HI6006 Application Of Competitive Strategy Models To Given Cases Tutorial Questions Answers

Answer :

Question 1

Starbucks is one of the largest retail coffee and snack stores and it is important to consider the factors such as the importance of social and global issues which must be taken into consideration in order to address the same. It is important for Starbucks to take into consideration such as the attitude and beliefs among the people, demographic factors, religion aspect, language, education and structure of the family. Starbucks also takes into account the social organization and the class structure while expanding its network of operations and reaching out to a wider customer base. 

It is important for the coffee retailer to account for factors such as consideration of the social status, income group, tastes and preferences of the consumers (Subramaniam, 2020). The attitude towards the society and the level of education among the candidates is also an important aspect which should be considered by Starbucks in order to undertake business activities in an efficient manner. Starbucks should also study the demographic profile of the consumers in order to undertake business activities in a sustainable manner. The understanding of consumer tastes , preferences and income group would enable Starbucks to make and sell beverage drinks by improving its USP and offering products of high value to the customers. The general income of the consumers and the presence of substitute brands of coffee would also enable Starbucks to determine the volume of business which it can undertake by targeting a specific segment of the customer market.

Question 2 

It is important to note that diversification helps an organization to reduce the possibility of risks by expanding its line of products and services in order to generate a greater stream of revenue (Tymchenko et al., 2019). Google is involved in creating a new market and expanding its existing group of customers. Google has not only undertaken diversification through development of original Internet based products and similar types of services but has also gained a significant degree of influence over business strategy (Hakobyan et al., 2019). Google has also expanded the empire of its market through several small and large scale acquisitions. This included acquisition of YouTube for $1.65 billion. The multinational tech giant had also acquired SkyBox Imaging in the year 2014 at $500 million and this helped in increasing the accuracy of the google maps. The organization’s diversification strategy if reflected in the manner in which it acquired DoubleClick in the year 2007 is $3.1 billion.  It is to be estimated that the organization acquired Android in the year 2005 at $20 million. This diversification strategy of Google was actually responsible for popularizing the market of tablets and smartphones and was also responsible for enabling the company to establish firm grounds in areas such as the market for consumer electronics.

The diversification strategies of Google are aimed at generating a large volume of revenue through advertisements (Apraiz et al., 2020). The monetization of ads is an important aspect which accounts for the fact online form of advertisements would help in generating content through revenue from various sources.

Question 3

The rationale behind the acquisition of LVMH is guided by the following reasons:

There is a high degree of profit and a solid potential for growth in the jewellery industry. The executives of LVMH are under the impression that the industry has high barriers to entry which is responsible for insulating Tiffany from upstarts. 

LVMH has a skilled management team which can help in earning 8.5% from the revenue in jewellery and watches. The organization has planned to boost its market budget by launching new products, spiffing up its chain of retail stores and making a charismatic visual appeal about the brand. The lower pricing of the products can be used to attract a younger group of customer segments (Yoshikuni and Albertin, 2018). It is estimated that the deal would be responsible for boosting LVMH’s small businesses such as the division involved in jewellery and watch segments which is one of the fastest growing segments in the consumer fashion industry.

All the above factors lead to the simple conclusion that acquisition of Tiffany by LVMH can surely help the organization to expand and propagate its business activities efficiently. LVMH’s acquisition of Tiffany was ultimately set at $131.5 billion in comparison to $135 billion as opposed to the actual deal. It is estimated that the deal would be of immense prosperous significance and it would also highlight the components of the study which would ensure strategic alliance formation.  

Question 4

Samsung is one of the largest technology smartphone companies which can ensure a successful form of strategic alliance in order to expand its business operations and outreach over the period of time.  

Samsung should indulge in creating a strategic alliance which can meet the mission and vision goals of the organization by exploiting the resources of the organization and meeting the required objectives in an appropriate manner (Chung and Kuo, 2018). Samsung Electronics was involved in announcing a strategic form of alliance. Under the terms of the strategic alliance, it is important to note that the global leader would benefit greatly through remote form of monitoring, help desk and online support system. 

Samsung should also be involved in developing an appropriate conflict resolution system and this can encourage employees to work with a well-defined goal and mission in order to meet the expectations of the organization (Chen and Liu, 2019). The development of an appropriate conflict resolution system involves highlighting the factors such as proper leadership strategies whose intervention at the appropriate time can help to resolve issues in a seamless manner. 

Competitive negotiation is an important aspect which must be taken into account by Samsung in order to identify the aspects of strengths and weaknesses of the partners. It is also important for Samsung to take into consideration the factors such as striking an important deal which would enable the organization to ensure that competitive advantage is enjoyed by both the parties who are involved in the deal (Kilduff, 2019). It is always beneficial to strategically collate with a partner who has a relatively lower position in bargaining and this can enable Samsung to reap the benefits of strategic alliance in a simple harmonious manner. 

Question 5

It is important for organizations to adopt policies and strategies which can enable it to stand ahead of its competitors in the market segment and it can also ensure the sustenance of an efficient business operation over the long-term period. 

It has been observed that Zara is involved in competing with some of the top fashion brands across the international market. It makes use of technology in order to control the process of designing, production and distribution (Palma-Ruiz et al., 2020). It makes heavy use of digital and social media marketing in order to promote its products and create a significant volume of reach out across a wide group of consumers. 

The organization is a part of one of the largest fashion systems which is involved in continuous communication and this in fact keeps the stakeholders of the organization informed about each and every activity of business operation (Linton and Kask, 2017). This communication takes place across customers, managers of the store, specialists, designers, PR, subcontractors, warehouse managers and even the retailers. The organization has also been involved in providing high quality products over the period of time. Although it follows premium pricing policy and strategy by emphasizing on the notion of quality (Stefanone et al., 2019). The high value-based products delivered by the organization over the period of time has enabled it to create a significant base of customers. Zara is also involved in reviewing the operational policies and procedures of the employees and it can enable the managers of Zara to improvise upon its business operations by reviewing the codes and policies over the period of time. The organization has also taken pride in its information management team which has enabled the firm to stay up to date with the latest trends and fashions within the fashion apparel industry.

Question 6

Leadership is one of the crucial components which serves as the backbone for organizational success. Given that Alan Joyce is considered to be a strategic leader, he is most likely to exhibit the following characteristics:

Effective and smooth form of communication

It is important to take into consideration the factors such as communicating about one’s ideas, thoughts and vision which can make an individual find common ground and use the same in order to discuss and exchange ideas (Desyllas et al., 2018). A leader portrays transparency through a shared form of decision making by conveying the feedback in an appropriate manner. It is the duty of the leader to indulge in a strategic form of communication which can act to resolve conflicts at various levels of operations.

Definite form of decision making and implementation 

A leader should be able to take quick decisions in the both long- and short-term course of business. It is essential to account for the fact that the decision-making process should entail optimal utilization of the available resources in order to avoid wastage and also ensure a high degree of efficiency (Linton and Kask, 2017). A leader should also possess the ability to guide and influence the masses as per the strategic goals, mission and vision of the organization. 

Visionary and adaptability

A leader should possess foresightedness and be able to predict the outcome of an event with a high degree of certainty. A leader should be flexible and willing to adjust to different situations (Kilduff, 2019). A high degree of adaptability among the leaders is also important as it can foster flexibility and allow leaders to guide their team in a proper manner by ensuring a high degree of efficiency.