Prodrive Strategic Choice Report: Analysis Using Strategy Clock Model

This report provides a comprehensive analysis of Prodrive, a UK-based vehicle and motor sport technology business. It begins with an introduction to Prodrive, followed by an examination of its external and internal environments using PESTEL and Porter's Five Forces analysis. A detailed SWOT analysis is also presented. The core of the report focuses on developing strategic choices using the Strategy Clock model, evaluating its eight positions and their implications for Prodrive. The report critically assesses the Strategy Clock's application to Prodrive, considering the firm's strengths, weaknesses, opportunities, and threats. Finally, it justifies and selects the optimum strategy for Prodrive, offering recommendations for future growth and competitive advantage. The report concludes by summarizing the key findings and recommendations for Prodrive's strategic direction.

Organizational Strategic Choice

Table of Contents
INTRODUCTION...........................................................................................................................1
1. Introduction of Prodrive, summary or external, internal and SWOT analysis........................1
2. Development of strategic choice using Strategic clock..........................................................3
3. Critical evaluation of Strategy clock.......................................................................................5
4. Justification and selection of optimum strategy......................................................................6
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

Index of Tables
Table 1 PESTEL analysis................................................................................................................2
Table 2 Porter's five forces..............................................................................................................3
Table 3: SWOT analysis..................................................................................................................4
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Abstract
Strategic choices are all about making selection about the strategies that are to taken by leaders
or managers in a dynamic political process. Choices are required to be made in terms of short
term as well as long term planning. In this context, long term planning The present report has
been prepared on Prod rive which is vehicle and motor sport technology business based in UK.
It is also involved in developing innovative powerful engines according to their clients’
requirements. The study has emphasized on studying the internal and external environment
followed by understanding the position of the company. It has further made use of Strategic
clock which is a model to develop strategies and choose the best one which would help the
organization to grow. The report has concluded that as per the internal, external as well
competitive analysis it is clear that company is doing well in its domain. However, the firm is
required to take appropriate steps with the help of which they could make strategies to reduce
external factors like political environment. It is further required to work on the social and
environmental front.
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Table of Contents
Abstract............................................................................................................................................2
INTRODUCTION...........................................................................................................................4
1. Introduction of Prodrive, summary or external, internal and SWOT analysis...................4
2. Development of strategic choice using Strategic clock......................................................7
3. Critical evaluation of Strategy clock..................................................................................8
4. Justification and selection of optimum strategy...............................................................10
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................12
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INTRODUCTION
In an organization, managers or leaders have to take actions on regular basis. For making
decisions, planning is very important. There is short term as well as long term planning. In this
context, long term planning which are also known as strategic planning are very helpful for
managers, leaders or top management in developing strategic plan (Ryan and Wilson, 2013).
They further decide on moving to alternatives plan which would be helpful for the organization
to grow. Strategic choices are the roles played by leaders or managers in influencing firm in
making choices in a dynamic political process. Present report is about Prodrive which is the most
successful and world's largest vehicle and motor sport technology business. One of the main
roles played by this firm is to construct and designs races cars for companies like Aston Martin,
VW, etc. This report covers the analysis of internal and external environment of Prodrive.
1. Introduction of Prodrive, summary or external, internal and SWOT analysis
Prodrive is a British motor sport firm which designs and constructs races cars. It is also
involved in developing innovative powerful engines according to their clients’ requirements.
Companies like MINI, VW and Aston Martin provide various specifications which they require
on their race cars and Prodrive develops cars for them accordingly. With the help of composite
diversion, they develop innovative engineered solutions (Johnson and et.al., 2013). Further, they
have about 500 staffs in Australia, China and UK. They have also started developing Hybrid
plane. This is the first time that they have ever attempted to develop something in this field.
Technology and creativity has helped car racing companies to win many races. This has
developed trust and confidence towards Prodrive.
In order to know the growth and performance analysis of this Company, internal,
external, SWOT and competitive analysis would be helpful. For analysing external environment
of Prodrive, PESTLE could be used. It focuses on all areas with the help of which external
factors that affect the firm could be determined. PESTLE for Prodrive has been made as follows:
Table 1 PESTEL analysis
Political factors Presence of liberal governmental policies in UK
Impose of new duty or tax may affect the entire growth of Prodrive
Government have direct control over fiscal and tax policies (Brown,
2014). It has the power to make changes around the fiscal year which
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may directly affect the business environment of Prodrive.
