Asda's Strategic Challenges, Theoretical Concepts, and Application

This report provides an extended analysis of Asda, focusing on its key strategic challenges, development milestones, and how the company prioritizes its objectives. It critically evaluates relevant theoretical concepts and applies them using examples from literature to support observations and arguments. The analysis includes discussions on managing business operations during a pandemic, gaining competitive advantages, building brand awareness, and expanding business globally. The report also explores Asda's strategies for tackling plastic pollution and enhancing customer satisfaction. Furthermore, it examines strategic options such as adding a new supply system, adopting new technologies, and entering new geographical areas. The report discusses the use of strategic models like Adaptive Strategy, Linear Strategy, and Porter’s Five Forces to understand Asda's competitive position and key factors for success, ultimately concluding on the role of strategic management theory in informing organizational strategy. A reflective assessment using Gibbs Reflective Cycle is also included to evaluate key learnings.

Extended Analysis and
Report

Table of Contents
1. Introduction..............................................................................................................................3
2. Organizations key strategic challenges and explaining how the priorities were arrived along
with key milestones in its development.......................................................................................3
3. Critical evaluation of relevant theoretical concepts for the strategic options..........................4
4. Application of theory using examples from literature review for observation and arguments
....................................................................................................................................................10
5. Conclusion of the strategic management theory in informing organizational strategy.........14
6. Reflective Assessment ..........................................................................................................15
REFERENCES..............................................................................................................................17

1. Introduction
The task will define the extended analysis within this report. This will address Asda key
milestone in its development along with the challenges and describing how the priorities are
arrived. Relevant academic literature will be presented which will evaluate balanced critical
evaluation of relevant theoretical concepts drawn from appropriate sources. Appropriate and
logical conclusions and recommendations will be analysed and discussed in appropriate manner.
This will be done to analyse Asda;s competitive position. Application of theory in the context by
using insights from literature and examples will be provided significantly in support with
observation and arguments. Conclusions will be drawn for the Strategic Management Theory in
informing organizational strategy. Further, reflective assessment will be drawn with the help of
Gibbs Reflective Cycle from the key learning and undertakings which will be evaluated and
discussed in the report. Therefore, there will be certain issues which will also be described within
the report in concern to the strategy.
2. Organizations key strategic challenges and explaining how the priorities were arrived along
with key milestones in its development.
ASDA is one of those top supermarkets in the UK, who efforts to retain customers and
enhance their satisfaction level that in turn lead to increase profitability and productivity level.
During the process of sustaining for longer in the retail sector, it may face varied challenges that
directly or indirectly put adverse impact on its profits and performance level.
The key strategic challenges which are faced by Asda are -
 While running the business in retail industry, chosen supermarket may face the worst
challenge such as managing business operations during pandemic.
 Another strategic challenge that ASDA may face is to gain competitive advantages due to
intense competition in the overall sector.
 It may face challenge building existing brand awareness in the market.
 ASDA may deal with issue to expand business and build its business existence
worldwide.
The priorities were arrived which helps in knowing the aspects as to how the business is
being undertaken and this helps in knowing that Asda has prioritized its customers and because
of this reason it may focus on overcoming challenges, which creates value of how the customers
are being served in the market at large scale. The key milestones and development. Asda has

achieved a milestone of tackling the plastic pollution and helping the customers to reduce, re-use,
and recycle.
3. Critical evaluation of relevant theoretical concepts for the strategic options
Asda has been providing the products and services to the customers in the market and the
company has been following the strategies to solve any issues and problems in the market. The
company has been analysing and evaluating the concepts of how to provide the strategic options
which in appropriate manner. There are not much strategic options which are made available
from Asda. This helps in knowing that the company is addressing the aspects of how the
customers are to be engaged with the price and privilege of providing the services from Asda.
The company is focusing on wining the price for customers which helps in delivering the
constant and consistent customer experience driving the growth and care given to the customers.
The strategies are being are drawn upon for the evaluation of how the Asda is taking
concern of the growth and development of the company. This helps in addressing the strategic
option which is made available for the aspect of customer gains in the market at large scale. The
strategy frame creates value of the work which has been put forth for overall development of the
company (Arrieta and Shrestha, 2022). The framing of strategy helps in addressing the key notes
of how the strategies are being framed at large scale. There are certain aspects as to how the
company is enabling the working of the strategy in appropriate manner.
One of the key strategic options which the company Asda should consider is to take
decision to add a new supply system which helps in knowing that how effectively the products
and services are being provided to the customers at large scale. Along with this, there can be new
technologies which should be taken into consideration at large scale within the market. The Asda
can also enter into new geographical area which helps in knowing that there can be large
customers to reach and this can be done with knowing the aspects of how the company is
growing and developing into large scale within the market structure (Giones, Brem and et.al.,
2019). There are negative aspects which are affecting the business of Asda and are devaluing the
process of how the company is undertaking its goals and objectives to be fulfilled at large scale.
This helps in addressing to the aspects of how Asda is working on the new strategies framed at
large scale. This also denotes that the growth and development is also important for the
company.

