Week 6 Journal

Bipin lamichhane

Strategy choices and impact

Week 6

Assignment question

a)      What is meant by the term “External Analysis”? What is the purpose of `PESTLE` analysis?

b)      Read the article about Big Mart Super Store- what external issues are the Super Markets would have to consider at this time to have competitive advantage over others? http://www.ekantipur.com/2012/08/01/business/big-mart-to-open-seven-stores-in-kathmandu-by-2012/358057.html

c)      Discuss your preparations for the Activity Week field work. Have you arranged to meet your group? Have you been to the Big Mart before? How are you planning to record your data? http://www.ekantipur.com/2012/08/01/business/big-mart-to-open-seven-stores-in-kathmandu-by-2012/358057.html

 Answers

a)      The company manager has to deal with the various factors either it is internal or external. Internal factors come within the organization and to cope with it managers do internal analysis. Internal analysis can be identifying the business strengths and weakness by analyzing its competencies. In other hand external analysis is the analysis made by managers to identify the threats and opportunities in market or environment. Both opportunities and threats exist independently of the firm. External analysis generally includes two factors, macro and meso.

Macro factors consist of the broad trends and pattern in nation and world beyond the firm. These factors include government regulations, economic indicators, and demographic factors.

Meso factors are more likely to industry analysis. These factors generally talk about the industry, the new entrants i.e. competitors, substitute products and markets and costumer.

The PESTLE stands for Political, Economic, Social, Technological, Legal and Environmental analysis, which is done to grab the opportunities’ and responds to the threats that are posed in certain market or environment. OR

PESTLE is an analytical tool which considers external factors and helps strategists to think about their impacts.

b)      As Big Mart store is planning for major expansion in valley, there are various external factors that the company should consider in this stage of transition to gain a competitive advantage over the competitors. The major concern I think will be in social, economic and environment factors.

The department stores have to compete with the local markets which have been established for many years. I think at first, they should target certain group of families and individuals. They should motivate people by offering quality products at reasonable price. Store should understand the needs and demands of local people. They should adopt with culture, trend and taste of people within the locality.

Store should implement new economic policy as they are entering in new market. They have to minimize the labor, inventory and petty costs so they can reduce the cost of product. Reducing the cost will help to gain competitive advantage and attracts more customers. As they opening new branches the store can offer new job to local people and gain the publicity. The store can organize environmental awareness programs on quarterly basis so the people might have positive attitude towards the store. This will help to understand that store is doing much more than selling products.

I think considering above mention factors will help to gain the gain competitive advantage to Big Mart Store over competitors.

c)      We are scheduled to meet at City centre sharp at 9:00 am. We have four members in our group and we all are really excited.  All group members have decided to meet before one hour from the scheduled field visit so we can discuss and be prepared. Big Mart is near our college so it is not new place for us. I have been there for like 12 times. Our members have decided to record all data first in recording book and later to put in laptops. We have purchased four recording books for each of the member.

References

·     James Cadle; Malcolm Eva; Keith Hindle; Debra Paul; Craig Rollaston; Dot Tudor; Donald Yeates (2^nd  Edition, 2010).Business Analysis . British Information Society Limited.

·     Online available from http://www.ekantipur.com/2012/08/01/business/big-mart-to-open-seven-stores-in-kathmandu-by-2012/358057.html [Accessed on, 13 Jan 2013]