Strategic Management

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Strategic Marketing

Unit 6.5
Level 7
Student Name
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1.1 Current issues that impact on ASDA
ASDA Group Ltd is UK number one largest food retailers. It sold variety of items like food,
books, apparel, CDs, electronics and house hold items. Earlier they have started as just
superstore and today they have expanded themselves globally.
Goal of ASDA
The main aim of any organization is to survive or exit in the market .for this they believe in
Value for money - Competitive prices - Meeting Consumer needs - Progressive returns on
investment. ASDA aims to make goods and services more affordable for the people.
Mission statement of ASDA
The mission statement of ASDA is to be the Britains best value retailer exceeding customer
needs always. It has shown that it value a lot for the respect of the individual, customer
service and excellence.
Marketing strategy of ASDA
ASDA is playing on low price/low cost strategy in the market. They have lowered down their
operating cost as well as carbon foot-printing with the help of sustainable development
programmes. They are using the strategy in which they are trying to use the best quality
products but with the lowered price so that maximum number of customers can be attracted.
They have tried their best to maintain a good relationship with the customers. They have
improved a lot in the customer services. They have played a strategy of ASDA price
guarantee to win the trust of the customers to a large extent.
Organization behaviour
Organizational behaviour basically deals with the deep study of the impact of all the activities
of individuals and groups within the behaviour of the organization. It also deals with the
study of the impact of organizational structure on human behaviour. In organizational
behaviour there is a integration of many other studies like sociology, psychology, social
psychology and economics. Organizational behaviour aims with the study of contribution of
human behaviour towards achieving greater efficiency and growth of the organization.
Taking the impact of different fields on the organization behaviour its seen that the study
sociology deals with the group dynamics. It shows the impact on the group behaviour to a
large extent. It also deals with the roles played by the individuals in the organization, power,
status, communication, conflict management, group processes, formal organizational
theories, group decision-making and norms.
Psychology has impacted the organization in studies like job-satisfaction, leadership,
individual decision-making, performance appraisal, and work stress and ego state. With the
help of study of psychology it helps the organization to change the attitude, improving
personal skills and generating positive approach for the development of the organization.
Even psychology is also considered important for the selection of the employees as it helps in
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reading the mind of the person, doing the measurement of the personality aptitude and
attitude.
As the organization need to keep an eye over the government rules and regulations. Political
science helps the company in knowing the position for financial investment, employment and
expansion and doing the promotion of international business. Social psychology is the blend
of the psychology and sociology to obtain better human behaviour in the organization. It
contributes to the ability of the people in the organization, maintenance of the social norms,
group decision-making and managing the change. Anthropology takes into account the
cultural and environmental framework for the human behaviour study.
People, structure and technology are the three main components of the organization. For the
achievement of the goal of the company they need to focus on these three factors. The
company should fulfil the desired needs of their employees as well as maintain a good
relationship with them. Teams and groups also play vital role in achieving goal of the
company. The organization could have formal and informal structure. The formal structures
do have some proper set of objectives set to priories whereas informal structure does not have
any such objectives to be taken care of.
So basically organization behaviour includes the study which involves the management of
interpersonal relationship, identification of the needs of the people and application of the
appropriate strategies to obtain the best result.
1.2 Various issues involve in ASDA
VARIOUS ORGANIZATIONAL BEHAVIOUR ISSUES
Organization culture of ASDA
Organization culture reflects the personality of an organization. ASDA believes that they
have a very unique culture. They have defined their values to their customers, employees and
to do best of them. For ASDA their customers are the main entity for them. They try to create
an understandable and positive environment for their customers. The employees are also
allowed to freely present their views for the betterment of the company. The employees
participate in different programmes held by the ASDA so that they can very well mix up
among themselves and with the top level management. ASDA always try to motivate their
employees by giving different schemes and trips. So ASDA have a positive culture with some
rules and regulation made to achieve the objective of the company. they also follow all the
legal laws and try to produce good variety of product keeping in mind the health of their
customers.
Organizational change in ASDA
RESEARCH
LEWIN MODEL OF CHANGE
Kurt lewin proposed a three stage theory of change known as unfreeze, change, and refreeze.
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Stage 1
The unfreezing stage is one of the crucial stages for any organisation. This stage is about
getting ready to change. It is basically feeling the presence of necessary change to be made in
the company and getting ready to move from current comfort zone. It is said that the more we
feel that change is necessary, the more urgent it is, and the more motivated we are to make
the change.
Unfreezing and getting motivated for the change is all about weighing up the 'pro's' and 'con's'
and deciding if the 'pro's' outnumber the 'con's' before you take any action. This is the basis of
what Kurt Lewin called the Force Field Analysis.
Force Field Analysis is a fancy way of saying that there are lots of different factors for and
against making change that we need to be aware of. If the factors for change outweigh the
factors against change we'll make the change. If not, then there's low motivation to change
and if we feel pushed.
Stage 2: Change - or Transition
The next step after unfreezing is the change or transition. It is the inner movement or journey
we make in reaction to a change. This second stage occurs as we make the changes that are
needed. It is often said that this is the hardest step as people are unsure or even fearful.
Its not a easy time as people are learning about the changes and need to be given time to
understand and work with them. Members are being supported by providing a full training
and coaching. Using role models and allowing people to develop their own solutions also
help to make the changes. It's also really useful to keep communicating a clear picture of the
desired change and the benefits to everyone in the organization.
Stage 3: Freezing (or Refreezing)
Kurt Lewin refers to this stage as freezing although a lot of people refer to it as 'refreezing'.
As the name suggests this stage is about establishing stability once the changes have been
made. The changes are accepted and become the new norm. People form new relationships
and become comfortable with their routines. It could take a lot of time.
In todays world of change the next new change could happen in weeks or less. There is just
no time to settle into comfortable routines. The rigidity of freezing does not fit with modern
thinking about change being a continuous, sometimes chaotic process in which great
flexibility is demanded.
Organization change in ASDA
ASDA was the second largest supermarket store in the United Kingdom in 2005. ASDA has
positioned itself as a value for money store in the market. Slowly they expanded themselves
into apparel, books, CDs, groceries, and other various household items. In the same year
they got award for the lowest price supermarket. The competitors of ASDA like Tesco and J.
Sainsbury were also trying to increase the market position by expanding themselves into the
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financial products, newspaper, pharmaceutical products, clothes and petrol. ASDA were
having the hierarchical structure. There were eight levels up to the CEO of the store. These
were layered like staff members, supervisor, department manager, general store manager,
regional operations controller, division director, operations director, joint managing director
and chief executive.
ASDA were having the formal way of organizing culture of the organization. They were
using the bureaucratic way of management. The staff members are kept in separate part of the
headquarters to the top executives. The major issues were handled by the top executives only.
It was seen that the communication pattern between the head office and the stores was one
way with top-down management style. They were using the centralised distribution but still
there customer number was declining rapidly. Regarding the quality of food they had tried
their best to provide fresh food to the customers but still they were not able to convince the
customer up to the expected levels. So they were facing the complexity problem in the
management. ASDA did work on recognising their strength through using well IT, up to date
effective distribution system and good operating management.
To improve the ASDA management they tried to remove the too many layers of the
management and creating narrow structure to better understand the organization. They bring
in many changes in the organization like:
They started working on increasing the price competitiveness

