Strategic Management

Case Study Based Report - Twitter

STRATEGIC
MANAGEMENT

Table of Contents
INTRODUCTION.......................................................................................................................................3
QUESTION 1..............................................................................................................................................3
A. ANALYSE.............................................................................................................................................3
Definition of deliberate and emerged strategy.........................................................................................3
Difference between deliberate and emerged strategy...............................................................................4
Analysis why Twitter is emergent or deliberate.......................................................................................4
B. EXPLAIN...............................................................................................................................................5
Dynamic Capability of Twitter................................................................................................................5
Competitive advantage............................................................................................................................5
QUESTION 2..............................................................................................................................................6
A. ANALYSE.............................................................................................................................................6
Pestle Analysis of Twitter........................................................................................................................6
SWOT analysis........................................................................................................................................7
Porter's five forces model........................................................................................................................9
Major issues from this model................................................................................................................10
B. EVALUATE.........................................................................................................................................11
Value Chain Analysis of Twitter...........................................................................................................11
VRIO Analysis of Twitter.....................................................................................................................11
QUESTION 3............................................................................................................................................13
A. ANALYSE...........................................................................................................................................13
Porter's Generic Strategies.....................................................................................................................13
The strategy chosen by Twitter..............................................................................................................14
TWOS Analysis of Twitter....................................................................................................................15
B. ANALYSE............................................................................................................................................16
SAF Model............................................................................................................................................16
SAF model in reference with Twitter....................................................................................................16
CONCLUSION.........................................................................................................................................18
REFERENCES..........................................................................................................................................19

INTRODUCTION
Strategic management refers as setting objectives, assessing the competitive advantage,
internal organization analysis and evaluating the strategies of the company. It is the ongoing
planning, analyzing, assessment and monitoring of all the necessities of the company that is
needed for meeting the organizational; objectives and goals. The assignment is based on Twitter.
It is a social networking and micro-blogging service by which the users can interact through
messages and post their tweets. The company is founded on 21 March 2006 by Jack Dorsey, Biz
Stone, Noah Glass and Evan Williams.
The study will analysis deliberate and emergent strategy and will identify the difference
between them. It will analyze what strategy Twitter is adopting. The report will explain dynamic
capability of Twitter. Furthermore, the study will analysis external and internal environment of
the company by using appropriate framework and models. The studies will analysis suitable
strategies for Twitter through using model of porter’s generic strategies. Lastly, it will identify
strategies through using SAF model.
QUESTION 1
A. ANALYSE
Definition of deliberate and emerged strategy
Emergent Strategy – Michael Porter has introduced this strategy. Emergent strategy is referring
as internal consistent pattern of competitive actions which is taken by the firm (Zhao, Fisher and
Miller, 2017). This spontaneous action arises over the period as organization navigates within
their operating environments. Emergent strategy is unplanned success. This strategy creates the
pattern which was not originally the part of the plan. Emergent strategy is a response for
uncertain actions. The firm can create strategy that is based on consequences which are not
expected.
Deliberate Strategy – This strategy is introduced by Henry Mintzberg. It refers as the formal
planning which is done by the organization. In this the company sets vision for the strategy

