Category: Strategic Management

The Accounting Of Strategic Management

In the year 1981 Simmonds reflected his view on the adoption of strategic management accounting (SMA). There were other writers such as Bromwich (1990) who continued in this culminating in an influential paper. There was a positive response by David Smith and journal referees however according to the different survey which was carried out in the 1990s indicated that in practice SMA was slow. There was a mixed comment on overall adoption saying, if was academic immigration (Lord, 1996) or the account possess enough skills to make SMA a success (Cooper, 1996a, b).

There was no proper definition for SMA, different writer has a different perspective. As per (Roslender and Hart, 2003) it is a tool to make management accounting more strategic. Simmonds defined it as “the provision of management accounting data about a business and competitors and have managing and controlling business strategy”. In SMA various techniques are been included and commentators defined SMA based on the techniques. The techniques such as activity-based management, life cycle costing and strategic performance measurement systems, activity bases costing etc. There are some commentators who oppose this because as per them activity-based costing is a part of SMA as the focus of ABC is on the accuracy of cost allocation, not strategic support.

The boom in activity-based costing (ABC) and activity-based management (ABM) which was observed by Shank as the pillar of the new idea. Whereby Cooper and Kaplan were the academic writers who encouraged these techniques, which gives an insight into ABC by providing a way for accounting to be relevant strategically. ABC was been seen as more of a solution provider to the problems of irrelevancy by academics and professionals.

The overall paper portrays SMA was as much successful as it should be. In the year 1980s there was tremendous enthusiasm from the professional and academic accounting communities as SMA has greater promises. Overall observation on SMA is the lacks in evidence that it was practice widely as forecasted by Simmons. As the SMA was not widely accepted which made it difficult to determine the success or otherwise of SMA implementations furthermore there was there were many researchers and put to practice which made SMA hard to recognize.

The evidence on the adoption of SMA technique was not strong enough and key evidence was inclined towards the activity based costing (ABC) which was very low and decreased overtime, there were many companies who did not supported implementing ABC in practice. This result was been collected by several surveys of practice (example, Innes et al., 2000).

Target costing, functional analysis and value engineering are the management techniques used by Japanese companies which was success. However there is not clear sign of evidence about the adoption of Japanese-style SMA techniques which it comes western companies and outside the Japan. The reason being SMA was not adopted much as there was an accounting lag and evidence showcase that techniques and tools which was used without the involvement of accounting function.

Strategic Management Of Ecosystems

Introduction

Ecosystem, a term highly used in biology for describing the various relationships among all the living and non-living elements in the environment, is widely used in the business world in somewhat similar context. This era of digitization has made a huge impact in every aspect of life including the understanding of the business and economic environment. The dynamic nature of the industries or enterprises (Teece, 2007), which has become increasingly developed, largely influences the study of ecosystems. It helps to explain the reason why continuous research is required to understand the key changes that influences the roles of the involved elements or agents. The roles of these agents and their respective relationships have been evolving and it is important to study the changes in the pattern in order to strategically manage them. The paper intends to explain the current theories and the relationships of the different elements.

Keeping the research question in focus, this paper begins with defining ecosystems through the aid of previous research and explaining the key impactful elements which have caused different approaches in defining it. Next, it explains the major characteristics of ecosystems and the strategic management of ecosystems in the current business environment. Finally, the findings have been summarised and some suggestions for future research are mentioned which are not fully explored in this paper.

Definition of Ecosystem

Several approaches have taken place to define ecosystems with one or more similar elements. One aspect of this research considers relations of various elements in a business industry such as suppliers, customers, buyers, government institutions etc. to explain their mutual relationships of supporting each other towards a common goal and also talks about the necessary leadership conditions in a dynamic environment (Moore, 1998; Teece, 2007). Another approach talks about the technological advancement in the Industry and the role of ecosystems affecting necessary strategic changes due to the efforts of external innovators (Adner & Kapoor, 2010). Ecosystem is seen as a platform in one of the study which talks about the interdependence of all the major platform financers and their relations with all the supporters (Ceccagnoli, Forman, Huang, & Wu, 2012). While another study focuses on the relationship of various elements due to the uncertainty, complexity and ambiguity in the ecosystem (Stefano, 2013).

While all these concepts talk about one or more important element that comprises the core of a business ecosystem. They are limited to not been able to completely capture the major players which could help explain the dynamics of ecosystem. After deep analysis, a somewhat appropriate definition which talks about the nature of ecosystems, the different elements in accordance to the changing dynamics and the contributing factors which specifies a unique complementary aspect was found. The authors say, “An ecosystem is a set of actors with varying degrees of multilateral, nongeneric complementarities that are not fully hierarchically controlled”(Jacobides, Cennamo, & Gawer, 2018, p. 2264). This approach sees the ecosystems not as a result of some generally specific or similar elements but talks about some specific, uncommon and unique factors that influences the mutual relationships which results in mutual benefits. It also talks about the role of hierarchies and how the change could be affected by the newest of entrants and have somewhat limited influence on the overall dynamics of the Industry.

Characteristics of Ecosystem

Based on the chosen definition, one crucial aspect of business ecosystem is the unique factor which is responsible for distinguishing it from other agents in the entire industry. This allows the firms to become an important part of the group which provides mutual benefits. Such benefits are relatively unique and would not necessarily be available for the firms operating independently in the industry.

Another important feature of business ecosystem is the network dynamics among various agents or participants. There are big and small players in the industry based on size, uniqueness of resources etc. which are interconnected for the accessibility of common advantages. Such a relation may cause some informal authority of strong and influential players on the overall setup but there is no formal authority which could dictate all the terms, Such decisions are taken by joint agreements and the structure have given rise to the concept of meta-organisation (Gulati, Puranam, & Tushman, 2012). All the entities in an ecosystem are autonomous and their interconnectedness determines the overall rewards to be shared by all the beneficiaries. Hence, this characteristic again summarises the key aspects of the chosen definition as the network would involve agents with unique capabilities. Also, the firms are not fully hierarchically controlled since the entities are legal autonomous bodies while there could be some informal authoritative relationships based on powerful influence.

The level of control present in the ecosystem is a characteristic which also helps in explaining the need for firms to become a part of an ecosystem. In the context of business ecosystem, it’s not about firms having authority over other firms but it is related to the overall management and continuous control over the entire industry for their survival. The control over the most unique resources and the cooperation among the participants allows the existing members to exercise a certain level of control when it comes to entry barriers, use of resources and competition (Smith, 2013). Such important relationships may also give rise to co-dependence and the inter-connectedness could result in control over price apart from the entry barriers thus minimising risk for the current firms in the industry (Smith, 2013). An ecosystem thus allows firms to maintain a certain position for a long period of time and reap benefits due to the protective cover of control over key resources.

While control is there in a business environment, it might suggest that the innovation is somewhat restrictive in an environment which looks to keep things stable. Innovations, however, are an important characteristic of a business ecosystem as they allow the firms to keep focus on the requirements of the industry. Based on the current trends and need, the entities may concentrate their efforts towards working for the kind of innovation which caters to the demand of all the member organisations. They may also decide not to indulge in research and innovation activities due to high investments or huge risks of disrupting the entire ecosystem. All the new research and advances could be aligned with the objectives of the industry to better serve the needs without disrupting the current flow of the existing process. Keeping in mind the requirements of the ecosystem, new entrants could also align their disruptive innovation and save themselves from the dilemma of whether they will be able to gain the support of the respective incumbents in the industry (Ansari, Garud, & Kumaraswamy, 2016). By keeping the objectives and the requirements aligned, the firms ensure protection from the disruptors as the ecosystem participants keep an eye on them by predicting the nature and long-term sustainability of the industry.

Ecosystems provide a platform for the firms engaging in similar business. The complementor firms can participate and reap the benefits through their uniqueness and superior performance for a long period of time (Kapoor & Agarwal, 2017). This platform allows firms to develop their product and use their unique advantage. Ecosystems provide an opportunity to develop the network and sustain the long-term position by keeping a stable market for the product. It enables the firms to easily access the pool of network for the required resources and allows firms to predict the future path.

The presence of easily available data and sharing of knowledge is highly sought after in an ecosystem. Using Open Data based Systems, an ecosystem allows various firms to access the required knowledge regarding product, services, customers, emerging technologies etc. to better equip themselves with all the industrial challenges (Immonen, Palviainen, & Ovaska, 2014). The ecosystems ensure the reliability and quality of data and requires all the participants to actively create the appropriate processes for better clarity.

