Introduction to Strategy & Its Model

Change is the aspect which is mandatory for each and every organization in order to expand and grow as per the market trends to meet the need of the customers. In order to meet the requirement of customers proper strategies are chosen. The present report analyses the different perspective of Brown Sports Footwear in order to apply appropriate strategy model. This determines strategic position of the Browns. Beside this, proper analysis is done in order to determine the future strategic direction in order to keep it functioning.

PESTEL analysis

This analysis helps in determining various perspective that are involved in order to determine  entire functioning as well as allocation of the resources in order to grow in the pool of the competing brands (Marszk, 2012). There are various factors which are involved, which are discussed below:

Political factors: The political arena affects the functioning of the shoe manufacturer as they impose certain restriction over the Brown Sports Footwear (Thompson and et.al, 2013). Due to this, the entire revenue generation structure is changed and that affects the business environment to a greater extent.

Economic factors: These factors determine the performance of Brown Sports Footwear which has direct impact which affects the prices that are related to the product and services. In the shoe industry, the offerings are made at a wider scale which impacts the purchasing power of the customers because of the ample amount of offerings (Ziout, Azab and Atwan, 2014).

Social factors: In UK market different dimensions are involved in order to serve the customers as per their preferences by properly analyzing the demand. Various dimensions are involved in order to make the offering to the customers by considering the different aspects that are based on the culture and trends (Medvedev, 2016).

Technological Factors: Over the past year, Brown Sports Footwear does not made any technological adaptation in order to make the offering to customers. They have adopted the technology at a very lower scale in order make the offering to the customers.

Environmental factors: As per the market trends, the area in which Brown Sports Footwear are making the offering is expanding at a greater speed as there are lots of competitors present which operated in the same sector. This resulted in excessive competition from the other brands.

Legal factors: In UK, the major preferences are laid upon customer’s security and their standards. Proper analysis is done in order to determine the entire functionality regarding offering which they make to the customers.

Porter five forces

This model is adopted by Brown Sports Footwear in order to identify the perspective whether the new product and the services are profitable (Wu, Tseng and Chiu, 2012). It helps in attaining clear understanding of the business environment in which it is operating and identifies certain forces.

Bargaining power of suppliers: As the supplier’s base is large due to which the rejection is made at a greater speed as there is easily availability of the product. This is due to the reason because the market gets easily segregated as new innovation and product differentiation is not done in the offerings (Medvedev, 2016).

Bargaining power of customer/buyer: As the customers in UK are frequent buyers and they try to follow the trends that is present in the market structure they prefer the new and innovative products and services. Brown Sports Footwear is making low price offering of the products in order to attract new generation customers.

Threats of new entrants: The footwear industry constitute of different offerings due to which number of entrants are trying to enter in the market of UK which is increasing the competition (Teh and Corbitt, 2015).

Threats of Substitutes: Browns sport footwear operates in the market of UK which has an intensive threat from substitute products as there are many companies that are offering the same product and service.

Industry rivalry: There are many brands that are operating in the same sectors such as Adidas, Nike and New Balance are the new brands who are the inductive competitors of Brown Sports Footwear.  The target market was same for all competitors, due to which hard competition was faced by them.

Strategic grouping

This is the method or the tool which is being used in order to identify the similar characteristics of the Brown Sports Footwear in order to compete with the similar brands in the work environment (Smith and Jarrold, 2014). These aspects assist in determining various dimensions that ensure the proper functioning in order to make offering of the product and services. The economy has been formulating at a greater speed and inducing higher competition in context of its offerings. In countries like UK, the customers are concern about their standards and purchase according to the set standards.

Brown Sports Footwear has to do the grouping of the strategy in such a manner that they are able to adopt different aspects in a systematic manner and can make the offering (Ghertman, Obadia and Arregle, 2013). The strategies are drawn over the heritage aspects that help the brand to build up global fondness among customers in order to increase the purchasing of the product which  they are offering.