formation. Deliberate Strategy means to plan and think before something has been act.
Management provides all the details in order to formulate deliberate strategy. Management has to
take collaborative actions in order to formulate the strategy that can align with everyone in the
organization. These strategies are said to be completely blind in order to take control over the
unexpected events and developments.
Difference between deliberate and emerged strategy
Deliberate Strategy is said to be a top down approach for the strategic planning. This
strategy is formulated on the basis of company’s mission and vision. This strategy is all about
making choices and to choose the best alternative option for the firm (Bettis, Ethiraj and
Mitchell, 2016). This strategy is focused on minimizing the outside influence on the operations
of the business. Sometimes the external environment is hard to predict in such case this strategy
gets fails. Hence, the company has to undertake proper assessment for the political, social,
technological and economical factors for driving the success.
On the other hand Emergent Strategy refers as a process of evaluating the unforeseen
outcomes from the executive strategy and afterwards learning is done for incorporating those
outcomes which are unexpected for the future. In this the bottom approach of management has to
be taken by the company. It is also termed as realized strategy. This strategy is based on the
concept that business environment is uncertain and constantly changing. Hence, no prior strategy
is proven that it will work in future or not. This strategy is more flexible in comparison of
deliberate strategy.
Analysis why Twitter is emergent or deliberate
Twitter is using Deliberate Strategy. This strategy outlines exact business intention. This
intentions are concern over the nature of goals which organization have, it mainly focus on
making profitability. Deliberate strategy is helpful to achieve the Twitter mission and vision. It is
helpful in making concrete attention for providing detail concern to business operations of
Twitter (Prajogo, 2016). This strategy attempts to minimize the outsider influences. The
employees also get familiarity about what the business goals are and what they are actually
working upon. In this the employees work on together basis and work all together for achieving
the goals of the company. Twitter adopts profitable operational techniques that are predictable in
deliberate strategy.

B. EXPLAIN
Dynamic Capability of Twitter
Rapid technology change – Twitter provides their customers technologies such as local storage
and pixels. This technology helps he customer for providing the better experience which is faster
and safer. There various websites, API’s, SMS, ads and email notifications use these
technologies (Bettis, Ethiraj and Mitchell, 2016). Twitter.com represents an opportunity for
making the bold changes in their underlying technology of the website. The company started to
began the implementation of new architecture entirely in the Java script. They put special
emphasis on development, performance and extensibility. The company has built JavaScript
library for accessing the Twitter Rest API that provides a starting point for development of
current project.
Change in customers’ needs – Twitter is great platform for the brand who wants to connect
with their customers. Twitter provides additional channel for the customer support. This provides
ease in doing communication directly with the customers in order to resolve their problems as
soon as possible. The company is providing new dimensions in customer service. It allows the
firms to reduce the waiting time of the customers. Twitter also cut off the expensive costs of their
clients as many companies generally have huge costs with call centre but by tiding up with
Twitter they have to pay considerably lower prices. Also, Twitter provides a platform to its
clients by which they can gain reputable business position.
Competitive advantage
Twitter has significant competitive advantage. Twitter strategy is distinguished from
other social networking sites such as Facebook and Instagram. They have different
communication method. The company is leading mode of social networking that provides users
to communicate without knowing each other’s through tweets. The company has also started
charging fees from its users for doing advertisement by promotion tweets. This strategy is
helpful for the Twitter to attract large number of companies towards their social media platform.
Many celebrities have accounts on Twitter which is comparably more than any other social
media companies. The company has also competitive advantage as it is the first company who
started the social media business.

QUESTION 2
A. ANALYSE
Pestle Analysis of Twitter
Political Factors – Twitter have influence of political parties on the firm’s profitability. They
have impact of various government policies and regulations. Also they have to pay various taxes
to the government of various countries as their business is on wider level. They also have risks of
changing political regimes
Economical Factors – The fluctuations in Foreign exchange rates in various countries influence
the business of Twitter (PESTEL Analysis, 2016). The GDP rate in the countries affects the
investment of the company. Also, the unemployment rate in emerging countries provides Twitter
an opportunity to provide jobs to the people in considerably lower salary than any other
developed countries.
Social Factors – The active social media users is driving the business of Twitter towards
popularity. The people are communicating more through social media networking. The people
are more active on social media channels. Thus, the companies are also promoting their products
on social media which is becoming other source of income for the Twitter.
Technological Factors – Technology is rapidly dismantling competitive landscape and price
structure of an industry for very short period of time. Thus, it is becoming important for Twitter
to do consistent innovation (Schilling and Shankar, 2019). It is very much important for the
Twitter to innovate on regular basis. The technology of the company is also improvised through
Twitter.com.
Legal Factors – The Company is abiding by intellectual property rights. The company has to
follow various cyber laws and information technology acts. The cyber security is major issue for
the firm as many hackers are stealing the data and information of their users and also of their
business clients. The company also needs to improvise their online payment security.