While defining the ecosystems, it was noted that ecosystems consist of several elements which are somehow interconnected, interlinked and sometimes interdependent. In the same manner, all the characteristics of ecosystem influences each other. Network dynamics helps in creating strong networks which results in getting a platform of knowledge and data sharing. Through reliable data, firms may predict the market forces and the need for innovations.

Strategic Management of Ecosystem

It is important to understand the strategic management of ecosystems as there had been constant changes due to the emergence of digitization. For instance, the definition of ecosystems has constantly evolved with many authors trying to cover all the major aspects of it. Based on new research and findings, they have updated their understanding and have tried to explain it for the current industry.

Appropriate strategy is required to deal with the dynamic nature of ecosystems where competitiveness may overcome the rewards of cooperation. Firms are organised in a way to look for the most sustainable option for their business. However, due to the complementary activities in a business ecosystem, it is hard to make a decisions relating to technology investments (Kapoor & Lee, 2013). It is important for a firm to grow individually and they are autonomous bodies, but the benefits of ecosystem put them in a dilemma of whether to be the early entrant or investor of a certain technology (Kapoor & Lee, 2013). The need to strategically manage these changes both for the individual firms and the industry therefore becomes very significant.

To deal with such disruptions, a firm should display the required strategic behaviour. One alternative which has the potential and is significantly prevalent in an ecosystem are emergent strategies (Mirabeau & Maguire, 2014). They usually are generated after the commencement of a project but a certain strategy to deal with the uncertainties of the industry helps in the long-term strategic planning of a company.

In order to make a sound strategy for a company to cope with the requirements of an ecosystem, it is very important to initially determine the nature of the industry itself. If an industry is somewhat like the case of Boeing and Airbus where most of the market is influenced by two companies, then the business environment would be more stable. Such an industry which involves huge investments, would see major disruptive innovation in a decade and the firms operating in this ecosystem can sustain their competitive advantage for a long period of time. This allows the influential firms in this ecosystem to exercise control and their strategy would involve keeping their position stable. The dominant firms can influence the prices and keep them in check to avoid competition and reap the benefits as other subsidiary firms also revolves around them. On the other hand, an industry with huge number of competitors and low investments would require a different kind of strategy to maintain their position. Based on the demand from consumers and the supply of resources, they need a strategy to maintain their sustainable competitive advantage (Adner & Zemsky, 2006). They need to keep their competitive advantage as long as possible and an ecosystem helps to ensure the balance in the supply of resources. Hence, the strategic management of an ecosystem would involve a detailed analysis of an industry and the various dynamic elements.

Each firm creates their own business model which would involve the best use of resources for value creation purposes. In co-evolving ecosystems, the ideas of value co-creation and co-capture emerges as important elements which should be integrated in the business models of the individual firms (Iivari, Ahokangas, Komi, Tihinen, & Valtanen, 2016). These elements influence the design of an individual firm´s business model to effectively create value for all the members of an ecosystem. This co-ordination also helps to explain the emergence of cooperative strategies. These strategies are made by different firms in an ecosystem for the purpose of mutual gain and improves value-added efficiency of the firms in various circumstances and environment (Nielsen, 1988). Hence, all participants in an ecosystem should indulge in the creation of sound cooperating strategies for the accomplishment of group objectives apart from individual gains.

An ecosystem has its advantages, but it is difficult to align the competing firms to work for the benefit of the entire industry as any rational firm would want to think about their own profits rather than the industrial gain or benefits of all the firms. This, however, could be overcome by the heterogeneity or uniqueness of firms. On a subcommittee level, Firms with broader array of complementary products tends to show less support in comparison to firms with unique selling attributes (Ranganathan, Ghosh, & Rosenkopf, 2018). In order to create the technology standards and cope with the deficiencies, the firms tend to collaborate to improve the networks leading to a greater acceptance of the emerging trends (Ranganathan et al., 2018). Hence, the firms indulge in strategies to support the long-term position and collaborate with other firms to overcome the technical difficulties.

Based on all the findings, a firm needs to have their individual business strategies to deal with their internal processes and an external strategy to deal with the volatility of the business ecosystem.

Conclusion

It can be concluded from the literature review that the ecosystems have evolved and there have been visible changes. For companies to survive and benefit from these changes, it is important to strategically manage them. This change could first be observed by the analysis of the meaning and definitions of ecosystem and how various authors are still doing a lot of research to better explain the changes by revisiting the previous literatures. The characteristics, in accordance, includes a lot more than what existed 20-30 years ago and still many factors are yet to be considered for a better understanding of the subject. For instance, the features may differ based on different industries and a separate study which involves several different types of industry could help to explain the common and the distinguished ones. For this literature, the characteristics of uniqueness, network dynamics, control, innovation, platform and data, and their inter-relationships are explained in detail.

The strategic management of ecosystem summarises the ways in which industries can cope with the rapid changes in the ecosystems and how the nature of the industry influences decision making. They need to maintain their competitive advantage for a long term stable and sustainable position. The study of business ecosystems is essential for new entrants as well to create a better impact and easily find their foot in the industry.

The study explains the relations between various elements of an ecosystem and how firms cope with different changes through their strategies. For future research, the limitations of business ecosystem could be better explained with case-based theories pertaining to a specific industry

The Elements Of Strategic Management For Business

Introduction

As an industry supplier for drinks, Coca-Cola (Coca Cola) is introduced and They can also be named as largest non-alcoholic beverage marketers. The span of the company also includes over 500 brands held or authorized and 4300 drinks along with 1400 low-calorie and non-calorie products. The firm works in five business segments: Europe, Middle East and Africa, Latin America, North America, Asia Pacific.

The company reported US$ 35 billion in annual revenue and US$ 11.8 billion in net earnings in 2010. The total number of people employed on the corporation’s payroll was 139,600 over the timeframe.

Literature Review

As an exceedingly successful company, it is vital to use effective business strategies to maintain long-term goals in any organization. This section describes the use of theoretical models and frameworks to implement the corporate strategy.

Corporate strategyAs noted in the case study Coca-Cola wants to redefine their industry by being a “Total beverage company”. They implemented that strategy by acquisition of the British coffee shop chain costa coffee for selling price of 5.1 billion dollars

Amount of acquisitions done by nonalcoholic beverages companies

If we compared acquisitions such as these to other rival companies such as pepsi.co, we can understand that not only they have diversify their industry such as bottling, delivering, they managed to enter new markets by acquisitions. Even if Coca-Cola has a large amount of loyal customer base, they’ve managed to maintain customer-centric products.

Strategic positionCoca-Cola’s positioning approach may have enabled them to create an appropriate self-image in their clients ‘ minds for the only ‘Real One.’ They intended their positioning approach to take an efficient image of their goods for their customers. Once they chose to aim and operate in the segment of the market, they obviously created an image of the focused market segment and correctly identified their brands as portion of their positioning approach.

Value ProportionImprovement of company by using relationships, higher revenues and, marketing opportunities can be idenetyfied as value propotion of company. Following graph show what are the elements on value proportion.

Porters value

Capabilities of Coca-Cola (as an aspect of internal environment)Simply capability discribed as how a company employs its resources to produce goods and services. Capabilities can differ from marketing, demand placing, or routine activities. Coca-Cola capacity is the ability to manage a extend job or activities collection. Continued use thoroughly, these capacities are becoming deeper and more hard for rivals to comprehend and imitate.as a cause of competitive advantage Coca-Cola company capacities are so easy.

Core competencies of Coca-ColaThe simplest meaning of the core competencies is the something unique that company has to enhance their business strategies.thess can be identified core competencies of Coca-Cola

Cola has its product skills and brand identification in its brand title. The idea of ‘hidden formula’ coca coke, for instance, is used to preserve its unique nature.

Coca-Cola’s other key competencies are to achieve its administrative competence by maintaining a well-structured business framework,

Coca-Cola has core competency of product reachability which means it’s available to more individuals than other rival products.

A powerful network of providers such as the bottling sector, air distributors, crops etc. is another key competence that can be recognized in Coca Cola. Coca-Cola has significant bargaining power through its suppliers, particularly because of its business composition taken from its conservatie operations.

Coca-Cola has great research and development capabilities including marketing.

SWOT

Strengths

In the beveerage sector, it has a large market and higher brand value. Over 500 non-alcoholic drink products are owned, distributed and sold by the company across 200 nations.

Coca-Cola has vast range of loyal customers not only in their birth country but internationally.

WeaknessesCoca-Cola’s net operating revenues have been rapidly declining throughout the last five years. Furthermore the company’s gross profits have dropped significantly. Net operating income in 2017 fell to $35.4 billion from $41.9 billion (Coca-Cola annual report 2017).

