HI6006 - Evaluating Competitive Advantage: Using PESTLE, SWOT & Porter

This essay provides a comprehensive analysis of strategy development tools, including SWOT, PESTLE, and Porter's Five Forces, using Estia, an aged care company, as a practical example. The SWOT analysis examines Estia's strengths, weaknesses, opportunities, and threats, highlighting its market position and financial stability. The PESTLE analysis explores the political, economic, socio-cultural, technological, legal, and environmental factors affecting Estia, focusing on healthcare expenditure and regulatory considerations. Porter's Five Forces framework assesses the competitive intensity within the healthcare sector, considering the threat of new entrants, bargaining power of suppliers and buyers, the threat of substitutes, and rivalry among competitors. The essay concludes that these tools are essential for enhancing market share and recommends that Estia focus on improving its market image to reach a broader audience.

Running Head: Competitive strategy
Competitive Strategy

Competitive strategy
Introduction
It can be evaluated that development tools are important for the company to conduct
the activities in a smooth way. In this essay, the emphasis will be given to the tools like
SWOT, PESTLE and Porter analysis. These tools will be explained with the help of the age
care company named as Estia. These tools help to conduct activities in a managed way and
helps to achieve goals and objectives.
SWOT ANALYSIS FRAMEWORK
SWOT ANALYSIS is known as the best tool that can help the company to find out
the present situation in the market. It also helps to gather the information which is related to
the internal environment. This tool is considered by the top-level management and also
evaluation is made before implementing new strategies in the market. It is also the best tool
that can help the company to accomplish overall goals and objectives in the market (Ahmadi,
Dileepan, and Wheatley, 2016).
Marketing mix is considered as a major component if focus is given on the overall
strength of the company. Next aspect is related to the weakness possessed by the company, in
this, it can be any factor which is not strong of the organization. Opportunities are concerned
with the chances that are available for the company (Ajmera, 2017). Threat is related wwith
the competitors in the market.
The practical example of Estia
Strength
It is seen that company is one of the largest companies so that strength of the
company is goodwill in the market. If the focus is given to the financial position then it is
evaluated that Estia has a strong cash flow that provides various resources to establish new
projects.
Weakness
It is analyzed that company needs more investment to focus on the latest technology
so that activities can be expanded. The organization has invested a huge amount so that
integration of the process can take place. Also, it is analyzed that Estia faces problem in
managing the challenges at the time of new entry of the firms and also lost a large market
share.
1

Competitive strategy
Opportunities
The company has many opportunities prevailing in the market. As it is evaluated that
many customers are involved in conducting the activities online. So, the organization is
focusing on investing in an online platform so that customers can be induced to avail the
services.
Threats
The threat faced by the company is due to the latest technologies considered in the
market. Also, the issues are faced due to various laws and fluctuations in the relation to the
overall standards of the organization. Fluctuation in currency is also the major issue which is
faced by the company at the time of conducting the activities (Kapoor, Tan-Koi and Teo,
2016).
PESTLE ANALYSIS FRAMEWORK
This analysis is done so that activities can be conducted according to the market
situation. On this framework the managers gives focus so that activities can be conducted in a
right manner. In this it can be evaluated that managers focuses on all the forces like on
political and many other factors so that the activities can help to accomplish overall goals of
the company.
Political factor is related to the overall rules and policies of the government. In this
tariff policies and fiscal policies are considered by the company so that activities can be
conducted smoothly. Next is the economic factor in which inflation and deflation are
analyzed as it affects the price of products and services.
In legal factor, the focus is given on the laws which are important for the company to
implement so that in right direction activities can be conducted. Last is an environmental
factor which is connected with the environment and the surrounding in which the activities
are conducted on the routine basis (Vergados, 2010).
Example of Estia
Political factor
It can be analyzed that public expenditure is low if a comparison is made with the
other developed countries and also the residential aged care plays a great role and have
2

