Strategic Management Case Study Report: Twitter's Competitive Analysis

This report presents a strategic management analysis of Twitter, examining its strategy formulation approaches, including deliberate and emergent strategies, and their limitations. The report delves into the significance of strategic management for the microblogging and social network industry, emphasizing the importance of strategic planning for data security and platform management. A key component of the report is an evaluation of Twitter's competitive environment using Porter's Five Forces model, analyzing competitive rivalry, supplier power, buyer power, threats of substitutes, and existing competitors. Furthermore, the report employs the VRIO framework to assess Twitter's internal resources, determining their value, rarity, imitability, and organization. The analysis provides insights into Twitter's strategic challenges and opportunities, offering a comprehensive understanding of its competitive positioning and strategic choices.

PROJECT (Strategic
management)

Contents
INTRODUCTION.....................................................................................................................................3
MAIN BODY.............................................................................................................................................3
CONCLUSION........................................................................................................................................14
REFERENCES........................................................................................................................................15

INTRODUCTION
The term strategic management can be defined as use of various kinds of resources in
order to achieve overall goals and objectives. It needs consideration of the process of an
organization as well as external factors which can affect functionality of a business (Schilling
and Shankar, 2019). The project report is based on a case study of twitter company. The report
consists detailed information about current theories, approaches and concepts which are used in
the company. The project report is categorized in three parts in which first one is about
formulation approaches used in Twitter. Analysis of competitor environment that is faced by
Twitter is included in second part. In the last part of report information about current and future
strategies is mentioned.
MAIN BODY
1 (a) The precepts of the deliberate and emergent strategies formulation approaches are two most
crucial strategic management techniques employed by multiple organizations (Teece, 2019). The
key distinction between the both strategies is that the deliberate strategy approach is like top-
down approach in strategic planning which emphasizes the accomplishment of the planned
business goal, while an emergent strategy is a process of discovering unintended outcomes
through execution of effective strategy and then exploring how to integrate these unexpected
results into potential organizational plans by implementing a bottom-up strategical framework.
Here following are several key differences in said both formulation strategies are discussed
below:
Deliberate strategy-formulation approach Emergent strategy-formulation approach
Deliberate strategy implies to strategy-
formulation approach that emphasizes the
achievement of the expected business goal.
Emergent strategy corresponds to approach of
discovering unintended results
from implementation of a strategy and then
understanding how to integrate these
unpredictable results into future-coming

business plans.
Michael Porter has formulated idea and main
concept of the deliberate approach.
Henry Mintzberg developed the structure for
business's emergent strategy as an alternate
solution against deliberate approach.
This approach applies top-down approach to
business management
Emergent approach applies bottom-up
approach to business management.
This approach takes a static method to
leadership, and is thus generally perceived to
be much less flexible.
Owing to its higher versatility, this technique is
preferred by most business practitioners.
Limitations of deliberate and emergent strategy formulation approach:
Following is a comprehensive discussion about the major limitation involved in
deliberate and emergent strategy-formulation approaches in context of Twitter, as follows:
Emergent Strategy:
The biggest limitation to an emergent approach is that this is not reliable and thus cannot
be prepared. In simple words, emergent approach is component of ongoing organizational
operation. As a consequence, this does not provide a credible alternative to more conventional
deliberate approach, particularly for new enterprises working on tiny margins. Corporations like
Twitter cannot, however, drop deliberate strategy and depend on emergent approach to improve
it. Emergent strategy is ideally suited to support and function as a remedial step for the
deliberative strategy. Another limitation to emergent approach is the potential for wasteful
distribution to capital. Inefficiency happens when previous allocation reasoning no longer
produces performance. Prior resource allocation approaches typically quit functioning during
periods of major transition in business.
Deliberate Strategy: Rigidity in plans stresses that businesses will continue to follow the
anticipated (deliberate) policy irrespective of environmental changes (Simandan, 2019).
Nevertheless, political shifts, technical advances and several other variables have had an impact

