HI6006 Competitive Strategy: Key Development Tools in Business

This essay delves into the critical aspects of strategy development in business, focusing on three key tools: PESTEL Analysis, Porter's Five Forces, and the Input-Output Model. The essay begins by highlighting the significance of strategic planning in organizations and introduces the concept of using various tools to achieve operational efficiency and competitive advantage. It then provides a detailed explanation of each tool, outlining their applications and benefits. PESTEL Analysis is presented as a method for understanding external forces like political, economic, social, technological, environmental, and legal factors that affect business operations. Porter's Five Forces model is examined as a tool for analyzing competitive forces and identifying strengths and weaknesses to improve business strategies. Lastly, the Input-Output Model is described as a quantitative monetary plan that represents the interdependence among different divisions of the national financial plan, aiding in the identification of inputs and outputs in business operations. The essay concludes by emphasizing the importance of these tools in enhancing business productivity and competitiveness, advocating for their effective utilization by managers to achieve better outcomes and higher returns on investments.

Key Strategy Development Tools in Business 1
KEY STRATEGY DEVELOPMENT TOOLS IN BUSINESS
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Key Strategy Development Tools in Business 2
Key Strategy Development Tools in Business
Introduction
The idea of having effective planning of different operations within the organization is a
significant aspect. The practical plan aims at enhancing various services together with the
outcomes of each department within an organization. Hence, strategy planning of operations
within an organization is commonly known to be the idea of describing the different manner
administrators of the corporations targets at attaining diverse activities to be completed
efficiently (Wurthmann 2019, p.23). The idea involved in strategic planning is often less specific
than the action structure, as it aims to give appropriate answers to the question about how
different operators can relocate from one operation to next. Some of the tools used for strategic
management consist of Cost-Benefit Analysis, SWOT Analysis, VRIO Framework, Porter’s Five
Forces, Strategy Map, PESTEL Analysis, as well as Balanced Scorecard. However, some of the
other tools used for strategy development include Ghemawat, Input, or Output, Ansoff, alongside
PROFIT. The use of strategic advancement devices in most business cultures are always
concentrated on the desires of different clients, aspects of contests, alongside the advantages of
the corporation to compete within the competitive marketplaces (Welford 2018, p. 5). Therefore,
this research paper explores three significant devices used for strategic advancement as well as
determining their applications in the operations of organizations. The three types of devices that
are examined in this research comprise of PESTEL Analysis, Output or Input Analysis, Porter’s
Five Force Models.
Tools for Strategy Advancement as Well as How they are Utilized in Different Business
Operations

Key Strategy Development Tools in Business 3
PESTEL Analysis
It is a kind of tool used for strategic advancement in various operations of businesses. It
is defined to be the technique utilized to understand various external forces on the proper
procedures of corporations. Besides, this tool of strategic advancement concentrates on processes
of examining several aspects like political, social, economic, legal, as well as technological
within the environment that deals with business operations (Zhiyong 2017, p.12092). It is,
therefore, a tool that most operators of businesses frequently use in the process of setting out
diverse priorities of their activities. The business operators also use this tool in allocating various
resources to support their activities together with aligning workers to operate per the set mission
and vision of the company. Moreover, this tool can be utilized in business operations to help
within the process of collaborating different actions with various analytics business tools that
consist of SWOT examination alongside Port’s Five Forces (Kara 2018, p.601). The use of
PESTEL Analysis as strategic management device requires strategic planning. It also need
appropriate administration to set in place to help in improving and achieving a sustainable
working environment that deals with any rivalry within the marketplaces.
According to research by Zhiyong (2017, p.12092) PESTEL Analysis when used within
the strategy of organization offer assistance to business in understanding the manner of
exploiting their strengths, neutralizing their faults in operations, as they concentrate on taking
appropriate measures to improve their daily services. The incorporation of other tools with
PESTEL help in offering practical knowledge of significant situations that can influence
different activities of organizations in the business environment. The device also assists in the
process of understanding diverse regulations of authorities, environmental management, together
with political concerns that possess different impacts within operations of businesses (Kara 2018,

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p.603). For instance, this kind of tool can be utilized in the process of examining the manner on
how several laws are set by various governmental agencies with how legal opinions are
evaluated in the situation of their capacities to impact the business settings. Hence, through the
utilization of PESTEL Analysis, different managers in businesses can be able to scrutinize
various economic statuses. Such statuses remain to be the significant aspect that influences
operations of the organization in different business environments. Therefore, with appropriate
analysis of diverse social elements through the application of PESTEL Analysis as an essential
strategic tool for development, then the business can be able to adequately analyze the socio-
economic environment of various issues within the marketplaces.
Porter’s Five Forces
The strategic tool for the development of Porter’s Five Forces is always regarded to be an
essential tool in most operations of businesses within organizations. It is necessary for the
processes that deal with examination together with the identification of five diverse and
contested forces that always shape every activity within operations of organizations within
business settings (Amrollahi and Akhgar 2014, p.164). Besides, Porter’s Five Force model also
aids in the processes of examining the major weaknesses and strengths that can allow
management and administrators of businesses to enhance their operations in a specified
direction. According to a study by Sutherland (Sutherland 2014, p.7), Porter’s Five Forces is
used in creating processes that aim at dealing with the process of sufficient identification of the
plan. It is also used to improve the policies of the organization in determining its mission within
the business environment. Furthermore, this model can utilize any form of the commercial
segment within the organization to help in improving the procedures of performing a search for
ideal techniques to make the company thrive (Wurthmann, 2019, p.28). It is often used by

