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Management

Competitive Advantage
Student’s name
8/18/2019
Competitive Advantage 1

Introduction-

Strategic management tools mainly highlights about the companies’ techniques and ways to
implement their strategic plans and to achieve the sustained competitive advantage. Other than
this, they also consider the internal as well as external environment impact on the organization
and accordingly considering the various approaches to regulate the organizational activities.
There are various ways such as SWOT analysis, pestle study, porters five force aspect and ansoff
matrix, which helps the companies to know more about the environment and accordingly make
strategic decisions (Bondarenko, et al, 2017).

SWOT Analysis-
SWOT analysis is the high- level model, which is applied by the organization at the beginning to
know about the internal as well as external environment, and accordingly the company sets the
strategic planning. SWOT mainly includes of strong point, flaws, chances and fears. Strength
and weaknesses are the inside features whereas; opportunities and threats are the outside features
(Gürel, & Tat, 2017).

Johnson and Johnson- Strength highlights that in the eyes of the customers, it is one of the most
trustable brand which is trusted by many medical practitioners. Over time, it is also seen that
they had increase focus on tailoring business to the local market and accordingly set their
products according to the customers demand. In terms of brand equity of Johnson and Johnson, it
is on 78th rank in the world. Moreover, in terms of supply chain they have extensive and vigorous
delivery method for creating every product obtainable to the malls, trade houses and in remote
areas also.

Weaknesses- The major weakness of Johnson and Johnson highlights about the conflicts with
the partner companies, other than this, handling large product portfolios, which create mess in
the working operations, and hence, this leads the conflicts. Moreover, many other new launches
of the products are also vulnerable to the uncertainty to the regulatory terms (Gürel, & Tat,
2017).

Opportunities of J and J highlights that some of the nations are now prohibiting the general
medicines and hence, J and J can tap that market also. It is also seen that nowadays, the
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analytical market seems to be rising with the new medicinal treatments and discoveries which
support with the other companies competencies and adding to the market share and leadership
aspects.

Threat of J and J displays that there are many products and brand which recalls and threaten the
companies credibility at large. Other than this, powerful competition and solid global contestants
who provide another and supernumerary merchandises generates more stiff competitions among
the brands. Other than this, there are also local players on the market who are offering the same
of the substitute products, which is also affecting the business profits and reputation (Gürel, &
Tat, 2017).

Pestle analysis-
Pestle analysis mainly highlights about the political, economic, social and technological factors
are considered. Each of these factors mainly highlights about business environment and helps in
examining the external environment and accordingly the strategies are formed.

Political aspect highlights that Zara follows the upright assimilation method where the business
retains its workshops, transportation system and their own outlets. As it is the global company in
which management takes every account on political situation and avoid the unnecessary closers
of the business. Hence, the company should keep an eye over political aspect to reduce tariffs
and also helps in boosting sales (Lüttgens, & Diener, 2016).

Economic aspect highlights about the economic growth, interest rates, inflation rates and
taxations changes. As Zara in this case do not sell their products to lower class and should also
the affordability aspects. Other than this, lower cost of labor allows the Zara to minimize the
costs and helps in improving the profitability as this low cost labor is the positive sign for
companies’ profitability (Altaf, & Khalil, 2016).

Social aspect highlights that, with time the urge of the customers to do online shopping is
increasing and by this Zara is most benefited. As, Zara has many outlets around the globe which
are catering for diverse cultures, tapping new market and counties and accordingly making new
products which are in high demands and hence, this leads to the success of brand (Black, 2017).
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Technological aspect highlights that, Zara has a global presence physically, through the zara
websites and social media organizations their a virtual presence around the world. Information
about the company new collection all can be get from Instagram page, Facebook, twitter which
helps the company to stay connected with customers. Moreover, Zara also introduce its
collection by sharing their photos, make it interactive, and connect customers emotionally with
the brand (Ansoff, et al, 2018).

