Morrisons Strategic Review: Industry Analysis, Strategy Evaluation

This report presents a strategic review of Morrisons, a major supermarket chain. It begins with background information on the company, its history, and market position. The core of the analysis uses Porter's Five Forces to assess the competitive landscape, including threats of new entrants, barga...Read More

Strategic
review

INTRODUCTION
Strategic review is a process from which it annually asses the performance on the basis of the
strategic objectives in the plan of the strategic and it also identifies the improvements and areas.
Morrison is fourth largest chain of the supermarket which sale the foods, groceries in the market
and the main aim is to satisfying the customers rather than making profit. This report will
examine the background and profile of the organisation and also the porter's five force analysis.
It also highlighted the analysing the strategic positions in the industry and also the evaluation of
the strategy. It describes the strategic directions to undertake the Ansoff matrix and BCG
matrix(Arshed and Pancholi, 2016.).
Main body
Background information of Morrisons
Morrisons is the fourth largest chain of the supermarkets. Its headquarter is in Bradford,
England, UK. It was established in 1899 and It began as the butter and egg in the market stall in
the market and the locations of the stores is focused in the North of England. The sales and
presence is increases in the marketing day by day. There are more than 500 supermarkets of
selling the food and groceries and it also sale the products online. The revenue of the company is
17,262 millions and the products which has been sold by Morrisons such as drink, food, books,
clothing, magazines and so on. There are 110,000 employees working with it. It also consists the
clarity of the brand not the quality of the products. It known as the best supermarkets for their
own brand products and it beat with their discount prices in the market to their competitors. It
has their own manufacturing facilities and it opens the vegetable packing sites at Cutler Heights.
It is one of the brand which offers the self-service and have the price of their products and
services.
Porter's five forces analysis
Porter's five force analysis is a strategic management tool for helping and determining the
competitive landscape of and industry. It underlying the levers of the profitability which is given
in the Morrisons. From using the Porter's five analyses it understands the five competitive forces
and develop the strategy for enhancing of the Morrisons.
 Threat of new entrants:- from the new entrants in the brings of the retail, innovations
and new ways of doing things. It reduces the cost, new values for propositions to its
1

customers. The supermarkets PIc's manage all the challenges and building the
effectiveness for the barriers of the safeguards to its competitive edges. From innovating
the new products and services, it not only bring the new customers to the fold and also
giving the facilities to the old customers for a reason for increasing the purchasing of the
supermarket. It builds the scales of economics that it can lower the fixed cost as per unit.
From spending money and building the capacities for the research and development of
the Morrisons. New entrants are likely for entering in the new dynamics of the industry
which established the supermarkets for defining the standards regularly. The significance
for reducing the extraordinary profits of the firm for discouraging the competitors in the
market(Aithal, 2017).
 Braining power of suppliers:- In retail industries the buyer of the raw material from the
supplying numerous. The dominant position of the suppliers is decreasing by the margins
of the Morrisons which has been earned in the market. From the powerful supplying in
the customers services sectors for using the negotiations power for extracting the higher
prices of the Morrisons in the retail field. It makes the efficient supply of chain with so
multiple suppliers in the market. Its overall impact is to higher suppliers for bargaining
power for lowering the profitability in the retail sectors. From the innovations and
experimentations with the designing the products with different materials and growing up
the prices of raw materials then easy to shift the Morrisons to another. For developing the
dedicated suppliers it all depends upon the organisation. From other companies
Morrisons developed the another party for developing the and manufacturing which is
depended for creating the scenario which significantly manufacture the power of less
bargaining to compare with others.
 Bargaining power of buyers:- from a lot demand of the buyers. It wants to buy the best
offering for available of paying the minimum cost as possible for the customers. It puts
pressures on Morrisons for running the profitability and revenues for long term. More
powerful customers and smaller base of the customers of the company makes the higher
power of the bargaining and the ability is to seek the offers and discounts for its
customers. From the larger base of the customers in Morrisons it is very helpful for
reducing the bargaining powers of the buyers for providing the opportunities for
streamlines the sales and process of the productions in Morrisons. New products also
2