Coca Cola Company products are regarded strong in calorie intake and detrimental to hygiene. Healthier beverages have been recommended by various organizations over fizzy products.

Opportunities

Coca-Cola can introduce or invest in more healthier drinks other than fizzy drinks to maintain health trends

Over the past century, the Coca Cola Business has vigorously acquired multiple local beverage businesses. The business has also improved its involvement in significant bottling operations. This gave the business more power throughout the whole quality system

Threats

Coca-Cola should consider about Scarcity of resources. Because due to climate changes sooner or later insufficiency of water will occur and some may point fingers at beverage companies.

Since Coca-Cola is a multinational company exchange rate and inflation play major roles in corporate profitability

Dependence of third party water bottlers companies.

PESTEL

• Political factors – FDA (food and drugs administration) and government can set penalties if Coca-Cola doesn’t meet their standards and also government can make law regulations such as taxation and environmental laws which can be reflect on pricing strategy.
• Economic Factors –In the 21 century economic factors such as inflation and recession can negatively affect global cooperates like Coca-Cola. Customers are affected by such financial crises. Under these circumstances, people have to move to purchasing only the fundamental essentials.
• Social Factors – Social factor is one of the most important factor that can effect revenue of the company. For instance in today’s world many people are trying to change their lifestyle to be healthier. Social trends like that can effect fizzy drinks industry negatively.
• Technological factors – These factors can influence aspects such as advertising and marketing sectors in Coca-Cola. Which is much bigger deal in corporate who spends nearly 3.5 billion dollars (Statista, 2019) for advertising annually.
• Environmental factors –When we consider on the environmental factors Coca-Cola should focus on energy, scare resources, and other raw materials. For example cocoa company is the main purchaser of can and bottle industry and in 2007 they consumed over 300 billion liters of water for production (UKEssays. 2018).
• Legal factors –law factors plays major role in nonalcoholic beverage corporates. It effects laws for employees and also the external environment. EU Member States prohibited coca cola because result of 100 kids being poisoned in Belgium (UKEssays. 2018).
• Environmental factor(Emission)

Porter’s 5 Forces

This model uses when company want to identify or analyses main competitive forces to recognize its competitive advantage. Followings are analyze of 5 forces for Coca-Cola Company.

• Competitors-A densely concentrated non-alcoholic beverage industry is defined by growing regional or national firms as well as worldwide mass-brand firms. In nearly all kinds of products, the Coca-Cola Company encounters different forms of rivalry. But traditionally pepci.co is the world leading rival company of Coca-Cola.
• Potential entrants- Market entry constraints are comparatively noticeable, as when the Coca-Cola Corporation as well as other worldwide competitors have developed unparalleled delivery networks and alliances. Hence, this force’s strength is very restricted. Potential newcomers arise as current businesses ‘ fresh groups and products.
• Substitutes- Like the potential newcomers, the replacements usually often arise from the current drink producers ‘ item portfolios. This power has a considerable adverse effect on the Coca-Cola output due to the drastic modifications in customer attitudes that have been experienced over the past century.
• Suppliers- Coca-Cola managed to maintain secure relationship with their supply network. And that is one of the core competencies which helps success of the corporate.
• Consumers- As the main strategies of Coca-Cola depends on its capacity to satisfy clients ‘ requirements and wishes, buyers seem to be the most significant power with a deep effect on both the economic position as well as economic results.

Discussion

Strategic analysis of an identified and critical aspect of the internal environmentAs described in the SWOT Analysis, the coca cola has more internal advantages. Except reminder of the item (mostly). Coca Cola does not externally have significant problems depending on assessment and its group composition relevant to its company needs. The high structure is used to keep its structure and management approaches to date. Because most of the problems related to performance and production are identified from there.

Evidence from a range of sources about the industry and about whether the firms current strategy is successful.The corporate value in Coke has increased from 17.3% to 17.8%, and was 11% higher than in Pepsi. Pepsi fell 10.8% to 8%. And discusses Coca-col’s good promotional efforts over the years at the primary athletics activities.

The Coca-Cola Company continues to freshen up everyone’s contacts. The corporation’s item has multiplied its attitude to social appreciation and understanding. For example In 2007 Coca-Cola Company changed their corporate structure due to satisfy the customer requirements integrating diversifying their production with North American can bottle and juice company.

Coca-Cola Launched diet coke and zero sugar coca cola to face the uprising health trends. And to get use of that trend Coca-Cola invested in more organic and healthier beverage companies. For example Coca-Cola acquired Keurig Green Mountain who invented single pod coffee maker.

As described in case study Coca-Cola uses geographic market segmentation. This can benefit company when difference between laws in region to region because in some countries this industry is controlled by authorities.

When we consider above mentioned facts we can identify that existing strategy is a successful strategy

Appropriate criteria to assess whether the current strategy will remain relevant as the industry changes.In the review of literature reader can identify several factors that can be negatively impact on the corporate using industry analysis tools like PESTEL, 5Forces and threats and weaknesses of the SWOT. In this context, it will be necessary to improve the strategy. There will be no outcomes further than a given stage in the present approach. The three most critical threats to the company in particular have to be resolved as identifies as SWOT.

Whether a change of strategy will be possible or desirable and Recommendations for change of strategyIn that regard, Coca Cola’s current approach as a corporation will also have to be further enhanced to make sure its market share is not decreasing. Following can be identified as possibility and recommendation of change of stratagy.

Coca-Cola existing segment is geographic market segmentation to achieve long term desired market. But since the consideration of health trends risen up they can shift their market segment to psychographic segment for efficiently match product with their lifestyle.

Coca-Cola can use combinations of market segmentations. For example populace in the geographic region of Asia pacific are tend to attached with cultural and religion. Because of that Coca-Cola can segment in that region in to demographic segments

Since scarcity of resources such as water increased Coca-Cola can alternate their business and operational strategies for gathering resources. For example this corporate can filter seawater instead of ground water.

Conclusion

Coca-Cola is a global, multi-national company. The stronger brand has made ongoing marketing attempts over 125 yrs and represents the company’s biggest commercial strength. But However, Coca Cola as a brand certainly differentiates, while maintaining that income security is guaranteed in its activity it needs the same degree of divergence. As it deals with public affairs, its strategic position on the worldwide economy, and as it develops brand loyalty that deals with cultural distinctions Coca Cola has to re-define in recent trends.

References

1. UKEssays. November 2018. Coca cola Company, Changes and challenges. [online]. Available from: https://www.ukessays.com/essays/business/coca-cola-changes-and-challenges-business-essay.php?vref=1 [Accessed 15 July 2019].
2. https://www.academia.edu/14662691/Carbonated_Soft_Drinks_Market_Coca_Cola_Problems_and_Solutionshttps://www.statista.com/statistics/286526/coca-cola-advertising-spending-worldwide/Porter, M. E., 2008. Strategic. Competitive Forces that shape Strategy. Harvard Business Review. Cambridge: Harvard Press
3. Bell, L., 2004.The Story of Coca Cola. Mankato: Smart Apple Media
4. UKEssays. November 2018. Coca Cola A Resource Based View Business Essay. [online]. Available from: https://www.ukessays.com/essays/business/coca-cola-a-resource-based-view-business-essay.php?vref=1 [Accessed 18 July 2019].

Strategic Management Of Apple Incorporation

Executive Summary

The following study tends to discuss a strategic plan of management for Apple, Co. A prominent smartphone company. The discussion initiates with a transitory introduction of the company followed by the external drivers which influence the state of the company. Afterwards, the competitive environment of the company is discussed which is further justified by Michael Porter’s five forces. Afterwards, the internal analysis is conducted followed by VRIO analysis. Finally, on the basis of thorough discussion is done on company adequate recommendations along with the conclusion.

Introduction

Apple is renowned as an innovative company and a giant in the field of technology that has conveyed numerous ground-breaking gadgets to the market like iPad, iPod and MacBook (Ansoff, et al., 2019). Apple has made a noticeable comeback in recent years. Whereas the industry of computers has been witnessing a downfall in these years, Apple yet again, stated ascending the graphs to re-establish its market position. Along with elevating sales of smartphones, the MacBook sales of Apple have been equally increasing since MacBook Pro’s release. According to the reports of 2017, Apple has a net sale of 29 Billion, making Apple one of the world’s esteemed and prominent brand listed by Forbes (Ansoff, et al., 2019).

Drivers of Changes

A driver of change is either an external or internal factor that alters an organisation. The factors of change can include political, economic, social and technological factors. Such external factors can be calculated by using PEST analysis since it is a valued strategic approach for recognising the size, position, growth, viable operational methods, and classification of decline and development of a business (Wheelen, et al., 2017).

