Title: Environmental analysis of (witheld)

Title: Environmental analysis of ………………………. Assignment topic Organisations can have a number of strategic options available to them. Making the right choice from available strategic options is the result of in-depth internal and external environmental analysis and better alignment with their vision, mission, and statement of values and objectives. Select an organisation of your own choice and, without going into the details, provide their vision, mission and statement of values and briefly discuss the objectives. For this assignment you may use the existing statements and objectives. Using appropriate Strategic Management tools critically analyse the internal and external environment of the chosen organisation. Based on your analyses, identify and critically evaluate two strategic options and select one option that provides the best strategic fit for the chosen organisation. With the help of sound arguments, justify why you think this is the best strategic option and how this can help the chosen organisation to achieve their overall vision and mission and strengthen their position in the market. Word count (from the start of the Introduction section to the end of the Recommendation section): 2 044 words Executive summary The internal and external environment has a major impact on every organisation. This paper analyses the internal and external environmental factors affecting …………….. and indicates how they can be used to a company’s advantage. Firstly, Strategic Management will be defined; its principles and practices will then be discussed, considering the environments in which ................. Limited exists. The strategic options proposed which the company could benefit from are a result of analyses conducted using PESTLE, SWOT and Five Forces framework, to achieve the goals envisioned. One of which will be chosen justifying why this would be the most viable selection, in line with .................’s objectives.  Contents 1. Introduction 6 2. Background 6 3. Vision 6 4. Mission Statement 7 4.1 Justification of the mission statement 7 5. Statement of values 7 5.1. Justification of the values 8 6. Strategic Management tools 8 6.1. Porter’s five forces model 9 6.2. PESTEL Analysis 9 6.3. SWOT Analysis 10 7. Internal 10 8. External Analysis 11 9. Importance of implementing strategies 11 10. Best-fit strategies 11 12. Recommendations 12 13. References 13 14. Appendices 14 1. Introduction Strategy is defined as ‘the long-term direction of an organisation’ (Johnson et al. 2014, p. 5). To construct a strategic plan it is essential for the strategist to take into account certain elements inclusive of; vision, mission and statement of values, and avoid common mistakes, like ignoring the developmental needs of the organisation to accomplish the next level of advancement. The aim of this paper is to analyse the external and internal environments of ................., by examining different strategic options and selecting the best suited to the organisation’s long-term strategy. This will be accomplished by an evaluation of ................. using Porter’s five forces framework, SWOT analyses and the PESTLE framework, to determine the best fit option. 2. Background ................. Limited (.................) is a fully owned subsidiary of the Bryden’s Group, formerly Pi Caribbean which started in April 1994, legally incorporated in 2003 with well over 350 employees presently. They represent several major international brands and provide direct, channel focused marketing and sales services via more than 90 sales and trade representatives supported by management teams comprised of sales, marketing and logistics specialists and are ably supported by state-of-the-art warehousing and distribution centers. The 2003 incorporation of Pi Caribbean and A.S. Bryden & Sons created: …an ideal partnership and synergistic fit which is able to support an aggressive growth vision. The alliance gave birth to ................. Limited, an independently managed operation and newest member of the Bryden's Group (..................com).   3. Vision (see Appendices figure 1) .................’s over-arching vision is to achieve sales of one billion TT$ by 2018. To realise this target the company desires to be the most affable distributor to do business with, through acquisitions; realising that year on year growth would not assist to achieve the main target, through supplier and customer partnerships and by being best in class comprising point of sale, customer service, supply chain management and brand building capabilities provided by happy people who achieve more (................. 2015). 4. Mission Statement To be a channel focused distributor of Health and Personal Care products in Trinidad and Tobago (................. 2015). 4.1 Justification of the mission statement ................. is a team in partnership with suppliers committed to providing customised marketing and distribution services by linking the needs of consumers or final users with the supplier offerings. Their success is measured on the achievement of market leadership of their key brands and superior financial returns. They believe that their sustainable competitive advantage is due to their business philosophy and management style. According to ................., they believe that ‘Happy people are more passionate and productive’ and are assumed to be an outcome of their corporate values (................. 2015). 5. Statement of values (see Appendices figure 2) People come first– Based on happiness, trust, open communication, empowerment, creativity and opportunity for growth. We win only as a team– Full participation and involvement by all, support for each other, personal freedom with team responsibility and close partnership with their customers, suppliers and associates. We always do the right thing way – Dedicated to continuous improvement, attentive and responsive to new ideas, encouraging of creativity and not afraid of failure. There is always a better way– Acting responsibly and staying true to their values (................. 2015). 