recession as because e this creates a bad
impact in the main markets of the company lie in Netherland and Germany.
 Socio – Cultural Factors – Tata Steel and Manufacturing company was awarded as the
Golden Peacock Global Award for its commitments in the business ethical behaviors and
improving the lives of its employees. Hospital services on wheel are one of the latest
innovations of Tata Steel and Manufacturing Company. This is also responsible for
development of the slum in the urban and underdeveloped countries around the world
(Sexton, Marsh and Greenslade 2018).
 Technological Factors – Tata Steel and Manufacturing Company is also using its latest
technology to reduce the emission of co2 in the environment. The company has invested

6STRATEGIC ANALYSIS TOOLS
a huge amount of money in the research and development of the ultra low carbon Steel.
The company is also engaged with the objective of using the energy conservation
schemes where the company is reducing the energy consumption process and production
process.
 Environmental factors – The environmental aspects means that how the company is
protecting the environment from pollution and other factors which are responsible for
creating a harmful society and nature. The company is facing a major problem with the
emission of the harmful co2 gas which is exerted in the production process of the
company. The company is working with a joint venture company in saving the sea turtles.
The project has been set in the major sea shores of the countries which has its
manufacturing units. The Dharma port in UK is also dedicated in saving the salt water
crocodiles of the country. It has also various breeding grounds in various parts of te
country where it facilitates the breeding of horses, and rare species like the crabs,
amphibians and reptiles (Keiller et al. 2018).
 Legal Factors – The legal factors, which are involved with the company, are the
workplace safety and employee safety. The company also faces various legal factors like
there are various tribal sectors in UK. The company is also disturbed from the last few
years as because of various strikes and internal issues faced by the company (Chesnais
2016).

7STRATEGIC ANALYSIS TOOLS
Socio cultural Factors
(The Tata Steel Company is
against the Cancer disease in
Europe )
Political Factors
(Company is disqualified in
foreign countries for its iron ore
lease auction )
Economic Factors
(The budget impact forTata Steel
is a great advantage for the price
of the resources)
Technological Factors
( The company is working in E
portal metal junction, it is also
researching in reducing the
carbon )
Environmental factors –
(The environmental aspects
means that how the company is
protecting the environment from
pollution and other factors which
are responsible for creating a
harmful society and nature).
Legal Factors –
(The legal factors, which are
involved with the company, are
the workplace safety and
employee safety)
Fig 3. Represents the PESTEL factors of the company
(Source Self made)
Strategic Model 4 – Porter’s Five-Factor Model
The threats of new entrants in the market are important as because it defines the
company’s competitive environment which affects the profitability of the market. The bargaining
power of the powers and suppliers affect a company’s ability to increase the prices and manage
the costs of the company respectively (Kung’u 2017). For example a product of Tata Steel which
is available with the buyers then the buying power of the products will be decreased. The low

8STRATEGIC ANALYSIS TOOLS
entry barriers of the company will be able to attract the new competition in the market whereas
high entry barriers will be discouraging it.
Fig 4. Represents the Porters five factor model for Tata Steel and Manufacturing company.
(Source – Self made )

9STRATEGIC ANALYSIS TOOLS
References
Chesnais, F., 2016. 5 The Internationalisation of Productive Capital and the Formation of Global
Oligopolies. In Finance Capital Today (pp. 133-157). BRILL.
Keiller, B.G., van Eyk, P.J., Lane, D.J., Muhlack, R. and Burton, R.A., 2019. Hydrothermal
Carbonization of Australian Saltbush. Energy & Fuels.
Kung’u, A.M.U., 2017. Effects of Selected Porter’s Five Forces on Competitive Advantage in
Steel Industry: A Case of Flat-Steel Segment (Doctoral dissertation, United States International
University-Africa).
KUNG’U, A.M.U., 2017. EFFECTS OF SELECTED PORTER’S FIVE FORCES ON
COMPETITIVE ADVANTAGE IN STEEL INDUSTRY: A CASE OF.
MADRASI, H., 2018. A STUDY REPORT ON THE MOVEMENT OF RANDOMNESS OF
BSE (SENSEX).
MASOUMI, M.S.S., 2016. Financial performance analysis of select steel companies in India
during post liberalization era (Doctoral dissertation, BHARATI VIDYAPEETH
UNIVERSITY).
Rani, C.J.U. and Gundavajhala, S., 2016. Corporate reputation. Asian Journal of Business Ethics,
5(1-2), pp.19-35.
Sexton, D.C., Steer, J.M., Marsh, R. and Greenslade, M., 2018. Investigating char agglomeration
in blast furnace coal injection. Fuel processing technology, 178, pp.24-34.

10STRATEGIC ANALYSIS TOOLS