Competitive strategy
dominance in the private sector. The government focuses offering good services to the public
and use modern medical equipment's.
Economic factor
In this, the expenditure related to healthcare is achieved from the private patients as
the income is high. It is seen that there are many policies which are given by the government
so that the infrastructure of healthcare can be raised (Zalengera et al., 2014).
Socio-cultural factor
In Estia the individuals who are aged are given proper services so that they can take
care of themselves. Also, it is seen that in Australia the population rate is so high that there is
a shift of any individual in the old age homes as people feel good and happy (Krause, 2015).
Technological factor
Estia considers latest technologies so that services can be given in a proper way. Also,
by focusing on the healthcare system in Australia in under huge pressure (Naccarella et al.,
2018).
Legal factor
The legal factors are considered when the company enters the market. The legal
factors are related to employment law and health and safety law.
Environmental factor
The company focuses on the factors related to an environment like recycling and
management of waste so that growth can be achieved in the market.
PORTER FIVE FORCE FRAMEWORK
This framework gives a proper understanding of the market situation so that
competitive strategies can be implemented accordingly. The top management gives focus on
this framework and analyzes the requirement of the products in the market. This helps the
organization to achieve competitive advantage in the market (Pucciarelli and Kaplan, 2016).
3

Competitive strategy
(Source: Porter five force analysis, 2018).
Example of Estia
The threat of new entrants
It is seen that new entries in the healthcare sector give pressure on the low pricing
strategy. The threats are high and the company can consider these threats by giving focus on
innovative services.
Bargaining power of suppliers
In the healthcare sector, it is seen that the effect is seen on the high bargaining power
of suppliers as it gives impact on the overall profits of the company (Moutinho and Phillips,
2018).
Bargaining power of buyers
4

Competitive strategy
The demand of the buyers is more. They avail those services which are good and also
of low cost. It is seen that by offering new products and services company can easily
enhance the customer base and can avail profits.
Threats of substitutes
The threat of substitute is high as it offers a value proposition which is good for the
customers and also for the company. The threat can be managed by the company by being
service oriented firm rather than product-oriented firm. Switching cost of the consumer is
also one of the factors that can help to manage the overall cost (Sweeney, Danaher and
McColl-Kennedy, 2015).
Rivalry against the competitors
This factor can also impact the overall prices and can reduce the overall profits. The
organization focuses on conducting the activities in a competitive residential aged care. Estia
can handle the competitors by maintaining sustainable difference so that markets hare can be
enhanced.
Conclusion
So, it can be concluded that these tools help to increase the market share. It is also
recommended for the company to enhance the market image so that it can be easy to reach a
large mass of audience.
References
Ahmadi, M., Dileepan, P. and Wheatley, K.K., 2016. A SWOT analysis of big data. Journal
of Education for Business, 91(5), pp.289-294.
5

Competitive strategy
Ajmera, P., 2017. Ranking the strategies for Indian medical tourism sector through the
integration of SWOT analysis and TOPSIS method. International journal of health care
quality assurance, 30(8), pp.668-679.
Kapoor, R., Tan-Koi, W.C. and Teo, Y.Y., 2016. Role of pharmacogenetics in public health
and clinical health care: a SWOT analysis. European Journal of Human Genetics, 24(12),
p.1651.
Krause, N., 2015. Early Parental Support, Relationships With God, and Self-Rated Health in
Advanced Old Age. Journal of Religion, Spirituality & Aging, 27(4), pp.305-322.
Moutinho, L. and Phillips, P., 2018. Strategic analysis. In Contemporary Issues in Strategic
Management (pp. 46-79). Routledge.
Naccarella, L., Newton, C., Pert, A., Seemann, K., Williams, R., Sellick, K. and Dow, B.,
2018. Workplace design for the Australian residential aged care workforce. Australasian
journal on ageing.
Porter five force analysis., 2018. Logiq3. [Online]. Available at:
http://www.logiq3.com/blog/how-to-competitive-analysis-using-porters-five-forces-
framework [Accessed on 24 April, 2018].
Pucciarelli, F. and Kaplan, A., 2016. Competition and strategy in higher education: Managing
complexity and uncertainty. Business Horizons, 59(3), pp.311-320.
Sweeney, J.C., Danaher, T.S. and McColl-Kennedy, J.R., 2015. Customer effort in value
cocreation activities: improving quality of life and behavioral intentions of health care
customers. Journal of Service Research, 18(3), pp.318-335.
Vergados, D.D., 2010. Service personalization for assistive living in a mobile ambient
healthcare-networked environment. Personal and Ubiquitous Computing, 14(6), pp.575-590.
Zalengera, C., Blanchard, R.E., Eames, P.C., Juma, A.M., Chitawo, M.L. and Gondwe, K.T.,
2014. Overview of the Malawi energy situation and A PESTLE analysis for sustainable
development of renewable energy. Renewable and Sustainable Energy Reviews, 38, pp.335-
347.
6

Competitive strategy
7