Economic factors Increase in inflation rates that affects the prices of product and services
provided by Prodrive Foreign exchange rates, interest rates, economic
growth patterns, etc. may have impact on working of Prodrive (Michael
and Popov, 2015).
Social factors Taste and preference of consumers towards vehicles.
UK has got a presence of middle class population
Technological
factor
Changes always take place in the area of technology.
In these regards, Prodrive always focuses on adopting or updating their
technology so as to provide better services to their customers.
Legal factors There are many legal provisions which affect the firm. Various laws
related to safety, consumer, labour, etc. affects the firm directly
Environmental
factors
It includes factors which affects the surroundings of UK (Jajja, Brah and
Hassan, 2014). Factors which affects Prodrive are weather, climate, etc.
Porters five forces analysis of Prodrive are as follows:
Table 2 Porter's five forces
Bargaining power of suppliers  Competition among suppliers is high
 Distribution channel is diverse
 Cost of switching suppliers is low
 Volume is critical to suppliers
Bargaining power of customers  Bargaining power of customers is high
 Buyer price sensitivity is low
 Number of customers is large
Threats of substitute  Performance of the substitute product and services
 Price of the products delivered
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Threats of New entrant  Capital requirements is high
 Requirement of strong distribution network
 High entry barriers.
 Economies of scale is required by the industry
 Continuous innovation is very essential
Intensity of existing rivalry  Fast growing industry
 Large industry size
SWOT analysis of Prodrive:
Table 3: SWOT analysis
Strength
 Increasing demand on luxury vehicles Evolving industry
Weaknesses
 Bargaining power of customers
 Growing rate of automobile industry
Threats
 Increasing competitors Unpredictable change in prices of fuel
Opportunities
 Use of innovative technology
 Expansion of market
 Changing lifestyle
2. Development of strategic choice using Strategic clock
Strategic clock was given by Bowman's in 1996. This model is helpful for the
organization to develop strategies and choose the best one which would help the organization to
grow. Following are the eight positions which can be followed by Prodrive:
Low value/Low price: According to this position, companies prefer to keep low prices of the
products. Main aim of these companies is to sell their product or services (Almohammedali,
Duncan and Edgar, 2015). These organizations adopt different strategies so as to attract more and
customers.
Low price: In this the organization sell their products and services at low. This is done so that
they could attract more and more customers. Through this, organizations could easily develop a
market. The quality provided by these firms are similar to the quality provided by their
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competitors. It is very essential for the firm to maintaining the quality. Any change in quality
would affect the firm negatively.
Moderate differentiation: According to this position, organizations provide their products or
services at low price but with high quality compared with its competitors. The main issue in this
strategy is volume. With the help of this strategy, firms are able to develop healthy relationship
with their customers (Kohtamäki and et.al., 2012). Moreover, they are also able to built up
confidence among the customers towards the product and services which the firm delivers.
Differentiation: In this strategy, organizations focus on developing brand. Branding plays an
essential role attracting customers. In this context, the main focus of the organization is towards
providing their customers with high quality products or services. There are many companies
which provide their products in premium price but do provide high quality services. On the other
hand, there are also firms which provide high quality products or services at low premium.
Focused differentiation: According to this strategy, organizations provide their products or
services at high price and at high value. There type of strategy is adopted by firms who know
that their customers buy perceived value (Canavan, Sharkey Scott and Mangematin, 2013).
Organizations can provide their products and services at any value. In this perception of
customers play an important role in favour of the organization.
Increased standard and price of the products: In accordance with this strategy, organizations
simply increase the price without changing the value of the product or services provided to the
customers. This is a type of risk which the firm takes. In spite of increase in price, if customers
buy the product, then the firm would enjoy the higher profitability. On the other hand, if it would
not work out as it was planned, then firm would make adjustments towards the value or price.
High price but low value: According to this strategy, the price of the product or services
delivered by the organizations are very high but the quality or the value would be very low. This
they of strategy is adopted by firms which monopolist (Wilkins and Huisman, 2012).
Organization which fall under monopolistic are those firms who are the only once in the world to
provide that kind of product or services. In this context, for such firms it is very easy to increase
or decrease the price of the product as they know that customers do not have substitutes for it.