Apple is known as the marketing company having a digital asset and worldwide provider of smartphones. It is the company in its own league, which produces and executes both hardware and software. It permits the buyers to purchase and share application and other multimedia content through Apple devices, through the use of a platform of selling media known iTunes (Chang, 2016). Apple’s CEO (Tim Cook), in 2012, shared that the company is very enthusiastic because of the sales of the iPhone, which was approximately 12 million sales of iPad and almost 35 million iPhones. Furthermore, he stated that the new pioneering iPad will be soon released with innovative characteristics which can only be provided by Apple (Mathooko and Ogutu, 2015).

Furthermore, the sales of Mac, iPhones and iPad have ascended by 7% and 188%. In contrast, the sale of iPod descended by 15%. As compared to the number of Q1, 2012 the numbers of Q2, 2012 are considerably low as all the preceding records were smashed by apple as shown in the Figure below. Apple at that time sold about 15.43 million iPads, 5.2 million and 37.04 million iPhones (Zhao, et al., 2016).

The report of Q1 2012 revealed that in a rivalry with Samsung, Apple secured the 2nd place worldwide with a prominent growth of 8.8% of all the market of cell phone and 24.2% of the smartphone market globally. As shown in the table below (Rosenberg Hansen and Ferlie, 2016).

PEST Analysis

To recognise Apple’s operational directives, the potential of the business, and the situation of the future market, PEST analysis is used (Heracleous and Papachroni, 2016).

Political Factor

There are numerous issues that are unable to be regulated by Apple like; war against terrorism, geopolitical doubts, health issues, and working authority which can influence the global sale of Apple’s gadgets (Mathooko and Ogutu, 2015). In order to decrease the cost of operation Apple has subcontracted in various countries like China, the Czech Republic, Ireland, Korea and Cork. The likeness of Apple can be spoiled in the eye of dealers and purchasers, in the case of deferred manufactural operations (Rosenberg Hansen and Ferlie, 2016).

Economic Factor

The power of purchasing varies upon the economic state of the World. In light of the past few years, an increase in the rate of unemployment in numerous counties has affected the sales of products of Apple. An additional reason was increased in oil cost which surrounded the economy of the world with inflation (Chang, 2016). Due to the outcome of these factors, the power of people purchasing the product greatly reduced which impacted the Apple product’s sales because of the rushed prices. However, recently the economic state of the world along with the company is getting better and Apple has brought itself currencies that are foreign, making the revenue of Apple ascent in the market worldwide (Zhao, et al., 2016).

Social Factor

The 2 factors which have been on the front line of products of Apple during the course of their history are the quality and design (Wheelen, et al., 2017). Consumers are preferring to purchase the luxury gadgets and products because their power of purchasing has increased throughout the markets of the world and people are giving priority to the products of iPad, iPhones and iPad (Rosenberg Hansen and Ferlie, 2016). The industry of music is having a significant impact on the current generation. This factor also plays a part in ascending sales because of Apple’s high-quality music store iTunes. Consequently, Apple is currently an embodiment of modern and luxury lifestyle through social factors (Ansoff, et al., 2019).

Technological Factor

Apple is always at an advantage due to its enhanced technologies and unique innovative products. Apple invests its substantial sum in the field of development and research. For this reason, Apple is at number 1 ranking in the lists of innovative gadgets (Lockamy III, 2017).

Internal Factors

Strengths

• Apple’s chief strength is its unmovable position in the market and the loyalty of their consumers which gradually increases because of ‘Apple’s ecosystem’, which gives the company a head start in the competitive market. Secondly, Apple has a diversity of applications, software, and products which are interconnected and uphold each other. Thirdly, the release of iTV and other fresh products is expected to release soon (Zhao, et al., 2016).
• Apple’s resilient position in the market and the loyalty of customers are its main strong points. This is due to the unique and innovative ecosystem which Apple has created. This advanced invention of Apple enables it to be unbeatable in the market. However, this is not the only innovative product of Apple, moreover, it has a diversity of products and applications which are linked with each other (Chang, 2016).
• Apple has a streak of awards to its name, as the most renowned and prominent establishment in the world (Clarke and Boersma, 2017).
• At 2012’s ending, the cash which Apple held was $10 billion. Furthermore, the gross profit margin of Apple is significantly higher than its rivals and Apple has no debts.
• In 2012 apple was the second most valued brand of the world, having a value of $76.5 billion.
• Satisfaction of the customer is Apple’s top priority, the customers are in delivered top quality product awareness conveyed through trained and well-versed staff (Dolata, 2017).

Weaknesses

• The high price which Apple is offering is its main weakness because of the strong competitive market. Apple’s consumers can purchase a phone having the same specifications as Apple’s, at a significantly lower price (Lockamy III, 2017).
• The customers will be not be influenced enough if Apple is continuously decreasing the market shares. Furthermore, it will motivate the customers in not using Apple’s Ecosystem.
• Numerous companies around the world have accused Apple of defying their patent designs and furthermore, Apple was not able to defend itself against these accusations in court. Such scandals can decrease the status of Apple in the market (Hernández and Garcia 2018).
• Following the death of Steve Jobs, Tim Cook became the CEO of Apple, in 2012, which was the major and prevalent loss for Apple, Co. Afterwards, Scott Forstall and John Browett left the company as well resultantly putting an undesirable impact on the management (Rosenberg Hansen and Ferlie, 2016).
• The fact that in the tech market, the gross profit margin of Apple is unbeatable. However, because of the tough competition and increasing prices the company will not be able to keep its current margins (Lockamy III, 2017).

Competitive Environment

The fact that Apple is a huge industry having numerous products to its name is known globally. In terms of the smartphone industry and other products, Apple has the following main competitors: HP (Hewlett-Packard Company), Samsung, Nokia, BlackBerry and HTC. The following figure shows the competitors of Apple in the smartphone market and the gross profit margin, revenue, price earning, earning per share, and net income compared to its competitors (Castro, 2016).

Competitive Forces by Michael Porter

The following figure is about the Five Competitive Forces Theory given by Michael Porter. These forces define the competitiveness of any market industry. The following model aids in calculating the influence Apple has on its capability to compete with its rivals in the market (Clarke and Boersma, 2017).

Intensity of Rivalry

The intensity of the rivalry is the first force among five. This defines the concentration of the competition a company has with its rival. Apple has done wonders through conveying technical support, creating loyalty of customers, and production of products (Khan, et al., 2015). Hence, Apple is free from the fear of this factor because anything which is released by Apple is destined to be sold because of their strong groundwork. Moreover, this groundwork of Apple preserves its productivity without the need to produce superior products than rival tablets, Android phones and eReaders, who are selling their products at a low price (Clarke and Boersma, 2017).

Bargaining Power of Suppliers

The bargaining power of suppliers can reduce the profits of Apple by recognising supplies’ high prices. Therefore, the company is always on the lookout for fresh suppliers because the fact that Apple Company is continuously growing cannot be doubted (Zhou and Gupta, 2018). Fresh suppliers are allowed to get themselves registered on the website of Apple online, which in result convince the suppliers to reduce the bargaining power. Hence, Apple is able to reduce their bargaining power amidst a significant number of suppliers (Knott, 2015).

Bargaining Power of Buyers

In order to gain a majority of shares in the stock market, Apple has to take its consumers into consideration through a variety of segments like age, income and educational level (Khan, et al., 2015). Another factor is that the purchasers are quite sensitive in the measures of prices and can easily be distracted to another retailer. In the overall market of smartphone and tablet, Google is the leading competitor (Castro, 2016). This is due to that fact that Blackberry, which was once known as a leader of the smartphone market, now, only owns 1% of the market. Approximately 75$ of the industry’s profit is held by Apple (Zhou and Gupta, 2018). Hence, the chances of Apple users to switch to another brand are considerably low. However, Apple still has to be careful since companies like Nokia are slowly coming to ascension once again (Lai, et al., 2015).

Threat of New Entrants

Letting more companies enter the market clearly means that Apple will experience a decrease in its shares. Apple can generate profit and preserve its shares in the market through brand’s and product’s differentiation along with making a firm marketing strategy (Zhou and Gupta, 2018). A well-established company like Apple is not easy to compete by any company fresh in the market. The reason is quite vivid it is because Apple has esteemed imaging of brand, excellent customer services, perceived value, and most importantly the innovation (Clarke and Boersma, 2017).