Redirection the range and breakthrough in store productivity
ASDA started generating the higher volumes to improve in terms of trading
Restoring the customer flow
They tried to reduce the fixed cost % to sales and increase the traffic sensitive purchases
2.1: Internal and external environment analysis of Tesco
Asda Internal and External Analysis
Internal Analysis
An internal analysis as discussed by Cowe et al. (2011) examines a given organizations
operations with its strengths and weaknesses. In that perspective Porters value chain analysis
will be used to conduct Asdas internal analysis.
A value chain analysis as describes different operations that take place in a given
organization in perspective of the competitive position of the given organization (Sekhar,
2009). According to Bensoussan and Fleisher, (2008) most organizations mainly adopt
differentiation or cost leadership strategies in order to ensure that they have a competitive
advantage in the market place.
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Inbound Logistics
While compared to other competitors, Asda is among the cheapest retailers in the UK
(Reuben, 2011). Among others, Asdas efficient ordering system as well as the companys
economies of scale plays a great role in ensuring that the company is able to sell products at
low prices and be able to make profits.
Operations Management
As far as operations are concerned, Asda has adopted various strategies that ensure that the
companys operations are efficient. For example, according to Sahota (2010), Asda has
implemented an enterprise resource planning in place that ensures the company achieves
efficient and effectiveness in all its operations.
Outbound Logistics
Apart from only relying on its physical stores, Asda has an online presence that ensures that
customers who prefer to shop online or have no access to Asdas physical stores do their
shopping online (Asda, 2012).
Service
Unlike in the past where Asda just offered groceries, the company has added more products
and service to its offering in order to ensure that it appeals to various types of clients. For
example, the company now has cafes in most of its stores implying that instead of customers
just shopping, they can also enjoy a cup of coffee or meals at most of Asdas stores (Asda,
2012).
Other Supporting Services

