CapitaLand: An Analysis of Strategic Management and Business Report

This report provides a comprehensive strategic analysis of CapitaLand, a major multinational real estate company. It begins with an introduction to CapitaLand, outlining its history, objectives, and services. The report then delves into a PESTEL analysis of Singapore, CapitaLand's primary market, examining the political, economic, and social factors influencing the company's operations. This is followed by a Porter's Five Forces analysis to assess the competitive landscape of the real estate industry, evaluating competitive rivalry, the threat of new entrants, the threat of substitutes, and the bargaining power of suppliers and buyers. A SWOT analysis is also included to identify CapitaLand's internal strengths and weaknesses and external opportunities and threats. The report concludes with recommendations based on the analyses and a final conclusion summarizing the key findings. The analysis aims to provide insights into CapitaLand's strategic position and potential for future growth.

Running head: INTRODUCTION TO MANAGEMENT
Introduction To Management
Name of the Student
Name of the University
Author’s note
Executive Summary

1INTRODUCTION TO MANAGEMENT
The aim of this assignment is to introduce the concept of strategic management that is
undertaken by an organisation in order to plan, organize, employee, incorporate ideas so that the
objectives of an organization can be achieved. A brief introduction has been provided of the
company that will be analyzed in the report which if followed by an analysis of the macro
environment in which the business exists. This is followed by an industry analysis and an
understanding of the opportunities and threats of the company.

2INTRODUCTION TO MANAGEMENT
Contents
Introduction......................................................................................................................................2
About the company..........................................................................................................................2
The objectives of Capita Land are...................................................................................................3
PESTEL Analysis............................................................................................................................3
Porter's five forces Analysis............................................................................................................6
SWOT Analysis...............................................................................................................................8
Recommendation.............................................................................................................................9
Conclusion.....................................................................................................................................10
Reference list:................................................................................................................................11

3INTRODUCTION TO MANAGEMENT
Introduction
A business organisation is an entity that operates on the fundaments of the principles and
ethics followed by the management of the organisation. The management is responsible for
formulating policies and taking decisions on the behalf of the organisation. In order to facilities
the smooth operation of the business several analysis and research is undertaken to effectively
take as well as implement policies and decisions (Capitaland.com, 2018). Depending on the scale
and nature of the business the size of the management is determined. Strategizing, organizing,
employing, leading and monitoring are some of the basic functions of the management. The
organisation that is going to be studied in the following report is Capita Land(Capitaland.com,
2018). CapitaLand Limited is one of the largest multinational real estate companies in Asia. The
organization is headquartered in Singapore and was established in November 2000. CapitaLand
was formed as a result of the merger of two companies DBS Land and Pidemco Land. The value
of the organisation is S$85 billion as at 30 September 2017. Capita Land operates in
approximately 150 cities in over 30 countries; geographically the company centers its focus upon
Singapore and China and is constantly expanding in Vietnam and Indonesia as well
(Capitaland.com, 2018).
Some of the services that are provided by the company are: shopping malls, offices,
residential homes, integrated developments, serviced residences; real estate investment trusts
(REITs) and funds. The Chairman of CapitaLand Limited is Mr Ng Kee Choe, the core
management comprises of 11 directors out of which 10 are non-executive(Capitaland.com,
2018). Some of the accomplishment of the organisation includes being one of the Global 100
most Sustainable Corporation in the world 2015 by Corporate Knights. Capita Land is also listed