decrease the defections for existing customers of the firm to their competitors(Singh,
2018).
 Threats form substitute products:- when the new products and services meets the
demand and needs of the customers in so many ways, profitability of the industry also
suffers a lot. It being services oriented rather than only oriented about their products,
from understanding the needs and demands of the customers rather than impact ion the
buying of the customers. It increases the cost of switching for the customers.
 Rivalry among the existing competitors:- From rivalry among the existing player in the
Morrison for intense driving the down of the prices and it also decreases the overall
profitability and revenues of the Morrison. It operates in competitive retail market.
Competition take long term profitability of the organisation. It builds sustainability for
the differentiation and also build the scale so it can better compete in the market. From
collaborating with the competitors for raising the size rather than competing for the
smaller market(Sparrow, Hird and Cooper, 2015.).
Analyses of strategic positions in the industry
Morrison company VRIO analyses & solutions
Organisation resources can be categorised and analyse the details which has been provided in the
Morrison and also the strategic analyses is based on the assumptions and strategic resources
provided the opportunity for building the sustainable for the competitive advantages to its rivals
in the organisation. There are four components of VRIO which used in the Morrison for the
analyses. This competitive advantages of sustainable help the organisation for averaging the
profits in the Morrison to threat the pressures competitively;
Valuable:- The valuable resources to Morrison are the resources which are critical and
valuable for the firm such as the financial resources, marketing expertise, human resources and
also the marketing management.
Rare:- Its necessary for the valuable resources for costly to attain and rare for the
resources. If its not rare then it presents both the competitors and also the new entrants will be
able to easily get access for them and enter into competitive market.
Costly to imitate:- from most of the industries it facing the increasing the disruption of
the threats. The data is provided in the Morrison which seems to core differentiate which is
difficult to imitate. From the duplication of the goods of the Morrison and also the competitors
3

which is coming up for the substitute products which is disrupts the present structure of the
Morrison(Cassidy, 2016.).
Organisational capabilities & competence to make the resources:- it also measures
that Morrison is able to valuable harness, it difficult and rare to imitate the Morrisons resources
in the market place. The level of the exploitation is analyses the products which can be done
through 2 prospectives. The firm is able to fully exploit and potential about the resources but still
it has so many upsides. The level of the exploitation is highly dependent upon the execution
strategy and execution team of Morrisons. The level of exploitation level is assessing the quality
of the human resources of the organisation and also the capabilities which tends to expand and
arise the time as it takes the actions which build a strategic resource.
Evaluation of the business strategy
Measuring the evaluation of the effectiveness for the strategy of the organisation. Its important
for conducting the evaluation for measuring the precautionary or even it changes the entire
strategy of the Morrison such as:-
Suitability:- It deals with the rationale of overall strategy and also consider the key
points whether it address the key issues of the strategy and underlined the strategic positions of
the organisation. Objectives of the Morrison will be suited with the aim and also articulated the
mission statement. Each and every objectives must be a step for the attainment of the overall
goal's boarder. It also contradicts the statement of the mission which is confusing and must be
avoided(Kerzner, 2019).
Acceptability:- It concerned with the overall expectations of the identified the
stakeholders and also with the performance which is expected the outcomes and also it can be
risk, return and reactions. Risk deals with the consequences and profitability of the failure
strategy in financial and non- financial ways. Return it deals with the benefits which is expected
by the stakeholders in financial and non-financial terms. Stakeholders reactions is an anticipating
the reactions. It also opposed the problems of the new shares, employees and also the unions
which opposed the outsourcing of the fear of losing the jobs and customers and it also concerns
with the support and regards of qualities.
Feasibility:- It concerned with the resources which is required the strategy are available
and it can obtain and developed. It also included people, time, funding and information. It also
evaluates the feasibility of the analysis of the cash flows and forecasting. It also evaluates the
4

break-even analyses and also the deployment of the resource analysis. The challenges of the
competitive dynamic and the changes in the environmental. It must not be applied for
undetermined the consistency for pursuing them.
Strategic directions it undertakes the Ansoff Matrix and BCG
Ansoff Matrix:- It is a tool which understand the growth possibilities and associated the risk
with them. It is popular as the expansion of the product and market grid. It also provides the
growth of the four strategies which include the development of the market, penetration of the
market, product development, and diversification as follows. The corporate strategy of the
Morrison is needed the review and required the strategy of the redesign for the development and
growth of the Morrison. It's a best way to analysing and redesign the level of corporate and
strategy for analysing through Ansoff matrix. The first options for making the food items and
grocery for its customers(Kemp, 2018. ).
Existing products New products
Existing markets Market penetration
It expands the firm
organically.
It expanded the Morrison by
acquiring a competitor.
Product development
It introduces the online
shopping stores.
New markets Market development
It overseas the expansion of
the firm.
From developing the
convenience stores and it
targets the new customers.
Diversification
It also develops the non-food
business.
BCG matrix:- The growth and share of the market is planing a portfolio for developing in the
market. It totally based on the observations of units of the business and it assumes the increase of
the relative market and it shares the results for increasing the generation of the cash. The
5