Figure 1 Pestle Analysis (Source: Scanning the Environment: PESTEL Analysis, 2016)
Environmental Factors – The people are nowadays becoming environment conscious. Thus,
the Twitter can also run sustainability campaigns and can take various measures and initiatives
related to sustainability which are focused on environment (Baumgartner and Rauter, 2017).
Through this their brand reputation will increase in customers mind. Twitter also allows and
provides opportunity to other companies to post on their channel related to sustainability. Thus,
through this the company’s brand image gets improved.
SWOT analysis
Strengths
 Twitter has good brand image in customers mind due to many celebrities’ accounts. It is
fairly maintaining the celebrity authenticity (SWOT Analysis, 2017).
 The firm has taken early entry in business of social media. The company is entered in
2006 where none of the competitors were present. Thus, the Twitter is able to take more
competitive advantage.
 Twitter use best technology for the functioning of their platform.

 Twitter has become popular channel for the communication. Many companies also using
Twitter for improving efficiency of their customer services and for doing official
announcements.
Weaknesses
 The company has low retention rate. The retention rate is only 40% that shows the
Twitter inability to keep the clients and people interested in their platform.
 The company hasn’t launched any new innovative features. Twitters get failed in
devising the interesting features on their platform.
 There is unequal distribution of the Tweets. Twitter has more than three hundred million
users but the company users do not take active participation in tweeting.
 Twitter is public forum so the data risks are more. People are more concern about their
safety issues.
Figure 2 SWOT analysis (Source: SWOT Analysis, 2017)

Opportunities
 The company has an opportunity to become effective tool for the organizations by being
a structured tool of communication.
 The company can do continuous improvement in their user experience as it looks like that
firm has stopped innovating. This helps the company to lead the more active users.
 Twitter can also increase the efficiency of their Twitter Moments; it can be used for
integrating seamlessly and for attracting more traffic.
 They can also provide some communication and marketing solutions for the businesses
that can help to generate more revenues.
Threats
 The Twitter has threat from the hackers and fake accounts. This can break trust of their
users who are more privacy concern.
 The company has threat from its competitors such as Facebook. Instagram and Tumble.
 They also have threat from upcoming social media firms which are more innovative in
comparison to Twitter. Thus, to remain in the lead the company has to do continuous
improvement in their business and need to start innovating in their services.
Porter's five forces model
 Threat of New entrants - It is very difficult to achieve the benefits of economies of scale
in the industry in which Twitter operates. To make this easier Twitter uses large capacity
conductors to get a cost advantage. This also makes production expensive for the new
and entrants.
 Bargaining power of suppliers - The number of suppliers in the industry in which the
company operates is very large (Porter’s five forces analysis, 2019). This means that the
supplier will have very less control over the prices of their material in the market, which
ultimately reduces the bargaining power of the suppliers
 Bargaining power of Buyers - The number of suppliers and buyers in the industry in
which the Twitter Company operates is very less. The means that the buyers will have
various alternative to choose from and therefore they will not have much control over the
prices of the service and this reduces the bargaining power of buyers.

Figure 3 Porters Five Forces Model (Source: Porter’s five forces analysis, 2019)
 Threat of Substitute services - There are very less substitutes available of the services
that are produced by the company. Due to very less close substitute available in the
industry the customers will not have much power to shift on the other substitute service
that is not produced by the Twitter Company.
 Rivalry among existing firms - The number of competitors in the industry in which the
company operates is very less. Many of these are larger in size than Twitter this means
that the Twitter will have less competition among the existing firms in its industry.
Major issues from this model
There are several issues in Porter's five forces model in context with the Twitter
Company. The financial resources of the Twitter Company are not sufficient on global level to
complete with the competitors. There are many competitors in social media industry in which
Twitter operates such as Facebook, Instagram, Snapchat etc. Thus, the company has to do regular
innovation in their features in order to survive in this competitive battle.

