Swot Analysis

  • 8 Pages
  • Published On: 28-09-2023

Introduction

Strategic management has become an integral part of the organizational strategies. It allows them to focus on improving their competitive position and most importantly the organization could be in a position to take most appropriate decisions. The effectiveness of the strategic management allows, aligning with the changes taking place within the business environment, and various factors affecting the business could also be handled correctly (Barney, 1991). Here in the current report, the use and applications of the strategic management models have been discussed so that the impact of these models on the competitive position of the companies could be studied. It is to acknowledge that these models could help in eradicating various problems and provide solutions related to different aspects of the business. In the current scenario, the discussed organization is Adnams, a UK-based organization, active into the brewery business. The entire study is revolving around the cited group so that the relevance of strategic management within the organization could be understood.

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Company Overview

Adnams is a very famous name in the business of brewery, and it has got a reputation among the customers. It’s a mid-sized organization and operations in Suffolk and Norfolk. Other than brewery business, the company is also active in the pub and hotel business. The number of shareholders of the company is 1200, which is a significant amount of shareholders for the mid-sized organization. The number of employees associated with the enterprise is 420 which again show their strength with respect to hiring the employees and running the business at mid-scale (Blumentritt, 2006). The most interesting aspect is that the roots of Adnams are very deep into the Suffolk. The family commenced their business in 1872 and as an official enterprise, the business was started in the year 1890. They have a long history in the area, and it enables them to understand the business and market in a proper way. It is a family owned business which is controlled by Adnams and Loftus family. Both the families have their stake in the brewery business (Blumentritt, 2006).

The organization has transformed its business hugely, and it allows them to sustain in the market and to outrun its competitors. The value system of the company is so high that enables them to develop goodwill among the customers as well as among the employees. It is something which also indicates towards the strong presence of company within the industry. Overall, the company is doing well, and it has high growth potential in future (Cole, 2003).

There are particular challenges or needed changes which must be addressed by the company. The major problem that has been noticed is that the company needs to come out of the tag of the family business so that the portfolio could be increased and the trust of investors could be gained. Further, there is a need for improving the working skills of the internal workforce. It may be helpful immensely on the ground of bringing the innovation and employee participation. The self-motivated employees could provide an edge to the company and could be useful in implementing the new strategies (Suppiah and Sandhu, 2011).

Identification of Key Strategic Issues

In the current case study, the situation of the company is stable on responding the recent changes taking place within the business environment. It is to acknowledge that the company is in a position to outrun their competitors, and they have expanded their business exceptionally well. The company is innovative, have diversified well, invested in the available business opportunities and marketing campaigns in a proper manner. These all are major strengths for the enterprise. Most importantly, they have utilized their assets in an appropriate way so that the corporation could achieve the cost-cutting. In the current scenario, customer centric, as well as employee centric approach, has been adopted by the company (Cole, 2003). It is to acknowledge that the company is in a position to ensure the quality and superior customer satisfaction through its services and products. Here, the identified strategic issues are related to the opportunities which are available in front of the company.

The major opportunity is that the company can expand its business in other parts of Europe. In the UK, the company is doing well, so it provides a well-established market for them. However, the saturation could be noticed as people are becoming more health conscious and the beer bars are becoming less popular in the UK. Thus, targeting the other countries of Europe is a very useful available opportunity for the company (Suppiah and Sandhu, 2011). Here, to understand the benefits of such strategic opportunity, the Ansoff matrix could be applied as it can help in understanding the scenario about the market development and improvement into the existing product range. The Ansoff matrix has a significant advantage as it provides the knowledge about the market development which is essential with a view to expanding in the market. Further, the diversification is another advantage of the Ansoff matrix which could become apparent with the help of the current strategic model. It is clear that the expansion and diversification have become the essential strategic moves for the companies (Suppiah and Sandhu, 2011).

The list of disadvantages includes that the Ansoff matrix missed out the explanation for the significant risks that are existing in the market while developing the new business area or adopting the diversification strategies. It is essential that certain steps must be followed before expanding or diversifying within the business. Thus, these major steps are missed out into the Ansoff matrix. However, for the same purpose, the cited organization can rely on research strategies. So it is clear that proper study of Ansoff matrix is required so that the most suitable option, out of the available four options, could be identified (Hunger and Wheelen, 2000).

