It is a fact, that every organization needs a strategy. Basically a strategy is a pattern of decisions at an organization which helps in determining and reveling the objectives, procedure, goals, and purposes in order to achieve those goals. Along with this, a strategy basically defines the range of business which the company actually looks to pursue where it looks to look upon several sets of consideration. A strategic plan is sometimes also called as the strategic intent which has the organization to offer and develop and also leverages the internal capabilities and resources though strategic goals.
The strategist challenge comprises of three valuable competitive positions. This includes the values which is the mission, scope and the value of the company. Then comes the opportunities which have the market demand, along with the proposition. Lastly the capabilities which are the major strengths and the competitive advantage.
Part 01: Tools for analyzing the competitive market
A competitor analysis is a framework that helps in evaluating an understanding the potential or the current competitors for a firm. Basically a competitor analysis is a tool to analyze the competitors for the firm. It is a component which helps the industry players analyzes the dynamics of the particular market (Caves, 1977).
The basic purpose of conducting competitor analysis is to assess the strategy of the firm and also to analyze the capacity of the way the industry has been operating. The basic purpose of competition can therefore be considered as the strategy which helps the competitors to analyze the barriers of competition which prevents and prevails other firms to enter a specific market. If a thorough analysis of competitors is conducted it helps the company build upon the forecast future cash flows which can in return help the company analyze its market value.
Step 1: Identify the competitors
The first and foremost element of competitor analysis is to identify the competitors. It is a fact that two companies, competing in similar industry might be competing on different unique attributes for each other. For example, a manufacturer of Kia automobile cannot be competing to a Porch, although both have been competing in similar industry. To indentify the competitors there are two ways. The basic step is look and analyzes the industry from the viewpoint of a customer (Caves, 1977).
Over the period of time, marketers have rather developed various techniques which include the perception mapping, the brand switching which identifies the most relevant competitors. Along with this, the point of sales and the scanner data also help in providing the rich sources to help out the competitors. Another study suggests that the larger the increase in demand happens when two products are available in the market as substitutes.
The second approach is to conduct a detailed analysis of the industry players with the similar strategies as competitors. For example, while analyzing the United States steel industry, the companies have been classified in three groups which are the large integrated steel mills, the minimills and the foreign importers.
Step 2: Gather Intelligence
The next step is the data collection which helps in providing insights of the competitors. This generally includes the old and the historical data which can be retrieved through the press releases, media coverage, etc.
Step 3: Analyze the rivals
Finally, the third step of this process is to analyze the competitive positions of the rival firms by comparing the strengths and weaknesses of the firms. This can be analyzed through the two components which is the drive for competition and the competitor’s ability to perform a certain strategy. The element includes four major elements which are the objectives, assumptions, strategy and the resources and the capabilities………………..
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