on businesses at various levels. These adjustments quite often make it impossible to incorporate
a deliberate strategy. As a result, most market analysts and professionals
recommend emergent strategy over deliberate approach for versatility. In fact, emergent
strategies are used as a means of learning while being in practice. In large corporation like
Twitter which operates in different countries across the globe flexibility in strategy formulation
is most crucial requirement. Thus, major limitation of this strategy implementation approach is
lack of flexibility which sometimes affects the outcomes adversely.
(b) Importance of strategic management for microblogging and social network industry.
The strategic management is crucial for microblogging and social network industries.
This is so because in the microblogging and social network industries like twitter, Facebook a
range of information is shared on a daily basis which need a particular management. As well as
in various kinds of companies, these social network platforms are used in order to do promotion
of products and services. Hence, strategic management for this industry is important. This tool
provides an effective framework which can give more security and suitability to the users who
use various kinds of platforms of social network industry.
The Twitter is one of the main example of microblogging and there are huge number of
users who use this platform. The strategic management enables better management of all
recorded data and keep safe from hackers. In the absence of strategic management, this can
become cause of emerging different types of obstacles such as lack of privacy of personal
information of users. Along with, this is important to know that all social network tools are based
on a global platform, therefore it is essential for controller and operators to apply strategic
management concepts and theories.
2 (a) In order to evaluate competitive environment of a company, there are a range of methods
and strategies. Each of them needs to be applied in more efficient and effective manner. In the
aspect of above mentioned organization Twitter, Porter’s five forces model can be used to make

analysis of competitive environment. Herein, below analysis is done in such manner that is as
follows:
Porter’s five forces model- Porter's Five Forces Model is a form of study of a company's market.
This focuses from the dynamics of the industry sector to extract five forces which decide the
competitive strength. The key five forces are mentioned underneath in such manner:
Competitive rivalry- New internet data suppliers, competitors, innovative ideas and new
perspectives makes pressure on Twitter corporation through lower pricing strategy, cost
reduction, and new customer value (Cescon, Costantini and Grassetti, 2019). To maintain the
strategic advantage, Twitter, Inc. will navigate all of these obstacles and create successful
approaches. This is important because, if above incorporation will not focus on their competitors
then it may lead to lose of position from competitive environment.
Strategies or methods to deal with competitive rivalry:
 They can deal from their competitors by launching more advanced and effective
products. This will not only bring new customers but also old customers will have a
reason to buy again.
 By creating economy of scale can also help in keeping fixed cost lower as much as
possible.
 Twitter incorporation can make investment on research and development that can keep
them ahead from new entrants. It is so because new entrants do not focus on more
research and development. Thus, this also can help them to beat their competitors.
Bargaining power of suppliers- Most of all the businesses buy their raw material from various
distributors in the Internet Information Providers market. The benefits that Twitter, Inc. gain in
the industry can be reduced by vendors in leading position. Throughout the sector of Internet
Information Providers, influential vendors apply the bargaining approaches to obtain higher
prices from the firms. The cumulative effect of higher bargaining power of suppliers is that it
reduces Internet Data Providers total profitability. As in Twitter incorporation, they face this
issue of higher bargaining power of suppliers due to which they have to pay more funds to
suppliers irrespective to get needed materials.

Strategies or methods to deal with bargaining power of suppliers:
 In order to deal with obstacles raising due to competitors, Twitter incorporation have to
create an effective supply chain including various suppliers.
 By designing new and advanced applications through different materials can help to
above company in the case when prices of material fluctuate.
 Another way to deal with higher competition, Twitter incorporation can rely on those
suppliers which are firm based. Such as they can learn from Wal-Mart and Nike
companies because these companies have third party manufactures who offer them less
costly products as compared to others. Due to this, these companies lead to the
competitive market in an effective manner.
Bargaining power of buyers- Buyers are often very demanding. They choose to purchase the
latest quality items by charging as cheap a price as possible (Köseoglu, Okumus, Dogan, 2019).
In the long run, this put pressure on the profit margins of Twitter Inc. This is so because
customers want to buy or acquire products and services which are less costly with better quality.
For Twitter it becomes difficult to serve all demands of customers due to higher bargaining
power of suppliers.
Strategies or methods to deal with bargaining power of buyers:
 These issues can be controlled by making a large chain of loyal customers. It will benefit
to above company in two ways, first one is that this will reduce bargaining power of
customers. As well as company will have scope to sell their more services and products.
 Customers want more discounts and offers, hence it is essential for Twitter incorporation
to launch new innovative items which can reduce cost and boost the margins.
 The new products will also minimize the defection of loyal customers of Twitter to their
rivalries.
Threats of substitute products and services- If a new product or service serves the expectations of
a particular client in various respects, productivity of the existing market declines (Shams and
Solima, 2019). Apps such as Dropbox and Google Drive are the substitute of hardware storage
drivers. A replacement product or service is highly threatened if it provides a value proposition