Apart from the Ansoff matrix, SWOT analysis could be also performed for the cited organization. The major advantage of SWOT analysis is that the current positive aspects of the company could be identified, and the primary disadvantage is that it doesn’t provide in-depth information about the external business environment. Thus, Ansoff matrix and SWOT analysis have been applied to understand the strategic market position of Adnams (Hunger and Wheelen, 2000).

Application of Strategic Models

SWOT Analysis

SWOT Analysis

Figure 1: SWOT Analysis

(Source: Cole, 2003)

Strength:The major strength of the company is that they have established their business so early, and people are very much aware of their brand. The company has shared many instances with the customers which allow them to build positive connections with them. It not only helps in achieving the satisfaction level but also the loyalty and customer retention could also be ensured. Further, the continued innovation within the business is also the major strength of the company. The investment in the assets and property is also active along with buying the farmhouse and investing in beef and pork as well. It is the best way to utilize the resources and earning extra wealth (Dettwiler, Lindelof and Lofsten, 2006). The financial stability of the company is also appreciable which could be considering as the major strength for the Adnams.

Weakness: The cited company is operating since 1890, but still the expansion rate is very slow along with the diversification. These days the trends within the restaurant and brewery industry are changing very rapidly. Thus, it is a weak aspect that the company is not able to respond to cultural changes taking place within the industry. Ahead, the list of weak points is that the tag of family business must be dealt in a proper way. It could prevent investors to invest at large scale. Therefore, more flexibility within the business is required (Baker and Hart, 2007).

Opportunities: The major available opportunity for the company is that they can expand their business and most importantly could develop new products as well. This opportunity is highly effective with a view to increasing the profit as well as the customer base for the company. Thus, these possibilities must be utilized by the corporation. The list of opportunities is that they can invest in new kind of technologies that can allow them to improve their production as well as the operations (Werbach, 2009).

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Threats: The list of the main threats includes the change in the governmental policies for the brewery industry. It could be unfavorable, and most importantly the impact on the profits could be noticed. Ahead, the threat is that the cultural changes are very high so the trends within the industry are changing that could be harmful if not responded well by the cited organization. People are becoming more health conscious, so the inferior quality of beer could shake the trust factor of customers. Hence, these threats could be faced by the Adnams (Jeffs, 2008).

These are significant results of SWOT analysis. On the basis of interpretation of the above analysis, it could be stated that mentioned business entity is operating under proper circumstances, and they have chances of availing various benefits from the identified opportunities. The Adnams is required to channelize their strengths in a positive manner so that the threats could be handled in an appropriate way. Further, the weak aspects need to be addressed, as it will help in ensuring the long-term sustainability for the Adnams (Dettwiler, Lindelof and Lofsten, 2006).

Ansoff Matrix

Ansoff Matrix

Figure 2: Ansoff Matrix

(Source: Baker and Hart, 2007)

On the basis of the current scenario, it could be mentioned that the company needs massive transformation into their current business perspectives. The major aspect is that there is an enormous requirement of taking such decision which can revive the market position of Adnams into the market. The model lay down emphasis on two significant aspects; one is that the company could definitely be in a position to bring some changes in the market-related strategies, or the changes could be planned for the product or services. Hereafter, the analysis of given case study, it could be stated that the company could go for the strategy of market development and product development. Both these strategies could be immensely helpful on the ground of strengthening the current market position (Hamilton and Webster, 2012).

Mainly the product development is the strategy where the company brings some innovation and unique feature into their existing product into the market. On the other hand, the market development is another strategy that could also be useful for the company. In this situation, they could be in a position to get an edge on the competitors. The expansion could become successful if the company adopts the market development strategy. Through expansion, the opportunities for capturing the more numbers of customers could be grabbed by the enterprise (Hamilton and Webster, 2012). It is highly essential that the number of clients must be increased on the regular basis. Further, through the product development, the Adnams could also be in a position to improve their product or service portfolio and existing product quality could also become very much attractive. However, the company is focusing on diversification where they are investing in different business models which are compatible with existing business (Rafinejad, 2007).

