Rediscovering SWOT Integrative Nature †MyAssignmenthelp.com

Question: Discuss about the Rediscovering SWOT Integrative Nature. Answer: Introduction: There are a number of main strategy development tools which are used by organisations for determining various micro and macro factors that affect their business. The companies use these tools to create strategies for addressing current and future business issues and improving the performance of the firm. This paper will discuss three of the most common strategy development tools which are used by organisations across the globe which include Porter five forces model, Resource-based view model and SWOT analysis. In order to understand how each of these models is used, examples of companies from different industries will be analysed in the essay. This essay will evaluate the examples of Woolworths Limited, Honda and BHP Billiton for understanding Porter five forces model, Resource-based view model and SWOT analysis respectively. The five forces model was developed by Michael Porter in 1979, and it assists companies in evaluating the competitiveness of an industry. The potential entrants, substitutes, industry competitors, buyers and suppliers are included in five forces which are useful means of analysing industrial environments and these factors also assists companies in selecting effective strategies for generating a competitive advantage (Jurevicius, 2013). The competition in the industry is an important force because a large number of competitors and their capabilities threaten a corporations profitability. The potential of new entrants is increased if there is a requirement of less time and money and increase in new entrants resulted in increasing competition of an enterprise which negatively affects its growth. The power of suppliers is referred to the ability of suppliers in the industry to raise prices of goods and services (Moreno-Izquierdo, Ramon-Rodriguez and Perles-Ribes, 2016). The power of buye rs is referred to customers ability to drive up prices of products and services. Suppliers power deals with the ability of suppliers to increase the prices of raw materials or services. The threat of substitutes is referred to alternative products or services that can be purchased by customers in place of a companys products which increases competition for the firm. Example Woolworths Limited operates in Australian retailing industry and it is the second largest firm in Australia in terms of revenue. The bargaining power of suppliers low because there are a large number of suppliers available in the industry and the company enters into a contract with them due to which they cannot hike their prices (Arli et al., 2013). The power of customers is low to medium because there are no switching costs for customers. However, customers rely on Woolworths because it offers high quality fresh food products. The threat of new retailers is low because initial investment is high and heavy competition from established market leaders such as Coles, ALDI, Big W and others (Keith, 2012). The threat of substitutes is low to medium because customers can easily purchase products from Woolworths competitors. The competition rivalry is high in the sector because a large number of competitors operate which offers competitive pricing such as Coles, Big W and ALDI. Resource-based View Model Analysis Resource-based view (RBV) model is used while analysing and interpreting resources of a company in order to understand how organisations achieve a sustainable competitive advantage in the industry. The RBV model primarily focuses on the theory of difficult-to-imitate characteristics of an enterprise for analysing sources which have superior performance capabilities which result in providing a competitive advantage of the firm (Nason and Wiklund, 2018). Resources which not be purchased by an enterprise and require an extended learning curve are more likely to be customised as per the companys requirements, and they are more difficult to be imitated by the competitors. The RGV model focuses on an inside-out look at the companys resources and analyses why they succeed or failed in the marketplace. Resources which pass the VRIO model have characteristics of generating a competitive advantage. Both tangible and intangible resources can provide a competitive advantage to an enterprise. The VRIO model analyses resources which are valuable, rare, inimitable and organised (Bromiley and Rau, 2016). This model is used by the top-level management, and they use it by analysing attributes of different resources of the firm and leveraging the once which incorporates characteristics of VRIO model. Example Honda is one of the largest engine manufacturers in the world, and it uses RBV strategy to maintain its competitive advantage in the industry. The company has developed a business strategy which revolves around its strength, expertise and capability in building petrol based engines. The corporation started its operations by building small clip-on engines for bicycles. It expanded its operations by manufacturing engines for scooters and motorbikes. Based on the effectiveness of its resources, the corporation started launching generators, marine engines, car engines, lawn and garden equipment and jet planes (Madhani, 2010). Each of these products required different levels of experience and product knowledge, however, Honda leverages its unique capability to build world-class petrol based engines. SWOT Analysis The SWOT analysis is a strategic planning method which is used by organisations for evaluating strengths, weaknesses, opportunities and threats of a business. It assists in analysing factors that affect the success or failure of our business. The strengths and weaknesses of an enterprise are its internal factors whereas opportunities and threats include external factors (Bell and Rochford, 2016). The internal strengths of a company include positive working environment, leadership effectiveness, and human resource abilities. External opportunities include changing interest rates, relaxation in government regulations, and high competition. This model is used by top-level management of a company. It assists management in developing business strategies that are based on their internal strengths and external opportunities which assist them in improving their profitability and generating a competitive advantage. Example BHP Billiton is an Anglo-Australian mining, metal and petroleum company. The company uses SWOT analysis while developing future business strategies. The strengths of BHP include strong market position, diversified revenue stream, strong international presence, strong workforce and effective corporate social responsibility structure which positive influence its brand image (Pellegrino and Lodhia, 2012). The companys weaknesses include past workplace accident cases which affect its brand image and government intervention in operation. External opportunities include expansion in copper and coal sector, acquisition of smaller enterprises, and associations with global companies. External threats include a reduction in export demand in foreign countries due to improvement in in-house production and intense competition (Floris, Grant and Cutcher, 2013). In order to address these issues, the company focuses on acquiring small enterprises, and it uses effective marketing scheme to in crease its international market. In conclusion, management uses different strategy development tools for analysing micro and macro factors that influence a firms operations. Effective evaluation of these tools provides crucial information to the management which assists them in selecting competitive strategies. Porters five forces framework, Resource-based view model and SWOT analysis are three of the most common strategy development tool which enables management in developing strategies that are focused to addressing business issues and generating a competitive advantage for the company. References Arli, V., Dylke, S., Burgess, R., Campus, R. and Soldo, E. (2013) Woolworths Australia and Walmart US: Best practices in supply chain collaboration.Journal of Economics, Business Accountancy Ventura,16(1). Bell, G.G. and Rochford, L. (2016) Rediscovering SWOTs integrative nature: A new understanding of an old framework.The International Journal of Management Education,14(3), pp.310-326. Bromiley, P. and Rau, D. (2016) Operations management and the resource based view: Another view.Journal of Operations Management,41, pp.95-106. Floris, M., Grant, D. and Cutcher, L. (2013) Mining the discourse: Strategizing during BHP Billiton's attempted acquisition of Rio Tinto.Journal of Management Studies,50(7), pp.1185-1215. Jurevicius, O. (2013) Porters Five Forces. [Online] Strategic Management Insight. Available at: https://www.strategicmanagementinsight.com/tools/porters-five-forces.html [Accessed 19 April 2018]. Keith, S. (2012) Coles, Woolworths and the local.Locale: The Australasian-Pacific Journal of Regional Food Studies,2, pp.47-81. Madhani, P.M. (2010) Resource based view (RBV) of competitive advantage: an overview. The ICFEI University Press. Moreno-Izquierdo, L., Ramn-Rodrguez, A.B. and Perles-Ribes, J.F. (2016) Pricing strategies of the European low-cost carriers explained using Porter's Five Forces Model.Tourism Economics,22(2), pp.293-310. Nason, R.S. and Wiklund, J. 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