STRATEGIC MANAGEMENT ASSIGNMENT

Leila Sarah Maryse Bakayoko ID Number: 10221537

Adama Doumbia ID Number: 10221541
Kenneth Emmanuel Ouli Lade-Ahlidza ID Number: 102218212
Ebenezer Osei Ahenkan ID Number: 10221574

PRESENTATION ON THE
LOGO CASE

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 I. COMPETITIVE ADVANTAGE

 Competitive advantage refers to the unique advantage a company

has over its competitors in the same industry, which allows it to
outperform them in the market.
 Competitive advantage refers to factors that allow a company to
produce goods or services better or more cheaply than its rivals.
These factors allow the productive entity to generate more sales or
superior margins compared to its market rivals.
 Competitive advantages are attributed to a variety of factors
including cost structure, branding, the quality of product offerings,
the distribution network, intellectual property, and customer
service.

 In the toy industry, owners attempt to gain a competitive advantage

by:
 developing innovative products
 creating brand recognition
 establishing strong distribution channels.
 They also use pricing strategies and advertising to gain
market share and differentiate themselves from their
competitors.

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II. ROLE OF MANAGERS AT DIFFERENT
LEVELS OF STRATEGY

The three levels of strategy are:

 Corporate level strategy

 Business level strategy
 Functional/Operational level strategy

 Corporate Level Strategy

Corporate level strategy is the uppermost level of strategy made by top-
level management which sets the overall direction of the
organization. The corporate level strategy attempts to obtain synergy
among employees, product lines, business units, and other components
of the organization believing that the whole is greater than the aggregate
of individuals.
The corporate strategy works based on what the organization wants to
achieve overall and sets strategies following the overall goals and
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objectives. Corporate-level strategies are set deriving ideas from vision
and mission statements.
Small and large multinational corporations can both benefit from
corporate strategy. Corporate strategy in a multi-business organization is
concerned with geographic coverage, diversity of products/services or
business units, and resource distribution to various segments or units of
the firm.
As the organizational parent, the corporate headquarters works with
diverse products and business units as children. These business units are
coordinated at the corporate level so that the company as a whole
succeeds as a family. As a result, it was determined that corporate-level
strategy is linked to an organization’s total scope and development. Its
constant goal is to bring value to various product lines and enterprises.
For making an effective corporate strategy the manager can go for its
four different types such as stability strategy, expansion strategy,
retrenchment strategy, and mixed strategy.

 Business-Level Strategy
Business strategy is the most common level of strategy we are
discussing probably all of us heard about it. Business level strategy is the
which is designed to use the best use of organizational competencies to
gain a long-term competitive advantage over competitors. 
 It aims to how to best successfully compete with competitors so that
competitive advantage will be gained.
It steers a strategic business unit (SBU) in the direction of competitive
advantage. A strategic business unit is a division of an organization that
has a separate district external market for goods and services from the
other strategic business units.

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It could be a distinct business or product such as Samsung selling
smartphones, cameras, TVs, microwaves, refrigerators, etc. The
corporate strategy is followed by a business-level strategy. As a result,
there should be a clear link between SBU and business strategy.
Every distinct SBU requires different strategies to compete in the
market. A manager can usually go for a cost leadership strategy,
differentiation strategy, and focus strategy in order to get a competitive
advantage against competitors. 

 Functional Level Strategy

The functional level strategy also called operational level strategy is
developed to run effectively the day-to-day activities of the organization.
Most operational strategies are no longer than one year.
A number of functions are carried out regularly to effectively run the
business as different functional departmental are created – production
department, HR department, marketing department, customer service
department, etc. functional strategy aims to bring effectiveness in such
functional areas.
At the functional level, resources, work pressure, information, and
manpower are integrated to bring effectiveness to the business and
corporate-level strategies. Functional strategies are for short time usually
less than one year. These strategies are related to capability, efficiency,
customer service, product quality, and marketing. All these functional
strategists support the business level and ultimately the corporate level
strategy.
Production Strategy, marketing strategy, finance strategy, human
resource strategy, and research & development strategy – all are very
important say parts or types of functional level strategy. Effectiveness on
all these functional types is required to run shorter activities of the
organization smoothly.
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 All these three levels of strategy are crucial to set appropriately
considering the organizational capability and desired goals. While
developing strategic decisions or different strategies a manager should
not forget each level of strategy helps other levels otherwise desired
goals will be difficult to achieve.

