W3 Lecture 2

Question 1

PESTLE

Answer 1

Political Factors: Political Stability, Regime orientations, Government Stability, Pressure group, Trade union power.

Economic Factors: Business Cycle, Interest rates, Inflation Rates, Investment levels, Unemployment, GNP trends, Patterns of ownership.

Socio-cultural: Demographics, Lifestyles, Social mobility, Educational levels, Attitudes, Consumerism.

Technological: Levels and focuses of government and industrial R & D expenditure, speed of technology transfer, Product life cycle

Legal: Legislative structure, Anti-trust laws, Trade policies, Employment legislation, Foreign trade regulation

Environment: Sustainability legislation, Green issues, Energy supply

Question 2

SWOT
SWOT Limitations (Take Brexit as a case)

Answer 2

Strengths Weaknesses, Opportunities, Threats

perception-based evaluation and information asymmetry

Question 3

PORTER

Answer 3

1. Threat of new entrants
2. Bargaining power of suppliers
3. Bargaining powers of buyers
4. Threat of substitute products or services
5. Rivalry among existing competitors

Question 4

RBV - Resource-based view

Answer 4

Elements of the framework:

1. defining the firm’s resources that present internal strengths and weaknesses.
2. the organizations’ combined resources form a number of capabilities.
3. These resources and capabilities provide a sustainable competitive advantage
4. This sustainability derives from linking the organization’s unique resources and capability across time
5. The characteristics of resources and capabilities are important in sustaining competitive advantage.

Question 5

Value Chain Analysis (VCA)

Answer 5

Value chain represents the internal activities a firm engages in when transforming inputs into outputs.
Primary Activities: 
-Inbound logistic
- Operations
- Outbound logistics
- Marketing n sales
- Services
Supporting Activities
- Firm infras
- HRM
- Techno Deve
- Procurement

Question 6

Online Marketplace

Analysis

Answer 6

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Question 7

Micro-Environment

Answer 7

The micro environment includes those forces that directly affect, and are affected by, an organization’s major operations. Including: Suppliers, Customers, Competitors, Distributors

Question 8

Internet Macro-Environment

Answer 8

The macro environment includes general forces that do not directly touch on the short-run activities of the organization but can influence its long-run strategic decisions.
Macro environment: Political, Economic, Socio-cultural, Technological, Legal, Environment

Question 9

Why a fast-growing industry is not always a profitable one?

Answer 9

i

Question 10

How eliminating today’s competitors through merger and acquisition can reduce an industry’s profit potential?

Answer 10

j

Question 11

How government policies play a role by changing the relative strength of the forces?

Answer 11

k

Question 12

How to use the forces to understand complements?

Answer 12

l

Question 13

Why industry profitability is what it is?

Answer 13

m

Question 14

How a company can influence the key forces in its industry to create a more favorable structure for itself or to expand the pie together?

Answer 14

a

Question 15

5 competitive forces that shape strategy?

Answer 15

1. Threat of new entrants
2. Bargaining power of suppliers
3. Bargaining powers of buyers
4. Threat of substitute products or services
5. Rivalry among existing competitors

Question 16

Internal Analysis model

Answer 16

• Resource Audit
• Value chain
• Portfolio analysis (BCG matrix)

Question 17

External Analysis

Answer 17

• PESTLE
• 5 forces model
• Porter’s diamond odel
• Bench making
• Competitor Analysis
• Scenario Analysis

Question 18

External + Internal Analysis

Answer 18

• SWOT

- PESTLE + SWOT

Question 19

BCG Matrix

Answer 19

Dog
Cash cows
Question marks
Star

Question 20

Benchmarking

Answer 20

Benchmarking is comparing one’s business processes and performance metrics to industry bests and best practices from other companies.

• Historical statistics
• Industry/sector: industry norms/ develop league table
• Best-in-class: best performance

Question 21

Limitations of 5 forces model

Answer 21

• It doesn’t consider the international differences and the idea of complamentor? (collaborator)

Question 22

Three areas of strategic marketing management

Answer 22

Strategic analysis: macro environment, competitive environment and inernal environment
Strategic choice
Orientation/ copetitive advantage, direction of development, method of development
Strategic implementation: tactical plans, criticl success factors, organizational structure, leadership style, corporate culture
(Johnson et al., 2008)