Legal aspect of Zara highlights about the legal obligations while maintaining the operating cost
and generating profits. By fulfilling all the legal obligations, the company generates the higher
reputation in the market and in the mind of customers. Nowadays, customers are more socially
responsible of the actions in which they identify about the fulfillment of the legal laws that
governs the international market for being successful.

Environmental factor- highlights that company should also focus on how the products are
created or generated from environment and along with it, the company Zara needs to fulfill the
strict store policies of waste material along with the adoption of environmental friendly activities
in practices. Moreover, this gives a government assurance that company is committed to produce
the environmental friendly products.

Ansoff matrix-
Ansoff matrix is also one of the strategic development tool which mainly focuses on form
present and potential products and markets. It mainly comprises of 4 aspects such as, market
penetration, market development, product development and diversification.

Apple is one of the well-known brands, through the helps of this model they decide to determine
its products and market strategy. Market penetration technique states that selling out existing
products in an existing market. Apple in this case releases its new phone in every 12 months and
add’s up the variety to the existing products and hence, this generates the ample of choices to the
ultimate customers (Berisha Qehaja, et al, 2017).

Product development mainly defines about the development produce for the clienteles, which
are faithful to the products. As, it is the moderate threat policy, company gets acquainted with
and with its new products. In terms of apple, they keep on introducing new such as currently they
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have launched I pod shuffle software for its current clienteles as they are accessible and are
transferrable.

Market development aspect highlights about the introduction of the existing product or the
services in an new market. This strategy basically helps in targeting the new customers, new
region, new country or the new demographics. In terms of apple Inc., apple I pad was launched
in an international market as their they do not have cell phones transferor that controls
companies products (Kalmykova, Sadagopan, & Rosado, 2018).

Diversification- aspect mainly highlights about the launching of a innovative products in a


complete fresh marketplace, as this kind of strategy mainly involves higher risk and lot of costs.
This majorly affects the future outcomes but at the end they company do earn profits. Similarly,
in terms of Apple, Apple I tunes launching was a new strategy likewise, inflowing into song
industry from the phone was very uncertain and cost operative for apple Inc (Bondarenko, et al,
2017).

Conclusion
From the above report we can conclude that there are numerous ways through which the
company can gets internal as well as external environment and further can amend or creates the
new strategies accordingly which can affects the companies outcomes are large. Above these
development tools with the companies’ example are the perfect way to understand about the
strategic tools. The application of ansoff matrix, SWOT analysis and Pest analysis all these tools
helps the companies to know about the external as well as internal environment as accordingly
they set their strategies for further development.
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References
Altaf, M., & Khalil, M. (2016). Strategic information system: a source of competitive advantage.
In Information and Knowledge Management (Vol. 6, No. 9, pp. 24-34).

Ansoff, H. I., Kipley, D., Lewis, A. O., Helm-Stevens, R., & Ansoff, R. (2018). Implanting
strategic management. Springer.

Berisha Qehaja, A., Kutllovci, E., & Shiroka Pula, J. (2017). Strategic management tools and
techniques: A comparative analysis of empirical studies. Croatian Economic Survey, 19(1), 67-
99.

Black, L. (2017). The social licence to operate: your management framework for complex times.
Routledge.

Bondarenko, T. G., Isaeva, E. A., Orekhov, S. A., & Soltakhanov, A. U. (2017). Optimization of
the company strategic management system in the context of economic instability. European
Research Studies, 20(2), 3.

Bondarenko, T. G., Isaeva, E. A., Orekhov, S. A., & Soltakhanov, A. U. (2017). Optimization of
the company strategic management system in the context of economic instability. European
Research Studies, 20(2), 3.

Gürel, E., & Tat, M. (2017). SWOT analysis: A theoretical review. Journal of International
Social Research, 10(51).

Kalmykova, Y., Sadagopan, M., & Rosado, L. (2018). Circular economy–From review of
theories and practices to development of implementation tools. Resources, Conservation and
Recycling, 135, 190-201.

Lüttgens, D., & Diener, K. (2016). Business model patterns used as a tool for creating (new)
innovative business models. Journal of Business Models, 4(3).