III. VISION, MISSION AND OBJECTIVES OF

THE LEGO GROUP
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  VISION
The Lego Group's vision was to "inspire and develop the builders of
tomorrow."
They aimed to achieve this by providing high-quality, creative play
experiences that would help children develop their imagination and
problem-solving skills.
 MISSION
The company's mission was to "enrich the lives of children through play.
“
Lego believed that play was an essential part of a child's development
and aimed to create products that would stimulate children's creativity
and imagination while also providing a fun and engaging play
experience. Lego also had a strong commitment to sustainability and
social responsibility, striving to create products that were
environmentally friendly and ethically produced.
 OBJECTIVES
 To increase revenue
 To expand the brand globally
 To create high quality products

IV. ENVIRONMENTAL SCANNING OF THE

LEGO GROUP

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Environmental Scanning provides an internal analysis of a firm, takes a
look at the firm’s industry and scans the macroeconomic environment.
It helps the firm to answer the question “where are we now?”

 P.E.S.T ANALYSIS

o POLITICAL

 Trade policies and regulations can impact Lego's ability to import and
export products
 Changes in tax policies and tariffs can affect the cost of production
and sales
 Government regulations regarding toy safety and environmental
standards can impact production processes

o ECONOMIC

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 Fluctuations in the global economy can impact consumer spending
and demand for toys
 Currency exchange rates can affect the cost of production and sales
 Changes in interest rates and inflation can impact the cost of
borrowing and financing expansion plans

o SOCIAL

 Trends in children's play preferences and habits can impact demand

for Lego products
 Shifts in demographics, such as aging populations or changes in
family structure, can affect the target market for Lego
 Increasing emphasis on sustainability and ethical production practices
may impact consumer perception of Lego products

o TECHNOLOGICAL

 Advancements in technology can create new opportunities for Lego,

such as the development of digital building sets or online play
experiences
 Changes in manufacturing technology can impact production
processes and costs
 The rise of social media and e-commerce platforms provides new
channels for marketing and sales, as well as opportunities for
customer engagement and feedback

 PORTER’S FIVE FORCES

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 Michael Porter developed a method by which a business can analyse
the competitive environment in which it operates in order to best
devise its strategy.

 Threat of New Entrants is Moderate

The toy industry is highly competitive, and the barriers to entry are
relatively low. However, established brands like Lego benefit from
economies of scale, strong brand recognition, and established
distribution channels, making it challenging for new entrants to compete
effectively.
If new entrants move into an industry, they will gain market share &
rivalry will intensify.

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The position of existing firms is stronger if there are barriers to entering
the market. If barriers to entry are low then the threat of new entrants
will be high, and vice versa.
Barriers to entry are, therefore, very important in determining the threat
of new entrants. An industry can have one or more barriers.
 Bargaining Power of Suppliers is Low
Lego has a large and diversified supplier base, reducing the bargaining
power of any one supplier. Furthermore, the company has a strong
reputation for ethical sourcing, which gives it more leverage in
negotiations with suppliers.
If the supplier forces up the price paid for inputs, profits will be reduced.
It follows that the more powerful the customer (buyer), the lower the
price that can be achieved by buying from them.
 Bargaining Power of Buyers is High
The toy industry is highly competitive, and buyers have many options to
choose from. This puts pressure on Lego to maintain reasonable prices
and deliver high-quality products that meet consumer demand.
Buyers will want prices in the industry to be as low as possible. The
more powerful this group, the lower the profits in the industry.
 Threat of Substitutes is High
Children have a wide range of entertainment options available to them,
from video games and mobile apps to outdoor activities and sports. Lego
competes with other toy brands as well as non-toy products, making it
vulnerable to substitution.
A substitute product can be regarded as a similar product with similar
specifications that meets the same purpose.

 Rivalry Among Existing Competitors: High

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The toy industry is highly competitive, and Lego faces strong
competition from other established brands like Mattel and Hasbro. These
competitors are constantly innovating and introducing new products to
capture consumer attention and market share.
The more intense the rivalry between existing firms within the industry,
the more likely that prices are forced down by competitive pressure.

