Holmes Institute HI6006 Competitive Strategy Essay: Development Tools

This essay provides a comprehensive analysis of key strategic development tools, focusing on their application in business contexts. It begins by introducing the concept of strategic development tools and their importance in guiding business decisions and evaluating progress. The essay then delves into three prominent tools: SWOT analysis, PESTEL analysis, and Ansoff's Matrix. SWOT analysis is examined for its role in identifying internal strengths and weaknesses, as well as external opportunities and threats, using Woolworths as an example. PESTEL analysis is discussed for monitoring macro-environmental factors, with Zara as a case study. Ansoff's Matrix is explored as a tool for corporate growth strategies, illustrated with examples from Apple. The essay concludes by emphasizing the significance of these tools in strategic decision-making, highlighting their impact on enhancing growth strategies and revealing opportunities for success. The analysis underscores the importance of considering internal and external aspects to effectively manage and sustain the strategic development process.

Running head: COMPETITIVE STRATEGY
Competitive Strategy
Name of the Student
Name of the University
Author note

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Introduction
The essay throws light on analyzing the different kinds of strategic development
tools that can be used by the companies as it assists in providing them the sense of the
direction along with outlining the different measurable goals in a sustainable manner. It
is considered to be the tool which is helpful in guiding day to day decisions and
evaluating the overall progress and changing the different approaches while moving
forward (Yin 2016). There are different strategy development tools which includes
SWOT, PESTEL along with Ansoff’s Matrix that can be explained as to identify their role
in identifying the external and internal environment in a successful manner. In addition,
it can be seen that the different kinds of strategic development tools are suitable for
ensuring that they work together in some of the areas which can be effective in
managing growth of the company in a suitable manner. It will be helpful for the different
businesses which are moving in other areas which will be appropriate for the overall
effectiveness of the firms.

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SWOT Analysis
It is considered to be the study which has been undertaken by the companies for
identifying the internal strengths as well as weaknesses along with external
opportunities and threats suitably. It can be applied to the entire organization or the
individual projects which is within the single department (Rastogi and Trivedi 2016).
Strengths- It includes the different aspects wherein the company is performing
well along with analysis of the qualities which separate them from the different
competitors present in the market. Weaknesses- It is the aspect in which the company
lacks and wherein the competitors perform better than them. There can be unclear
unique selling propositions that can affect the growth of the company in the market
(Phadermrod, Crowder and Wills 2019). Opportunities- The emerging needs for the
different products and services will be determined which can create the opportunity for
the company (Gürel and Tat 2017). Threats- It includes analysis of the emerging
competitors present in the market along with changes in regulatory aspects that can
affect the growth and it can create impact on revenues of the company negatively
(Gurcaylilar-Yenidogan and Aksoy 2018).
For instance- With help of SWOT analysis, Woolworths analyze their internal
strengths and weaknesses along with identifying external threats and opportunities
which can differentiate them from other competitors. Strengths- It is the strong pioneer
brand in the market along with the efficient kind of operations has helped Woolworths in
managing their growth (Woolworths.com.au 2019). Weaknesses- Growing presence of
online market has restricted growth along with Woolworths have limited presence in
compared to other competitors (Woolworths.com.au 2019). Opportunities- Promote the
brand through proper advertising and the company seeks proper growth through proper
strategic acquisitions. Threats- More competition from the different international players
present and there is rising cost of the different raw materials (Woolworths.com.au
2019).

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PESTLE Analysis
With the help of PESTEL analysis, it assists in monitoring macro-environmental
factors which may create huge impact on the performance of the companies.
Political- It analyzes the degree of intervention of government in economy or
certain industry. The influences of the government play a major role which is inclusive of
political stability, foreign trade policy and labor laws which needs to be taken care of.
Economic- It will be considered as the determinants of the performance of the certain
economy and the factors include rate of inflation, disposable income of the customers
(Fink et al., 2017). Social- It includes the different factors such as population growth
rate and lifestyle attitudes that can affect the growth of company (Gurcaylilar-Yenidogan
and Aksoy 2018). Technological- There are different technological incentives such as
innovation level and research and development techniques which can be used for
managing growth (Fozer et al. 2017). Legal- There are different specific laws such as
discrimination laws along with antitrust laws that can affect efficiency of companies
(Gurcaylilar-Yenidogan and Aksoy 2018). Environmental- Scarcity of the raw materials
along with other issues such as carbon footprint that can affect the growth of the
company.
For instance- In case of Zara, the PESTEL analysis assists in making the
officials of company understand for the different factors that can affect the effectiveness
in other countries. Political Aspects – It has huge rate of the government interventions
present and there is political stability for growth of ZARA in other markets of Europe
Union Economic Aspects- The economy is fluctuating in nature which can affect
spending of customers and there are differences in prices in different countries
(Zara.com 2019). Social Aspects- There are different discounts and offers which will
be suitable for ZARA to attract customers. There are different preferences of customers
which can be solved by ZARA (Zara.com 2019). Technological Aspects- Launch of
apps in making the customers more feasible along with interactive maps for locating
stores (Zara.com 2019). Environmental Aspects- There is rapid fashion change in EU
that can affect the growth of ZARA. Legal Aspects- Issues related to copyright and
changes in litigation in different countries.

