Assignment:
Conduct a strategic analysis for the firm you work for, or one that you are interested in. ( Choose Nestle (global) company for this work)
First you need internal analysis of the company which looks at the firm's current strategy, organization structure, culture, governance, leadership, and value chain. Then, a financial analysis between the target firm and its competitors.( use current financial data ) Include as many graphs, charts etc but each must be specifically referenced in the text.
The analysis includes 10 to 12 pages.All references must be cited and included in a list of endnotes in Chicago style (the in-text citation method is sufficient - provide authors' names, date of publication & page number where information was obtained. The outline for this work is as under:-
Stratergic analysis outline :-
EXTERNAL ASSESSMENT
General environment
Describe the trends in the external environment: economic, demographic, socio-cultural, technological, regulatory/political, global, and physical. Classify the general environment trends into opportunities and threats. (No mention of target firm here.) (Add summary)
Industry trends
Describe the industry trends. What factors are driving the industry at this time: include recent past, present, and future trends? (Add summary)
Economic structure/Life cycle stage
Identify the industry's economic structure: monopoly, duopoly, oligopoly, or fragmented. What is the life cycle stage: introduction, growth, shakeout, mature, decline? (Chart suggested) Provide supporting data as needed.
Porter's Five Forces
Discuss Porter's 5 Forces here. Identify each as low, moderate, or high. Provide supporting data as needed. Discuss the three most important questions: industry attractiveness for new entrants, incumbents, and target firm. (Chart okay but not required) (Add summary)
Strategic Group Analysis
Conduct a cluster analysis using two variables that "clusters" the direct competitors on the strategic mapping graph. Variables are subjective but they should be logical and apparent. (Chart suggested)
Key Success Factors
Identify 5 variables that are critical factors to succeed in the target industry. Rate each direct competitor on each variable using a 1-5 scale (1=poor performance, 5=excellent performance). Discuss the ratings and provide objective supporting data as needed. (Table required) (Add summary)
Competitor Analysis
Create a table with your target firm and two most direct competitors. Answer the questions regarding future objectives, current strategy, assumptions, capabilities, and response. (Add summary)
INTERNAL ASSESSMENT
1. Current strategy analysis
o Define the current strategy in use by the firm. Identify how long the strategy has been in place and discuss how effective the strategy has helped in achieving the firm's goal financial or strategic goals.
2. Culture, leadership, ethics (framework)
o Describe the firm's culture. If possible, provide a one-word descriptor of the firm's culture (paternalistic, high-performance, meritocracy, democracy, nurturing, cutthroat, etc.). Discuss whether the culture is appropriate for the industry. Discuss how effectively the culture has helped the firm achieve its goals. Identify and discuss objective data that either supports or refutes the firm's culture? What do the employees say about the firm? How is the turnover and absenteeism rate? Are the firm's leaders respected or hated? Are there employee lawsuits against the firm? Is this firm a good place to work?
o Describe the firm's leadership. Identify and discuss the CEO leadership style and traits (both positive and negative). Is the CEO effective? Is the CEO the right leader for the firm at this time? Will the current CEO be effective if you change the strategic direction of the firm? Does the CEO have a successful track record? (Do not give a functional resume description.)
o Describe the firm's ethical practices. Does the firm have an ethics statement? Does the firm have an ethics compliance officer? Do the firm's espoused values match the firm's enacted values? Do the firm's actions follow one, or more, of the ethical frameworks? If yes, describe how and, If not, say so. Identify and discuss objective data that either supports or refutes the firm's ethical position? Describe the impact of the firm's ethical practices on all stakeholders.
3. Corporate governance
o Describe the firm's corporate governance. Are there large investors within the ownership structure? What is the structure of the Board of Directors? How many directors: independent versus inside? Is the CEO the COB? What are the backgrounds of the more notable board members? How effective is the board in carrying out its duties? Does the balance of power favor the BOD or the CEO?
4. Organization structure
o Identify the organization structure. Is it appropriate for the firm at this time? Is the organization structure effective? Does the organization's structure follow its strategy? (Organizational chart suggested.)
5. Value chain analysis/ Core competence analysis
o Describe the primary and secondary activities in the firm's value chain. Highlight any activity, resource or capability, which might be the basis of the core competences of the firm. Identify and discuss the firm's core competencies. (Add summary)
o Image analysis: Evaluate the firm's logo, graphic designs, and other artwork. How effective are these materials in promoting the firm's marketing efforts? What message(s) does the firm's artwork transmit to the firm's customers and the public at large? Is the artwork consistent with the firm's image?
6. Financial analysis
o Conduct a financial analysis including the balance sheet, income statement, and statement of cash flows. Compare the target firm's financial position with the financial position of the direct competitors. Conduct a financial ratios analysis focusing on profitability, liquidity, asset, and financial leverage. Compare your target firm with its past performance, the strategic group, and the industry. The narrative should focus on summarizing the key aspects of the financial analysis. (Tables required)
7. Competitive advantage analysis
o Conduct a competitive advantage analysis focusing on the VCRN (valuable, costly to imitate, rare, non-substitutable) and the profitability ratios (ROA, ROA, ROI, ROIC, net margin). Answer the question: does your firm have a competitive advantage?