Analyzing ASDA's Strategic Management: Models for Competitive Success

This report provides a strategic management analysis of ASDA, a British supermarket retailer, focusing on its strategies to maintain market share and adapt to changes. It employs several models including PESTLE analysis to evaluate external factors like political and economic conditions, SWOT analysis to identify strengths, weaknesses, opportunities, and threats, and the McKinsey 7S model to assess organizational alignment. The analysis covers ASDA's responses to challenges such as Brexit, unemployment rates, and increasing competition, highlighting its use of marketing strategies, technological innovations, and leadership styles to enhance profitability and customer satisfaction. The report concludes by emphasizing the importance of adapting strategies to external changes and leveraging internal resources for sustained growth and competitive advantage. Desklib provides this document as part of its collection of student-contributed assignments and study resources.

Strategic Management

Table of Content
INTRODUCTION...........................................................................................................................1
Pestle Analysis.............................................................................................................................1
SWOT ANALYSIS ....................................................................................................................3
McKinsey 7S Model ...................................................................................................................4
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Strategic management involves various activities such as effective evaluation of external
market condition, availability of resources or activities that are essential for achievement of
company objectives. Companies plans in advance different strategies in order to gain competitive
advantages and enhance their profitability by meeting needs of customers. ASDA is British
market supermarket retailer that was established on 19 February 1949 that offers various
products and services such as home care products, clothes and financial services. The report has
compared theory and practice approached for effective understanding of strategies management
that is used by ASDA to retain its market share. It has also explained about the way strategies
management of ASDA has helped in brining changes or modification in the organization.
Various models and theories are used to explain the way ASDA have managed different changes
to earn maximum profit margin and sales volume.
Pestle Analysis
It is model that used to analysis internal and external factors that impact on overall
performance and productivity of organization. Pestle analysis is most common tool that is used
by every organization to analysis various external changes so that appropriate measures can be
taken within limited time and cost (David and David, 2017). ASDA have also used this model to
formulate effective strategies so that company can earn more profitability and market share.
Therefore, Pestle Analysis of ASDA can be illustrated as follows:
Political Factors: Government policies and procedure keeps on changing as per different
situation and condition therefore such policies impact on the way company will operate its
particular market condition. Brexit is one of the major policies that is made by government of
UK which has adversely impacted on sales volume and profitability of large organization as
import and export have been decreased. But ASDA through offering qualitative products at
reasonable rates is able to attract maximum number of individual that resides in UK. Free trade
regulation has also provides opportunities to ASDA to expand its operations worldwide by
effectively meeting needs of diverse individual that live across worldwide. Therefore, ASDA
through changing its strategies as per external environment situation or policies of government is
able to retain its market share.
Economic Factors: It is another factors that influence or impact on firm operations that is
economic condition of specific country. Marketing manager of ASDA before entering into new
1

market it effectively evaluates unemployment rate, disposable income of people or education
level and interest rates in order to plan definite strategies to cope up with external changes for
long term growth and sustainability of organization (Berisha Qehaja, Kutllovci and Shiroka Pula,
2017). There is high level of unemployment rate, interest rate and decrease in purchasing power
of customer’s. Therefore, ASDA in order to retain its market share have planned strategies to
offer products at high discounts so that they can be influenced to make purchased of ASDA
products and services over other competitors.
Social Factor: People preference and demand keeps on changing as innovation of new
technologies or launch of new products or recent trends in the market so companies need to
identify customer’s needs for effective operations of business. Most of the people across UK and
worldwide likes to make purchasing while staying at their home as its provide convenience and
comfort to people thus satisfy their needs effectively. ASDA through framing strategies to
increase its presence in social sites or its official websites have influenced maximum individual
and enhanced its profitability. ASDA marketing manager by identifying needs of people that
they are less likely to spend money on products and services have provided maximum discounts
which have contributed in effective growth and success of enterprise. Due to increase in various
health issue people are prefer more organic, hygiene and qualitative products and services for
satisfaction of their needs so ASDA by introducing organic products ranges is able to attract
existing as well as new customers to make purchase.
Technological Factors: There are various innovation and development in technologies so
customers have become more demanding therefore company need to continuously innovative its
technologies to fulfilment of different requirements of individual. Marketing manager of ASDA
has planned to use Social media such Facebook, intragram and twitter to influences maximum
individual to make purchased so that company can easily grow and expand its market operations,
Social media marketing strategies has helped in reducing cost and have effectively promoted
various products and services to large number of individual living across worldwide within
limited time and cost (Shepherd, Mcmullen and Ocasio, 2017). ASDA have also updated its
technologies as per recent trends in order to reduce cost, optimum utilization of resources and
maximum production so that requirements of maximum number of individual can be fulfilled.
Therefore, it can be stated that innovative strategies helps in adapting changes and brining
economic of scale so that maximum benefits can be rendered to end users.
2