B. EVALUATE
Value Chain Analysis of Twitter
Value Chain Analysis of Porter’s is gaining high popularity. Hence, it is crucial for the
company to go through value chain analysis for identifying inner capabilities and resources.
Twitter has to realize that all the functions and activities have not same level of scrutiny
(Mudambi and Puck, 2016). Thus, it is necessary to identify the importance of all the activities
and resources.
Primary Activities of Twitter
Outbound Logistics – Twitter need to optimize and analysis the outbound logistics for
exploring the sources of competitive advantage and for achieving the business objectives. They
have to add various features in their services for attracting large number of users and clients.
Marketing and Sales – This is the strong part of the Twitter. The company is on social media
platform so it is easy for Twitter to do promotion of their firm and it also provide platform to
other companies so that they can do advertisement and promotional activities (Fernandez-Stark
and Gereffi, 2019). Twitter makes high revenues from the other companies who do promotion on
their channel.
Secondary Activities of Twitter
Human resource management – The effective HR management in the company can help to
reduce competitive pressure through motivating the skill level of workforce. Twitter’s HR
department can provide attractive rewards to its employees for encouraging the creativity at the
workplace and for improving the efficiency in the organization.
Technology development – Twitter has advanced level of technology and they also have
integrated website Twitter.com through which the technological development can be done. The
Company has to do regular innovation in technology to be in lead in this competitive battle.
VRIO Analysis of Twitter
Resource or
capability
Valuable Rare Inimitable
and non
Organized to Impact on
competitive

substitutable Exploit advantage
Strong global
presence
Yes Yes Yes Yes Realized a
sustainable
competitive
advantage
Efficient
human
resource
Yes Yes No No Realized a
competitive
parity
Strong
financial base
Yes Yes No Yes Realized a
temporary
competitive
advantage
Convenient
web reach
Yes Yes Yes No Realized a
temporary
competitive
advantage
Customer
value
Yes No Yes No Realized a
sustainable
competitive
advantage
Valuable - The resources of the Twitter Company are valuable as they are expensive and very
rare (Yudhistira, 2016). The resources of Twitter include financial resources, human resources
and other material resources.
Rareness - The resources that are used by the Twitter Company are rare as they are very
expensive and not easily available in any market. There is software that is only available in
limited stores.

Imitability - The degree of risk related to imitation is very less as the resources that Twitter uses
is rare and expenses, so it is very difficult to duplicate the services of the Twitter Company
(Ariyani and Daryanto, 2018).
Organized - There is a proper value and analysis of resources in Twitter Company. The
resources are timely ordered, although they are expensive but there is a proper bargaining and
quality of the resources.
QUESTION 3
A. ANALYSE
Porter's Generic Strategies
 Cost Leadership strategy - This is a strategy which involves expanding and winning the
market share by applying some cost and price sensitive techniques. This can be achieved
by having a lower cost of production and price in the particular target market or at least
the price should be in the ratio of in which cost should be less than the price but the
revenue must at least cover the cost. The lower price of product will not result in less
investment instead it will still increase the profitability and the Twitter will get high
return on investment.
 Differentiation strategy - A differentiation strategy refers to conducting the production
process in such a manner that the product will be different from other products in the
market (Generic strategies Michael Porter, 2019). This will be helpful for the customers
to easily identify the product of the company. The differentiation can be in any way and
of any kind such as changing the shape, color and quality or providing the product with
some different packaging or putting some unique labels on it. Differentiation strategy will
also work as attraction for the customers due to uniqueness in the product.