Threat of Substitute Products

The threat of substitution of a product has two main factors, performance and price, which permits the customers to change the product. The substitution threat can be reduced and its percentage depends upon the loyalty of the consumer (Paik and Zhu, 2016). There is no company in the market which can offer the ‘ecosystem’ innovated by Apple. The main reason for the people to by iPhone is that they yearn for robust apps along with standards, furthermore, the other upgradability of Apple permits the customers to transfer content (Yusoff, 2018).

The sales of the companies have enhanced geographically, among this 1/3rd of the sales are from the US and 1/3rd are from Asia. Compared to Europe, having 22% of the market, these areas have a maximum expected growth in sales (Dolata, 2017). The market in Asia has significantly increased because Asia’s sales have upsurged twice the time since 2011. This suggests that the sales of the iPhone have increased by 85%. Furthermore, the growth of the iPad has ascended by 17%. This suggests a 132% increase in revenue. In contrast, the iPod and Mac were significantly low in sales as shown below (Yusoff, 2018).

Compared to its competitors like Google Android, shares of Apple have upsurged from 48% to 60% which far superior. The shares of Google have expanded from 15% to 19%. In general, the outcome was quite positive (Knott, 2015).

The level of equity had no effect on 45% of the high interest. Furthermore, without influencing it has augmented by 68% (Castro, 2016). The equity of the company may not ascend in future. It is due to the fact that the company has declared the repurchasing and dividend of the shares. The ratio of liquidity of Apple is 1:6, which is quite beneficial for the company and the excess money was $110,000,000,000 which has enhanced from $97,000,000,000 from Q4.

Conclusion and Recommendation

In short, The Apple, Co. is extremely innovative and the only company who took the innovation to a whole new level in contrast to the competing companies. These stances are usually considered to be significantly risky. However, Apple has been benefiting since the beginning when it comes to inventive products. Rigid and firm position in the market and unflinching loyalty of consumers have made Apple the tech-giant of the world. Furthermore, the closed ecosystem and various other user-friendly products have enabled Apple to stand apart from its competitors, having its own league. Apple is the most admired company in the whole world, which is an important factor. Whereas, it is also accredited to be the first business model having a sustainable music download system through iTunes and iPod. The fact that Apple is a lucrative company having expecting optimistic days, cannot be debated. However, the Apple should cautious in political and legal aspects which is due to the fact that in many countries Apple has a high price and it purchases the processor of application from Samsung, a fact which may give birth to problems.

References

1. Ansoff, H.I., Kipley, D., Lewis, A.O., Helm-Stevens, R. and Ansoff, R., 2019. Implanting strategic management. Springer.
2. Castro, R.B., 2016. Apple Inc.–A Marketing Success Story.
3. Chang, J.F., 2016. Business process management systems: strategy and implementation. Auerbach Publications.
4. Clarke, T. and Boersma, M., 2017. The governance of global value chains: Unresolved human rights, environmental and ethical dilemmas in the apple supply chain. Journal of Business Ethics, 143(1), pp.111-131.
5. David, F.R. and David, F.R., 2016. Strategic management: A competitive advantage approach, concepts and cases. Pearson.
6. Dolata, U., 2017. Apple, Amazon, Google, Facebook, Microsoft: Market concentration-competition-innovation strategies (No. 2017-01). Stuttgarter Beiträge zur Organisations-und Innovationsforschung, SOI Discussion Paper.
7. Heracleous, L. and Papachroni, A., 2016. Strategic Leadership and Innovation at Apple Inc. SAGE Publications Ltd.
8. Hernández, J.G.V. and Garcia, F.C., 2018. The link between a firm´ s internal characteristics and performance: GPTW & VRIO dimension analysis. Revista de Administração IMED, 8(2), pp.222-235.
9. Khan, U.A., Alam, M.N. and Alam, S., 2015. A critical analysis of internal and external environment of Apple Inc. International Journal of Economics, Commerce and Management, 3(6), pp.955-961.
10. Knott, P.J., 2015. Does VRIO help managers evaluate a firm’s resources?. Management Decision, 53(8), pp.1806-1822.
11. Lai, S. and Rashev, P.Z., Apple Inc, 2015. Transceiver with spectral analysis. U.S. Patent 8,995,502.
12. Lockamy III, A., 2017, July. An examination of external risk factors in Apple Inc.’s supply chain. In Supply Chain Forum: An International Journal (Vol. 18, No. 3, pp. 177-188). Taylor & Francis.
13. Mathooko, F.M. and Ogutu, M., 2015. Porter’s five competitive forces framework and other factors that influence the choice of response strategies adopted by public universities in Kenya. International Journal of Educational Management, 29(3), pp.334-354.
14. Paik, Y. and Zhu, F., 2016. The impact of patent wars on firm strategy: evidence from the global smartphone industry. Organization Science, 27(6), pp.1397-1416.
15. Rosenberg Hansen, J. and Ferlie, E., 2016. Applying strategic management theories in public sector organizations: Developing a Typology. Public Management Review, 18(1), pp.1-19.
16. Wheelen, T.L., Hunger, J.D., Hoffman, A.N. and Bamford, C.E., 2017. Strategic management and business policy (p. 55). Boston: pearson.
17. Yusoff, N.H.M., 2018. DETERMINANTS OF RISKS AND PERFORMANCE IN APPLE INC.. pdf.
18. Zhao, Z.Y., Zuo, J., Wu, P.H., Yan, H. and Zillante, G., 2016. Competitiveness assessment of the biomass power generation industry in China: A five forces model study. Renewable Energy, 89, pp.144-153.
19. Zhou, L. and Gupta, S.M., 2018. Marketing research and life cycle pricing strategies for new and remanufactured products. Journal of Remanufacturing, pp.1-22.

Business Policy And Strategic Management

Business policy and Strategic management are guidelines defining how the scope within which decisions can be taken by the subordinates in an organisation while the latter is the course of action through which an organisation relates itself with environment so as to achieve its goals (Anjankumar). They are a set of decisions and actions resulting in the formulation and implementation of strategies designed to achieve a firm’s objectives.

In the case involving DSS Consulting, on being promoted to the position of Chief Operating Officer at DSS Consulting, Meg Cooke was tasked with new responsibilities and roles chief of them being to see DSS Consulting expand its client base from the traditional small school districts to larger districts in line with the new company policy of allowing new leaders to take more control over DSS and the new business strategy which they hoped would help improve revenue growth at the firm (Divekar). To achieve this, DSS restructured and consultants assigned to new cross functional teams responsible for marketing and delivering services to districts in their assigned regions. Chris Peterson was assigned the Southwest Region team as team leader and put together a team that she would work with to meet their objectives.

At the time Meg assumed her position, DSS was facing various challenges that had led to stagnation in revenue growth and new strategies were necessary to see a change in company revenue. She therefore took to a new business model with new policies and strategic management in lorder to help DSS gain strategic competitiveness in the market through value creating strategies that were customer focussed and creating value for customers(Michael et al. 2017 p 5). She allowed subordinates to deal with problems and issues without consulting her for decisions every time, and let the teams decide their areas of focus independently. Since DSS corporate strategies had changed along with the company vision and objectives

Chris and her team went on with their roles and responsibilities and completed their running projects before deciding on a new project to create a scaled down Planning and Budgeting system for their regular small districts. During the planning and development stage, Chris involved two superintendents of smaller districts who all had positive feedback on the system. The team also sought the help of specialists within DSS whenever they encountered challenges while developing their product however, they received little help as they were also focussing on their own projects. All through the project, Meg and Chris did not meet much as compared to other groups since Meg gave the team space to make their own decisions

On completion and beta testing of the product, Chris and Meg met to discuss the project. In the meeting, Meg seemed more interested in how the new system would be marketed to larger school districts given that they may not be interested in the system as it were. This shows that Meg was more concerned with how relevant the project was to the new company policy and strategy of focussing on larger districts to expand their revenue growth.

During the Monday morning meeting, Meg informed Chris of her decision not to go forward with their project citing lack of interest for their product in other regions, and her concern that the system would not interest larger districts. Although this did not sit well with Chris after her team and herself dedicated a lot of their time and energy on the project, Meg reacted as she did because the project did not fully comply with the new company policy and strategy to expand from their traditional small districts to larger districts and becoming a cross-functional, customer focused organisation(Ananjkumar). This decision was arrived at by Meg after evaluating the strategy Chris’ team had taken and concluding that it did not meet the immediate company goals as were(Kenton, 2018). Chris’ and her team’s product despite taking up a lot of time and resources did not meet the new company policy as it was still focussed on the smaller districts.

