Strategic Analysis in Business and Non-profit Organizations

This essay provides a comprehensive overview of the concept of strategy, emphasizing its significance in both business and non-profit organizations. It defines strategy as a crucial set of activities that bridge the gap between means and ends, highlighting its role in providing direction, optimizing resource utilization, and enhancing business practices. The essay explores the importance of strategy in non-profit organizations, focusing on effectiveness, fund-raising, and planning. It then delves into the challenges of developing and implementing strategies, including environmental factors, resource availability, sustainability, and legal policies. The essay also discusses challenges such as insufficient partner buy-in, leadership attention, and resistance to change. Finally, it examines the modern competitive environment, emphasizing the relevancy of strategy in adapting to market dynamics and competitor analysis. The analysis of Porter's five forces and examples from companies like Woolworths and McDonalds are included to illustrate the practical application of strategic principles in the context of a competitive landscape.

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Introduction:
Strategy is the very important concept that has been studied since years. For making
improvements in the business, strategic approach by management in every function is important.
This assay deals with the discussion of the strategy and its importance for business and for a non-
profit organization. The later part of the essay discusses about the challenges faced by the
organizations in developing and implementing the strategy. The concept of modern competitive
environment and its relation with strategy is also discussed in the essay.
Strategy:
Strategy is the concept that has been adopted in businesses by military. Strategy can be defined
as the set of activities that bridges the gap between the means and the ends. The term strategy has
entered the business area by describing the activities or the steps that the company takes in order
to compete in the industry and to enhance the customer’s base (Besanko, Dranove, Shanley and
Schaefer, 2009). Strategy is the result of the decision that has been made by the company’s top
management regarding the process or the policies that needs to be followed by the organization
in order to work effectively. It can be defined as the patterns of the actions that are being
implemented in order to perform (Ireland, 2007). It can simply be explained as the direction in
which the company performs in order to achieve its goals.
Importance in business:
Strategy provides direction to the company: as discussed that strategy is the set of activities that
needs to be conducted in the company in order to perform the tasks. These strategies provide the
direction to the company to achieve its gaols. Thus it is very important for the business to make
the strategies to perform each and every task.
Strategy helps in using the resources optimally: making the strategy also helps in using the
resources effectively and intelligently (Johnson, Langley, Melin and Whittington, 2007). There
are many resources available with the organza tin. Excessive use of these resources may increase
the cost of production. Thus, framing the strategy helps in using those resources effectively so
that cost of production can be maintained.

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Enhancing business and customer’s retention: Strategy needs to be framed by the company in
every function such as marketing, sales, HR, operations etc. making the strategy for different
function results in enhancing the business practices and also helps in retaining the customers as
the customers also prefer to associate with the company having proper functioning (Gobble,
2012).
Example: Woolworth is the company that operates in supermarket retail industry in Australia. It
is one of the leading companies in the industry and its strategies are its competitive advantage.
Its effective strategies allow the company to compete with its competitors. The company
evaluates the industry and the market and develop the strategies accordingly. The recent strategy
of the company is to reduce the prices and cater the market (Dos Santos, 2011). As far as the
expansion strategy is considered, the company focuses on developing new stores in Australia so
that customers reach can be enhanced.
Importance in NPO:
The importance of strategy in Non-profit organization is slightly different from the for profit
organization. This is because the success of the strategy in for-profit organization can be
measured by its revenue, sales etc. Non-profit organizations also need strategy but their aim is
different (Nestorovska, 2013). The effectiveness of strategy in this organization can be
determined by the large number of people the organization is serving.
Effectiveness: Strategy helps in making the process effective in the non-profit organizations.
This is because if the processes of these organizations are effective then only the organization
can attract more number of people (Doole and Lowe, 2008).
Fund raising: Non-profit organisation need funds and cash inflow, which they cannot earn but
have to get it from the other organizations (Teece, 2010). This process also required the company
to make strategy so that more and more profit organization invest and support the non-profit
organization.
Planning: It is one of the major advantages the non-profit organization has by making the
strategies. Planning is not only important for non-profit organization but also for the for profit
organizations.

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Different non-profit organizations have different gaols and have different strategies to achieve
the same. Some runs their firm to support the animals, some support the poor people. So, this
organization works for a social cause. Oxfam is one of the NPO in Australia that believes in
implementing different strategies to cater the service to the people. As far as the recent strategy
of the company is considered, they are concentrating on empowering women so that the social
cause of domestic violence can be removed (Eyben, Kidder, Rowlands and Bronstein, 2008).
Thus making strategy of educating the women and supporting them has supported them to
achieve the gaols.
Challenges in developing strategy: for business and for NPO
Environmental challenges: the major challenge that the organizations face in order to develop the
strategy for the company is environmental challenge (Dul, Bruder, Buckle, Carayon, Falzon,
Marras, Wilson and van der Doelen, 2012). The internal and the external environment of the
company affect the strategy development of the same. This is because the change in the internal
environmental of the company and the variations in the industrial environment have to be
considered when the strategy of the company needs to be developed.
Challenges of resource availability: It is very important for the companies to make use of the
resources available in optimum manner (Freeman, 2010). This is because if the company does
not use the resources optimally then it may raise their cost of production. The availability of the
resources is also challenge for the company as the company needs to make the strategy according
to the resource available to them.
Sustainability as a challenge: These days, sustainability is the big challenge faced by the
organizations (David, 2011). This is because the practices of the companies are harming the
nature and the atmosphere. Thus making the strategy according to the sustainability laws in mind
is necessary.
Legal and governmental policies: different policies area framed by the government for different
industries. Thus, the organization needs to frame the strategy in accordance with the legal
policies made by the government (Hitt, Ireland and Hoskisson, 2012).
Challenges in implementing strategy:

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Insufficient partner buy in: implementing the strategy requires the process to be followed. Kit
has been analysed that it is not necessary that every partner needs the change or can adapt the
change effectively. Thus, it is very difficult to make the changes or implementing the strategy in
the process.
Insufficient leadership attention: implanting strategy requires effective leadership. This is
because here the leaders have to pay their part in implementing the strategy and helping thee
people to adapt the same. Implementation of the strategy fails when there is weak leadership.
Weak strategy: for implementing the strategy effectively, it is required to make strong strategy
that is appropriate to achieve the desired gaols (Hill, Jones and Schilling, 2014). If the strategy
that has been made is not related to the goals that have been set then it is not possible to get the
desired outcome and thus the implementation of the strategy also fails. Making the strategies that
are appropriate and aligned with the objectives that need to be achieved then the implementation
of the strategy become very easy as it automatically gives best results.
Resistance of change: there are employees in the organization that resist the changes that have
been made in the company’s process (Peppard and Ward, 2016). This is because the change in
the processes requires the organization to make changes in the associated function as well. The
employees need to adapt those changes and require to get trained in new processes and skills.
Some of them resist these changes as they need to make so much effort to adapt such changes.
Example: Oxfam is the non-profit organisation that has faced many issues at the time of
implementing the strategies. One of the issues or the challenge is the weak management role.
This is the major challenge that has been faced by the company called Oxfam (Eyben, Kidder,
Rowlands and Bronstein, 2008). Some of the other problems are unaligned structure of the
company, lack of communication between the department etc. these problems need to be
resolved so that the strategies cam be implemented easily in the company.
Modern competitive environment:
A modern competitive environment can be defied as the external system that affects the practices
of the company or the business. It is the environment where all the companies function and
compete with each other to get large customers base and market share. If there are large numbers

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of sellers in the market then the industry has to face large competition as the customers have
many choices. In other case if there are less number of sellers than customers have fewer choices
and thus the competition is also low in that industry (Wheelen and Hunger, 2011). This
competitive environment also involves the competitors that can be divided into two categories.
First one is the direct competitors. These are the competitors who sell the similar type of
products while the indirect competitors are those who sell different types of products but still
compete with the other companies. For any business, it is very necessary to conduct competitive
environment analysis so that information about the industry and the competitors can be analysed
in order to frame the strategy. There are many factors that affect the competition the industry.
Two of the factors are indirect and direct competitors. The third factor that affects the
competitive environment in this modern world is the regulators elements. Government makes
different policies for different industry. The last element that makes the environment competitive
is the social and technological trends. The social and technological trends are changing and thus
making the environment more competitive for some of the companies. This is because the
companies have to change their processes according to the new technology.
Relevancy of strategy in modern competitive environment:
Strategy formation is that major function that needs to be conducted in the organization and
environment of the industry is major component that affect the formation of the industry. This is
because the change in the environment and the level of competition in the industry allow the
company to make changes in its strategies so that it can compete in the competitive environment
of the industry. It has been analysed that porter’s five forces is the technique that helps the
organization to analyse the five factors that makes the environment competitive such as the threat
of competitors, substitutes and new entrants and the bargaining power of seller or buyers.
Change in these factors affects the level and intensity of the competition in the industry. For
example, the fast food industry is becoming highly competitive these days (Besanko, Dranove,
Shanley and Schaefer, 2009. This is because of the changes in the demands and choices of the
people from the fast food companies. McDonalds have realised that the environment is becoming
competitive and thus developed the strategy of serving the people with different types of meals
other than burgers such as McPuff, McFlurry etc. this facilitates the company to cater big market

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and customers base. There are many companies such as Woolworth and Coles who understands
the competition level in the market and this make the strategy accordingly.
Conclusion:
It has been concluded from the report that Strategy is the very important concept that has been
studied since years. For making improvements in the business, strategic approach by
management in every function is important. Strategy is the concept that has been adopted in
businesses by military. Strategy can be defined as the set of activities that bridges the gap
between the means and the ends. It has been analysed from the report that strategy is very
important for the business and for the Non-profit organizations as well. This is because for
running the business and achieving the desired goals, it is required by the company to frame the
strategies that provide direction that needs to be followed.

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