MGMT19128 Term 2: Strategic Plan for Holden Company

This report presents a strategic plan for Holden, an Australian automotive company. It begins with an introduction to the company and its background. The report then delves into an internal audit, including value chain analysis and an assessment of resources and competencies. The external environment is analyzed using Porter's Five Forces to understand the competitive landscape. The report identifies key strategic issues, focusing on customers and competitors, and proposes strategies such as cost leadership. The conclusion emphasizes the importance of strategic planning for Holden's success in the competitive automotive market. The report also includes references to support the analysis and recommendations. This comprehensive analysis provides valuable insights into Holden's strategic position and potential future directions.

Running Head: STRATEGIC PLANNING
Strategic Planning
Name of the Student
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Author Note

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Table of Contents
Introduction......................................................................................................................................2
Discussion........................................................................................................................................2
Internal Audit...........................................................................................................................2
Key strategic issues..................................................................................................................4
Conclusion.......................................................................................................................................5
References........................................................................................................................................6

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Introduction
GM Holden is one of Australia’s largest automobile importer. The company was
formerly known as General Motors Holden. The headquarter of the company is located in Port
Melbourne, Victoria. The company was founded in the year 1856 in South Australia, Adelaide.
The founder of the original company was James Alexander Holden and the automotive division
was founded by Sir Edward Holden (holden.com, 2018).
Discussion
Internal Audit
The internal audit of a company consists of the value chain analysis and identifying the
core resources and competencies. The external audit on the other hand covers the current
condition of the industry in which the company deals in (Christopher, 2016). Value chain
Analysis- The value chain analysis covers the entire process starting with the production of the
products the logistics, technology, management, infrastructure, marketing and sales, services and
others. This analysis tool helps to find out areas for improvement (Lee & Gereffi, 2015). The
inbound logistics in the automotive industry is the first step of the process where the raw
materials are supplied in the production house. The operation stage is divided into several parts
and covers the process of transforming the raw materials into the product. The outbound
logistics reaches the products from the manufacturers to the retailers.
The marketing and sales are the essential parts of the automotive industry. The
promotion, distribution, advertising, sales management, relationship with the customers are
maintained (Nykvist & Nilsson, 2015). The company must set its target customers in this stage

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and seek for ways to satisfy the customer demands. The final primary activity is adding value to
the product. The customer support comes under the service stage. It is a continuing process in
which customers are supported regarding the use, maintenance, enquiries and others which helps
the organization to create a positive impression in front of the customers.
Resources and competencies -The Holden Company must have some key resources and
competencies to succeed fast in the highly competitive industry. The resources include
operational, financial, intangible resources and others (Niesten & Alkemade, 2016). The
company also must be aware of its competencies that would be helpful in determining what type
of company it is and what activities must be conducted to use the resources in the best possible
way. For example, a well –structured sophisticated IT will be helpful for the company to forecast
the market demand an act accordingly. A sophisticated corporate culture and CSR will enable
the company to have a good working environment with motivated and loyal employees.
Competencies are the activities that a company is able to do in order to beat the competitors.
The Holden Company functions in the Australian automotive market and the market analysis of
Australia’s automotive industry through Porter’s Five Force model will help to find out which
aspects the company should focus on and what the key elements to flourish are(Nykvist &
Nilsson, 2015). The analysis will reveal the success factors for the company. Threat of new
entrants - The Local Australian automotive market is not that strong because the foreign markets
put pressure on the Australian market.
The exporting car manufacturers enjoy the decreasing export taxes and randomly export
duty – free cars causing challenge in the development of the Australian car manufacturers. The
threat of new entrants is high in the Australian market. Threat of Competitors - The existing
competitors in the Australian automotive market are Ford, Toyota, Mitsubishi and many others.

