Essay

Strategic Analysis

1
Introduction

A strategy in business is considered to be the long-term plan that is created by the business to

reach the anticipated and future state that they envision. A strategy comprises the company’s

goals and objectives, the type of goods and facilities that are inbuilt in the company and the

customers who the company want to sell their product to earn profits. This essay will evaluate

the detailed knowledge about strategy theory and its importance for an organisation. The need

for the strategic plan will be evaluated in detail and the examples of well-known businesses

from local areas will be accessed. The company’s environment will be accessed and the way

strategies help in bringing competitive advantage will be described in a detailed manner.

Body

An organization's business strategy is a written plan that outlines how it intends to reach its

goals. There are several essential concepts that go into a firm's business strategy, including

how the organisation will attain its goals. For example, it will teach how to contract with firm

rivals, look at the wants and expectations of consumers, and analyse the long-term growth

and sustainability of their business. A strategy can be used to classify future trends and

opportunities. It can look at the larger variations in the market, such as political, social, or

technical variations, as well as customer changes, and design methods so that the firm can

adapt and grow to these future fluctuations (Ghemawat, 2016). A company plan provides a

vision and direction for the complete organisation. It's vital that everyone in a firm has rich

goals and follows the way, or purpose, of the organisation. A plan may give this vision and

prevent employees from losing sight of their company's goals.

As per the views of Ropianto, et al., (2017), an organization's strategic idea functions as a

road map, clearly classifying the best path for the business to pursue in the years to come, this

is because it provides direction for the firm and helps it focusing on that goal. As a result,

2
strategic planning may assist an organisation in setting the proper goals and objectives and

directing everyone's efforts toward achieving those goals. When the company take the time to

create a detailed strategic plan, this states that the firm will be more aware of its strengths and

boundaries, as well as where it stands in the market, both individually and with admiration to

competitors. Strategic planning is required in all types of company either big or small, of any

size and shape and of any nature (Leskaj, 2017).

Figure 1 Strategic Planning in Business

(Source: Bryson, 2016)

The above diagram depicts that strategic planning is a technique through which

organisational leaders decide their vision for the future, as well as their goals and objectives

for the organisation. For the organisation to achieve its stated vision, this process also lays the

groundwork for the order in which these goals should be achieved. Making a strategic plan

requires effective time, effort, and also continual reassessment and it has the ability to set a

business on right track (Bryson, 2016). The major benefits of strategic planning include:

Develop one, focused vision for the company: As a practical tool for achieving the

company's goals, strategy affects every employee. This provides an aligned vision for the

3
firm and its stockholders. This is a huge benefit of strategic planning. By making everyone

conscious of the business's goalmouths, how and why those goals were recognised, and what

they can do to support and attain them, the company may generate a greater feeling of

responsibility throughout the organisation. It is very essential for a company to draw

attention to flaws and biases in reasoning: These judgments in the workplace are tainted by

preconceived notions. Participating in the strategic planning process compels the company to

evaluate and justify why they make each choice, and back it up with truths, predictions, or

case studies, thereby fighting their cognitive biases (Kabeyi, 2019). Confirmation bias is a

cognitive prejudice that may be more difficult to detect in the act. The company have a

propensity while attempting to justify a certain point of view, to ignore evidence that does not

support our position. Another benefit of strategic planning is that it helps in tracking the

progress of a company based on strategic goals. This allows the management to keep track

of progress toward targets. A top-down method to measuring key performance indicators may

be created when each department and team knows the company's overall plan (KPIs).

According to Sirén and Kohtamäki (2016), organizations need strategic planning because it

gives them a sense of direction and sets specific goals. Strategical planning is a valuable tool

for both directing daily decisions and reviewing progress and altering tactics as the

company go forward in business. This means that the firm should carefully reflect its

strategic objectives, and then back them up with truthful, well-researched and quantitative

standards for evaluating the success of strategic planning efforts. Strategic objects must be

based on the finest facts available at the moment and managers most accurate evaluations of

what the organisation can achieve. Strategic planning should include an evaluation of goals

and development after a period of time, taking into explanation the company's performance in

attaining these goals as well as any new proceedings that have occurred since the initial

planning. For example, if the company intention to increase its hardware shop operations by

4
20 per cent during a certain year, but a powerful contestant opens a superstore down the road,

the company will definitely reframe its goals and amount progress in terms of preserving the

market share. When it comes to a company's strategic planning, the process itself may be just

as significant as the end results in itself. Staff from all departments and at all levels of

responsibility may make a significant contribution to strategic planning when they consider

how their actions and duties fit into the bigger picture and what they can do to make a

difference (Ida, et al., 2015).

