Strategy Development Tools | Assignment

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Competitive Strategy
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Competitive Strategy
Introduction
In order to make sure that the business operation is capable enough to compete in such
competitive environment, it is important for any organization to analyze its internal and
external aspects which directly or indirectly affects the business and its process. This is
the point where strategy development tools play an important role for the analysis of the
business environment. There are several tools of strategy development that are
existential and leveraged by several organizations to perform an environmental scan
and evaluate the current business state and identify the risks (Vuorinen et al., 2018).
SWOT analysis framework is used for the internal environment analysis and PESTEL is
used for the analysis of external environment. Porter’s five forces model is used to
analyze the competition level and deduce strategy for organization’s long run. In this
essay, the discussion will be based on the above mentioned tools and its utilization in
business environment (Birkinshaw et al., 2005).
SWOT Analysis Tool
SWOT framework helps in analyzing the internal as well as external environment of any
business operations and helps in assessing the organization’s current position based on
which future decisions can be made. Using SWOT analysis, the organizational
environment is evaluated based on 4 factors which are Strengths, Weakness,
Opportunities and Threats.
The internal environment analysis is defined by Strengths and weakness of any
organization. The areas where any organization is performing well or makes the
business stand out with the competitors are the strengths, like staff motivational factors,
advanced manufacturing process etc. Without the proper analysis of weaknesses,
SWOT tool won’t be valuable. This is an inherent factor that should be considered for
evaluation. Weakness of any organization can includes its policies, practices or other
business operations where the design thinking is needed. Similarly, opportunities and
threats defines the external environment. Opportunities arise from the environment
outside the organization such as market developments, ramification in technology etc.
which demands attention for any organization. Threat comprises of anything that might
act as a barrier in your business and impact the overall efficiency. Threat may include

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Competitive Strategy
problems arising due to supply chain disruption, market requirement undergoing sudden
shifts, employee attrition rate etc. All these factors combined together will help any
organization to prioritize ideas and strategy for gaining competitive edge in business
environment (Phadermrod et al., 2019).
SWOT analysis of Apple Inc.
Apple Inc. is a leading technology company offering electronic products across several
dimensions. SWOT analysis of Apple provides insight on business strategy and steps
taken to maximize the growth. Apple has a strong brand image in the market which is
one of the notable strength of the company. Also, the rapid innovation and the pricing
strategy helps the company to be ahead of its competitors in the market. The weakness
of Apple is its high prices and the limitation in its distribution network. The company is
aggressive in choosing its distribution partners which makes the availability of products
very limited. Also, due to premium pricing the consumers from middle to high income
brackets are the only one who can afford their products, leaving behind the consumers
from low income bracket (Phillips and Moutinho, 2018).
There are few opportunities for the company to grow in some of the areas like working
on developing new product segments, expanding its current distribution network etc. An
expansion in its distribution area can help the company to reach more customers and
increase its customer’s base. The company is facing major threat from the rival
companies which are operating in low budget segment and offering products which can
directly compete with the Apple flagship devices. Also, the rise in labor costs possess a
threat to the company’s increased costs (Khan et al., 2015).
PESTEL Analysis Tool
For a comprehensive analysis of macro-environmental factors (external environment),
PESTEL framework is an important tool which can give idea about the market situation,
developments in market etc. The framework provides information based on several
aspects like the political, economic social, technological, environmental and legal.
Political factors comprise of variations in overseas market, taxation system, foreign
policy, and trade laws etc. which all together are important for any business looking to
move to global level. Economic factors indicate how much profitable a business is which