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Ansoff’s Matrix
` It is considered to be the strategic management tool that can be used by the
companies for portraying the corporate growth strategies which are alternative in nature.
It mainly focuses on the firms present and potential products and markets which will be
suitable for analyzing the existing and new markets that can be beneficial for their
growth in the future.
Market Penetration- It helps the firms in achieving growth with help of existing
products (Fink et al. 2017). Product Development- It helps the firms in developing new
products which will be targeting the existing market of customers. Market
Development- It helps the firms in seeking growth through targeting existing products
to the new segment of customers (Fink et al. 2017). Diversification- In the respective
case, the firm grows through diversifying in new businesses by developing new
products in completely new market.
For instance- Ansoff’s Matrix of Apple helps in understanding the different
aspects in a suitable manner. Market Penetration- Apple engages themselves in
market penetration strategy through effective application and efficiency in a suitable
manner (Apple.com 2019). Product Development- Apple has introduced different kinds
of updated versions of the different products that helped them in becoming more
effective. Market Development- Apple has implemented the different kinds of growth
related strategies by focusing on few markets in Asia and gain customer base.
Diversification- There is inclusion of different kinds of other devices such as iPhone to
meet demands of customers in a strong manner.

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Conclusion
Therefore, from the overall analysis, it can be concluded that these are the
strategic development tools that can be efficient to understand the growth of the
company in a strong manner. Through proper implementation of the respective tools, it
has been useful for the companies to guide the day to day decisions in a proper manner
and it has been successful in enhancing the growth-related strategies suitably.
Moreover, the crucial role in the strategic development process is analyzing the internal
and external aspects that can affect the growth of the company negatively which
enhanced the effectiveness of the company strongly and it created different
opportunities for revealing the suitable opportunities for improving the success rate of
the company in a strong manner. In managing the strategic decision-making, there are
different threats and weaknesses which can be ineffective in nature for their growth
prospective and it will be ineffective in developing strategies as well. Lastly, with SWOT,
PESTEL and Ansoff’s matrix, there can be incorporation of the different perspective
such as analysis of internal and external aspects that can be ineffective for analyzing
which will directly impact the overall sustainability of the process.

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References
Apple.com 2019 Apple Inc. (Online) Retrieved from https://www.apple.com/ [Accessed
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Fink, T.M.A., Reeves, M., Palma, R. and Farr, R.S., 2017. Serendipity and strategy in
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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.
Gurcaylilar-Yenidogan, T. and Aksoy, S., 2018. Applying Ansoff’S Growth Strategy
Matrix To Innovation Classification. International Journal of Innovation
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Gürel, E. and Tat, M., 2017. SWOT analysis: A theoretical review. Journal of
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Murdock, A., 2017. Diversification and Growth. In Private Action for Public Purpose (pp.
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Phadermrod, B., Crowder, R.M. and Wills, G.B., 2019. Importance-performance
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Rastogi, N.I.T.A.N.K. and Trivedi, M.K., 2016. PESTLE technique–a tool to identify
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Woolworths.com.au 2019 Woolworths Supermarket - Buy Groceries Online (online)
Retrieved from https://www.woolworths.com.au/ [Accessed on 9th August 2019]
Yin, N., 2016. Application of AHP-Ansoff matrix analysis in business diversification: The
case of Evergrande Group. In MATEC Web of Conferences (Vol. 44, p. 01006). EDP
Sciences.

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Zara.com 2019 ZARA International | New Collection Online (Online) Retrieved from
https://www.zara.com/ww/ [Accessed on 9th August 2019]