which is unique and different from the industry's current options. In regards to above
corporation, there are numerous alternatives of their application which are being used by new
and existing customers.
Strategies or methods to deal with threats of substitute products and services:
 Twitter incorporation should become service oriented instead of limiting till product
oriented.
 They should better understand demand of customers rather than focusing on what
customers are buying.
 By raising switching cost for the customers is also an effective alternative for above risk.
Rivalry among existing competitors- If the competition among a sector's established players is
dramatic then it will drive prices down and diminish the industry's economic profit margins.
Twitter, Inc. operates within a very competitive market of Internet Information Providers. The
rivalry takes toll on the organization 's total long-term competitiveness.
Strategies or methods to deal with rivalry among existing competitors:
 By making sustainable differentiation can benefit them to deal with higher competition in
the environment.
 They can make collaboration with their larger competitors so that profit margin can
increase at lower risk.
 Twitter incorporation can make a scale of operations so that they can beat to their
competitors.
2 (b) VRIO is also regarded to broaden as compared to the industry environment analysis tool
PESTLE because it involves a more macro-level assessment. VRIO is mostly about assessing the
internal condition of organizations, examining resources / tools in general, and what function
they perform in international rivalry, as well as how the company may make potential changes in
a certain area. In regards to Twitter corporation, this framework has been analyzed in such
manner that is as follows:

Value- It applies to the resource being used; how valuable it is, is it readily available, can it be
bought, rented or leased? Is it costly or cheaper? Above all, it is about the resources accessed and
the interest a resource can eventually create for the enterprise. Taking an example of renting a
big office space. If figures suggest that the rental rate is too expensive and that the long-term
ownership of a home will be better so it is a smart decision to cancel the rental deal to acquire the
house using a loan (Umam and Sommanawat, 2019). In regards to Twitter incorporation, they
should acquire only those resources whose cost is lower as compared to other. For instance, they
acquire different types of software applications which is a key resource. In this context they can
do proper analysis of value of this resource by examining its cost as compared to other
alternatives available in the market.
Rareness- It refers to the resource's rareness or its rarity when it comes to purchasing. How
limited or uncommon is the resource? When the resource is important but not unavailable, it can
be matched by the company with that of the rivals. When that is a very costly and rare resource,
therefore it can be used by the business to differentiate itself from its rivals. The more
uncommon or unavailable resource is, the greater the comparative advantage. The company
would also be to offer a commodity that is completely different and unique as well as which
cannot be replaced. In regards to Twitter incorporation, they should consider only those
resources which are rare and less costly. By doing so, this will be beneficial for them to beat their
competitors. This is so because customers want to buy only those products which are unique and
less costly. For instance, they can make modification in their current application by using such
resource and this will surely increase their competitiveness.
Imitability- This refers to the degree of imitation regarding resources. To what point is the
product imitating, allowing rivals to manufacture similar products? When a resource is valuable,
rare, and cheap to reproduce, it does not provide a competitive advantage (Thorén and Vendel,
2019). At the other side, the comparative benefit would be considerable if resource prove
impossible to reproduce. In regards to Twitter incorporation, they should consider this aspect
while selecting any type of resource in order to developing their product or service. This is so
because if they will focus on it, then they will be able to beat their competitors. When the
resource is impossible to replicate, above incorporation must realize that the resource involves

substantial costs. This could be risky to search for identical goods or imitations, because rivals
may do the same. This can just have a detrimental impact on the final product quality.
Organization- It applies to the organizational structure and the classification of all actions that
have yet to be carried out (Rustamadji and Omar, 2019). It goes without mentioning that
production of a product will need a lot of materials. Such materials have to be arranged, pricing
lists have to be written out, calculations have to be made and assembly needs to take effect. All
the resources need to be processed and applied effectively in the aspect of creating a product. It
all depends on structure of organization. Such as in the aspect of above Twitter incorporation,
they have to choose resources wisely and in accordance of structure in which they are dealing.
From this analysis, other companies can learn that they have to choose the resources by making
proper analysis of its various aspects. This is important to do because in the absence of any
mistake may lead to different kinds of issues such as higher cost of operation, lower margin. In a
summarized manner, this can be stated that companies should choose only those resources which
are rare and less costly because it can draw attention of more number of customers.
3 (a) In general, companies use a range of strategies and activities in order to maintain their
profitability level and position in competitive environment (Doktoralina and Apollo, 2019). Like
Twitter company uses various kinds of strategies which is helping them to dealing effectively in
competitive environment. They implement different kinds of pricing strategies, costing
approaches and many more in order to gain higher benefits. Herein, below some types of
strategies are mentioned which can be used in future by above company:
Porter’s generic competitive strategy- The relative position of a product within its market defines
if the productivity of a business is above or below the industry average. Long-term continuous
sustainable competitiveness is the underlying source of beyond average productivity. A business
may hold two specific forms of competitive advantage: low cost or differentiation. Combined
with the variety of operations by which a company aims to accomplish them, the two main forms
of competitive advantage lead to three common techniques by generating above-average success
in an industry: cost leadership, differentiation and focus. The concentration technique has two

