Competitive Strategy Essay - Tools and Techniques for Strategic Management

[Course title]
competetive strategy

P a g e | 1
Competitive strategy essay
Various strategy development tools, techniques and models are available that
support strategic management of firms and to assist them in decision making
processes. They are designed and developed for supporting managers in every
stages of strategic management procedure to achieve organisational gaols
( Qehaja , et al., 2017). To understand how these tools are effectively applied on
businesses, this essay will use a case example of McDonald’s operating in fast-food
industry. This essay will analyse and evaluate four critical strategy development tools
after identifying its uses as per current literature.
PESTEL analysis
PESTEL or macro environment analysis tool is used by business managers to
examine and evaluate external factors facing the firm which requires to be
considered for gaining competitive position in marketplace. Many of the firm uses
this tool while entering new marketplaces as it guides management in making
business plans that can suit new market external environment. Acronym PESTEL
typically stands for political, social, technological, environmental and legal factors of
business organisations that needs to evaluated at regular intervals to identify any
significant changes that may impact organisational performance (Ritson, 2011).
PESTEL analysis of McDonalds reveals external factors that affects the firm’s
performance while operating in an international business environment. Political
factors of McDonalds show that company responses to every governmental
regulation and policies along with showing effective CSR policies within its
management. Economic conditions though hampered company sales especially
during the times when US and European nations faced financial crises and recession
period. Alongside, since McDonalds operates in various countries, any significant
changes in country economics disrupts its overall operation strategies. Social factors
again seem challenging to the firm due to increased concern seen among
consumers against fast-food consumption. Technological factors, however can be
seen employed by the firm since it utilises advanced technical equipment’s and
innovative systems for food production, storing, and waste management areas.
Environmental factors also affect McDonald operations as any climatic change may
hamper the production of its major raw material i.e. food products. Lastly, legal
constraints like suppliers’ unethical practices, changing policies of outsourcing
countries and other food related standards critically affects McDonalds operations.
.