According to, Marques and Eberlein, (2021), the strategic options which are made
available for the company to consider the positive impacts of growth and development are
mentioned as to how the strategies are framed and this helps in creating value for the aspects of
growth in appropriate manner. There are strategic options which helps to address the goals and
objectives of the company framed. Asda focused on clothing and this created strategies of
gaining more number of customers from market by diversifying the area of market such that the
company is able to analyse the aspects of diversified products in different ranges and categories
as concerned by the customers. The company is delivering the customer experience which is
helping the customers to create value for the products and services which has been displayed to
the customers in the market. There are certain aspects as to how effectively and in appropriate
manner the strategies help in addressing the concepts of growth which are working according to
the changes and modifications which are made in the market.
There are some major models of strategy which are used for the effective representation of how
the company is considering the value of customers and is delivering them products and services
which are delivered in the market (Hu, Frank and et.al., 2022). The models of strategy are being
addressed in the manner as to how the models are helpful in promoting the business of Asda. The
models used are –
Adaptive Strategy – This is the model which is concerned with the development of the
match between the development and risks which is present in the external environment. The
organizations source and capabilities helps in addressing that how the resources are managed and
within Asda. The organization and its parts change along with the adaptive strategies which are
framed in the manner of how effectively and inn appropriate manner there are aspects of
proactively and reactively aligning with the customers’ preferences. The company Asda helps
inn treating the aspects as to provide the customers with the best facilities through the providence
of products and services. This model focuses on customers’ preferences to be solved and
provided so that they are being concerned as to how effectively the adaptive strategy is being
used.
Linear Strategy – The linear strategy focuses on planning that goals and the means of
achieving the goals and objectives at large scale. The leaders of Asda plan how they will deal
with the competitors in the external business environment and in the market. The organizational
goals are achieved when Asda helps in framing the strategy in an effective and efficient manner.

There are aspects as to how the Asda is taking concern of growth and development in the
external business environment. This strategy helps in formulating the roles and responsibilities of
the leaders such that the goals and objectives are clearly understood in definite manner.
The other models which are used are –
Porter’s Five Forces Model – This is the model which includes –
Competitive Rivalry – This is the stage which helps in examining the aspects as to how
effectively and in appropriate manner the competition in the market place is handled by Asda. It
also helps in analysing the rivalries within the market. When there is rivalry competition in the
market it helps in understanding that how the changes are being analysed and are ensured to be
high within market. In the context of ASDA, intense competition in the retail industry may put
negative impact on business growth in term of increasing a lot of pressure on management.
Bargaining Power of Suppliers – The extent of this force low, because number of
suppliers exist in the industry where ASDA operate its venture. It may put positive impact on
firm in term of delivering or offering quality products to customers, with sustainable suppliers
who are ready to work with firm with utilization of bargaining power, as they may do not have
that. The bargaining power of suppliers helps in understanding how much power the business
supplier has and this demonstrates that Asda is helping the company to analyse the bargaining
power which is helping to ensure the that the company is raising its stands and is focusing on the
power of suppliers to be enlisted in the market.
Bargaining Power of Buyers– The degree of this force is low, because lack of
alternatives accessible in the world, that ASDA may initiate to offer people. It can be said that
the low bargaining power of customers, enable firm to gain competitive benefits in term of
retaining and acquiring potential buyers. The customers have the power of utilizing the products
and services which are there in the market. But eventually the buying power becomes low when
less customers are buying the products.
Threat of New Entrants – There is threat of new entrants in the market which addresses
the aspect of how effectively and in appropriate manner the changes are being taken into
consideration and this creates value as to how the threat of new entrants who are the competitors
are enabling to join the marketplace (Song, Wang and et.al., 2018). The extent to which new
entrance threaten ASDA is low, because of some legal and other requirements related to new
business establishment in the retail industry, UK. This factor may provide firm chance to achieve