5.1. Justification of the values The objective of ................. is to ‘have happy people enhancing lives together, passionately delighting the internal and external customers and suppliers’ (..................com). They believe that their major sustainable competitive advantage is their philosophy and management style (see Appendices figure 2.1) generating happy people who are more passionate and productive (................. 2015). .................’s environment is one based primarily on happiness and the company’s experience is that a comfortable environment enables the employee to perform at his or her best which translates into better results and increased profitability. 6. Strategic Management tools There are various strategic management tools available, to analyse a company’s environments the options selected for this assignment are, Porter’s five forces framework (see Appendices, figure 3), SWOT and PESTEL analysis. Porter’s five forces framework illustrates the impact of rivalry within existing competitors; the threat of new entrants; bargaining power of buyers; bargaining power of suppliers and the threat of substitute services or products, on the company. It helps strategists analyse the industry and environment in which their companies function, formulate a plan to ensure an advantage among existing competitors and to determine how an industry would appear to new entrants (Johnson et al. 2014, p. 41). According to Research and Markets (2013) the SWOT framework demonstrates strengths and weaknesses within the organisation and opportunities and threats that exist externally. The internal features are the company’s own strengths and weaknesses. Analysing them is a matter of analysing the state of the company. They are factors that already exist for instance; culture, technology and staff relations. The external features are the organisation’s opportunities and the threats to its future performance. These exist only on the horizon, and they are less easy to assess; an organization has little or no control over its environment but needs to persistently monitor and adapt to these external changes. They arise from factors such as changes in technology, demography or government policy. The positive aspects are the strengths and opportunities; the negative facets are the threats and weaknesses (Guide to Management Ideas 2003). 6.1. Porter’s five forces model A Company's success is governed by the strongest competitive force or forces imposed, which are essential to strategic formulation (Porter 2008). Using the five forces framework, which focuses mainly on the influence of the external environment, to analyse .................’s external environment the following are the conclusions drawn; Threats of entry posed by new or potential competitors are low due to Government regulatory board requirements, high start-up costs associated with entry and the fierce competition that already exists. The rivalry among existing distributors are high owing to the fact that the products offered are of similar quality and prices.; Bargaining power of buyers is medium for instance chain stores and private hospitals who buy in bulk quantities, apply pressure on distributors to keep prices in check moreover the government tendering system is structured in such a way that distributors have to commit to the lowest prices possible in order to win a bid and switching costs are minimal on account of the similarity of competitor prices. Bargaining powers of suppliers are low since the number of licensed distributors are limited and already have stipulated contacts with the suppliers. The threat of substitute products is high due to the lower cost of generic products as there are mimics of products already developed. 6.2. PESTEL Analysis PESTEL incorporates Political, Economic, Social, Technological, Environmental and Legal segments (see Appendices figure 4). Analysing these sectors it can be concluded that, political uncertainty is on the horizon owing to general elections carded for September, 2015. Economically the country benefits from GDP growth from USD 19.18 billion in 2010 to USD 24.64 billion in 2014 (see Appendices figure 4.1) allowing for increased disposable income (tradingeconomics.com). Socially the population is apt to choose from a wide variety to suit their requirements; furthermore technology plays a fundamental role with the increasing use of online shopping, where more than USD 1 billion has been spent two years prior to December 2014 (trinidadexpress.com). The environmental impact is shown within the delivery aspect of the company, where road accidents, bad weather and other influencers could delay timely execution. Within the legal aspect, health and safety regulations mainly influence the staff within the company whereas product registration is controlled by the Bureau of Standards and Ministry of Health. 6.3. SWOT Analysis SWOT analysis is one of the most widely practiced methods from a variety of options in the attempt to implement or improve the corporate development strategy process (Hill & Westbrook 1997). SWOT is a mnemonic that represents the words; Strengths, Weaknesses, Opportunities, and Threats. It is used to assist strategists within organisations to access ways in which to manage the SWOTs and enhance performance (Guide to Management Ideas 2003). Furthermore SWOT analysis can be used to educate staff of the necessity for change and solve problems (Business & Management Dictionary 2007). SWOT can be broken into two environmental entities, Strength and Weakness for internal evaluation and Opportunities and Threats to access the external setting. Where weakness assigned ought to be turned into strengths; threats into opportunities and strengths should be matched with opportunities. Using the SWOT analysis, the information collected on ................. indicate there are many strengths which the company can utilise to, keep or increase the company’s market share (Appendices, figure 5). Their major strengths are innovative and dedicated people who are willing to do what it takes to get the job done, trusted partner relationships with suppliers creating opportunities for growth and the inclination to invest as evidenced by the recent acquisition of Genethics Pharmaceutical Limited in 2014. 