Strategic Management Analysis Assignment Sample

Introduction To Strategic Management Assignment

The strategic management refers to making and executing a plan that help the company in attaining its goals and objectives. The report will state about the Morrison Company goals, business model and challenges. It will include the strategic direction of the company. It will discuss the organizational structure of the company and also recommend a strategy to overcome problems. The report will state about the current position of the Morrison Company. It will outline the VRIO, PESTLE and SWOT of the company. The report will highlight some recommendations for competing better.

Main Body

Business model, goals and challenges

The Morrison Company is a food retailer supermarket, located in United Kingdom. The company has a wide network of supermarket that consist 497 supermarkets in England, Wales, Scotland and Gibraltar. It offer grocery items as well as produce fresh baked breads, chilled foods and meat products.

The Morrison Company use Business to Consumer model. It sells food as well as grocery items to the customers. The concern supermarket use Low margin, high volume model. The company keeps the prices of product competitive means according to the price of the competitive firm in the market (Keiningham et al, 2020). This aids the company in attracting more customers so that able to do high sale and enjoy earning greater revenue. This model leads to fewer cost aids in attracting more customers.

The goal of the Morrison Company is to deliver high- quality of food items and services at best and affordable price. Its goal is to help the customers to save the money on the item that purchased on regular basis. This goal of the company straightening the company`s position in the market as well as help in increasing profitability. This goal enables the customer to visit the store again.

The Morrison Company is furnishing better goods and services to its customers but also face some challenges. These challenges are as under-

The challenge face by the company is that it has limited storage capacity and also has a outmoded technology because of this it face a problem related to shortage of supplies. Because of this the company is producing minimum amount of products that make it unable to meet customer demand on time (Tavill, 2020). In addition, the company has lack of communication that makes the company failure about what they expect to do. The company has limited presence in international market, it primarily focuses on UK market this leads to increase competition domestically.

Morrison`s strategic direction

The strategic direction means a plan which needs to be executing for the progress of a company to fulfill its goals, vision and mission. The mission of the Morrison is to use experience and innovation to furnish better solution to the packaging industry. Its mission is to provide a work environment that allows company to meet customer needs (Hecht et al, 2020). The vision of the company is to be identified as superior provider. The values of the company includes that human`s right to be treated with esteem as well as equality and live without any fear.

To achieve this company provide better quality food items and services to customers so that able to achieve a big market share. It offers product at reasonable prices which aids the company in becoming superior provider as well as make the company able to meet the consumer needs. To achieve the mission, vision, goals of the company, the Morrison recognize the growth opportunity as well as expand market and add new products in the company. It makes strategies of promotion and pricing to increase the profitability.

Company`s Organisational Structure

The Morrison Company use functional structure in the company. The functional structure means a kind of structure that arranges a company into different department according to expertise. The company distributes responsibilities according to different roles such as production, research and sales. This structure combines the people who have similar skill, knowledge and when it use in the company environment, it helps in achieving goals.

The company divide department according to the production, research, sales, marketing, finance and so more. The employee of every department give report to the team manager, the team manager repots to the department manager and department manager reports to the CEO of the Morrison (Olmos, Roffé and Ginnobili, 2020). The advantage of using this functional structure in the company is that it increases productivity as employee work under the department in which the employee has skill and expertise. As in this structure the role of each employee is clearly defined, so the company is able to make people accountable for any work.

Strategy statement

• The Morrison Company is facing problem related to storage capacity as well as manufacturing space. To overcome this problem, the Morrison should expand its space by establish a new plant on another place. This aids the Morrison Company in increasing their manufacturing capacity for the products (Wood et al, 2021). In addition, the company is able to earn more profits as well as satisfy the demands of the customer by supplying goods in appropriate number.
• The company should expand its business to the international market so that efficiently increase the market share for the products. The expansion leads to competitive advantage to the business, lowering cost, attain greater opportunity to increase revenue and profitability.