strategic objectives, instead of focusing on developing new tactics that aid to deal with new
companies along with existing.
Threat of Substitute Products and Service – There is threat of products and services to
be replaced in the market which helps in addressing the aspects of growth and development. The
degree of this force is low, because certain products and services as substitute accessible in the
sector, which may do not provide ASDA customers to switch to new brand products purchase.
Key Factors for Success – The key factors for success helps in knowing that Asda is
keeping the form of how effectively and in appropriate manner is engaging the customers at
large scale. This helps in knowing that how effectively Asda is focusing on the customers and is
engaging them to provide the success factors which are in diversification and enhancement of the
company. The operations of the company are also considered as important and this helps in
knowing that the company is creating value for which the products and services are delivered in
the market at large scale. The main strategic focus is on the leadership strategy and this helps in
knowing that due to the major changes and considerations of the Asda, there are frameworks for
leadership strategy to be framed in an effective manner and this creates value as to how the
leaders are contributing within Asda to make and initiate the key success aspects of the
organization.
There are two other models which are described and this helps in addressing the aspects
as to how the models are applied at large scale. These models are described as –
Balanced Scorecard – Balanced Scorecard is defined as the management system which
helps in providing the feedback of the internal and external businesses processes at large scale
and is helping to retain and regain the corrections which are there to be made. There are different
perspectives which helps in addressing that how effectively and in appropriate manner different
perspectives such as financial, business process, customer and learning and growth helps in
understanding the continuous development of Asda (Haas, 2019). This is the major part as to
how the changes are to be addressed and are kept in providence of feedback so that the work is
improved and the enhancement is done in appropriate manner. There are different perspectives
which are addressed within the Balanced Score Card and they are - Financial – The perspective of the shareholders helps in addressing the aspects of growth
and development in the Asda.

 Business Process - There are certain key processes which helps in understanding the
aspects as to how the changes are framed are created in an effective and in appropriate
manner which concerns the business and the shareholders. Learning and Growth – Continuous improvement is done and is analysed by having the
aspects as to how the Asda can helps the processes within company so that the employees
can learn maximum and are concerned with the aspects of growth and development
(Quesado, Aibar Guzmán and et.al., 2018). Customers – The customers perceive good products and services which produces good
image of the company Asda.
Core Competencies – The core competencies of Asda are providence of low cost, good
quality products to gain market share which helps in knowing the major aspects of having the
major competencies and analysing the aspects of growth and development at large scale. The
company also helps in providing the effective products and services as to help and to gain the
positive outcomes of company growth and development in the market at large scale within
market structure (de Oliveira and et.al., 2018). These core competencies which is low cost helps
in addressing how effectively and in appropriate manner good quality products are produced.
The market is also changing day by day which creates the opportunities for diversifying
the services and products to be delivered at large scale in the market to customers. The company
is also taking charge of differences and gaps to be filled within the business environment and due
to this there are aspects of improvements seen within the business of Asda.
According to, Subhan and et.al., (2022) strategic formulation is time-consuming process
as there are lot of steps involved in framing strategy at large scale. The company is also taking
concern of the models to be applied in an effective and appropriate manner. This is paving the
way for growth and enhancement in company’s strategic functions and how importantly
company is improving its ways of producing they products in manner of promoting and
advertising it effectively in market.
On the contrary, the company which is Asda is also facing the issues and challenges
which is affecting the productivity and performance of the employees. Therefore, certain
strategies which are framed in appropriate manner and creates difficulties while resolving the
issues because it takes time. There are certain strategies which creates difficulties and problems
as they find it difficult to address what the problems which the company is facing. Also, the

impacts of pandemic have also created difficulties in the working of how the company is
addressing the positive ways of effectiveness at large scale (Di Lauro, Tursunbayeva and
Antonelli, 2019). The challenges such as Asda facing issues with new owners has become
serious for which proper strategies should be framed so that the company is able to create value
for the work and systems in appropriate manner. There are also aspects as to how such strategy
should be framed for removing the barriers and gaps which are observed within company. There
is an indicative presence as to how effectively the company is taking the challenges and is
solving such major issues in effective manner.
VRIO Model
Resources Value Rarity Imitability Organization
Vision of
leadership for
next set of issues
or challenges
Yes No Rivals cannot be
imitated
Able to use the
current resource
Strategic HRM
strategies related
to employee
retention and
talent acquisition.
Yes Yes No Yes , firm may
have current
resource.
Brand position in
compare to rivals
Yes No Yes ASDA may have
ability to build
and maintain
brand position,
better than
competitors.
Strategies and
resources to gain
competitive
advantages
Yes Yes No Firm may have
ability to gain
benefits by
developing