Figure 4 Porters Generic Strategies (Source: Generic strategies Michael Porter, 2019)
 Cost focus - The cost focus strategy is referred to a lower cost advantage for Twitter in a
small market segment or segments. A lower cost advantage will only be achieved if the
cost of the product will be kept low and for maintaining a lower cost of the product the
cost of production should be less. While considering the cost focus strategy the quality of
the product should not be compromised because due to quality consciousness too many
customers will refuse to purchase the product.
 Differentiation cost - In the context of differentiation focus strategy a firm mainly
focuses on differentiation of its product in only one or some small number of market
segment in which Twitter operates. The special customer need in a market segment
means a big opportunity of providing some different products which are different from
the competitors in order to achieve higher profits and customer focus & believe.
The strategy chosen by Twitter
The Twitter's company will choose differentiation strategy (Lasserre, 2017). This strategy
will be helpful in providing a better customer value as the Twitter Company is involved in social

media networking and connects several billion peoples with one another. Also millions of
advertorial Companies are closely linked with Twitter. The Twitter Company is having a global
reach which enable people to link with one another and can share necessary information
regarding the lifestyle, culture or country.
TWOS Analysis of Twitter
TWOS Threats Weakness
Opportunity The communication can be an
effective tool for some
marketing solutions that can
help in generating more
revenues (Rothaermel, 2016).
But the company has threat
from various hackers and fake
accounts which can hamper
the personal data of the firm.
The hackers can also misuse
the importance data of the
Twitter company.
By doing continuous
improvement in the user
experience the company can
grab a big opportunity in the
market. But the weakness of
the firm in the area of
innovation does not allow the
firm to maintain a huge
customer segment. If the firm
wants to maintain a huge
customer segment then the
firm needs to do innovations.
Strength The good brand image of the
Twitter Company among the
customers and also among
celebrities. By this the
company is able to maintain
celebrity authenticity. But the
threat from the competitors is
rapidly increasing day by day
which may restrict the growth
of the firm.
There is a unequal distribution
of the tweets. Twitter is
maintaining more than 300
billion users but there is less
active participation in tweets.
While in this case Twitter
does not face much difficulty
because it is growing more
popular in day by day.

B. ANALYSE
SAF Model
 Suitability - It is considered as one of the most important element in the SAF strategy
model. Suitability is the key factor which analysis whether a particular strategy will be
suitable for the Twitter Company or not with respect to the changing business
environment. It is usually assessed as a variety of different criteria that are individually
important to a business in various aspects such as expectation suitability, environmental
suitability and capability suitability. All these individual categories of suitability all the
basis of categorization of plans and policies of the firm.
 Acceptability - This aspect of the SAF strategy is only about measurement of risk, return
and stakeholder reactions that may result in hampering or motivating a particular strategy
in Twitter Company. Returns can be measured on the basis of benefits that stakeholders
provide except some financial benefits. This strategy can be both financial and non-
financial because returns can be calculated on the basis of several methods such as
profitability analysis, cost - benefit analysis and real option analysis (WheelenHunger and
Bamford, 2017). In terms of risk, the probability of failure of this strategy or any
financial loss related to brand for corporate impacts can be raised up.
 Feasibility - The last strategy of the SAF strategy model is feasibility. This strategy is the
key factor that can be cause of success of the strategy or can be cause for failure of the
strategy in the Twitter Company. If a business has to decide in the context of financial
capability it has to analyze whether the company has sufficient resources, aptitude and
the ability to implement the strategy that is framed. This will be easier if forecasting of
business environment related to need of cash flow and break-even analysis is done
earlier. Also some other financial tests need to be performed. This will be helpful for the
Twitter company to enhance the inventory of resources whether human or material
resource.
SAF model in reference with Twitter
The Twitter Company is a social media networking unit which operates globally. The
Suitability factor in context with Twitter is slightly different. The strategy that is developed by
Twitter must be relevant to a social media site because the changing trend of customers is

relevant only with digital modifications (Ansoff, Kipley and Ansoff, 2018). The second factor
that is Accessibility is related to risk, return and stakeholder reaction factors. The Twitter must
take use of profitability analysis technique in order to ascertain the maximum loss that the firm
can take. The last factor of SAF model is Feasibility which is linked with the analysis of
resources that Twitter has. The analysis of resources can be done by break-even analysis and
some other financial tests which will calculate the capacity and capability of the Twitter.