Key Strategy Development Tools in Business 5
different business operators to increase their attractiveness within the marketplace as a way of
ensuring that their operation and services that they offer turn out to be appealing within the eyes
of targeted clients.
The fundamental purpose of this strategic device for development is to help in processes
of examining the factors that can make the company remain competitive over its rivals. It always
draws the ideas from the economics of industrial corporations to help in arriving at the five
diverse forces. The forces are essential in the determination of the amount of contest in the
markets, through the utilization of the model of Porter’s five Forces within operations of
organizations. Most operators can find it easy to create ideal policies to become competitive in
their services (Göral 2015, p.106). The operators that use this kind of tool in their process of
strategic advancement to attain different aspects that positively influence their daily activities
like the force of bargaining among buyers along with negotiation of different suppliers
internationally.
Input-Output Model
It is a kind of strategic device within operations of most businesses that refers to the
quantitative monetary plan that often represents the interdependence present amid divisions of
the national financial plan of various regional economies. It is always considered to be an
essential tool within operations of the business, as it aids the administrators of every business to
be capable of identifying various inputs together with outputs. The defining aspect is what is
required by industry to help in processing multiple duties that are needed to change outputs and
inputs within their daily operations. According to Slavov (2016, p. 24), this model can be
significant as it can enhance the functioning of the organizations because it can sometimes be

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configured to comprise of any storage that occasionally happed during the processes of
operations. The inputs within this device of strategic advancement always represent the proper
flow of the data. The input also represents the flow within the service of an organization. The
model can also be utilized within operations of businesses to be connected to aid in procedure of
conducting the investigation on how different aspects influences various trades within specified
marketplaces (Dejuan 2015, p.108). Furthermore, this model, when used in different operations
of companies, tends to act as the primary tool used in the evaluation process of various
influences of business set within the system of interdependent financial structure. Besides, it can
be used to help in connecting high employment to generators of jobs within a specified company
(Mokrišová and Horváthová 2018, p.1). Therefore, most organization has been using this model
for different purposes. Some companies have been using this model for examining the
distribution of their income for socio-economic forecasting. However, other organizations are
using the model to enhance their design of operations efficiently and to map dangers within the
population in portions of the organization.
Conclusion
From above illustration of different tools that are vital in the strategic development in
business operations, it can be noted that every device is significant in improving the process and
progress of businesses if appropriately utilized. The three tools discussed above are vital in
improving how different companies are managed. They also help in enhancing the revenue that
organizations earn from time to time as they establish their operations in various business
environments. Hence, there is a need for managers to concentrate on working to attain effective
utilization of strategic devices for the management of their operations. The effective
management and use of these tools can improve productivity as well as the competitiveness of

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every organization. All the strategic development devices such as Porter’s Five Forces, PESTEL
Analysis, and Input-Output Analysis are essential in improving the operations of most
companies. Hence, all businesses need to use strategic development tools to help in the
generation of higher outputs for their investments leading to good returns and production of
improved quality of products.

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List of References
Amrollahi, A. and Akhgar, B. (2014). Analyzing Open Source Business with Porter’s Five
Forces. International Journal of Computer Theory and Engineering, pp.162-165.
Dejuan, O. (2015). Forecasting energy demand through a dynamic input-output model.
Economics and Business Letters, 4(2), p.108.
Göral, R. (2015). Competitive Analysis of the Hotel Industry in Konya by Using Porter’s Five
Forces Model. European Journal of Economics and Business Studies, 3(1), p.106.
Kara, E. (2018). A Contemporary Approach For Strategic Management in Tourism Sector:
PESTEL Analysis on The City Muğla, Turkey. Journal of Business Research - Turk, 10(2),
pp.598-608.
Mokrišová, M. and Horváthová, J. (2018). The Application of Model of Input and Output
Transformations in Measuring Business Performance. Research in Applied Economics, 10(1),
p.1.
Slavov, T. (2016). Algorithm for Multiple Model Adaptive Control Based on Input-Output Plant
Model. Cybernetics and Information Technologies, 12(1), pp.13-33.
Sutherland, E. (2014). Lobbying and litigation in telecommunications markets – reapplying
Porter’s five forces. info, 16(5), pp.1-18.
Welford, R. (2018). Editorial: The launch of a new journal, Business Strategy and Development.
Business Strategy & Development, 1(1), pp.4-5.

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Wurthmann, K. (2019). The essential mix: six tools for strategy-making in the next decade.
Journal of Business Strategy, 1(1), pp.14-35.
Zhiyong, X. (2017). PESTEL Model Analysis and Legal Guarantee of Tourism Environmental
Protection in China. IOP Conference Series: Earth and Environmental Science, 81, p.012092.