assumptions are true because of the curve of experience and increasing the growth of the relative
market. It develops the advantage of the cost and the growth to share the matrix for providing the
indications for the generation and the assumptions of its cash(Schawel and Billing, 2018.). it can
be classified into four main categories which are as follows:-
Dogs:- It has the share of the low market and growth of the rate is low and neither it generates
nor it consumes the larger amount of the cash. Dogs are cash traps, because tied of the money
and also up in the business which has the little potential in the Morrison. Such business for
divestiture the candidates.
Question mark:- it growing rapidly and also consume the large amounts of the cash but it has
the low market share which do not generate the much cash amount in Morrison. The cash
consumption is larger results and it has the potential to gain the share of the market and it
becomes star it eventually a cash cow when the growth of the market is slows. If it does not
succeed then it becoming the leader of the market and also the perhaps of the cash consumption
and it also degenerates into the dog from the decline of the market growths.
Stars:- It generates the larger amount of the cash because of the strong relative share of the
market and also consume the amount in the larger quantity and higher the growth rate, in each of
the direction it approximately nets out the cash. Star can maintains the share, larger market and it
becomes a cash cow and the also it declines the growth rate of the market. It diversified the
portfolio which Morrison always have the stars which become the next cows of cash and also it
ensures the future generation of the cash(Dawes, 2018).
Cash flows:- As the leader in the mature market, it exhibits the cash cows on the assets which is
grater than the growth rate of the market and it also generates more quantity of cash which it
consumes. Morrison units provide the extracting of the investing and profits as the little cash as
much as possible. Cash cows provided the cash for the turn of the questions and mark into the
leaders of the market for covering the administrative cost to the company and also the
development and research to the service which corporate the debt and it also pays the dividend to
their shareholders. It generally relative to the stability of the cash flows and it determined the
values which can be reasonable and accuracy by the calculation of the present values to the
stream of the cash which uses the discounted analysis of the cash flows.
6

Recommendations
In order to increase the sales of the Morrison it uses the Ansoff matrix to increase the
productivity in the global market and also the visibility of the brand which increase the share of
the market and also the conventional store and it is more convenient for investing the option then
the supermarkets. It uses the product diversification strategies of the Ansoff matrix to build the
image in the market and also from the mix cultural involvement of the customers and also
Morrison will be able to judge the local better pulses for creating the awareness on the organic
products. It shows the higher revenue of the income which is predicted(Gurcaylilar-Yenidogan
and Aksoy, 2018).
CONCLUSION
Strategic review is a process which annually observe and analyse on the basis of the performance
strategic objectives in the plan of the strategy. This report will conclude the background
information of the organisation and also the porter's five analyses. It analyses the strategic
positions of the organisation. It evaluates the strategies of the business. It concludes the strategic
directions for undertaking the Ansoff matrix and BCG matrix for the cash flows and statement of
the organisation.
7

REFERENCES
Books and journals
Arshed, N. and Pancholi, J., 2016. Porters Five Forces and Generic Strategies.
Aithal, P.S., 2017. An Effective Method of Developing Business Case Studies based on
Company Analysis.
Singh, S., 2018. An Analysis of Major Challenges That an Indian Leather Industry Is Facing and
Their Impact on Leather Export Performance in Recent Years. Available at SSRN 3125545.
Sparrow, P., Hird, M. and Cooper, C.L., 2015. Strategic talent management. In Do We Need
HR? (pp. 177-212). Palgrave Macmillan, London.
Cassidy, A., 2016. A practical guide to information systems strategic planning. Auerbach
Publications.
Kerzner, H., 2019. Using the project management maturity model: strategic planning for project
management. Wiley.
Kemp, R.L., 2018. Strategic Planning in Local Government. Routledge.
Schawel, C. and Billing, F., 2018. Ansoff-Matrix. In Top 100 Management Tools (pp. 31-33).
Springer Gabler, Wiesbaden.
Dawes, J., 2018. The Ansoff Matrix: A Legendary Tool, But with Two Logical Problems. But
with Two Logical Problems (February 27, 2018).
Gurcaylilar-Yenidogan, T. and Aksoy, S., 2018. Applying Ansoff’S Growth Strategy Matrix To
Innovation Classification. International Journal of Innovation Management. 22(04). p.1850039.
8