strategies.
Financial
resources
Yes No Yes Good source of
funding.
Supply chain
network
flexibility
Yes No No Have excellent
supply chain
network.
Sales force and
channel
management.
Yes No No Organization may
have good
management
teams.
According to above table, it can be interpreted that ASDA is able to gain competitive
advantages and become a sustainable brand in the retail sector, as it may have those resources
that enable firm to gain all the benefits that it may expect of get.
Resource based view-
It is one of those strategic models that applied in the context of varied companies, for
purpose of determining abilities, assets and effectiveness of firms to gain competitive
advantages. In case of ASDA, the current model may apply in appropriate manner, along with
elements that it includes and these are;
Tangible resources-
ASDA may have number of tangible resources such as stores as it may have more than
6,200 outlets in the world and already operate under 63 banners in more than 27 nations outside
the UK. Along with these things, firm may also utilized advanced technologies that may
contribute to increase organizational performance level. All these assets may falls under the
category of immobility, as firm may use these to obtain unpredictable benefits in turn.
Intangible resources-
Brand reputation, intellectual property, trademarks, and good will, are those intangible
resources that ASDA may have and gain their benefits in form of using in appropriate manner.
These two categories of resources, chosen supermarket may effectively use to become a
sustainable brand and gain sustainable competitive benefits in bulk.

4. Application of theory using examples from literature review for observation and arguments
Strategic options which are potentially provided for Asda helps in understanding the
aspects as to how effectively the company is taking charge of removing the barriers and filling
the gaps with the help of framing of strategies. The theory which is being applied by the
organization is Vroom’s Expectancy Theory. The managers of the company are aware that there
should be proper process of measuring the efforts of employees so that they are analysing how
the employees are working and are delivering productivity which helps in addressing the growth
and development of the employees within the company. The company is following the aspects as
to how effectively the company is following the key concerns of growth and development. The
Vroom's expectancy theory is being analysed by how the employees of Asda are motivated and
are taking concern to deliver their performance in the best manner possible (Nævestad, Hesjevoll
and et.al., 2019). It helps in analysing the employees' performance at large scale which is based
on the factors such as skills, abilities, experience and knowledge.
With the help of literature which is presented above, it is addressing both positive and
negative measures as to how the company Asda is analysing the growth and development of
organization with the help of strategies which is being analysed and addressed in appropriate
manner. The company is also following two major strategies which are adaptive strategy and
linear strategy. In the above literature there are aspects as to how effectively the strategic
challenges are also addressed which are concerned with the company growth.
The above literature also helps in ensuring that how effectively there are certain measures
which are undertaken to initiate the growth and developmental aspects of concern with the
company. There are certain strategic options which are provided in the above literature which
helps in initiating the aspects of how Asda is growing its business in the market and is concerned
with the customers’ at large scale. For example — Asda provided the aspects of how the
company is facing the major challenges due to which there are positive and negative concerns
which are idealized and are evaluating the development of company Asda.
The above literature also provides the insights of strategic option which the company is
facing at large scale. There are certain growth and developmental measures which are concerned
as to how the strategies are framed within Asda. It is also observed that the challenges which the
company is facing by concerning the positive aspects of growth and development. The company
is also analysing the best manner of how effectively the changes and modifications are being

made in respect to the strategies which are framed (Bapuji, Ertug and et.al., 2020). The positive
measures are also addressed within the company which is taking concern of growth and
development at large scale in appropriate manner. The literature also helps in addressing the
aspects of growth and development along with the changes which are made within the company,
and they are helping to diversify the aspects as to how effectively the changes are made and are
in concern the improvement in the aspects of solving the issues and problems at large scale. The
company is also following some strategies which are effectively replacing the other set patterns
which the company was earlier following at large scale.
From the above literature, it is also applied that certain strategies are also following the
aspects of growth and development. Therefore, the company is helping to reduce the barriers and
fill the gaps which are being addressed at large scale (Alagoz, Chih and et.al., 2018). Asda is also
paving ways for which all aspects of growth and development is being drawn upon and is in
concern the status of facing the challenges at large scale. This is helping to create value for
company and is helping to grow and develop in the business environment at large scale
effectively and appropriately.
There are four models which are used which helps in knowing that how effectively and in
appropriate manner they are applied and are concerning the major growth and development of
the company. This also addresses that by application of the models Asda is focusing on how the
customers are attracted towards the products and services of company. The model Porter’s five
Force helps in knowing that the suppliers and buyers are having the power of how effectively the
company is gaining the best measures of having the high power in the market. There is also
threat of new entrants which helps in describing that the company Asda is competing against
many other retail companies which are there in the market (Alagoz, Chih and et.al., 2018). The
model also delivers the threat of substitute products and services which can be replaced within
the market and this complies that how the company growth and development is done to remove
the threat which Asda is facing.
The next model which is key success factors helps in addressing that Asda is focusing on
the growth and development of the company and is creating value for how effectively and in
appropriate manner the changes are made and this helps in denoting the success factors which
are being addressed for the company. Asda is growing its business in the diversified manner to
seek success in the market and produce and deliver the products and services within the company