REFERENCES

1. Anjankumar. Business Policy and Strategic Management. Kunda College of Technology and Management. Retrieved from https://www.scribd.com/doc/45606679
2. Kenton, W. (2018). Strategic Management. Retrieved from https://www.investopedia.com/terms/s/strategic-management.asp
3. Divekar, S. Business Policy & Strategic Management. Retrieved from https://www.slideshare.net/mobile/share/business-policy-strategic-management
4. Michael, A., Duane, R., Robert, E., (2017). Strategic Management; Competitiveness & Globalization.

Strategic Management And Marketing For Tourism And Hospitality

Strategic Management

To begin with, tourism is one of the largest industries in the world contributing 6 trillion dollars annually into the global economy. World travel & tourism council, 2011 predicted that tourism could create 69 million jobs in the Asia and Mexico. Tourism has been part of this world from the very beginning. People have been travelling from one place to another for leisure and fun. And now with modernization more people can travel in lessor time. This thing has made this industry worth trillions of dollars. From sea routes to airlines everything advanced now. (Jain, page 510, 1992). Europe has always been the most hotspot place for travellers for many years even in 2019 top 2 countries with most travellers were France and Spain (Romecitynow, 2020).

Moreover, as stated by Thompson, Strickland and Gamble that the meaning of Strategic management is the main plan of a business, in which they decide how to keep growing as a organization, stay competitive in the market, how to reach the targets in order to enhance the organization’s performance and to keep attracting and satisfying customer’s needs (Tapera, 2014).

As well as, the concept of management needs to be understood as it’s a big challenge in tourist organizations. Trends in global market changes the perspective of tourist management in the dimension of strategy of new models in tourist organizations. (Maric and Page 427, 2012).

The benefits which can be obtained from strategic management helps encounter planning process. Key factors for this are internal and external environmental issues which effects organization directly and indirectly and can change the way an organization operates. Strategies make sure that organizations are well set on its goals and objectives with a guideline.

Moreover, it provides a path for employees of that organization to follow. Without such strategies and guidelines organization cannot determine their routes or implement any policies in the organization. This could further affect their survival in the industry.

Due to this process of strategic management all the loop holes and questions could be answered in a much systematic way. Thus, they will get a much clear picture of their routes.

Evolution of Strategic Management in Tourism & Hospitality

In recent years, tourism and hospitality management has gained significant importance and development and has become important part of people’s life. Attractive places and promotional spots have gained enough famous that people don’t just go for enjoyment but to spend their best time of life. This has increase competition in global market of tourism. (Getz and Page 593, 2016).

The management is a crucial innovation which is a modern revolution in tourism industry. In such way managements try to overcome the hindrance in the industry which can cause the problem for people. Its importance can be understood by the complexity of the industry and competition in the global market.

Further, this leads the people and the organizations towards information and knowledge. It helps maintain the coordination within the organization effectively and efficiently (Robbins et al., 2009:10).

It helps win the market and increase the profit with significant percentage. Organizations must strategize plans for long term future in order to compete and act accordingly with changing market. (Banja, page 120, 2016).

Importance of Strategic Management in Tourism & Hospitality

The primary purpose of strategies is to have a guidance and be competitive in the market. With dynamic changes in domestic and international market it is impossible to survive without a strategy. Even if the data of tourism industry is put together of last decade, significant changes can be observed.

Furthermore, sometimes strategies could be problematic as well due to changes in the market. Internal and external factors affect businesses in different ways and organizations can never predict them. The best way is to stay updated and be flexible with the strategies so they can change easily.

In this context, Entouristik can develop strategies as well to effectively grow their business by changing market by implementing effective strategies.

Strategic Marketing

Strategic marketing is all about developing a marketing strategy for an organization. Primary focus is on the competitive and consumer advantage a business can has in the market. Strategic marketing is different from strategic management although there are some similarities. Strategic marketing helps identifies the market to compete and survive on the basis of advantages. Furthermore, Hambrick And Fredrickson (2001) stated that marketing strategies has five following elements:

• It deals with where organization plans to be active
• How it will get there
• How it will succeed in the marketplace
• What the speed and sequence of moves will be
• How organization will obtain profit

However, it has a resource and budget limitation under which it has to be operated. Strategic marketing can be for short term and long terms depending upon the situation and resources available. But with this strategy company can analyse its performance and make changes (Jain, page 510, 1992).

Importance of Strategic Marketing in Tourism & Hospitality

As mentioned earlier, tourism and hospitality industry is the world’s biggest industry is not just because of customer’s satisfaction or desire but because of the marketing strategies which have been implemented by the businesses to attract customers. One of such strategy is marketing strategies which helps sustain the competition in the market and grow with a tremendous speed. Everyday millions of ads and marketing tools are used to attract customer to travel different places. From airline to hotels to restaurants and different destination spots. People are attracted and choose these things to travel.

Tourist organizations have adopted this strategy not only to grow but to meet the challenges of changes markets. Organizations can define such marketing strategies as “integrated pattern of decision making”. Crucial decisions are made in this strategy which can easily affect the market in positive and negative manner (Varadananjan, 2010, p. 128).

As experts suggest that strategies which are driven by market and customer preference should be the starting point of any business (Cravens & Piercy, 2009). Thus, every market and customer factor have to be considered in making strategy like customer taste, seasonality, etc. Referring to the benefits and advantages of the strategic marketing, it is becoming very important. However, this market still lacks many crucial elements in marketing. One of the reasons is that now the marketing strategy is more focused towards destinations than consumers. Consumers are the main elements because of which this organization is running and they are the one need to be focused (Williams, 2006).

Due to the advancement in the market, organizations have lost their interest in offering packages rather than outlets and destinations. The preference and desire of consumer is being neglected completely. Now consumers have more knowledge of tourist spots and the demand high value service from the tourism industry (e.g. Web 2.0 and Web 3.0)

Tools for Strategic Marketing in Tourism and Hospitality

The competitive strength in the environment of tourist services, especially hotels are strongly related to the policies and strategies which are developed through the process of new information technologies (Oltean et al., 2014).

Technological innovation has greatly impacted the traditional tourism marketing strategies in the last decade as well as, changing the behaviour of implementing the strategies and tasks of service providers. With the increase in demand for quality services and high satisfaction have forced companies to modify themselves and adopt technologically advanced systems.

Such innovations are becoming part of every organization in the industry. This is obvious that investment in information technology will increase the effectiveness and efficiency of the organization. Although, this will also increase the competition by reducing the cost and time spend on each task and capturing markets globally (Bilgihan et al., 2011).

As stated by, Eurecat Tourism Innovation Department Director Salvador Anton Clave said during the Forum TrisTIC de Barcelona event that “the change goes beyond improving processes of the tourist experience; it entails transforming the tourism system itself.”

Some elements like mobile phones have major effect. They have made everything available in one click from booking to travelling everything can be done on your cell phones. People can locate restaurants, hotels, top tourist spots and even purchase anything they like. And most importantly people can never get lost in new location thanks to GSP and google map (Global growth agents, 2019).

Mobile apps

In terms of technology and future growth, smartphones are the most important development. Today, instead of just connecting people now they are used for booking tickets of airlines. Book Uber cars to reach different locations and to choose places where one wants to go.

Faster and safer with biometrics

The biometric system at airports and hotels have made trips extremely safer. On the basis of this all the gather can be collected with the help of fingerprint. In future it is possible that people will not need to carry passport and tickets with them instead with the help of biometric system their booking record will be displayed on computer and travelling will become very safe and easy.

Fewer hotels, more private homes

Sharing foods and living places is becoming new thing in tourism industry. With the help of Airbnb people can book their accommodations much cheaper than hotels and have the luxury of living in homes. This make things safer for people and increase the diversity in people to share their things and make money.

Furthermore, COUCHSURFING has made life much easier than Airbnb. This app has allowed people to connect and live free in different countries, reducing their cost of travelling to minimum level possible. In COUCHSURFING people share their houses and food with travellers for free and give them tour of their places. And each people can know another even before they meet by their profile and references, they get by other peoples. Such new technologies have made things secure and easy for everyone.

Car rentals with GPS

Nowadays, people don’t need navigators to track locations but they have smartphones for them. People can track their cars and distances. Rental companies have taken great advantage of this and Ryanair airline is also using this service in their benefits (Tourism Review News, 2019). It has become simpler to book a car online and locate it through the GSP about where the car is.

Customers us informational technology system to compare alternative solutions for traveling and finding best suitable offers. Using different servers like Kayak, TripAdvisor they can find best travel guides and secure bookings to meet their requirements (Buhalis & O,Connor, 2005)

Online shopping also differs due to the complexity of the website, the easier it will be more customer will shop from that website. (Beldona, Morrison, & O’Leary. According to an Australian study, different people have different comfort zone in terms of website and they act according to their preference. Even while booking on the website it have to secured which increases the trust of costumer to again visit (Benckendorff, Moscardo, & Murphy.

