Business:
Assume that you are a strategy consultant hired by a firm to conduct a strategic analysis for your target firm.
Please answer the following questions. Make sure to include references for any sources of information or data that you use that is not your own.
1) In the Industrial Organization (I/O) view of the firm, performance is due largely to the industry in which a company competes. In the Resource-Based View (RBV) of the firm, company performance is driven by its individual strategy, and unique resources and capabilities.
a. Calculate and compare your company’s financial performance to that of a competitor. Be sure to clearly indicate Advantage, Disadvantage or Parity between the two companies. A good rule of thumb would be to consider Parity to be a variation of 5% or less between your company and the competitor. Please compare based on:
i. Inventory Turnover
ii. Fixed Asset Turnover
iii. SGA Expenses/Sales
iv. COGS/Sales
v. Development Costs/Sales
vi. Fixed Assets/Sales
vii. Receivables Turnover
viii. Profit Margin
b. Using your answer from (a) above, do you think your company’s performance is driven by the industry in which your company competes (the I/O perspective) or is it driven by your firm’s unique strategy, resources and capabilities (the RBV perspective)? NOTE: you MUST explain your reasoning here. The point isn’t to flip a coin and guess; it’s to do critical analysis and come a conclusion based on that analysis.
2) Do a SWOT analysis for your company. You should be using Part 1 of your Homework to help you here. Identify 3-5 each of Strengths, Weaknesses, Opportunities and Threats for your company. Note that this ends up being 12-20 overall major points. Take special care to distinguish between internal (S&W) and external (O&T).
3) Recommendation time. Using your previous analyses (including Part 1 of the Homework, which should help you in your SWOT), please make 3-5 major recommendations about how you would improve your company to compete in the coming years.
4) Now offer a competitor a plan to beat your company. Assume you have been hired by your company’s competitor (i.e., the same competitor that you chose for Q6). If you were giving advice to that competitor, how would you tell them to beat your company? Note: imitation is a thing that can help generate a tie, but not a win; as well, the second mover is generally going to lose in an imitation battle. We play to win the game.
a. Offer 3-5 major recommendations to help your competitor defeat your target company, taking care to explain WHY you made that recommendation. Note that these recommendations should be informed at least in part by material in Q1, Q2, Q3, Q5 and Q6. (For example, you could recommend the competitor take advantage of a particular weakness of your company, or that the competitor stay away from one of your company’s strengths.