Strategic Models: Porter’s Five Forces, Ansoff Matrix, VRIN, SWOT Analysis

This report explores strategic models such as Porter’s Five Forces, Ansoff Matrix, VRIN, and SWOT Analysis. Using Woolworths as an example, it discusses how these tools can help analyze the competitive environment and develop effective strategies. The report provides insights into the industry analysis, growth strategies, resource evaluation, and internal and external factors affecting the company.

Strategic Models

STRATEGIC MODEL 1
Contents
Introduction...........................................................................................................................................2
Strategic Models....................................................................................................................................2
Porter’s Five Forces Framework........................................................................................................2
Ansoff Matrix....................................................................................................................................3
Resources based view (VRIN)...........................................................................................................4
SWOT Analysis.................................................................................................................................5
Conclusion.............................................................................................................................................5
References.............................................................................................................................................7

STRATEGIC MODEL 2
Introduction
The main aim of this report is to enhance the knowledge of strategic models. The companies
adopt the strategies to achieve the goals and objective. It is required for the company to
analyse the environment in order to implement the effective strategies. Strategic management
is the process that contains the different tools such as PESTLE, SWOT Analysis, Porter’s
Five Forces Framework, Ansoff Matrix and many others (Rothaermel, 2015). Woolworths
has been taken into consideration to analyse the environment with the help of strategic tools.
In this report, the discussion is made on the strategic tools with the example of Woolworths.
Porters Five Forces Framework, SWOT Analysis, Ansoff Matrix and Resource based view
will be explained in this report.

STRATEGIC MODEL 3
Strategic Models
Porter’s Five Forces Framework
It is a framework which is deign by the porter in order to analyse the industry. It is a simple
tool but useful for understanding the competitive environment of the industry for the
company. It affects the profitability ratio and helps to adopt the strategy according to the
environment (CGMA, 2018). This tool contains the five approaches in which the industry of
the organisation has been evaluated in the different terms and areas. These are threat of
competitors, threat of substitute, threat of new entrants, bargaining power of suppliers and
bargaining power of buyers. These approaches analyse the every part of the industry but in
the different terms and factors.
Porter’s five forces of Woolworths
Threat of new entrants
 Low Degree
 Existing companies have high value
of goodwill
 Difficult to enter the market
Bargaining power of Supplier
 High Degree
 Attracted by those companies who
have large market share
Bargaining power of Buyer
 High Degree
 Similar services provided by many
companies
 Offering low price to attract
consumers
Threat of competitors
 High Degree
 Asda, Coles and Wesfarmers are the
many other companies who offers the
similar services
 High competition among the

STRATEGIC MODEL 4
companies
Threat of substitute
 Low Degree
 Daily consumption products have no substitute
 Consumers have less choices to buy retail market
(Source: Mordor Intelligence, 2019)

STRATEGIC MODEL 5
Ansoff Matrix
Ansoff Matrix is a tool which is used by the company to analyse the environment and plan
the strategies for growth. The matrix contains the four strategies in order to grow in the
market. Market Penetration, product development, market development and diversification
are the strategies under the tool. This tool helps to analyse the risk and recommend the
strategy in order to grow in the market.
Market Penetration
This approach defines that the organisation expands the business with existing product within
the existing market.
Product development
This approach recommends the company to expand the business by developing the new
products to deliver the variety of products in the existing market.
Market development
This approach of Ansoff matrix, recommends the company to invest the large amount in the
existing product in order to deliver the quality of services to consumers in new market.
Diversification
In this approach, it is defined that the organisation introduces the new products which is
different from others (Ansoff, Kipley, Lewis, Helm-Stevens, and Ansoff, 2019).
Ansoff Matrix of Woolworths
Market
Product
Existing New

STRATEGIC MODEL 6
Existing Market Penetration
 Grab the high
market share
 Repositioning of
brand value
Market development
 Variety of new
product as it is a
supermarket
 Different pricing
policies to target
the new market
segment
New Product
development
 Updating the
product as per
consumer
requirement
 Innovative
techniques
replace the
existing strategies
Diversification
 Vertical
horizontal
diversification
is beneficial for
Woolworths.
 Variety of new
products
(Woolworths Holdings
Limited, 2018)