Some of the other strategies that Asda has adopted in order to ensure that it is successful in
the competitive retail sector includes establishing close relationships with various
manufactures which ensures that the company is able to get products at low prices which
means that the company is able to make good profit margins even though the products are
sold at cheaper prices (Asda, 2012).
External Analysis
To conduct Asdas external environment analysis, PESTLE analysis and Michael Porters
five forces framework will be used.
PESTLE Analysis
PESTLE as mentioned by Abraham (2006) stands for political, economical, social,
technological, legal and environmental factors
Political factors
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The European Union has presented a good opportunity for Asda to expand into European
markets as most of the trade barriers have been removed (BBC, 2009). In addition, the
admission of China to the World Trade Organization (WTO) has made it possible for Asda to
expand into the Chinese market while also making it easier for Asda to import products for
sale from China.
Economical factors
As far as economic factors are concerned, they play a great role in the success or failure of
Asda since if the UK economy was experiencing difficulties like was the case in 2008 when
the economy was under recession, majority of people lost their jobs which meant that they
had less spending power. Nevertheless, the recession as noted by Daily Mail (2008) and
Murchie (2009) favored Asda as the company experienced increased revenues as customers
who normally did their shopping at other expensive retailers such as Marks and Spencers
were left with no option but to shop for cheaper products that were being sold by Asda.
Social factors
As customers become more informed, there is an increased demand for organic food
implying that Asda has to ensure that it has organic food in its offering in order to meet the
needs of the customers who are keen on organic foods.
Technological factors
As is the case with any other organization, Asda has to ensure that it adopts various
technological innovations like online retail and e-marketing in order to be successful.
Legal factors

Since Asda operates in UK, the company has to ensure that it adheres to various rules and
regulations put in place by the UK government in order to ensure that no fines are imposed.
Environmental factors
In order to ensure that Asda has a positive impact to the environment, the company has put in
place an environmental friendly approach that has seen the company use recyclable materials
in various situations like in packaging of most products.
Michael Porters five forces analysis
Porters five forces analysis as discussed by Paul (2011) is an analysis technique that aims at
establish the position of an organization in a given industry in perspective of five different
forces. The five forces are threat of substitute products, bargaining power of buyers,
bargaining power of sellers, competitor rivalry and threat of new entrants.
Threat of substitute products
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According to Lamb et al. (2010), the threat posed by substitute products is normally high in
situation where customers can easily access the products without having to pay extra costs for
the products. In the perspective of Asda, convenience stores commonly referred to as corner
shops, organic shops and off licenses can be said to be the substitute products. The threat
posed the these types of stores can be said to be low since they only stock certain types of
products implying that customers would still have to frequent supermarkets in order to fulfill
their shopping needs.
Bargaining power of buyers
As discussed by Shimizu (2011) and Stonehouse et al. (2004), buyers are said to have high
bargaining power in situations where they can have an impact on a sellers sales terms mainly
because they buy in large quantities. From that perspective, Asda customers can be said to
have a low bargaining power as they make purchases as individuals in small quantities.
Threat of new entrants
The threat posed by new entrants to Asda can be argued to be low since it would require any
new entrant a lot of capital investment for any new entrant to establish presence in the
market. Nevertheless, it would also take the new entrant a lot of time before the entrant can
be considered to be on the same footing with Asda, Tesco and other established retail
supermarkets in the UK.
Bargaining power of suppliers
Suppliers have high bargaining power in situations where they are only few in numbers
(Stonehouse et al. 2004). The bargaining power of Asdas supplier can be said to be low since
they have to supplier products according to various supermarkets terms as explained by
Renton (2011).

