Management Strategic Assumptions New Zealand Issue 2022

Running head: MANAGEMENT
Management
Name of the Student
Name of the University
Author Note

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Introduction
Strategic assumptions are defined as the assumptions that are held by the management
who are the decision makers while constructing a strategic plan. All the strategic plans need to be
build upon a grounded, accepted as well as validate set of strategic assumptions. Any strategic
decision is considered to be as effective as strategic assumption on which it is based. Like other
types of assumptions, strategic assumptions can be defined as the assumptions that are held by
the decision makers about different types off factors as well as drivers of change that has the
potential to influence their decision making, planning as well as thinking. When it comes to the
Food industry of New Zealand, it can be said that it is highly saturated. Hence in order to
enhance as well as maintain the competitive advantage of the organizations situated in the food
industry, effective and robust strategic formation is highly crucial (Chen, Wen & Luo, 2016).
The strategic assumptions are held by the management of the organizations about a set of
different factors as well as drivers of change that influence about events that had taken place in
the past, along with the currently happening situations. In the following paragraphs, four
strategic assumptions will be analyzed so that the management of the organizations established
in the food industry of New Zealand can create effective business strategy (Luo, Shi &
Venkatesh, 2018). The four business assumption that will be discussed on the following
paragraph includes the macro environmental forces, the requirements of the consumers, the
market dynamics and the workforce of the organization.
Discussion
Macro Environmental forces

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The macro environmental forces help the management of an organization to get a detailed
and clear idea of the external environment on which the growth of a particular industry is highly
dependent. The PEST analysis helps the decision makers to discover which factor has the
potential to impose impact on their business so that effective strategies can be made to handle
them. In the following paragraph, PEST analysis of the food industry of New Zealand has been
performed.
Political Factors
Considering the fact that obesity is a major issue in New Zealand, the government of the
nation has implemented a good number of strategies for the public to be more conscious while
buying foods. Additional taxes have been implanted on fat rich fast food items. This has imposed
negative impact on the fast food industry of the nation. The increased cost of fast food has
resulted in decrement in the revenue of the fast food centers (Sacks et al., 2015). Consumers are
option for food items sold in restaurants rather than fast foods. In order to deal with this issue, a
good number of fast food organizations in New Zealand is investing on healthier fast food
options like green chicken sandwich or fruit milk shakes.
Along with increased tax on fat rich food items, strict regulations have been implemented
in order to ensure environmentally sustainable food industry. Food organizations are bound to
use advanced technology and proper decomposition measures in order to ensure proper
decomposition of wastes.
Economic Factors
Being a developed county, the current economic status of New Zealand is excellent. He
per capita income of the nation is high compared to other developing and developed countries

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across the world. The stable economic condition of the nation denotes that the residents have
high disposable income (Swinburn et al., 2017). A good number of the consumers prefer
restaurants and hotels above fast food centers. Healthier alternatives to food are more preferable
and pricier compared to easy to make meals or fast foods. However, the convenience of readily
made food — despite the unhealthiness — can outweigh the trial and error of cooking food from
scratch. This has allowed greater expansion of fast food restaurants over the last decade. Food
taxation, food interest rate as well as consumer spending affect the opportunities as well as
options presented in the food industry. In spite of the fact that there is slowdown in sales, fast
food can be considered as a prime necessity to a good number of people (Luo, Shi & Venkatesh,
2018). Along with this, being a aging population, lack of workforce is highly evident in New
Zealand the labour cost of the mentioned nation is high. In order to deal with this issue, a good
number of food manufacturing organizations have invested in importing labours from developing
and underdeveloped countries like China, India and Africa.
Socio cultural factors
Considering the fact that obesity has hit hard in New Zealand, a good number of
consumers of the food industry is leaning towards healthy life style (Huang et al., 2017). A
considerable percentage of population is opting for healthier food options and hence vegetarian,
vegan and pescetarian eating habits are becoming less of a trend and more of a life style choice.
However the preference towards fast food and easy to made food items are still there, especially
for the busy professionals as well as the baby boomers. In order to incorporate both the fast food
loving as well as healthier food opting consumers, fast food chains are incorporating healthier
food options in their menu list along with regular options.