Kim and Han (2007) concluded that potential consumers of seven different agencies identified that low fares and security is the most important aspect of any website.

Customer loyalty and satisfaction is highly integrated with quality service and secured channel (Ho and Lee (2007). In developing countries like India, Brazil, research has showed that IT staff have high technical skills and need more development to grow their businesses (Tetteh & Snaith).

Additionally,

In case of Entouristik, the management should also adapt such marketing strategic to expand their business effectively.

External Environment Analysis

This theory is based on the ideology of maximizing company’s profit and building long term advantage for an organization. The industrial organization perspective is the basis of the theory which shows that the external factors of the market are more crucial to gain and sustain competitive advantage in the market (Porter, 1981).

Comparison

Strategic management is a long-term strategy planned by the business in order to establish a clear path for the business to follow which portrays how will the business expand, target achieving, how to maximize the profits, which can provide a sense of motivation for the employees.

Whereas, strategic marketing is about segmenting and targeting markets through multiple techniques such as, launching new products which are trending in the market, by setting up prices according to the strategies of long-term management. The primary goal is to satisfy the customer needs and wants far better than the rival comapny and achieve and sustain a competitive advantage. Many businesses face failures to sustain their relationships with existing customers. (Romecitynow, 2020).

Conclusion

In order to expand and effectively run their business Entouristik should use strategic management for the long-term future, and to prepare for the changing marketing conditions. As well as, develop marketing strategies using new era technological marketing tools to attract and sustain customers in order to maximize the profits.

Tesla’s Strategic Management Review

In this age of development and globalization, organisations require proper analysis and formulation of abilities so that they could provide the employees with framework and strategies to improve the growth and development of the organisation (Lyyra and Koskinen 2016, p. 61). Through the implementation of strategic management, the organisations are able to develop abilities to meet their goals (Almuzel et al. 2018, p.191). However, in such conditions, it should be mentioned that prior to implementing the strategic management associated interventions, the resources available, the assessment of the internal and external processes and others could be understood (Jazouli, A. and Mitchell 2017, p. 10). Hence, this provides a framework for the population so that using these strategies; the organisation could develop its long term strategies and could help each other to achieve the goals. Perkins and Murmann (2018, p. 475) also add to it by saying that application of strategic management helps the organisations to fairly distribute the resources and help each of the team member to reach its organisation development associated goals.

The primary aim of this paper would be to analyse the strategic management of the Tesla organisation. Further, in the process, it will discuss different aspects such as the focal organisation analysis, critical analysis of the business environment of the process, industry and competitor analysis, and Future trends and key drivers.

Focal organisation analysis

Strength

1. Branding: technological progression has always been considered as the brand of this organisation and this brand recognition is the biggest strength of this organization. As per the effective brand with their innovative ideation has helped them to earn a worldwide buzz for the organisation and it is beneficial for everyone in this organization.
2. Product and technological success: the cars developed by this organisation are sustainable and are proven to have effective and high performances. The organisation has invested primarily in the research and development section so that new and developed technologies could be included in these products (Cheong, T., Song, S.H. and Hu, 2016, p. 123).

Weaknesses

1. Increasing cost for the research and development units: while discussing the weaknesses of this organisation the revenue generated should be discussed. As the organization did not earn the proper amount of revenue due to its high investment in its Research and Development unit. As perMacDuffie (2018, p. 482), this organisation spends 14% of its revenue in these units so that they could develop cost-effective batteries.
2. Expensive products: the over price of products limits the consumer base of this organisation and hence, this is one of the primary weakness for the entire organisation. As per Cheong, T., Song, S.H. and Hu (2016, p. 123) majority of people are unable to buy their products due to the high price and creates an obstacle for the growth of this company.

Opportunities

Increasing and sustainable market trends: despite the limited and restricted consumer base, this organisation has observed a proper up and high market trend in recent years and this creases a room for opportunities for the growth and development of this organisation. The new and developing products of this organisation promise to be green, environmentally friendly and budget-friendly to the middle-class families.

Ability to expand internationally: the organisation has developed its base in the western market and now through their expansion strategies, is not ready to expand in Asia. The organisation has planned to use the inexpensive labour costs so that they could develop products depending upon their consumer needs in the Asian market (Teece 2018, p. 123).

Resources and capabilities: the organisation has spread its base in multiple sectors due to which they have become unstoppable and irreplaceable. One of the best resources of this organisation is its brilliant engineers that have developed this organisation as one of the most technologically advanced organisation. Secondly, after acquiring the Solar City, the organisation now has developed solar panels for its products, defining its capabilities in future (Akakpo et al. 2019).

Critical analysis of the business environment

As per Välikangas et al. (2018, p. 470), differentiation should be considered as the primary business strategy of this organisation as due to their high production rates, high operation costs and consumer processes have affected the profit ratios of this organisation. Despite this, the organisation is observing a steady and sustainable growth due to its differentiate abilities. The organisation focuses upon working their products differentiate from others and hence, despite focusing upon the low-cost processes, Tesla invests upon newer technologies so that they could help the organisations through the implementation of innovation. In this aspect, it should be mentioned that the organisation focuses upon developing and implementing sustainable growth so that they could compete with their competitors and implement success for its technological performances in their market (Teece 2018, p. 123).

Besides this, the organisation’s abilities to implement its innovation and technological processes in the research and development section should be discussed effectively so that they could develop new and sustainable abilities (MacDuffie2018, p. 482). This organisation has dedicated completely its resources and revenues in the growth and development of new and efficient technologies. Due to this prospect, they and their products could be distinguished from others. Despite having higher revenue rate than other automobile organisations, Tesla spends 14% of its revenue in the research and development and hence, this organisation is a major cause of buzz among the automotive consumers that thrive for development and innovation in products (Teece 2018, p. 123).

The functional strategy should also be discussed in this aspect. As per MacDuffie (2018, p. 482), Tesla has a stable commitment towards its value chain and production and as per Teece (2018, p. 122), it is the dealership and abilities that help the organisation to understand that their products are their primary branding tools. Therefore, despite all these, their primary focus should be upon their product, its quality and sustainability. As per Lyyra and Koskinen(2016, p. 61), due to the sustainability and urge for development, the organisation has also trained its employees so that they could also completely focus upon the abilities of the organisation. Further, the organisation has also developed abilities so that their focus for the environment could be understood and through the development of environmental consciousness among its employees as well as consumer base. Therefore, the development of these, the organisation has developed abilities so that they could connect to every aspect in these processes (Teece 2018, p. 123).

Industry analysis

While discussing the type of industry and analysing its functions, the organisation and its existing rivalry with others should be discussed effectively. Tesla organisation works in a highly competitive and as an automotive organisation due to which this organisation holds the most significant place in the global market place (Teece 2018, p. 123). There are multiple rivals for this organisation and as per the business trends, General Motors, Ford Motor Company, and Fiat Chrysler are the organisations that are associated with the critical competition with Tesla in global market place. However, depending upon the new innovations and technologies, this organisation does not have any rival. However, with the development of abilities and critical market complications, it should be mentioned that with the development of technological aspects and research and development, other organisations would soon develop new and technologically developed products. This would eventually hamper the loyal consumer base as those organisations would sell their products at less price. As per Lyyra and Koskinen (2016, p. 61), these models would directly compete with the new and technologically developed products in the market. One of the primary reason for this situation would be limited number of high-class consumers associated with Tesla organisation and high price of its products. All other organisations are focusing upon developing cheaper and developed version of products, electrical vehicles and others due to which majority of the population would be able to afford those products and they would be able to provide effective service to its consumers. Besides this price related rivalry, the organisation is about to face complications with critical market competition associated with luxury car brands as well such as BMW, Mercedes-Benz, Maserati, Audi, Porsche, and Jaguar (Teece 2018, p. 123). These products are involved in the increased competition and hence, it has become important for this organisation to implement critical aspect and focus upon implement strategies so that every product of this organisation could work effectively for the development of products that would be affordable and appealing to every individual associated with it. Besides this, competition could also be present due to the presence of critical health complications associated with the car parts collected from the processes due to which majority of the organisations develops parts that could be used within the products developed by Tesla organisation. Hence, this competition is associated with the usage of care parts that could be used within the process of making innovative cars. Therefore, these are the complication that arises after the analysis of market in the process (Lyyra and Koskinen 2-16, p. 61).