 SWOT ANALYSIS

o Strengths
 Strong brand recognition and reputation
 Innovative and high-quality products that encourage creativity and
imagination
 Global presence with a strong distribution network

o Weaknesses
 Vulnerability to fluctuations in the toy market and competition from
other companies
 High product prices compared to other toy brands
 Perception of Lego as a toy for younger children, limiting appeal to
older age groups
o Opportunities
 Expansion into new markets, such as Asia and South America
 Development of new product lines and partnerships to diversify
revenue streams
 Increased focus on digital marketing and e-commerce to capture a
larger audience

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 o Threats
 Competition from other toy companies, particularly those with lower-
priced products
 Changes in children's play preferences and trends
 Economic downturns and consumer spending patterns

V. COGNITIVE BIASES AND HOW THESE

BIASES CAN BE OVERCOME

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 Action-Oriented Bias
 Action-oriented biases can push leaders to act or move to action-
oriented discussions too soon or less thoughtfully than they should
during the strategic planning process. Often caused by a perceived
pressure to act, overconfidence, the need to feel in control, insular
thinking, or a lack of systemic thinking skills, the tendency to act
too soon can derail strategic innovation and stakeholder buy-in.
 To combat action-oriented bias, design in the time to consider
several strategic scenarios along with the consequences of both
action and inaction.

Anchoring Bias

 People who are subject to anchoring bias depend too much on

initial information (the anchor) to make subsequent judgments.
Leadership teams that attach themselves too much to an initial
value, idea, or approach can often make bad decisions and fail to
see other strategic alternatives objectively.
 One of our favorite ways to combat anchoring bias during strategic
planning is to designate a red team to challenge ideas of the group.

Attribution Error
 Attribution bias explains our tendency to underestimate the
influence of the situation on people’s behavior. From a strategic
planning perspective, this can cause executive teams to
miscalculate the importance of aligning their corporate culture with
their strategy.
 New strategies often call for new behaviors and new ways of
thinking. Make sure you understand and shape your culture to
help, not hinder your strategic priorities.

Confirmation Bias

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  Confirmation bias leads us to not only look for evidence that
validates what we already think but also to discount information
that supports other points of view. In a changing and competitive
landscape, confirmation bias can be devastating.
 To ensure that your strategic planning process does not
overweight information favoring your existing beliefs, use third
parties to create a neutral fact base during the information
gathering stage.

Framing Effect

 Similar to the anchoring bias, the framing effect impacts our

decision making as a consequence of how the information is
presented instead of on the information itself. This effect can
derail strategic plans if lesser options or poor information is
framed in a more positive light or if more attractive options or
better information are cast in a less favorable light.
 To avoid the framing effect, actively involve the entire strategy
design team in how information should be presented and insist on
a strong rationale behind each strategic imperative.

VI. ROLES STRATEGIC LEADERS PLAY

Strategic Leadership can be defined as the ability of the top-level

managers or executives to determine the future courses of action and

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direction of the firm and motivate the members to make efforts in that
direction.

 Navigator: A strategic leader identifies the major issues and its

causes. Further, he/she always look for better opportunities, to affect
actions.
 Strategist: As a strategist, he/she develops such strategies which
have a long-range view and establish those objectives which suit the
organization’s vision and mission.
 Entrepreneur: A strategic leader has the risk-taking ability, who
takes risks after completely analyzing it. For this purpose, he/she
always looks for opportunities and exploit them at the right time.
 Change Agent: As a change agent, he/she initiates changes in the
organization, wherever required. And to do so, first of all, he/she
makes sure that the members of the organization realize the need for

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 change so that they can accept it positively and the changes are
successfully implemented.
 Motivator: A strategic leader plays the role of a motivator, by
attracting, developing, encouraging and retaining talent in the
organization, to make sure that the organization possess the best
human resource.
 Captivator: As a captivator, the strategic leader aims at developing
passion, dedication, persistence and commitment towards the
common goals, by influencing them in a way that people get ready to
follow the vision.

Apart from these roles a strategic leader also plays the role of a
visionary, policy maker, crisis manager, spokesperson, process
integrator, mobilizer, enterprise guardian etc.

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