Low value but high standard price: According to this strategy, organization would sell their
product or services at low price and at low value (Fink, Dauber and Yolles, 2012). This strategy
results in decrease in market share and has many other negatives.
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3. Critical evaluation of Strategy clock
Firms adopt different type of pricing method so as to attract more and customers. These
type of strategies are adopted in accordance with the type of product or services delivered by the
organizations. As it was discussed above strategy clock has eight positions and each it has their
own advantages as well as disadvantages. Following are the critical evaluation of each positions:
Low value/low price: According to this strategy, the price of the commodities delivered by the
organizations are kept low and even the value of the price is kelp low (Watson, 2013). If they
provide their customers with low value, then their customers would shift on to their competitors.
In accordance with the products Prodrive deliver have to maintain their quality as it would affect
the firm negatively.
Low price: In this strategy organizations would provide their products or services at low price. In
this context, the competitors are very less for Prodrive. If it reduces its price, then customers
would perceive that the quality provided by this firm has been compromised. There are positive
aspects also for this strategy as there are chances that more and more customers would prefer
Prodrive because of reduction in price.
Moderate differentiation: In this strategy, the firms would provide their product or services at
low price but in high quality. As it was discussed about, it strategy of reducing price would affect
positively or negatively (Ryan and Wilson, 2013). Providing their products at low price would be
lose for the organization as they spend lot for improving their technology and in research
purposes so as to provide their customers better and improved products. So they should not
reduce their price.
Differentiation: Firms focus on developing their brand image. Branding plays an important role
attracting customers and in developing trust among the customers. It would be very helpful for
Prodrive to focus on their brand image as with this help they would be able to attract more and
more customers. On the other hand, it would also affect the firm as they have to spend more and
it would increase their expense.
Focus differentiation: In this strategy, firm deliver their product or services at high price and
with high quality. As the competitors for Prodrive are very less and if they provide their products
at high price and in high quality, then they would be able to develop trust and confidence among
the customers (Johnson and et.al., 2013). There are chances that because of raising price few
customers would shift on to other organization.
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Increased standard and price of the products: According to this strategy, Prodrive would
increase their price. It is a type of risk which the firm wishes to take. The probability of success
and failure are equal. If the firm faces lose, then the market share would also decrease.
High price but low value: In this the price would be kept high and the value would be low. It
would be favourable for the firm but it is very important for Prodrive to keep the quality high as
it would affect the trust of the customers and there are also chances that customers would shift to
its competitors.
Low value but high standard price: This strategy would not be favourable as Prodrive has to
maintain their quality of services and price (Brown, 2014).
4. Justification and selection of optimum strategy
From the above give Strategy Clock, it could be analysed that the best strategy which
Prodrive could adopt is position five. According to this strategy, Prodrive has to deliver its
products at high price and with high quality. It is very essential for the firm to maintain the
quality as if the firm do not deliver its products at high quality, then the trust and confidence
among the customers would be affected. There are mainly two main competitors for Prodrive
among which if Prodrive deliver its product at low price, then it would surely affect the
customers trust (Michael and Popov, 2015). As the competition is less and if they provide their
products at high price and with high quality, then would be able to maintain high growth
compared with its competitors.
In this context, if Prodrive should always focus on adoption of innovative and updated
technology with the help of which they would be able to provide better and improved products to
their customers. This would be helpful in maintaining their price and in providing their
customers with high quality services and products. In addition to this, they should also conduct
various research and surveys with the help of which they would be able to understand their
customers needs, wants and accordingly they would be able to improve their services which
would be helpful in satisfying them (Jajja, Brah and Hassan, 2014). Thus, it can be
recommended that position five would be favourable for Prodrive.
CONCLUSION
From this report, it can be articulated that internal, external as well competitive analysis would
be very helpful for the organizations in order to understand the position in the environment. In
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this context, SWOT analysis is very helpful for the organization to know the areas in which they
need improvement and the areas in which they could enhance their capabilities. On the other
hand, PESTEL is very helpful in analysing external factors. Organization could work and take
appropriate steps with the help of which they could make strategies to reduce external factors.
Lastly, Strategy clock given by Bowman's has proved to be very helpful in selecting appropriate
strategy with the help of which firm would be highly benefited.
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