The importance of strategic planning can be effectively understood with the example of

different companies. A pioneer of internet shopping, Amazon is the world's largest online

retailer. After a successful start as an online bookshop, the company decided to go out and

offer anything that could be purchased online. Amazon has also gone worldwide, and today

operates throughout the world with a combination of regional websites and international

shipping and logistics infrastructure. Competitors have been inspired by Amazon's aptitude to

use technology as a competitive benefit, reaping the benefits from thrifts of scale, and

utilising synergies between its inner resources and external forces. Amazon Company

operates in a highly competitive business environment. Because it wanted to provide its

consumers with a variety of alternatives, Amazon developed digital bookshops, video and

music, as well as the 'Kindle Reader'. Finally, Amazon's shift into cloud computing and

leveraging of its main capabilities let it recognise the value of its assets, crucial for worldwide

development despite the downsides. As a result, Amazon's brand is based on a commitment

to customer service. Customer service is one of its top priorities, and it aims to be regarded as

one of the best companies in the world (Almeida, et al., 2019). This means that Amazon aims

to promote itself as the most convenient firm, with the lowest pricing and the finest customer

service available in the industry. Pickup lockers are available at Whole Foods and others, but

it's tough for Amazon to compete with the size of click-and-collect programmes offered by

5
some of the biggest brick-and-mortar stores. Adopting effective strategies has effectively

helped the company to gain a competitive advantage and provide its customer’s with

effective experience (Vilela, et al., 2020).

Another example of well know a business that has gained a competitive advantage with its

business strategy is Adidas. Adidas aspires to become the first truly fast sports company in

the world. For the company's new business plan, speed is a key component. It also seeks to

take advantage of its scalable operating strategy in order to increase its income faster and

achieve better financial and operational results. Sustainability has been a significant concern

for all the world's major brands, including Adidas. The business is making sensible

investments in this area and has created some significant relationships that will allow it to

increase efficiency while reducing its environmental effect. The business has also chosen to

maintain its offices plastic-free and has devised a strategy that would prevent the usage of at

least 40 tonnes of single-use plastic every year. In addition, the company is concentrating on

eco-innovative technologies and procedures that limit its dependency on hazardous goods and

minimise its environmental effect. Adidas has also made significant investments in digital

technology in order to increase company efficiency. A digital leadership team was

established at Adidas in 2017 with the goal of initiating digital projects across the whole

company and assisting various departments with decision-making in this area (Neluheni, et

al., 2014). A comprehensive digital plan for the future has been created by this team, along

with its digital priorities. From Adidas and Reebok websites, Adidas is creating a unique

digital experience for its clients (Aurach, 2021).

Due to its global reach, Adidas has a huge and diverse client base that spans the globe. Due to

a fresh focus on marketing and business strategy, the company's client base is increasing

quickly. Most of the brand's clients live in these locations. Adidas' greatest client base is

located in bigger cities. However, the firm is also striving to strengthen its relationship with

6
its customers. Products manufactured from sustainable raw materials have been added to the

brand's product offering. As well as being a customer-centric firm, it has helped it build a

strong reputation for its products. The company faces huge competition from its rival

companies such as Nike, Puma, and many more. The adoption of different strategies has

helped Adidas to gain competitive advantage and develop its good business presence in its

customer mind (Aurach, 2021).

There are various advantages and disadvantages of strategic planning. There is a high need

for company to make its business plan while considering the market and customer needs. One

of the major aims of strategic managers is to promote the collaboration of functional

managers in order to establish synergy across various areas of a company. Managers in

finance, advertising, operations, and human resources are vital to an organization's success,

yet they typically compete instead of collaborating. It gets worse when SBUs are separated.