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These manufacturers give furious competition every year. Due to the limited market volume of
Australia which is 20 million, these rival companies literally struggle to occupy the maximum
market share. The internal competition increases the sustenance pressure on these companies.
Apart from these, there are other smaller car manufacturers which are gaining importance in the
market fast with their small business competitive strategies (Soo et al.,2017). The Holden
Company has to compete with these market goliaths and establish its own position. Threats of
substitution - The land of Australia is full of other substitutions including bicycle, metro, train,
motorbike, plane, trains and other. Therefore, this industry is full of substitutes.
The government regulation on carbon emission has reduced the use of personal cars and
the public choose public transports more. Power of buyers - Due to the extensive and exclusive
range of car varieties from the various car manufacturers, the bargaining power of the buyers are
high in this industry. Therefore, if the Holden Company intends to profit in this industry, it has to
be extra-ordinary to satisfy the buyers. Power of Suppliers – Due to the large automotive
industry and plenty of car manufacturers the suppliers always keep the companies in pressure.
The car manufacturers do not avail the opportunity to bargain the price of the parts unless they
themselves produce it (Grant, 2016). In this respect the Holden Company either have to produce
the auto mobile parts themselves or stay under pressure of the suppliers.
Key strategic issues
The key strategic issues are those on which the company must focus in future for better
results. The first is customers and the second is the competitors (Soo et al.,2017). The company
must focus on the customer satisfaction, customer preferences. The company should explore and
discover what the customer want extra in their products, what will be their preference after 3-5
years (Habib, Kamran & Rashid, 2015). The Holden Company must develop enough

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competency in judging the customer demands, their behavioral, regional, educational, cultural
differences which shape their choice. Since, the next focus be on the competitors, the company
must draw a sketch of the strategic planning of their competitors. They must foresee what their
competitors have and they do not have in their company. Based on the data, they need to
establish their own strategic plan which will excel their competitors in future (Wu,2015).
Keeping in view the Australian automotive market and the tough competitors in the industry, the
Holden Company must develop cost leadership strategy, in order to beat the competitors in terms
of price. However, the price does not matter to some customers, with the reasonable price, they
must provide quality products also.
Conclusion
Therefore, from the above discussion it can be said that the Holden Company is a rising
automotive company is Australia and it must implement a strategic planning in its business in
order to succeed fast and give tough competition to the giant competitors in the Australian
market. The present report outlines the key strategies that the company must incorporate
analyzing its value chain and internal resources, competencies and capabilities.
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References –
Christopher, M. (2016). Logistics & supply chain management. Pearson UK.
Grant, R. M. (2016). Contemporary strategy analysis: Text and cases edition. John Wiley &
Sons.
Habib, S., Kamran, M., & Rashid, U. (2015). Impact analysis of vehicle-to-grid technology and
charging strategies of electric vehicles on distribution networks–a review. Journal of
Power Sources, 277, 205-214.
holden.com (2018). Holden Australia | New Cars, Offers, Dealers & Services. [online]
Holden.com.au. Available at: https://www.holden.com.au/ [Accessed 4 Oct. 2018].
Lee, J., & Gereffi, G. (2015). Global value chains, rising power firms and economic and social
upgrading. Critical perspectives on international business, 11(3/4), 319-339.
Niesten, E., & Alkemade, F. (2016). How is value created and captured in smart grids? A review
of the literature and an analysis of pilot projects. Renewable and Sustainable Energy
Reviews, 53, 629-638.
Nykvist, B., & Nilsson, M. (2015). Rapidly falling costs of battery packs for electric
vehicles. nature climate change, 5(4), 329.
Soo, V. K., Peeters, J., Compston, P., Doolan, M., & Duflou, J. R. (2017). Comparative study of
end-of-life vehicle recycling in Australia and Belgium. Procedia CIRP, 61, 269-274.

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Wu, M. Y. (2015). Driving an unfamiliar vehicle in an unfamiliar country: Exploring Chinese
recreational vehicle tourists’ safety concerns and coping techniques in Australia. Journal
of Travel Research, 54(6), 801-813.