Existing rivalry between competitors
The existing rivalry between the competitors can be said to be very high as the five main
supermarkets (Asda, Tesco, Morrisons, Sainsbury, Waitrose and The Co-operative) adopts
various strategies in order to ensure that they appeal to the public who are their customers.
Asda SWOT analysis
SWOT analysis as discussed by Kotler (2011) is a situational analysis tool that is used to
analyze an organizations internal strengths and weakness and at the same time used to
analyze the external threats and opportunities.
Strengths
Asdas strengths can be argued to come from a wide network of numerous stores throughout
United Kingdom that has ensured that Asda has a strong brand name. In addition, the fact that
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the company has over 136 retail stores means that the company benefits from economies of
scale. Since Asda is owned by Wal-Mart, this can be argued to be strength to Asda as it can
easily adopt a concept that works in America in UK.
Weakness
Asda main weakness can be argued to be the fact that it is viewed as a cheaper retailer which
might at times imply that the company sells poor quality products as noted by Renton (2011).
In addition, the large size of the company can be said to be a weakness as it can be at times
difficult to manage and coordinate all the activities.
Opportunities
There are a lot of opportunities for Asda to exploit. Since UK belongs to the European Union
there is an opportunity for Asda to expand into European markets that have high potential. In
addition, the company can also diversity its service offering into other sectors such as travel,
insurance and broadband services.
Threats
The main threat to Asda can be argued to be the increasing competition posed by other
competitors such as Tesco and Morrisons that are in the market. In addition, as noted by
Renton (2011) German based Aldi and Lidl have also been gradually gaining market share in
the UK retail sector implying that they also pose a threat to Tesco.
2.2 ASDA approaches to positioning in the marketplace
FOUR DEVELOPMENT STRATAGEMS IN THE MANUFACTURED GOODS/MARKET
NETWORK:
1. Marketplace Perception. Retail additional of the similar products or facilities in existing
marketplaces. These approaches or stratagems generally attempt to amendment related
consumers to systematic consumers, as well as consistent consumer into substantial
consumers. Distinctive organizations are dimensions concessions, with promotion to bonus
cards offering also Consumer Affiliation Administration. Stratagem is frequently to
accomplish financial prudence of gauge from side to side more effectual industrialized,
further effective delivery, more buying influence, slide membership.
2. Marketplace Improvement. Trade further along with the equivalent produces or facilities in
fresh marketplaces. These stratagems frequently attempt to demand consumers away on or
after participants or present standing produces in overseas marketplaces or familiarize
innovative trademark labels in a marketplace. Different marketplaces can be topographical or
well-designed; such as while the company trade the equivalent manufactured goods for
alternative persistence. Insignificant or minor amendments might be required. Be cautious of
traditional metamorphoses.
3. Product Improvement. Trade original produces or facilities in existing marketplaces. These
stratagems repeatedly attempt to trade other produces to (consistent) consumers. These can be
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trappings, attachments, or absolutely fresh produces. Cross-selling. Every so often, prevailing
announcement frequencies are castoff.
4. Modification. Trade original produces or facilities in existing marketplaces. These
stratagems are the furthermost dangerous category of stratagems. Repeatedly there is a
reliability emphasis in the announcement to illuminate why the concern entered into different
marketplaces with fresh produces. On the other side modification stratagems also can lessen
hazard, for the reason that a huge organization can supper convinced hazards if it drives on
other than some marketplace. Modification can be complete in four different behaviours and
methods:
Horizontal modification. This ensues when the corporation purchases or progresses novel
produces that possibly will demand to its present consumer collections although those new-
fangled produces might be scientifically dissimilar to the obtainable manufactured goods
appearances.
Vertical modification. The business exchanges into the corporate of its dealers otherwise
into the occupational of its consumers.
Concentric modification. These outcomes in original manufactured goods appearances or
facilities that have technical as well as/or marketing collaborations with present creation
appearances, although the merchandises might demand to the other consumer crowd.
Parent company modification. This happens as soon as there is neither hi-tech industrial nor
selling cooperation and this entails accomplishment other consumer assemblies. Occasionally
used by enormous corporations pursuing ways to steadiness a recurrent collection with a non-
recurring one.
Though the Manufactured goods/Market Network of Ansoff is previously decennia
longstanding, it residues an appreciated perfect design for communiqu from place to place
corporate division approach methods and occupational progress. Thus the Matrix system is
also acknowledged as: the Ansoff Matrix, the Manufactured article Market Expansion
Network, and the Evolution Vector Matrix. Derek F. Abell has recommended that another
new model called 3D-Business Designationis longer to the Model of Ansoff. According to
that model ASDA implements and improve the markets as well as the growth of ASDA is
very impressive and so exhausted with management.
ASDA is the one of the largest British supermarket which is currently possessed by (Wal-
Mart). For the centuries ago wherever the well-founded is in the hazard of forfeiture for the
reason that they have amassed a quantity of financial mortgages and sum of million in
commitments. The existence of attentiveness is alternative influence in the eventual forfeiture
where it raised sophisticated. In the meantime, the corporation's bit fee demolish
precipitously. As portion of the resolution, the structural modification is greeted. As a result,
the alteration of exertion consumed remained a day-to-day restraint for the business which
assists the impression existence theme to association in altering or renovating the complete
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stockpiles. Amount of the administrative alteration is directing on rearrangement the
corporation investments.