Environmental Factors: Due to increasing air pollution and ineffectively utilization of
resources and lot of disposable of waste in river and countryside by various organization have
forced enterprise to take crucial steps for protection of natural resources. ASDA have take few
steps to conserve resources and reduce amount of wastage for better health and well-being of
individual. ASDA makes optimum utilization of resources through training employees about the
way particular task need to be done so that maximum outcome can be gained. Production
manager has used innovative technologies to reduce amount of wastage so that limited resources
can be effectively used and needs of customer’s can be fulfilled.
Legal Factor: It is last external factors that is also considered by ASDA top management while
establishment, expansion and operations of enterprise so that it can easily achieve its goals and
can gain competitive advantages. Company is abided to different laws such as health and safety
laws, equality law, working hour and discriminative laws thus it has save company form various
penalty and fines and contributed in overall growth and success of enterprise (Levine, Bernard,
and Nagel, 2017). These strategies help company in satisfying needs of employees so that best
and qualitative services can be provided to maximum number of individual.
SWOT ANALYSIS
It is another tool that can be used to identify the way company manage various strategies
by use of internal resource and capabilities in order to gain competitive advantages. SWOT
analysis helps in identification of strength, weakness and associated risk or threats and
opportunities that can contributed in expansion of businesses and acceptance of change. The way
ASDA is able to effectively managed changes through making specific changes in its strategies
and plans so that needs of customer’s can be fulfilled. Therefore, SWOT analysis of ASDA is
done as follows:
Strength: Company strength lies in its innovative marketing strategies that is to provided high
discounts or promotion offers so that more people can be interested in buying products of ASDA
as compared to other competitors. ASDA have used its strength to effectively market or promote
its products to various individual that reside in different countries (Berisha Qehaja, Kutllovci
and Shiroka Pula, 2017). Therefore, it can be stated that one of the strength or strategies of
ASDA contributed in effective management or satisfaction of customer’s needs that have
different preference, culture, behaviours and attitude.
3

Weakness: Most of the people criticized on qualities of products and services that are offered by
ASDA to different individual because of heavy discount. Therefore, Company have planned to
enhance its quality and brining economic of scale so that it can be build strong and positive
brand image in market. Most of the countries have restricted entry of ASDA as it provide huge
discount that can be threat for different local enterprise so top management has to plan better
strategies in order to expand business across worldwide and meet needs of different individual.
Opportunities: Company have designed various strategies to utilize available opportunities in
limited time so that firm can get maximum benefits. It has opportunities to expand its business in
new market segment in order to earn more profitability and market share. Company have
planned to enter into new market with organic products range so that their wants can be fulfilled.
Therefore, it can be stated that ASDA have effectively managed strategies as per external
changes in order to take advantages of available opportunities and gain competitive advantages
in retail industry.
Threats: One of the threat for ASDA is increasing competition level because of large and strong
brand image enterprise such as Tesco that have leading market share. In order to remove threat
of increased competition company have decided to follow lost leadership strategy so that large
number of customer’s or individual can be motivated to prefer products of ASDA (Veselovsky,
and et.al., 2019). Therefore, ASDA have used its internal threats to cope up with threat of
increasing competition that have helped in enhancement of profitability.
McKinsey 7S Model
It is framework that is used to effectively managed different changes of external
environment so that company can easily grow and expand its operations across worldwide. There
are seven features or stages that can be used by company to effectively managed different
changes so that it can sustain for longer period. Therefore, Mckinsey model can be used to
evaluate the way ASDA have effectively managed different changes to earn more profit margin.
Such as:
Strategy: ASDA have formulated effectively strategies to managed different changes through
analysis of existing competition level and requirements or needs of customer’s. It helps firm to
arrange sufficient resource and make effectively utilization of capabilities so that wants of end
users can be fulfilled within limited time (Zehir and et.al., 2016). HR manager of ASDA have
4