Morrison current position

The Morrison Company revenue for the year 2023 was £18,358 m which was in 2022 was £18,479m. The gross profit of the company in the year 2023 was £475 m and operating profit was £ 89 m which was in the year 2022 was £ 391m and operating profit was £ 18m (Wm Morrison Supermarkets Limited Annual Report and Financial Statements, 2024). The current position of Morrison is sound as its gross and operating profit is increasing than the previous year.

VRIO, PESTLE and SWOT

VRIO

The VRIO refers to value, rarity, imitation and organisation, it is used to analyse an organisation's resources and capabilities.

PESTLE

The PESTLE helps the entrepreneur in analyzing the prospects of the business and setting up new operations of the company in a particular location.

• Political Factor- The political factor includes rules, regulation related to industry. The political policies impact the productivity of the company. The Morrison have to tackle the political factors like interest rate, taxes, consumer protection of the different countries as it operate business in many countries (Morrison SWOT and PESTLE analysis, 2024). Thus, the Morrison has to keep this factor in the mind while establishing business set up new stores.
• Economic Factor- The economic factor includes inflation rate, exchange rate, interest rate, demand as well as investment in the country. This factor affects the purchasing power of the consumer. The Morrison uses this factor while forecasting the demand of the products of the company. Thus, the Morrison influence due to changes in this factors.
• Social Factors- There is quick changes in the living style of the people. In today`s era the consumer like branded products. The factor includes age, gender, and income of the consumers. The choice and preference of the customer depend on age and income. The Morrison Company offer products according to the taste and preference of the different age group person. The beliefs and values of the customer help Morrison in meeting the requirements and needs of the target consumers.
• Technological factor- The technology factor includes new technical development, methods, process of producing as well as marketing of the company. The use of technology helps the Morrison Company to reaching the large number of customers. The Morrison need to use more technology to remain in the competitive position in the market. It use AI and machine learning to forecast the inventory.
• Environmental factor- The Morrison should consider the environmental factor while producing the product. The government restricts on the use of food product that contain gasses and sprays (Makov et al, 2020). The retail company obeys this environmental rules and regulations. The Morrison Company considers this standards and rules to operate the business in different countries.
• Legal factors- The legal factors include laws of health and safety, consumer right, product labeling and product safety. The Morrison Company has several policies and regulation to to comply with this law.

In the political environment of Sainsbury it finds difficult to import goods from abroad due to Brexit, it also face problem of rising cost and competition. The people start eating healthy food items, the company has to make changes according to this (PESTLE Analysis of Sainsbury's, 2024). It use technology like AI and enhance profitability. For the legal environment, it adopt techniques to reduce plastic and food waste.

SWOT

The Morrison is the main brand in the retail sector. The SWOT analysis includes strengths, weakness and opportunity, threats of Morrison.

• Strengths-The strengths of the Morrison is that it has better and efficient supply chain as well as distribution network that aids the company in offering wide range of food, beverages and other services to the customers (King, Freyn and Morrison, 2023). The company has 500 stores and strength of employee over 130000. It offers its goods and services with the help of online platform which increases business and profitability. All these strengths provide Morrison a competitive advantage and make a strong position of company.
• Weakness- the Company have finite geographical reach comparing to other big brands in the market. It is weakness of company because it restricts the growth. Also, the past issue related to farmers right impact the brand image and reputation of the company.
• Opportunity- the Company have opportunity to expand the market for organic product as it is demanding in the market. It has opportunity to grow business internationally by opening stores in other country through partnership, it helps in grow the business.
• Threats- in today`s time, market share of the competitor increasing that significantly impact the profit margin of the Morrison. In addition, there is various changes in the Government policy related to taxes, it is considered as threat because it increase operating cost and decrease profitability of company (Barykin et al, 2021). The expansion of competitors on the online platform is harmful for the physical retail store of the Morrison. Thus, it is considered as threat.

5 Forces

Recommendation based on Porter`s competitive strategy

The porter's competitive strategy helps in achieving competitive advantage. There are three strategies –

• Cost leadership- this strategy help the company in attaining competitive advantage by offering the product and service at a less cost than its competitors to attract more customer and to capture large market share.
• Differentiation- This strategy use by the firm to make its product different from its competitor in terms of quality of product and services. If product is unique, it give high customer loyalty to company.
• Market Segmentation- In this the competitive advantage a company gain with the help of market share. The high market share company enjoys competitive advantage due to large customers.

