Strategic Management: Competitive Advantage Analysis Report

This report delves into the concept of competitive advantage, examining the strategic management tools used to achieve it. It explores various tools, including SWOT analysis, Porter’s Five Forces, and PESTLE analysis, highlighting their application in assessing internal and external environments. The report provides detailed analyses of real-world companies like Coca-Cola, Wesfarmers, and Apple Inc. using these tools. The SWOT analysis of Coca-Cola assesses its strengths, weaknesses, opportunities, and threats. The PESTLE analysis focuses on Wesfarmers, evaluating political, economic, social, technological, legal, and environmental factors. Porter's Five Forces model is applied to Apple, examining the bargaining power of buyers and suppliers, threats of new entrants and substitutes, and rivalry among existing players. The report concludes by emphasizing the importance of these strategic tools in formulating future strategies and achieving organizational success.

Management
Competitive advantage
Student’s name
8/19/2019

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Introduction-
Strategic development tools mainly consider the potential internal as well as external impact on
the organization and accordingly mapping out an approach to deal with such impact. Hence, for
this there are numerous tools, which can be further applied to develop an appropriate plan, which
can be put into an action effectively. Hence, various strategic tools comprises of SWOT analysis,
Porter’s five-force model, Ansoff matrix, pestle analysis (Hitt, et al, 2012).
SWOT analysis is strategic marketing tool, which mainly highlight about the companies
strength, weaknesses, external opportunities and threats, which makes the company aware about
the market happenings, and accordingly they can make further strategies to win over the market
in only in financial terms but also in terms of long-term reputation.
Strength of Coca-Cola Company highlights that it is considered as the highest brand with the
main brand equity. Other than this, they also have the vast worldwide occurrence with the unique
brand personality. Moreover, they also capture the large market share and they have customers’
loyalty as compared to the other brands. Along with this, they also have the large distribution
network all because of the demand in the market (Chapman, 2011).
Weaknesses among the brand highlights that they are having a higher rivalry with the Pepsi. As,
the rivalry in-between these two varieties is immense. Other than this, product diversification is
also very low but if we see the competitor company Pepsi, they have introduced varieties of
snacks such as lays and kurkure and much more. In terms of health, people are now more
concern for their health and they are taking various health. Hence, by this, the sale will get
majorly affected and so does with the companies branding position.
Opportunities of Coca-Cola mainly states that they can diversify their products in terms of
health and food commercial as this will improve the contributions of the Coca-Cola to their
ultimate clienteles. Other than this, they should also makes improvement in supply chain as their
entire corporate is based on conveyance and delivery, thus, in this case they can keep an eye over
the supply chain and retain working over the price reduction (Santos, & Laczniak, 2015).

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Threats of Coca-Cola, mainly highlights about the competitors not only in the same product line
but other than this, coffee such as Starbucks, costa coffee are also one of the biggest competitor
to the carbonated drinks. Other than this, healthy drinks such as Real juices, Tropicana as well as
many energy thirst-quenchers like red bull are stealing away the large marketplace or the
customers’ base of Coca-Cola indirectly. Moreover, raw material sourcing is also important and
in terms of Coca-Cola, H2O is the major risk. Due to this, the company will experience the major
fall in their revenue and the distribution (Hassan, Amos, & Abubakar, 2014).
Pestle analysis mainly highlights more about the external environment other than the
competitive forces. The external environment mainly comprises of political, economic, legal,
technological and environmental factors. If we talk about wesfarmers, it is one of the well-known
companies, which mainly based in Australia, and deals in retail, chemical, fertilizers and
coalmines (Jie, & Gengatharen, 2019).
Political factors- play a significant role and having a major impact over the profitability. In
order to achieve success in which retail business certain political risks and factors that are need
to be considered before arriving or participating in certain marketplace. As political steadiness is
must to maintain the country’s budget, legal framework for agreement implementation, taxation
in includes taxes rates and incentives (Campbell, 2017).
Economic factors- it mainly includes information about inflation rate, foreign exchange rate,
interest rate, GDP of country. As, all these factors has major impact on companies’ profitability
and for that they need to consider likewise, the rate of GDP growth in the country will affect the
wesfarmers to grow in the near future (Campbell, 2017).
Social factors- Society culture also impact the workings of the organizations as shared attitude
and beliefs of the population also plays the major role as through this company got to know
about their customers wants and needs and accordingly the actions are taken onto place by the
company. Other than this, certain measures are need to be taken into consideration such as
demographics, attitude, leisure interest and class structure, hierarchy and power structure in the
society (Campbell, 2017).
Technological aspect mainly highlights about the innovation, this is not only for the sake of
maximizing the profits of the company but other than this, it also prevents obsolescence in the