variants: focus on costs and focus on differentiation. This strategy can be applied in Twitter
incorporation in such manner:
Cost leadership- In this strategy, companies try to become low cost producer in the market. Cost
benefit sources are diverse, and rely on the industry 's structure. These may involve the
achievement of economies of production, patented technologies, raw materials preferential
access and other considerations (Fitri, Nugraha, Hakimah and Manihuruk, 2019). A low-cost
manufacturer wants to identify and leverage all of the cost profit streams. If an organization is
willing to attain and sustain overall cost leadership, it would be a higher-than - average
competitor in its market because it can manage costs at or below the average business. In regards
to above Twitter incorporation, they can apply this strategy in order to keep their cost lower from
their competitors. By doing so, this will be beneficial for them to achieve higher profit margin
because cost is only factor which decides level of profitability.
Differentiation- A company aims to be unique in its market in a differentiation approach along
with certain aspects that are generally accepted by buyers. It selects one or more attributes that
other buyers in a market consider as essential, and positions themselves to fulfill those
requirements in a particular way. This is rewarded with a greatest value for its uniqueness. If a
company is able to keep their products different from their competitors and considering all the
factors of buyers, then this can be helpful for them to invite a number of customers. For instance,
in above Twitter incorporation, they can apply this differentiation model in order to attract more
number of customers. If they will do so then their competitive strength will raise. Herein, this is
important to know that above company can make product different from others only if they
choose resources wisely.
Focus- The generic focus strategy lies in choosing a narrow competitive sphere within a business
sector. In the market, the focus strategy chooses a segment or community of sectors and tailors
the approach to support them to the detriment of others. This strategy consists two types of
variants which are mentioned below in such manner:
(a) In cost focus, a company try to gain cost advantage in the target segment. The cost
benefit can be achieved by an organization only if they get needed material from a known
or loyal supplier (Wenzel, Stanske and Lieberman, 2020). By doing so this will be easier
for them to keep cost of production lower as much as possible. For instance, in above

Twitter incorporation they can rely on this aspect in order to keep cost of operations
lower as much as possible.
(b) A firm 's focus on differentiation seeks differentiation within its target segment. All
variants of the focus approach are focused on differences in the market between the goal
category of a force and other categories. The target segments will either include
customers with specific demands or the method of development and distribution that
better suits the target segment must be distinct from those of other segments of business.
As in the context of above Twitter incorporation, they can focus on differentiation
strategy and for this purpose they have to deal with producing a product which is totally
different from the available alternatives.
3 (b) Twitter incorporation can use SAF strategic model with an aim of making their outcome
more and keeping cost of operations lower as much as possible. Herein, below analysis of this
model has been done in such manner that is as follows:
Suitability- Suitability is perhaps the most significant element in the SAF approach model,
because the suitability of an alternative is the key to whether or not the plan can achieve what the
firm needs (Petera and Šoljaková, 2020). Usually, suitability is evaluated in a number of various
standards that are of particular important to the business or corporation, such as suitability for the
atmosphere, suitability for perceptions and viability for capabilities. So these different suitability
types can be further classified to better represent the unique requirements of the company. To
evaluate the suitability of a plan, the business should address questions such as "does the strategy
successfully utilize the resources of the company? "Will the strategy solve the issues found in the
analysis? Or is the approach consistent with the objectives that the organization aims to achieve?
This analysis can be useful for above Twitter incorporation in order to achieve their overall goals
and objectives. Herein, this is important to note that above company needs to make proper
evaluation about strategy before choosing it. This can be done by assessing future outcome from
applying the relevant approach.