used flexible policies and strategies so that new changes can be easily adaptable and firm can
gain competitive advantages in retail industry.
Structure: HR manager has provided definite organizational structure and effectively distributed
roles and responsibilities that need to be performed by specific individual so that best outcome
can be gained. Flexible organization structure helps in better coordination and cooperation of
efforts of different individual towards accomplishment of specific task. Therefore, it can be
stated that organization structure of ASDA helps in motivating employees to enhance their
performance and effectively managed different changes so that company can gain competitive
advantages.
Systems: Proper system is established by manager of ASDA so that employees can be aware
about specific task that they need to performed for getting desired results. Effectively
establishment of systems has contributed in effective coordination among different individual for
achievement of common goals (Venkateswaran and Ojha, 2017.). It has reduces conflict and
contradiction among employees regarding task that need to be performed or changes that need to
be adapted as system are provided to perform task effectively. Definite system and procedure
that need to be followed by individual is another strategy management that is used by company
to earn profitability.
Shared Value: ASDA have followed various values, ethical and moral principles so that needs
of customer’s and employees can be fulfilled. Company have provided equal opportunities to all
employees to share their ideas, opinion in the organization so that it can get competitive
advantages. Equal treatment and respect or recognizance of employees of ASDA that have
worked hard for growth and sustainability of firm is another strategies that helps in enhancement
of performance and easily acceptance of different changes for effectively achievement of specific
goals.
Styles: Leader of ASDA uses contingency leadership styles in order to motivate and influence
various individual to put their best efforts for growth and success of enterprise. Contingency
leadership styles promote in brining various changes within organization as employees of ASDA
are highly motivated to accept different changes. Leaders of ASDA through understanding
views, ideas and opinion of each employee that are working in the organization is able to find
effectively solution so resolve problem and influenced individual to work effectively for
common goals (Parayitam and Papenhausen, 2018). Therefore, leadership styles is another
5

techniques that helps in management of external changes and better satisfaction of customer’s
requirements.
Staff: ASDA have highly qualified, experienced and knowledgable employees that work
together for accomplishment of different task. They are ready to faced different challenged, takes
risk and find effectively solution so that company can easily achieve its specific objectives and
can gain competitive advantages. Therefore, highly motivated and trained staff contribute in
providing qualitative services and products to large number of individual. ASDA HR manager
always plan to retained talent employees within organization by providing better working
environment and building strong relationship between them so particular goals can be achieved
and company can earn large amount of profitability.
Skills: Various training and development program are organized by ASDA so that skills and
capabilities of employees can be enhanced and it can effectively achieve particular goals.
Employees of ASDA have different skills that helps in performance of various task easily and
quickly and satisfaction of customer’s needs beyond their expectancy.
Therefore from above model it can be illustrated that ASDA have effectively manage
various external changes which have contributed in expansion of businesses operations and
achievement of specific goals (Arend and et.al., 2017). Organizational structure, skills of
individual and styles of leadership, value and strategy are some key areas where company have
effectively takes steps so that it can retain maximum market share in retail industry.
Lewin changed management model
Another model that can be used by ASDA manager to formulate change management
strategies so that company can retained its market share and profitability. This model helps
manager to understand different individual so that effectively strategies can be adopted to inspire
them to accept particular changes. It can be stated that change is an ongoing process so it takes
time for individual or employees to accept new change or innovation or method of performing
specific task. Leader of ASDA by using different leadership styles is able to motivated and
inspired individual to work hard and effectively so that overall goals of organization can be
achieved (Kapoor and et.al., 2018). Therefore, lewin is one of the best approached that can be
used by manager of ASDA to bring changes such as to motivated employees to manufacture
organic products and uses innovative technologies for satisfaction of customers needs in most
effective manner. There are three stages in Lewin change management model such as:
6

Unfreeze: This is first stage where employees are aware about necessary changes that need to be
brought within organization so that particular goals can be achieved. At initial stages of
introduction of organic food products range and innovative technologies to market products and
services many employees of ASDA resist and it was quite difficult for manager and leader to
influence individual accept changes. Most of the employees hesitate to accept change due to lack
of knowledge, capabilities or skill to perform task which act as a barrier in achievement of
common objectives. Leaders of ASDA has put his best efforts to explains each individual why
the changes is necessary and the way it can provide benefits to organization and employees that
are working in the firm (Sedevich-Fons, 2018.). Manager through providing proper guideline to
individual and inspiring them to accept changes is able to launch organic food products and
increase its presence in social sites. Proper guidance and effectively leadership styles used by
different leaders of ASDA has helped in enhancing performance and productivity of each
employee. Therefore, effectively change management strategies adopted by manager of ASDA
to motivated employees to accept change rather than to resist on specific work so that company
can grow and expand its operations.
Change: It is stage where actually changes takes place such as employees of ASDA takes time to
accept new and innovating techniques to manufacture, and market various products and services
of company. Leaders of ASDA have provided appropriate guidance to employees about task that
need to be performed in specific manner so that maximum outcome can be gained. It has
provided confidence to employees to easily accept external changes and work together as team
so that common objectives can be achieved. Open and effectively communication between team
member or employees contributed in completion of various task within limited time, cost and
efforts. Effectively distribution of roles and responsibilities that need to be performed by each
individual within ASDA is also determined so employees are ready to accept changes so that
company can increase its profitability and market share.
Refreeze: It is stage where employees of ASDA have accepted and implemented changes of
organization such ASDA is able to provide online shopping experience to its customer’s and
launch organic food range. All such helps in increasing customer’s satisfaction level and loyalty
thus company is able to gain competitive advantages. Some of the people wants to follow normal
routine as before so manager and leader through effectively analysis and monitoring performance
of each employee is able to resist change (Sugahara, Daidj and Ushio, 2017). Manager of ASDA
7