It is clear that it helps in higher profits, and sustainability could be also achieved by the company. The market penetration is another strategy which could also be equally helpful on the ground of bringing the transformation into the existing market position. Through market penetration, the Adams could penetrate or try to explore the current market with the help of existing customers. Here, such strategy could be failed due to intense competition and lack of innovation (Sharp, 1991). The cultural changes are very high, so new features in product range are required in the existing market as well. Thus, other than the market penetration, the company can rely on diversification, market development, and product development. These strategies could provide the chances of capturing more market share, attracting more numbers of customers, responding to the cultural changes and most importantly the innovation within the business could be introduced. Hence, these are significant results of Ansoff matrix with respect to the Adnams, and following the results could be helpful in dealing with the business challenges and improving the market position (Sharp, 1991).

Recommendations

The primary recommendation is that the cited company needs to focus on the SWOT analysis and its results on the regular basis. The results of such analysis could be immensely favorable on the ground of analyzing the current situation, and accordingly, the strategies could be devised so that in future advantages and disadvantages could be handled accordingly. Moreover, it is also recommended that while going for the market development, the company should focus on the PEST analysis. It is an analysis that could provide information about the external market situation and most importantly the organization can take its decisions fast and appropriately (Trott, 2008). Through PEST analysis, market development and its related plans could be constructed adequately.

Other than the PEST analysis, the company can go with the strategy of industry analysis as well. Here, the Porters five forces model could be applied. These are other management models that can help in strengthening the market position of the company. Furthermore, the most significant aspect is that the strategies could be devised on the basis of firm decisions. These recommendations could generate positive results. On the contrary, with respect to focusing on the strategy of product development, the phases of product designing could be followed. The company can do the research where the cultural aspects related to the country and people could be identified at large scale (Trott, 2008). Through proper research, the company can definitely channelize their resources in the effective and efficient way. Therefore, these are certain recommendations that should be followed by the Adnams in a stringent manner.

Conclusion

Thus, on the basis of above discussion it could be stated that the strategic management includes the application of various models that could enable an organization to get a solution for the challenges and issues faced in the business environment. In the above scenario, the Ansoff matrix and SWOT analysis have been discussed in an articulated manner. It has been found that the market development and product development are particular strategies that could be immensely helpful for the cited organization. In such a way, the company can definitely utilize their strengths, and most importantly the Adnams could grab the opportunities.

References

  • Baker, M. and Hart, S. 2007. Product strategy and management. Harlow, England: FT Prentice Hall.
  • Barney, J., 1991. Firm resources and sustained competitive advantage. Journal of Management. 17(1). pp.99-120
  • Blumentritt, T., 2006. Integrating strategic management and budgeting. Journal of Business Strategy. 27(6). pp.73–79.
  • Cole, A. G. 2003. Strategic Management. Cengage Learning EMEA
  • Dettwiler, P, Lindelöf, P. and Löfsten, H., 2006. Business environment and property management issues: A study of growth firms in Sweden. Journal of Corporate Real Estate. 8(3). pp.120 – 133.
  • Evans, J. And Lombardo, G., 1993. Marketing Strategies for Mature Brands. Journal of Product & Brand Management. 2(1). pp.5 –19.
  • Hamilton, L and Webster, P., 2012. The International Business Environment. Oxford University Press.
  • Hunger, J. and Wheelen, T., 2000. Strategic management. Prentice Hall.
  • Jeffs., C., 2008. Strategic Management. SAGE
  • Rafinejad, D., 2007. Innovation, product development and commercialization. Ft. Lauderdale, FL: J. Ross Pub.
  • Sharp, B., 1991. Competitive Marketing Strategy: Porter Revisited. Marketing Intelligence & Planning. 9(1). pp.4 –10.
  • Suppiah, V. and Sandhu, S. M., 2011. Organisational culture's influence on tacit knowledge-sharing behavior. Journal of Knowledge Management. 15(3). pp.462 – 477.
  • Trott, P., 2008. Innovation management and new product development. Harlow, England: Financial Times/Prentice Hall.
  • Werbach, A., 2009. Strategy for Sustainability: A Business Manifesto. Harvard Business Press.

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