In order to facilitate the collaboration between these managers, a strategic strategy has been

put in place. The strategic organiser's role is to tell the entire organisation about planned

changes, corporate strategies, present condition implications, and what adjustments are

planned to be made. A thorough presentation of this information to all managers lessens

opposition to change since managers are less unsure about the future (Nickols, 2016). If a

firm wishes to establish a sustained competitive edge, strategic planning is necessary.

Strategic planning, much like marketing or human resource administration, adds a lot of

charges to a business. Managers or premeditated planners must be employed, more efforts

must be made to analyse the outward and internal surroundings, and tools must be created to

adequately implement the strategic planning process. It is rare for strategic planning to be

implemented successfully because of its complexity and the high level of commitment to

strategic goals. Poor implementation is a common cause of failure, but it's more common for

operational and strategic goals to be mismatched.

7
Conclusion

From the above essay, it has been concluded that strategic planning helps a company to

achieve its goals for the long term and also meet its customer needs and demands. It is

considered as a road map that provides direction to business and helps in sharpen its focus to

reach there. The example of companies such as Amazon and Adidas are provided and an

evaluation of the way in which it gained competitive advantage is discussed in a detailed

manner.

8
References

Almeida, R.M., Shi, Q., Gomes-Selman, J.M., Wu, X., Xue, Y., Angarita, H., Barros, N.,
Forsberg, B.R., García-Villacorta, R., Hamilton, S.K. and Melack, J.M., 2019. Reducing
greenhouse gas emissions of Amazon hydropower with strategic dam planning. Nature
Communications, 10(1), pp.1-9.

Aurach. H., 2021. ADIDAS PRESENTS GROWTH STRATEGY ‘OWN THE GAME’

UNTIL 2025. [Online]. Available at: https://www.adidas-group.com/en/media/news-

archive/press-releases/2021/adidas-presents-growth-strategy-own-the-game-until-2025/

[Accessed on: 17 Aug, 2021]

Bryson, J.M., 2016. Strategic planning and the strategy change cycle. The Jossey-Bass
handbook of nonprofit leadership and management, pp.240-73.

Ghemawat, P., 2016. Evolving ideas about business strategy. Business History Review, 90(4),
pp.727-749.

Ida, S., Ramli, A., Mustafa, M. and Yusoff, R.Z., 2015. Strategic planning and firm
performance: A proposed framework. International Academic Research Journal of Business
and Technology, 1(2), pp.201-207.

Kabeyi, M., 2019. Organizational strategic planning, implementation and evaluation with
analysis of challenges and benefits. International Journal of Applied Research and
Studies, 5(6), pp.27-32.

Leskaj, E., 2017. The challenges faced by the strategic management of public
organizations. Revista» Administratie si Management Public «(RAMP), (29), pp.151-161.

Neluheni, G.N., Pretorius, W. and Ukpere, W.I., 2014. The role of quality strategic planning
on organisational success. Mediterranean Journal of Social Sciences, 5(1), p.697.

Nickols, F., 2016. Strategy, strategic management, strategic planning and strategic
thinking. Management Journal, 1(1), pp.4-7.

Ropianto, M., Rukun, K., Hayadi, B.H., Utami, F.H. and Candra, O., 2017. Optimization of
Strategic Planning Organization in the Framework of Achievement Objectives of

9
Education. Advances in Social Science, Education and Humanities Research
(ASSEHR), 149(2), pp.149-151.

Sirén, C. and Kohtamäki, M., 2016. Stretching strategic learning to the limit: The interaction
between strategic planning and learning. Journal of Business Research, 69(2), pp.653-663.

Vilela, T., Harb, A.M., Bruner, A., da Silva Arruda, V.L., Ribeiro, V., Alencar, A.A.C.,
Grandez, A.J.E., Rojas, A., Laina, A. and Botero, R., 2020. A better Amazon road network
for people and the environment. Proceedings of the National Academy of Sciences, 117(13),
pp.7095-7102.

10
11