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near future. Hence, the company should not only does the technological analysis but also speed
at which technology disrupts. Other than this, technology also has a major impact over the
product offerings and affects the value chain structure in food an staples retailing sector
(Johnson, et al, 2011).
Porters’ five-force model-
Porters five-force model mainly evaluates that how the suppliers, customers, competitors, new
entrants and substitutes acts to the companies offerings. Apple in relation to it has a competitive
landscape of software and hardware and through this it has become the most dominant
competitor of the electronics industry.
Firstly, bargaining power of the buyers highlights that, apple has a strong bargaining power of
buyers this is because of the low switching cost, high level of information to buyers and small
customers size. Naturally, it is very easy for the customers to switch over other brands and
generates the tough situation for the apple to satisfy every customer to which they are targeting.
Hence, every purchase of the customers is compared with the company’s revenue, which makes
the consumers position weak as individual level (López-Nicolás, & Meroño-Cerdán, 2011).
Bargaining power of the supplier in case of Apple Company is low, which determines that the
power of the suppliers is less in comparative to the demand on company. The weak bargaining
power of the suppliers generates the high level of companies concentration and this therefore
generate the advantage for apple to have suppliers all over the world and results more success.
Threat of new entrant in apple company context they face this threat at the moderate level,
because in such type of business there is high level of wealth is needed, high price is involved.
Hence, to establish the business they need to fight against the current companies in the
marketplace such as apple and many competitors such as Samsung, Microsoft. As, it is seen that
building a new brand is extremely expensive However, it is seen that many organizations have
capacity to enter in market but they need to face the capital , high cost (David, & David, 2013).
Threat of substitute products in terms of apple is weak because of the technology, online
services and the electronics, which an apple brand applies. Hence, this proves that apple has very
low or the weak substitutes available in the market. Other than this, customers also uses landlines

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and digital cameras other than this I phones. However, such products have low performance due
to their limited features and hence, apple in this context having advantage to tap more of
customers in order to generate more success (López-Nicolás, & Meroño-Cerdán, 2011).
Lastly, rivalry among the existing players highlights about the strong competition among an
industry. Therefore, this aspect mainly highlights about the intensity of the influences on the
company by its competitors. In apple context, competition with the competitors is done on the
basis of switching cost, level of differentiation and much more. Other than this, apple in this
aspect faces high competition with Samsung. This is all because of the rapid changes in
technology, adapting innovative techniques, aggressive advertising and much more. Lastly, it is
also seen that low switching cost also generates major issues because in this context customers
prefers to switch to android because of the higher iOS cost and higher functional cost (Khan,
Alam, & Alam, 2015).
Conclusion
From the above essay we can conclude that strategic management tools not only helps in
knowing the internal and external environment of the company but also helps the entire
organization from setting the various future strategies in order to generate more success than
usual. As by know the strength and the weakness of the company and various opportunities and
threats it will be easier for the company to set the future objectives and aims accordingly.
Moreover, this essay also carrier the various examples of the companies who SWOT , Pestle ,
Porter five force and ansoff is presented which helps us to know about the company’s internal
doings and the external opportunities and threats and accordingly they have set their future
strategies in order to win over their competitors or the market.

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References
Hitt, M. A., Ireland, R. D., & Hoskisson, R. E. (2012) Strategic management cases:
competitiveness and globalization. Cengage Learning.
López-Nicolás, C., & Meroño-Cerdán, Á. L. (2011) Strategic knowledge management,
innovation and performance. International journal of information management, 31(6), 502-509.
David, F. R., & David, F. R. (2013) Strategic management: Concepts and cases: A competitive
advantage approach. Pearson.
Chapman, R. J. (2011) Simple tools and techniques for enterprise risk management (Vol. 553).
John Wiley & Sons.
Hassan, D. N., Amos, A. A., & Abubakar, O. A. (2014) An evaluation of marketing strategies
undertaken by Coca Cola Company as a multinational corporation in Nigeria. Journal of
Business and Management, 3(2), 5-10.
Santos, N., & Laczniak, G. (2015) Marketing to the poor: A SWOT analysis of the Market
Construction Model for engaging impoverished market segments. Social Business, 5(2).
Khan, U. A., Alam, M. N., & Alam, S. (2015) A critical analysis of internal and external
environment of Apple Inc. International Journal of Economics, Commerce and
Management, 3(6), 955-961.
Johnson, G., Whittington, R., Scholes, K., Angwin, D., & Regnér, P. (2011) Exploring strategy.
Financial Times Prentice Hall.
Campbell, J. (2017) Insights from the company monitor: Wesfarmers. Equity, 31(8), 16.
Jie, F., & Gengatharen, D. (2019) Australian food retail supply chain analysis. Business Process
Management Journal, 25(2), 271-287.

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