2.3 How integrate internal and external analysis
Integration of the internal and external analyses
Both internal and external environment have an impact on the success of an organization. The
responsibility of the management is to analyze the inherent factors that require solutions and
corrective/preventive actions in order to allow developing of efficient and effective marketing
strategy. At ASDA there is learning and development activities which aim at fostering skills
and competencies in line with the business requirements. To mention a few, there is
promotion and increased take-up rate of new e-learning suite of courses and drug control
officers accredited in two workshops. More so there is staff satisfaction which is a key aspect
and a driver to ensuring that issues raised by staff will be addressed. Community
responsibilities are never ignored and a balanced lifestyle for all staff is upheld enabling all
employees to balance their workplace, community responsibilities and family. Its my advice
to all strategic managers to not only consider the present state of the environments in their
industry but also be able to predict its future positions.

3.1 Analysis of decisions and choices to be made at a corporate level
Well justified decisions and clearly defined objectives are crucial if an organization is to
achieve its goals and objectives. Making of specific choices involve a great deal of
understanding the underlying bases that guide future strategy and generating the best strategic
options for purposes of evaluation and selecting from among the available list. At the
corporate level,decisions and choices are made in respect to the mission statement which
distinguishes it from other firms and within the boundaries of operation. Every decision made
should ensure there is unanimous purpose which can facilitate working towards the same
objective and emergence of an organization culture (Jolson, &Hise, 1973, P.267). A survey
on ASDA identifies components inclusive in their mission statements like customers,
products and services, technology and concern with employee and public image. For success
to be guaranteed, decisions and choices should entail a list of elements like companys
history, the available organization resources, market environment and distinctive
competencies (In Stemp& Bata, 1970, P.11).

3.2 Assessment of how these decisions influence marketing at business unit and
functional level.
Decision to be made at unit and function level
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Strategic decision at the corporate level is always made in respect to the various departments
within an organization. For instance, in the marketing area strategists should have make
decisions in relation to products to offer, target market segments and the available market
position strategies. A company is expected to come up with a specific marketing objective
during the planning period. At time single objectives can be pursued or multiple marketing
objectives including, sales growth, market share, customer satisfaction, innovativeness, brand
loyalty and reputation. ASDA satisfies its customers by making decisions which improve
product quality and improved service. Charging low cost is also a decision at this level which
is well analyzed through customer base and expected quantity sales.
If such decisions are inaccurately developed by focusing much on short term goals or being
too general that they end up providing little real guidance, there might arise a planning gap
between planned and achieved objectives. This is disadvantageous in that it may require the
strategic managers to change their strategies to improve current performance or adjust
objectives downward to realistic ones.
4.1 Analysis on marketing communications strategies
Marketing communications strategies create a core activity so that every interested person
can clearly understand the intentions of others and appreciate the value of goods been
offered. Managers are required to choose a communication strategy that not only reaches
wide area but which is also cost effective. Effective strategies that have been implemented at
ASDA to enable them engage positively with products, services brands and organizations
include.
Sales promotion.
ASDA has ensured their wide variety of products and services encourage customers by
creating good public relations which result in goodwill. This has proven to be an area which
is used for customer retention purposes. It can be used to target smaller audiences.
Advertising
This non-personal form of mass communication has offered a high degree of control to the
team responsible for the design and delivery of advertising messages. It is a flexible tool,
which ASDA has used to communicate with national audiences.
Direct marketing
ASDA has like any other organization embraced the use of direct marketing to target specific
individual customers. Email communication, direct mails and e-marketing controls a big
percentage of the population. This strategy has allowed interactivity and more fast relaying of
information which fasten the exchange of transactions in such a way that some few traditional
communication practices and shopping patterns are been reconfigured
4.2 Analysis on marketing strategies, their application and implementation for an
organization
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Implementation, Monitoring and Evaluation of strategies
As discussed above, the success of an organization is determined by the adopted strategies to
market their products as well as their implementation. The processes should fit in the
marketing plans of the organization and the corporates goals and objectives. Monitoring of
these strategies will enable a firm to develop more heterogeneous resources to serve growing
markets and changing consumer needs. Monitoring will also help in exploring new
opportunities and forming alliances. ASDA has been keen in analyzing new opportunities
that develop its focus more on their products or technologies making it enhance its resources
and gain long-term viability. The management has put in place evaluation of employees is
reinforced by training and development schemes to ensure every strategy has a positive
change to the business.
Managing the competitive advantage
ASDA has maintained its competitive advantage through cost leadership. It has also adopted
market penetration strategy, which is increasing sales of present products and services.
Managing competitive advantage of an organization will involve understanding the needs of
the target customers and finding strategies to make use of resources that are available and set
the business apart from competition. Without significant effort, the competitors try to
duplicate/ copy a successful advantage as the market changes. Continued analysis of the
business and economic changes in terms of pricing has helped ASDA stay at the current
situation.

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