motivated and inspire individual to think new and innovative ideas so that customer’s
requirements can be fulfilled within limited time frame. Continuous training and development
program are organized by ASDA so that employees can be motivated to adapt to new changes.
Most of the employees of ASDA have get comfort and confidence in using innovative
technologies such as official website to create awareness among large number of individual so
that they can be influenced to makes purchased. Strong brand image and continuous growth of
company act as motivation for employees to bring innovation or various changes so that wants of
customer’s can be satisfied in most effective manner.
CONCLUSION
It can be concluded that strategies management helps in effectively performance of
various function of organization in competitive market condition. ASDA through finding new
and innovative method to do particular task is able to enjoy maximum amount of profitability
and market share. It can also be concluded from above report that ASDA have brought several
changes in its operations, activities because of high skilled employees, definite organizational
structure and different leadership styles of leaders. Strategies management helps in planning in
advance about the method to face different challenged of organization so that it can continuously
grow and expand its operations. At last, it can be stated that ASDA have effectively utilised
opportunities and make necessary changes for long term growth and success of enterprise.
8

REFERENCES
Books and Journals
Arend, R .J. and et.al., 2017. Strategic planning as a complex and enabling managerial
tool. Strategic Management Journal, 38(8). pp.1741-1752.
Berisha Qehaja, A., Kutllovci, E. and Shiroka Pula, J., 2017. Strategic management tools and
techniques usage: A qualitative review. Acta Universitatis Agriculturae et Silviculturae
Mendelianae Brunensis, 65(2).
Berisha Qehaja, A., Kutllovci, E. and Shiroka Pula, J., 2017. Strategic management tools and
techniques: A comparative analysis of empirical studies. Croatian Economic
Survey, 19(1). pp.67-99.
David, M. E. and David, F. R., 2017. Are key marketing topics adequately covered in strategic
management?. Journal of Strategic Marketing, 25(5-6). pp.405-417.
Kapoor, R and et.al.,2018, July. Strategic Management of Emerging Technologies. In Academy
of Management Proceedings (Vol. 2018, No. 1, p. 14866). Briarcliff Manor, NY 10510:
Academy of Management.
Levine, S .S., Bernard, M. and Nagel, R., 2017. Strategic intelligence: The cognitive capability to
anticipate competitor behavior. Strategic Management Journal, 38(12). pp.2390-2423.
Parayitam, S. and Papenhausen, C., 2018. Strategic decision-making: The effects of cooperative
conflict management, agreement-seeking behavior and competence-based trust on
decision outcomes. Management Research Review, 41(1). pp.2-28.
Sedevich-Fons, L., 2018. Linking strategic management accounting and quality management
systems. Business Process Management Journal.
Shepherd, D. A., Mcmullen, J. S. and Ocasio, W., 2017. Is that an opportunity? An attention
model of top managers' opportunity beliefs for strategic action. Strategic Management
Journal, 38(3). pp.626-644.
Sugahara, S., Daidj, N. and Ushio, S., 2017. Value Creation in Management Accounting and
Strategic Management: An Integrated Approach. John Wiley & Sons.
Venkateswaran, R. T. and Ojha, A. K., 2017. Strategic management research on emerging
economies. Critical perspectives on international business.
9

Veselovsky, M. Y and et.al., 2019. Strategic management of innovation development: insights
into a role of economic policy. Enterpreunership and Sustainability Issues, 7(2).
pp.1296-1307.
Zehir, C and et.al., 2016. Strategic human resource management and firm performance: The
mediating role of entrepreneurial orientation. Procedia-Social and Behavioral
Sciences, 235. pp.372-381.
10