CONCLUSION
It has been concluded from the above study that strategic management refers as
formulation of strategies, its implementation and evaluation for driving a business towards
success. Strategic management is important for the Twitter as it helps their business to gain
competitive edge. It has been determined that Twitter is using Deliberate strategy in order to
achieve their organizational objectives and goals. From the Pestle analysis it has been analyzed
that Twitter have influence of macro environment factor. The company has advantage as they
have different communication platform in form of tweets from the other social media companies.
Through VIRO analysis it has been concluded that the company’s resources are valuable and
rare. The company also has to do innovation in their current features to take competitive lead. It
has been summarized that the company will use differentiation strategy as it provides value to
the customers.

REFERENCES
Books and Journal
Ansoff, H.I., Kipley, D. and Ansoff, R., 2018. Implanting strategic management. Springer.
Ariyani, W. and Daryanto, A., 2018. Operationalization of Internal Analysis Using the VRIO
Framework: Development of Scale for Resource and Capabilities Organization (Case
Study: XYZ Company Animal Feed Business Unit). Asian Business Research Journal. 3.
pp.9-14.
Baumgartner, R.J. and Rauter, R., 2017. Strategic perspectives of corporate sustainability
management to develop a sustainable organization. Journal of Cleaner Production. 140,
pp.81-92.
Bettis, R.A., Ethiraj, S. and Mitchell, W., 2016. Creating repeatable cumulative knowledge in
strategic management.
Fernandez-Stark, K. and Gereffi, G., 2019. Global value chain analysis: a primer. In Handbook
on Global Value Chains. Edward Elgar Publishing.
Lasserre, P., 2017. Global strategic management. Macmillan International Higher Education.
Mudambi, R. and Puck, J., 2016. A global value chain analysis of the ‘regional
strategy’perspective. Journal of Management Studies. 53(6). pp.1076-1093.
Prajogo, D.I., 2016. The strategic fit between innovation strategies and business environment in
delivering business performance. International journal of production Economics. 171.
pp.241-249.
Rothaermel, F.T., 2016. Strategic management: concepts (Vol. 2). McGraw-Hill Education.
Schilling, M.A. and Shankar, R., 2019. Strategic management of technological innovation.
McGraw-Hill Education.
Wheelen, T.L., Hunger, J.D. and Bamford, C.E., 2017. Strategic management and business
policy (p. 55). Boston, MA: pearson.
Yudhistira, G.R., 2016. the Vrio Analysis of Corporate Strategy in Facing the Implementation of
the ASEAN Open Skies 2015: the Case of PT. Garuda Indonesia (Doctoral dissertation,
UNIVERSITAS BAKRIE).
Zhao, E.Y., Fisher, G. and Miller, D., 2017. Optimal distinctiveness: Broadening the interface
between institutional theory and strategic management. Strategic Management
Journal. 38(1). pp.93-113.
Online

Generic strategies Michael Porter, 2019. [Online] Available through :<
https://www.calltheone.com/en/consultants/generic-strategies-michael-porter>\
Porter’s five forces analysis, 2019. [Online] Available through :< https://medium.com/product-
gyaan/porters-five-forces-analysis-868945aa5846>
Scanning the Environment: PESTEL Analysis, 2016. [Online] Available through :<
https://www.business-to-you.com/scanning-the-environment-pestel-analysis/>
SWOT Analysis, 2017. Online] Available through :< https://www.business-to-you.com/swot-
analysis/>