STRATEGIC MODEL 7
Resources based view (VRIN)
It is business analysis framework which is used to analyse the competitive advantage in the
market. This strategic framework begins with a vision, mission statement and continues with
the objectives, internal and external analysis and end with the strategic implementation. This
framework is mostly used for the internal analysis in order to evaluate the resources and
capabilities of a firm. It contains the four frameworks on which the resources and capabilities
of the company are examined and these are value, rarity, imitability, and non-substitutability
(Hernández, and Garcia, 2018).
Value
It defines that the value of a resources for the company in order to grab the new opportunity
or to satisfy the consumers.
Rarity
It states the resources are rare and difficult to available in the market.
Imitability
In this framework, the resources are evaluated on the basis of imitability.
Non-substitutability
This framework states that the product is non-substitutability that does not have any
substitute that can replace it.
VRIO of Woolworths
Value Rare Imitability Non-
substitutability
Competitive
Advantage

STRATEGIC MODEL 8
Large
Number of
stores (990)
Yes Yes No Yes Strong
Competitive
Advantage
Human
Resources
(1,15,000)
Yes No Yes No Temporary
Competitive
Advantage
Technology Yes Yes Yes Yes Strong
Competitive
Advantage
Brand Name Yes Yes No Yes Strong
Competitive
Advantage
Intellectual
property
right
Yes No No Yes Strong
Competitive
Advantage
(Source: Woolsworth, 2018)

STRATEGIC MODEL 9
SWOT Analysis
It is a strategic tool which is used by the company in order to determine the strength,
weakness, opportunity and threat. It helps to adopt the effective strategies as per its strength
and opportunity. The main purpose of this tool is to identify the internal and external factors
those are favourable and unfavourable for the company to achieve those objectives. It helps
the company to grab the high market share with the high brand value by avoiding the wrong
decision for the business success. These approaches mainly focus on the growth of the
company in the market. It is beneficial for the company to adopt the effective strategy by
analysing the threats and opportunity for the organisation (Mind Tools, 2018).
SWOT Analysis of Woolworths
Strength
 High brand image in Australian
Market
 High market share
Weaknesses
 Low level of online presence
 High competitors
 Threat of price war
Opportunity
 Expand business in online market
 Enter the health factor with the high
brand image
Threat
 High threat of competitors such as
Wesfarmers, Asda and many others.
 Threat of losing customer due to
demand of healthy product
(Woolworths Holdings Limited,
2018)

STRATEGIC MODEL 10
Conclusion
At the end, it is concluded that the company can achieve the success by adopting the strategic
tools. It is observed that the strategic tools help to analyse the internal and external factor of
the company. Internal and external analysis helps to reduce the risk and threat due to which
the organisation can easily gain the competitive advantage.

STRATEGIC MODEL 11
References
Ansoff, H.I., Kipley, D., Lewis, A.O., Helm-Stevens, R. and Ansoff, R. (2019) Implanting
strategic management. Springer.
CGMA. (2018) Porter’s Five Forces of Competitive Position Analysis. [online] Available
from: https://www.cgma.org/resources/tools/essential-tools/porters-five-forces.html
[Accessed 11/04/19].
Hernández, J.G.V. and Garcia, F.C. (2018) The link between a firm´ s internal characteristics
and performance: GPTW & VRIO dimension analysis. Revista de Administração IMED,
8(2), pp.222-235.
Mind Tools. (2018) SWOT Analysis. [online] Available from:
https://www.mindtools.com/pages/article/newTMC_05.htm [Accessed 11/04/19].
Mordor Intelligence. (2019) Australia Retail Sector - Growth, Trends and Forecast (2019 -
2024). [online] Available from: https://www.mordorintelligence.com/industry-reports/retail-
industry-in-australia [Accessed 11/04/19].
Rothaermel, F.T. (2015) Strategic management. McGraw-Hill Education.
Woolworths Holdings Limited. (2018) our purpose, vision and values. Retrieved from:
https://www.woolworthsholdings.co.za/overview/our-purpose-vision-and-values/
Woolsworth. (2018) About us. Retrieved from:
https://www.woolworthsgroup.com.au/page/about-us