4INTRODUCTION TO MANAGEMENT
in the Sustainability yearbook 2015 by RobecoSAM. The organisation is focused on building
sustainable and innovative future(Capitaland.com, 2018).
The objectives of Capita Land are:
 To ensure value relation with the consumers and clients
 To provide with premium quality service
 To work towards a sustainable future (Capitaland.com, 2018)
PESTEL Analysis
An organisation operates in two business environment internal and external. The internal
business environment can be controlled and monitored by the organization as the factors
involved in the process are within the controllable limit of the management, on the other hand,
the external business environment are some of the aspects which deeply influence the
management and the policies of the organisation but are not under the control of the management
hence it should be analyzed in order to continue operating in a smooth way (Gupta, 2013).
With the help of PESTEL analysis an organisation can determine analyze the macro
environment and understand the market growth or decline, opportunities and barriers; it can also
understand the position of the company in the market. Factors such as political, economic, social
are the three most important factors that the company should analyze to understand and strategies
according to the external business environment. Singapore is the home country of Capita Land
and the analysis that is undertaken is conducted based on Singapore (Gupta, 2013).
Political: Singapore is a country that is politically stable and do not have an extensively strong
trade barrier. The Political and Economic Risk Consultancy (PERC) is a firm that provides

5INTRODUCTION TO MANAGEMENT
strategic business information and analysis for companies doing business states that politically
Singapore is one of the lowest risk countries. The country has a democratic government that
enjoys stability since independence (Hill& Lian, 2013). The standards of living among the
citizens have improved drastically in the past decade owing to a growing economy. This aspect
of the country has resulted in attracting the business organizations to invest in Singapore. Several
multinational organisations have their operations in Singapore. The country also has liberal trade
policies to encourage business in the economy. In 2016 the government of Singapore had
announced that S$4.5 billion will be invested to ensure an industry transformation program and
in 2017 in the budget the government said that along with this investment additional S$2.4
billion will be invested in the next four years to sustain potential growth in theinternational
economy(Koh, 2018). Research and industry development also received monitory support from
the government which makes it easy for the business to invest and grow in the economy. For a
heavy industry like real estate it is important to have support from the government to expand and
grow the business (Hill& Lian, 2013).
Economic: The government in the year 1960 recognized the importance investment and
formulated several polices to encourage local and foreign trade in the country. The economy of
Singapore has developed ever since and is now in a much stable condition. It has emerged to be
one of the successful and strongest economies in Asia having a free-market condition
(Tremewan, 2016). As a developed economy the per capita income of the citizens are high which
ensure that the standard of living among the people are also high, this aspect of the economy
ensures that business prosper and grow in the country as there is demand of products and
services. Some of the major aspects of the economy that influence trade and business are:

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negligible rate of corruption, high education level among the citizens, healthy competitive
market. Some of the issues that are faced by business organisations in Singapore are: shortage of
labor and constantly increasing wage rate (Tremewan, 2016). The scarcity of human resource is a
prominent issue in the country. The economy of Singapore mostly focused on the service sector
like tourism, real estate etc. To combat the issue of human resource in the country the
government has invested to raise the productivity, and improve the skill among the employed
population of the country.Another area where the government has shown interest and support is
in research and innovation, these aspects will ensure to maximize impact of industrial
transformation program. The government and the industries prevalent in the country will come
together, to identify barriers and develop solutions to support transformation (Tremewan, 2016).
This sector has contributed approximately 75.5% to the total GDP in 2016. The industrial
sector contributes 24.5% whereas the manufacturing contributes 18.3% to GDP. Some of the
other economic challenges that are faced by the country are presently are: low fiscal balance,
currency depreciation and low oil prices(Koh, 2018).
Social: The society in which an organisation is set up is important to analyze in order to
understand the growth possibilities in the future, nature of the consumer behavior, barriers that
the organization is facing from the society and the perspective that dominates the society etc. The
standard of living among the population of Singapore can be said to be high owing to the high
per capita income(Lee, 2018). Education is given importance by the society and the government
which has ensure that the literacy index of the country remain on the higher end. The society
follows traditional principles and values but with a contemporary outlook towards innovation
and progression. These values are also noticed in the mission and vision of CapitaLand. The
population of the country is happy with the government is willing to do their own bit for the