7. Internal ................. has an internal environment fostering creativity, mutual respect and opportunity for each person to realise their full potential by following the first value and supporting a flexible work life (................. 2015). This is evidenced in the SWOT analysis prepared on ................., where people are the greatest strength; portrayed its visionary beliefs that ‘happy people are more passionate and productive’ (..................com). 8. External Analysis ................. Limited identifies that the customer is the life line of their business success and the objective is to meet customer needs and to exceed their expectation in quality, delivery and value (................. 2015). Taking into account the five forces, ................. currently ranks third in government tenders’ market share with 14.8 percent against 112 competitors, they are committed to customer satisfaction, observe the laws of Trinidad and Tobago, provide high quality products and adhere to a code of ethics acting with integrity. 9. Importance of implementing strategies Implementation of strategy is paramount to the success of a company, without action strategy is no more than a notion. When strategic plans are converted into action it becomes the guiding force in an organisation. The development of implementation can be quite a challenging task, particularly when the strategy entails substantial deviations from established ways of culture. Often strategy plans fail for the reason that employees resist change; implementation of strategy may also fail because of inadequate availability of required resources, communication and training. This is the purpose of ................. enabled training sessions to educate staff of the vision, values and beliefs such as; The leadership and emotional intelligence program facilitated by Barry Hart. 10. Best-fit strategies The best fit strategy for ................. comes from the SWOT analysis used in combination with PESTEL framework which gives an extensive array of information. This is based on findings from the options examined; Porter’s five forces framework indicates a strong position in the industry however SWOT and PESTEL analyses contain a greater opportunity for improvement and capitalisation in both environments for .................. The feasibility of this can be gathered initially from the strengths and weakness where there is a dedicated workforce nevertheless a high staff turnover and insufficient staff. This could be solved with little effort by management through disseminating information and adhering to the company values to facilitate the company moving closer to depicting its visionary beliefs that ‘happy people are more passionate and productive’, whilst also creating a longer lasting culture of motivated and committed personnel (..................com). 11. Conclusion In conclusion the vision, mission and statement of values are in accordance with the objectives of ................., principally in the external environment, though they are not fully exploited to maintain an upright internal stance, as perceived in their weaknesses. 12. Recommendations ................. should place additional emphasis on their greatest strengths by employing additional staff that is properly trained for the tasks required of them; educated in the values of ................. with suitable job descriptions and output expectations defined. Furthermore although state-of-the-art systems have been implemented; the Warehouse management and accounting technology purchased should be fully exploited in order to promote greater efficiency of resources. There is also a necessity to take advantage of new technology to the region, for instance handheld systems to assist the sales team with real time access to stock information, credit management and on time deliveries with the purpose of reigning supreme in the market share currently possessed. 13. References Bloomsbury Business Library, Business & Management Dictionary 2007, p 7227, http://web.a.ebscohost.com. ................. orientation document, July 2015. ................. website, viewed 4 July 2015, http://www...................com/ourvalues. Guide to Management Ideas, 2003, pp 218-219, viewed 6 July 2015 http://web.a.ebscohost.com. Hill, T, & Westbrook, R 1997, Long Range Planning, February, vol. 30, no. 1, pp 46-52, viewed 5 July 2015, http://web.a.ebscohost.com. Johnson, G, Whittington, R, Scholes, K, Angwin, D & Regnér, P 2014, Exploring Strategy-Text and Cases,10th Edition. Porter, M, E., 2008 ‘THE FIVE COMPETITIVE FORCES THAT SHAPE STRATEGY’ Harvard Business Review, 00178012, January, vol. 86, no. 1, viewed 5 July 2015, http://web.a.ebscohost.com ‘Research and Markets’ 2013 Business Wire (English), viewed 6 July 2015 http://www.researchandmarkets.com/research/t2lqws/systemair_ab Trading Economics website, viewed 11 July 2015, http://www.tradingeconomics.com/trinidad-and-tobago/gdp Trinidad Express, viewed 11 July 2015, http://www.trinidadexpress.com/news/Vendors-blame-poor-sales-on-online-bargains-286628011.html 14. Appendices Figure 1-Vision of ................. Figure 2-................. Core values Figure 2.1-.................’s beliefs Figure 3-Porter’s five forces model Figure 4-Pestle Framework Figure 4.1-Trinidad and Tobago GDP/US$ Billion Figure 5-SWOT analysis of ................. Strengths -Innovative & dedicated people -Trusted partner relationships -Willingness to invest -Brand building -High penetration and in-store impact -Quick decision making -State-of-the-art systems -Enhanced growth potential Weaknesses -Insufficient office staff -High turn-over of staff -Inconsistent communication with staff -Underutilisation of technology (Warehouse management and accounting system) -Non-existent Job descriptions -Invest in Digital x-ray machines (new technology) -Seek alternative suppliers -Stable economy and GDP growth indicates more disposable income for consumers Opportunities -Loss of brands to competitors owing to intense rivalry -Under-bidding of tender contracts -Political instability due to upcoming elections is September 2015 Threats 13