The Morrison Company competes better with its competitors while using cost leadership competitive strategy of the Porter. This strategy enables to attract more customers towards the company ( Ali and Anwar, 2021). As it offers good at less cost, this help in grab more customer as well as market share because this strategy helps the customers in fulfilling their regular demands and profitability of the company.

Conclusion

By concluding the report, it has been analyzed that strategic management means developing and executing a plan that help the company in attaining the objectives. The report based on the Morrison Company. It includes business model of low cost strategy to attract the customers, its goals and challenges like lack of storage space and communication in the company. It covered the strategic direction as well as functional organizational structure of the company. It included some recommendation to overcome the problem and challenges faced by the company. The report stated about the current position of company. It also included the VRIO, PESTLE and SWOT of the company. The strengths included efficient supply chain and weakness is limited geographical reach. The report also covered strategy to compete better using Porter`s competitive strategies of cost leadership.

References

Books and Journals

• Ali, B.J. and Anwar, G., 2021. Porter's Generic Competitive Strategies and its influence on the Competitive Advantage. Ali, BJ, & Anwar, G.(2021). Porter's Generic Competitive Strategies and its influence on the Competitive Advantage. International Journal of Advanced Engineering, Management and Science, 7(6), pp.42-51.
• Anastasiu, L., Gavri?, O. and Maier, D., 2020. Is human capital ready for change? A strategic approach adapting Porter's five forces to human resources. Sustainability, 12(6), p.2300.
• Barykin, S.Y., Kapustina, I.V., Kalinina, O.V., Dubolazov, V.A., Esquivel, C.A.N., Alyarovna, N.E. and Sharapaev, P., 2021. The sharing economy and digital logistics in retail chains: Opportunities and threats. Academy of Strategic Management Journal, 20, pp.1-14.
• Hecht, A.A., Perez, C.L., Polascek, M., Thorndike, A.N., Franckle, R.L. and Moran, A.J., 2020. Influence of food and beverage companies on retailer marketing strategies and consumer behavior. International journal of environmental research and public health, 17(20), p.7381.
• Keiningham, T., Aksoy, L., Bruce, H.L., Cadet, F., Clennell, N., Hodgkinson, I.R. and Kearney, T., 2020. Customer experience driven business model innovation. Journal of Business Research, 116, pp.431-440.
• King, T., Freyn, S. and Morrison, J., 2023. SWOT analysis problems and solutions: Practitioners' feedback into the ongoing academic debate. Journal of Intelligence Studies in Business, 13(1), pp.30-42.
• Makov, T., Shepon, A., Krones, J., Gupta, C. and Chertow, M., 2020. Social and environmental analysis of food waste abatement via the peer-to-peer sharing economy. Nature communications, 11(1), p.1156.
• Olmos, A.S., Roffé, A.J. and Ginnobili, S., 2020. Systemic analysis and functional explanation: structure and limitations. Life and Evolution: Latin American Essays on the History and Philosophy of Biology, pp.209-229.
• Tavill, G., 2020. Industry challenges and approaches to food waste. Physiology & behavior, 223, p.112993.
• Wood, B., Williams, O., Nagarajan, V. and Sacks, G., 2021. Market strategies used by processed food manufacturers to increase and consolidate their power: a systematic review and document analysis. Globalization and health, 17(1), pp.1-23.

Online

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• Wm Morrison Supermarkets Limited Annual Report and Financial Statements. 2024. Online. Available through: <https://www.morrisons-corporate.com/globalassets/corporatesite/investor-centre/financialreports/documents/2022-23/wmsl-updated-30.01.2024-4.pdf->
• Morrison SWOT and PESTLE analysis. 2024. Online. Available through: <https://www.swotandpestle.com/morrisons/>
• PESTLE Analysis of Sainsbury's. 2024. Online. Available through: < https://pestleanalysis.com/pestle-analysis-of-sainsburys/>