7INTRODUCTION TO MANAGEMENT
development and improvement of the economy. The blue-collar jobs are disliked by the
population which in turn gives foreign workers an opportunity to work in the economy which
explains the issue of labor that is mentioned above. A real estate organisation like CapitaLand
has ample of scope of growth and expansion in the country as there is constant demand for
construction and development (Lee, 2018).
Porter's five forces Analysis
The porter’s framework is an analytical tool that is used by organizations to determine the
level of competition in the market. These five forces explained form the micro environment in
which a company operates it analyses the industry more than the company giving an in-depth
idea about the competition in the market so that an organisation in that industry can take
decisions regarding becoming the market leader and gaining competitive advantage over the
other players in the market (Dobbs2014).
Competitive rivalry in the industry: the real estate industry in a country is the direct
reflection of the economic growth and development of the country. With improving conditions of
the economy the demand for the services of a real estate organisation also increases. The
companies that operate in the real estate industry concentrate the resources in the market so that
they cangain large market share and eventually become the market leader in the long-run. Apart
from the number of competitors in the industry, the rivalry heavily depends on the balance of
power, product differentiation, and market supply and demand (Mera& Renaud, 2016). This is a
heavy industry and it ensures profit in large amount but it also includes immense risk and support
from the external business environment factors like government, shareholders, society, economy
of the country of operation etc. the government of Singapore has supported the industry and has

8INTRODUCTION TO MANAGEMENT
come up with several measures to ensure growth and development of the industry . Far East
Organisation, Frasers Centrepoint, Kingsford Development Pte Ltd etc are some of the major
players in the Singapore market. CapitaLand is a multinational company hence the organisation
seeks competition on a global platform as well. Therefore it can be concluded that there is
intense competition in the market (Mera& Renaud, 2016).
Threat of new entrants: Free market entrepreneurs in Singapore are free to embark upon
a business journey that they wish to. As discussed the government has several policies and
measures to encourage business and trade in the economy. In the case of real estate industry it is
essential for the entrepreneur to employee a large investment and the operation of the business
also requires large amount of money to meet the daily requirements of the business (Deng et al.,
2014). As a multinational company CapitaLand do not pose major threat from the new entrants
as the company has a good position in the market. Therefore the scale of business in this industry
plays a large role to determine whether the new entrant pose threat to the old players in the
market. Brand identification is also another hindrance for new organisations as the clients that
will invest in a real estate would like to do business with the organisation they believe in or has
previously done business with. Hence it can be said that the threat from new entrants is moderate
in the industry (Lee et al., 2014).
Threat of substitute products or services: the service that is provided by a real estate
company has no substitute; the only substitute to the service is rehabilitation instead of new
construction, which is highly unlikely in the countries that CapitaLand operates. The concept of
substitute for the real estate industry is ambiguous and very difficult to establish therefore it can
be said that the threat of substitute of the industry sis low or negligible (Lee et al., 2014).

9INTRODUCTION TO MANAGEMENT
Bargaining power of the suppliers: The suppliers of a real estate firm like CapitaLand
requires a number of suppliers for the raw materials to constructa building. The financial
institutions that support the organisation also can be regarded as a supplier of the company as
they supply financial support which is important for the daily operations of the business. The
switching cost of the organisations is low as there is trust and goodwill also associated with
thebusiness hence the bargaining power of the suppliers is high (Deng et al., 2014).
Bargaining power of the customers: An organisation that operates in the real estate
industry has to strive hard to gain goodwill and good reputation from the clientele. The industry
is governed by powerful consumers who invest a lot of money in getting the services form the
organisation. The pressures from the clients are felt by the organisations thus it can be said that
the bargaining power of the consumers are high (Deng et al., 2014).
Recommendation
Scanning
The company has sufficient resources to have a successfully expand in countries which
have developed economies so that there is a constant flow of finance in the organisation to
support and back up the sustainable plans in the future.
The organisation should encourage more innovation and creativity in the process of
operation to ensure that the company includes sustainability in every step of business operation
and also reduce the cost of operation in the long-run.
Forecasting