Competitor analysis

The industry has a wide range of market competitors ranging from Luxury Competitors to American Automotive competitors. The analysis for the luxury competitors Bavarian Motor Works and Mercedes Benz is given below (Kauerhof 2017, P.80):

BMW (Bavarian Motor Works)

• Strength: Excellent quality, performance, strong brand value.
• Weakness: Poor in associated partnerships and operational cost-efficiency.
• Capabilities and Competencies: Versatile, strong financial hold and innovative in terms of technology.
• Business Strategy: Market segmentation and differentiation.

Mercedes Benz

• Strength: Excellent performance, quality and strong brand value.
• Weakness: Costly maintenance.
• Capabilities and Competencies: Financially stable and excellent engineering and automobile technology.
• Business Strategy: Market segmentation and differentiation.

The above mentioned BMW and Mercedes Benz are two distinct luxury brands that are consistent competitors of TESLA motors. In the coming years, BMW plans a launch of 25 electronic vehicles with 12 of them being completely electronic and possessing a useable range till 435 miles (Kancherla and Daim 2018, P.348). Mercedes Benz also plans to spend $ 1 billion to commence the production of electronic vehicles and introduce a total of 10 novel electronic vehicles (Kancherla and Daim 2018, P.350,351). At the same time, Volvo which is a mass-market brand also plans to launch hybrid and fully electronic vehicles in the year 2019 (Mortiz et al. 2015, P. 88). Considering the innovative measures being undertaken by luxury brands, it can be said that Tesla Motors is vulnerable and is going to witness strong market challenges.

American Automotive Competitors: Ford Motor Company and General Motors.

Ford Motor Company

• Strength: Stable U.S market position, excellent design and precision.
• Weakness: lack of innovation.
• Capabilities and Competencies: Manufacturing and mass production.
• Business Strategy: Cost leadership.

General Motors

• Strength: Multiple collaboration with Chinese companies and strong market positioning within the U.S.
• Weakness: Dependence majorly on the U.S market for revenue.
• Capabilities and Competencies: Global supply-management and innovative strategic supplier engagement program.
• Business Strategy: Poor cost strategy

The two companies General Motors and Ford Motor Company have invested heavily on artificial intelligence, fostering improvement in car design and autonomous car designs which can pose a threat to TESLA motors.

Current trends and key drivers

The luxury brands BMW, Mercedes Benz as well as the American Automotive Competitors have levied efforts in the field of technology so as to improve the car design and transition the traditional car designs into semi or completely electronic operated car designs (Bilbeisi and Kesse, 2017). It is worth noting in this context that For Motor Company has recently announced about the investment of $1 billion for fostering innovation and developing the technology of autonomous driving (Ayala 2016, P.77). The strong market competitors of TESLA motors are integrating effort to make use of advanced AI to launch the concept of ‘Self-driving’ cars. Therefore, it can be anticipated that the current trend in the automobile industry would mostly be reliant upon the development of artificial intelligence and for the same TESLA motors would need to invest in rigorous research and development for the purpose of introducing innovation aligned to the technology of AI. TESLA motors are known for its experienced and skilled manpower and therefore with the employment of skills and expertise of the employees, the enterprise would be able to evolve and integrate innovation so as to produce cars that are of superior quality and unmatched in terms of specifications (Gaya Ferra and Tresserras 2016, P.67). This would help TESLA motors to maintain an edge over the stable market competitors.

Future trends and key drivers

At present, TESLA motors remain unmatched within the automobile industry in terms of specifications and performance in the 21st century. In this context, it is worth noting that the introduction of electronic cars based on the lithium ions has helped to enhance the brand value of TESLA motors against all other market competitors. At present, the market position can be considered stable and through the market size and large infrastructure the company is also provided with a number of strategic opportunities as well as options that can help to enhance the competence of the company (Stringham et al. 2015, P. 88). Factors such as sales as well as supply chain expansion, introduction of budget-friendly models, introduction of mobility services and creation of new market segments and business expansion can help to improve the brand image and sustainability of the company (Mosey and Kirkham 2017, P. 27). In this regard, it is important to acknowledge that the mentioned aspects must be intricately evaluated and taken into consideration such that brand image can be enhanced. It is also essential to consider the risks involved such that appropriate mitigation strategies can be developed so as to ensure that the brand image and reputation of the organization is not impacted and that the organization develops manifold to acquire stability within the International market.

Key factors and opportunities for Tesla

This section would present a brief discussion on the mentioned factors where TESLA motors could work so as to expand the business and acquire market stability. TESLA motors have an opportunity to improve sales within the regions of Asia, Europe and South America. A number of regions within the mentioned continents are unexplored or underexplored and offer an exhaustive opportunity for business expansion. There is a huge opportunity for TESLA motors to make use of improved automobile engineering and technology such as solar cells and other means of sustainable technology so as to expand business within the untapped markets of the mentioned regions (Wen 2016, P. 67). Therefore, expanding the business to the mentioned areas can help the company to grow multi-fold which would add to the revenue of the company. Demographic studies mention that the maximum proportion of the world population includes, people who fall under the category of middle-class income. This means that the company can work on launching economically optimised models which would fit the demands of the people who belong to the lower or middle-class income category. Market segmentation and introduction of economically optimized car models would help TESLA motors to acquire market revenue, expand and diversify (Bilbeisi, K.M. and Kesse, 201. TESLA motors can also work on ride-sharing or mobility services which would potentially serve as a market innovation that would help to boost market revenue. The mobility service by TESLA would intend to serve as an inexpensive solution to customers wherein customers would be able to make use of luxury cars for sharing cab rides to office at an affordable price range. This innovation would not only ease commute route but at the same time would also help to control carbon emissions which would further boost the revenue of TESLA motors (Stringham et al. 2015, P.88). Another application-oriented initiative can be undertaken where the customer would be able to summon a TESLA car at the doorstep similar to that of UBER and commute via a luxury car at an affordable price range. In addition to this, TESLA motors also contain opportunities in the form of mergers, acquisitions and collaboration to expand market and boost the revenue of the company (Ivanov, Tsipoulanidisand Schönberger 2017). It can be expected that long term investment and innovative initiatives can help the brand acquire improved profitability and a larger customer base that would help to attain a stable market position within the international market.

The required material for this task is attached. The needed case can be found in

The required material for this task is attached. The needed case can be found in file “Industry Note on 3D Printing Industry”, and additional information about 3D Printing can be found in file “3D printing technology overview”. 
Task (can also be found in file “Instructions for 3D printer case Partners” in more detail): 
The CEO asked you to prepare and external analysis of the 3D printing industry in 2019. Please prepare a 5-page report (MAXIMUM) that includes an assessment of the industry’s strategically relevant macro-environmental components, evaluates competition in the industry, assesses drivers of change and industry dynamics, and lists industry key success factors. The company’s management also asks that you indicate the opportunities and threats (O&Ts) within the industry based on your data and analysis. Provide a short recommendation of how and where firm should enter the 3D printing market based on your analysis.
Do the external Analysis using the models and concepts from the course. Demonstrate that you can draw from the data in the case to develop the models and concepts in the book. ONLY USE CASE DATA. Use the models to provide a recommendation. Your report should demonstrate:
1. What are the Macro environment factors that impact the industry? Do a (PESTEL)
analysis with the factors driving change in the industry. Provide data and evidence from the case to support your findings. Put the data in a table label it Exhibit 1.
2. What are the competitive forces impacting the 3D printing manufacturing industry (assess the 5 forces)? Explain why if each forces is strong or weak. What is the effect on industry attractiveness and potential profitability of new entrants and incumbent firms? What does your analysis indicate might happen to prices?
3. Identify Demand for 3D printers, the market segments and industry characteristics. Which segment is growing? It would be helpful to uses a table.
4. As a recommendation identify the major issues (O&Ts) occurring within the industry from your analysis. What are the driving and priorities for the 3D printing firms’ executives?
Where should the firm enter the 3D printing market?
Write a maximum 5-page report providing your analysis of and recommendations for the most important three challenges for an Executive President (or CEO) in the 3D manufacturing industry. You can have up to 3 extra pages for Exhibits.
Use one-inch margins, and 12-point Times Roman font or equivalent. Write in report form. Use headings to organize your report. In the first paragraph state your purpose and an overview of the report. Put exhibits at the end elow is rubric for grading criteria (I am expecting you to create exhibits and then refer to case exhibits as Case Exhibit…). Note that a portion of the grade is based on the quality of the writing and exhibits. You should be able to identify the opportunities and threats available to the firms in the industry. Your report should provide compelling analysis and advice in the report to the CEO and top management.

I have attached my team’s research for our analyis. I need the assignment put to

I have attached my team’s research for our analyis. I need the assignment put together 
completely and editied. Feel free to add and edit accordinly.