HI6006: Essay on Competitive Strategy Development Tools

This essay provides a comprehensive overview of four key strategy development tools used in business: SWOT analysis, PESTLE analysis, the Ansoff matrix, and the resource-based view. It explores how SWOT analysis helps companies identify strengths, weaknesses, opportunities, and threats, using Walmart as a practical example. The essay then delves into PESTLE analysis, explaining how it examines political, economic, social, technological, legal, and environmental factors, with a focus on L'Oreal. The Ansoff matrix is presented as a tool for strategic planning and growth, with Adidas serving as a practical illustration. Finally, the resource-based view is discussed as a means of assessing and leveraging internal resources, using Airbnb as an example. The essay emphasizes the importance of these tools in achieving competitive advantage and maximizing growth in today's business environment. The assignment is contributed by a student to be published on the website Desklib. Desklib is a platform which provides all the necessary AI based study tools for students.

Running head: Tools
Competitive strategy

Tools
“Important tools used by the business”
There are important tools that are considered by the organization to solve the complex
issues and also to control the overall operations. The paper will focus on the
development strategy tools that assist the company in attaining growth. In relation to
these tools, it can be examined that growth and profits can be maximized in a highly
competitive market.
SWOT ANALYSIS is the tool that is used by the management to make accurate
strategic plans. Different factors will be examined with this tool that will boost the
success ratio of the companies. It helps the companies to compete with the other
competitors who are operating similar nature of work in the market (Gürel and Tat,
2017). By focusing on the SWOT analysis tool it can be investigated that the managers
of the company can determine the next move that will help in attaining more benefits in
the market. This tool also maintains the high degree of control on the problems and
opportunities that are faced by the company. So, it can be stated that this is one of the
famous tools that is used by small and large companies for controlling operational work
(Bull et al., 2016).
(SOURCE: Ceta, 2019).
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Tools
Practical Example: WALMART
Strength
1. The Largest leader in the retail sector
2. High international presence
3. Large organizational size
4. Global supply chain
(Source: Strategic management insights, 2019).
Weakness
1. Less profit margins
2. The business model can be easily copied
3. Competitive disadvantage in relation to high end sellers
Opportunities
1. Expand in the developing countries
2. Can focuses on human resource practice
3. Improve quality standards
Threats
1. Healthy lifestyle trend
2. High competition in market
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Tools
3. The online retailers are of different sizes
PESTLE ANALYSIS is one of the popular tools used by the companies finds the
external factors of the company. Francis Aguilar has created this model that focuses on
scanning the environment of the organization. This tool is mostly importantly considered
by marketers to examine the different macro-environmental aspects that affect the
growth ratio of the company. The overall outcome which is attained through this tool
assists in considering threats and weakness that takes place in the business market. In
relation to this tool, marketers play an important role in controlling the activities by
considering the external factors that are affecting the business profits. So, it can be said
that it is an important tool that should be used by the companies in the present era
(Fozer et al., 2017).
In relation to the political factor, it is investigated that there are rules and policies in the
manufacturing company in Paris that is important to be followed. There are also many
import policies of the regions that help in attaining growth. Economic factor emphasizes
on the recession factor that has uplifted the cosmetic industries. The GDP is the major
contributor in relation to the L'Oreal business as human development index is high of
the company. The social factor relates to the company in which the aim focus is n the
modern societies. This company introduces the products according to the demand of
the society. Technological factor focuses on the company in which it can be seen that
innovation is implemented that helps to boost the segments of the products. In context
to the legal factor, there are various competitors of the company so that it is important to
fulfill the legalities of the region so that it could be easy to attain growth. To maintain the
safety of the environment, the company emphasizes on conducting different campaigns
that help to enhance awareness among customers (Porter and Heppelmann, 2014).
Ansoff model is also the tool that is used to plan the overall activities of the company.
This tool is used by the executives and marketers to devise the strategies that will help
in future growth. This concept was introduced by the Russian American Igor Ansoff. It is
related to the product and market matrix which suggest the companies focus on the
dependence in relation to the market situation. It also provides growth strategies option
to the companies through which they can get to know the accurate direction beneficial
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Tools
for the company. So, this is mainly used for accessing the growth of the business in the
market (Grundy, 2017).
Practical Example: ADIDAS
The company has penetrated in the new markets and attained growth. Adidas should
not alter the products at the time of entering into the market. The company can attract
the customers of the competitors through penetration by advertisement campaigns. In
relation to market development, the company has a strong presence in the markets
such as Asia, Europe, and North America. The company has the chance to bring
improvement in product quality and packaging system. Product development has been
done for the different target groups such as for children and middle age people.
Resource-based view is mainly the tool that accesses the availability of the resources.
It is important for the companies to have control over the resources so that it could be
easy to attain a positive outcome. So, it helps to access the resources and capabilities
through which the strategic decisions can be made. This tool focuses on identifying,
locating and acquiring the valuable resources for the company. Therefore, it can be said
that this tool is meant for maintaining the balance of the resources (Yu et al., 2018).
Practical example: Airbnb
It has been analyzed that the resources of the company are difficult to imitate such as
patents and trademarks. Non- substitutable are the services that cannot be substituted
by the company such as good treatment with customers. So, it can be said these are
the factors that help in analyzing the actual position of the company in the highly
competitive market.
It can be concluded that these are the essential tools that should be taken into
consideration by the companies so that growth opportunities and threats can be
minimized. These tools also help in attaining the competitive advantage in the highly
competitive business world.
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Tools
References
Bull, J.W., Jobstvogt, N., Böhnke-Henrichs, A., Mascarenhas, A., Sitas, N., Baulcomb,
C., Lambini, C.K., Rawlins, M., Baral, H., Zähringer, J. and Carter-Silk, E., 2016.
Strengths, Weaknesses, Opportunities and Threats: A SWOT analysis of the ecosystem
services framework. Ecosystem services, 17, pp.99-111.
Ceta, N., 2019. SWOT analysis. [Online]. Available at: https://tallyfy.com/swot-analysis/
[Accessed on 27 April 2019].
Fozer, D., Sziraky, F.Z., Racz, L., Nagy, T., Tarjani, A.J., Toth, A.J., Haaz, E., Benko, T.
and Mizsey, P., 2017. Life cycle, PESTLE and multi-criteria decision analysis of CCS
process alternatives. Journal of cleaner production, 147, pp.75-85.
Grundy, T.D., 2017. Dynamic Competitive Strategy: Turning Strategy Upside Down.
Routledge.
Gürel, E. and Tat, M., 2017. SWOT ANALYSIS: A THEORETICAL REVIEW. Journal of
International Social Research, 10(51),pp.65.
Porter, M.E. and Heppelmann, J.E., 2014. How smart, connected products are
transforming competition. Harvard business review, 92(11), pp.64-88.
Strategic management insights., 2019. SWOT analysis of Walmart (5 Key Strengths in
2019. [Online]. Available at: https://www.strategicmanagementinsight.com/swot-
analyses/walmart-swot-analysis.html [Accessed on 27 April 2019].
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Tools
Yu, W., Chavez, R., Jacobs, M.A. and Feng, M., 2018. Data-driven supply chain
capabilities and performance: A resource-based view. Transportation Research Part E:
Logistics and Transportation Review, 114, pp.371-385.
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