10INTRODUCTION TO MANAGEMENT
The organisation should strive towards building a clear brand image as it is a key to the
success in the real estate industry. The creation of the company is based on acquisition and hence
there is a confusion related to the identity of the organisation. With the help of main-stream
advertising or promotional tactics the company will gain foothold in the industry and will be able
to maintain the position of the market leader.
Assessing
As a notable name in the real estate industry CapitaLand, should enable skill
development and personal improvement program within the organisation as well as outside the
organization. The company can organisation comprehensive internship programs by partnering
with top universities and colleges to ensure that students who want to explore their talent in the
industry can get a close understanding of the dynamics of the work culture and the way the
industry works. For internal development of the employees the company can ensure that in every
six months an evaluation process is initiated and specialized skill development programs and
seminars are arranged for the career development of the employees. balanced scorecard method
can be used to assess the performance improvement of the employees.
Monitoring
The expansion and the growth rate of the organisation is the best way to monitor the
prospects of the company based on the recommendations. The company has to focus on the
strengths and work on the weaknesses that are discussed. Market research and analysis is
another way to monitor the impact of the recommendations, the origination heir third party
research organisations to conduct the research or may choose to do it internally.

11INTRODUCTION TO MANAGEMENT
Conclusion
It can be concluded form the above discussion that CapitaLand is one of the
leading real estate organisations in Asia. The company is focused on developing a sustainable
future and hence employees several plans to ensure that the growth of the company is
accompanied by development of the society and the people associated with the company as well
as improvement of the environment. Some of the opportunities of the organisation that has been
concluded form the porters and the Pest analysis are: The industry in which the organisation
operates has intense competition but the company has several strengths coupled with
opportunities to expand and grow in the future. The organisation mostly operates in Asia and
hence it has the opportunity to expand in some of the most rapidly developing countries in the
continent. The company has been channelizing the focuses of the resource in expanding in
Indonesia and Vietnam, along with this Myanmar is also a land of opportunities. The
organisation can also expand its operation in China and Japan as well. The organization has the
resources to invest in innovation and reduce the cost of operation of the business on a daily basis.
This also gives the company an opportunity to strive towards the objective of achieving a
sustainable future. The company is focused on some of the specific countries for expansion
which takes away from the opportunity that it has to expand in other global markets as well.

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Reference list:
Capitaland.com. (2018). Our business. capitaland.com. Retrieved 3 January 2018, from
https://www.capitaland.com/international/en/about-capitaland/our-business.html
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https://www.capitaland.com/international/en/about-capitaland/who-we-are.html
Deng, Y., McMillen, D. P., & Sing, T. F. (2014). Matching indices for thinly-traded commercial
real estate in Singapore. Regional Science and Urban Economics, 47, 86-98.
E. Dobbs, M. (2014). Guidelines for applying Porter's five forces framework: a set of industry
analysis templates. Competitiveness Review, 24(1), 32-45.
Gupta, A. (2013). Environmental and pest analysis: An approach to external business
environment. Merit Research Journal of Art, Social Science and Humanities, 1(2), 13-17.
Hill, M., & Lian, K. F. (2013). The politics of nation building and citizenship in Singapore (Vol.
10). Routledge.
Koh, D. (2018). Budget 2017: Singapore to invest S$2.4 billion over next four years for Future
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billion-over-next-four-years-for-future-economy-strategies
Lee, C. L., Stevenson, S., & Lee, M. L. (2014). Futures trading, spot price volatility and market
efficiency: evidence from European real estate securities futures. The Journal of Real
Estate Finance and Economics, 48(2), 299-322.

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Lee, M. (2018). Singapore ranked world's most expensive city for expats for 4th straight
year. straitstimes.com. Retrieved 3 January 2018, from
http://www.straitstimes.com/business/economy/singapore-ranked-worlds-most-
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Mera, K., & Renaud, B. (2016). Asia's financial crisis and the role of real estate. Routledge.
Tremewan, C. (2016). The political economy of social control in Singapore. Springer.