Strategy Development Tools and Their Application in Real World Businesses

competetive strategy
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Essay
Strategy development tools are considered as significant management tools that provides
organisations with various benefits while enabling them to create and execute decisions in
thought out manner. Organisations collect valuable data to analyse and process them
according to strategy development tools to fulfill organisational vision and mission
( Carpenter, et al., 2012). Contemporary organisations utilise various strategy development
tools out of which four tools will be discussed in this essay along with applying them in real
world businesses to analyse and find out how businesses utilise developmental tools.
Pestle analysis
PEST or PESTLE analysis tools are mostly utilised by organisations when they plan to enter
fresh market as it helps businesses understand and acquire valuable information regarding
new business environment. PESTLE analysis framework analyses political, environmental,
social, technological, legal and economic environment of firms. This tool is also used by
management at regular intervals to analyse present environmental constraints and external
changes that needs to be recognised timely for smooth running of the business (Gupta, 2013).
McDonalds is one of the leading organisations dealing in chain business of fast food products
and making PESTLE analysis of the company will help in analysing its external factors while
working in an international level. Political analysis of McDonalds reveals that the company
has expansion opportunities due to international recognition gained by providing quality
products. Economic conditions show that McDonalds is at a favourable position since it tries
and enter developed and developing countries only which drive sales for the company
without facing much distress. Socially, the company have to face many challenges especially
due to the changing demands and lifestyle trend in which customer prefers consuming freshly
cooked and healthier food rather than fast food products. McDonalds have always remained
ahead technologically and thus technological factors shows greater scope for the company.
Legal constraints again bother company many times that affects overall sale of the company
particularly while dealing with its supply chain partners situated at diversified countries.
Environmental factors do affect company especially during the times of drought and famines
that affects its production due to insufficient raw materials like food products and vegetables
(McDonald's, 2018).

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SWOT analysis
SWOT analysis is yet another very useful strategy development tool utilised immensely by
management to analyse strengths, weaknesses, opportunities and threats faced by
organisation. This tool not only assists managements in identifying current business position
by identifying strengths and weaknesses, but also makes them aware of internal and external
threats faced and how they can be turned into opportunities. This tool is mostly used while
formulating business plans to analyse significant factors affecting current position of business
along with enabling management to determine future policies and business course. Since this
tool helps in taking crucial decisions at various operational levels, many education,
community and health related firms prefers SWOT analysis over the others (Gurel & Tat,
2017).
GlaxoSmithKline (GSK) is one of the Australian pharmaceutical company that will show
how they utilise SWOT analyses for measuring their internal and external business
environment. Strengths identified in GSK is its global manufacturing units along with
efficient supply chain management that focuses on developing business worldwide.
Innovation and technology are also considered by the firm that adds to its strengths along
with strong financial position and diversified product portfolio. Weaknesses can be seen in
GSK’s internal management as it lacks managerial capabilities because in the past history,
GSK have shown few failures from management side. However, opportunities still lay in
front of GSK due to strong assets and financial position seen for entering into more
innovative segments like biologic and antibodies products development. Threats are also
constant for the company due to higher expectations from consumers side along with change
seen in operating country demographics (GlaxoSmithKline Australia Pty Ltd., 2018).
Five forces analysis
Five forces analysis of Michael Porter is another significant development tool that helps
managements of firm in analysing competitive position of their company within the market or
country it operates in. Five forces analysis helps in determining intensity in which
competitors of related industry behaves while competing along with formulating marketing
mix for the company after analysing five significant factors. Factors include customers
bargaining power, suppliers bargaining power, threat of new entrant, rivalry among
competitors and threat from substitutes. This 5F factors helps businesses in formulating