McKinsey Seven S Model

McKinsey Seven S Model

Illustration 1: McKinsey 7S Model: A strategic assessment and alignment model

(Source: The Organizational strategist,2011)

This is the model which was applied over Brown Sports Footwear in order to decide the different scope of various dimensions (Teh and Corbitt, 2015). This framework helps Brown Sports Footwear to effectively organize different operations in order to make the offerings. It consists of following aspects:

  • Shared value: These aspects determine the core value of Brown Sports Footwear and the fundamental values which they have determined in order to meet the several aspects and make the offerings to customer.
  • Strategy: In order to retain the position, Brown Sports Footwear properly makes alignment in order to win the market by adopting different resources and the capabilities.
  • Structure:  Brown Sports Footwear ensures that the proper structure is framed in order to carry out different roles to meet requirement of the customers.
  • Skills:  Brown Sports Footwear ensures that the right workforce is being employed in order to carry out different operations and re-build its position (Thompson and et.al, 2013).
  • Staff:  Brown Sports Footwear ensures that the work base is effective and helps in attaining huge profits by making the beneficial offerings to the customers.
  • Style: Different learning style and culture is being adopted at Brown Sports Footwear in order to carry out the function in a collaborative and cooperative manner in order to meet the competition which is present in the market where they are making the offering.
  • System: It includes technical aspects that determine the functioning of Brown Sports Footwear employees which they use in their day to day functioning (Wright, Paroutis and Blettner, 2013).

Porter's generic strategy

Porter's generic strategy

Illustration 2: An Introduction to Porter's Generic Strategies

(Source: Business Models & Strategy. 2011).

There are different strategies that are adopted by Brown Sports Footwear to be applied on the product and the services they are offering to the customers are discussed below:

  • Cost leadership: This aspect was determined by Brown sports footwear in order to increase the profit by offering product at a lower prices. (Merchant, 2014).
  • Differentiation: This strategy is adopted in order to determine that the offering to the customer are attractive which influences the customer to buy the product.
  • Cost focus:  Brown Sports Footwear is concentrated on particular niche market in order to understand the market dynamics and meet the unique needs of the customers.
  • Differentiation focus:  Brown Sports Footwear aims to meet demands of the customers by adopting creative strategy in order to strengthen the offering.

Bowman's strategy clock

Bowman's strategy clock

Illustration 3: Bowman Strategy Clock

(Source: Das, S., 2011)

This model helps Brown Sports Footwear to analyze competitive position in order to make the offering to the larger customer base and increase market share (Wright, Paroutis and Blettner, 2013). This model represents eight strategies to make the segmentation of the customer as per the pricing category. This helps Brown Sports Footwear to choose a position in order to create competitive advantage and establish a new position to sustain in the market for the long run.

Swot analysis

There are different dimensions which ensure the entire functioning of Brown Sports Footwear in UK market (Thompson and et.al, 2013). Proper SWOT analysis is done to determine the different perspective.

Strength

  • Trends: There are different trends and styles that also influence the footwear industry and the offering made by Brown Sports Footwear is centered especially to the people who like changes (Wright, Paroutis and Blettner, 2013). .
  • Loyal customers: As the demand for the sports footwear is high because the customer consider it as the style icon as it is easily purchased by the customers..    Weakness
  • Expensive: The prices of the product which were offered to the customers were very expensive and it resulted in less demand.
  • Restricted market: The prices were very high that made the market restricted for customers who have a lower income (Marszk, 2012).

Opportunities

  • Sponsorship: With the help of proper endorsement, the popularity of Brown Sports Footwear can be increased at a wider scale.
  • Events/shows: Promotion of sports shoes at the large shows and events raises the awareness which help in attracting customers at special discounts.

Threats

  • Recession: It is the major aspect which is causing reduction in purchasing power of the customers in UK. The prices are quite high and that affect overall profits. (Thompson and et.al., 2013)
  • VAT: This may induce intense pressure over production cost and result in high price which may reduce the customer base.

RECOMMENDATIONS

  • Brown Sports Footwear should adopt new technology to make offering to the wide number of customer to expand their customer base.
  • They can also make some investment on research and development in order to determine the present trends in order to meet customer need specification.
  • The can also adopt the strategies which focuses on the differentiation in order to make the product offering unique in the entire market place.
  • The cost base should be determined at the lower range so that the offering is availed by the lower income level people also.

REFERENCES

  • Ghertman, M., Obadia, J. and Arregle, J.L. eds., 2013. Statistical models for strategic management. Springer Science & Business Media.
  • Medvedev, K., 2016. Hungarian women toe the line: How Communist propaganda parallels corporate advertising. Clothing Cultures, 3(1), pp.41-54.
  • Merchant, H., 2014. Configurations of governance structure, generic strategy, and firm size:opening the black box of value creation in international joint ventures. Global Strategy     Journal, 4(4), pp.292-309.
  • Smith, E. and Jarrold, C., 2014. Grouping, semantic relation and imagery effects in individuals with Down syndrome. Research in developmental disabilities, 35(11), pp.3162-3174.
  • Teh, D. and Corbitt, B., 2015. Building sustainability strategy in business. Journal of Business Strategy, 36(6), pp.39-46.
  • Thompson, A., Peteraf, M., Gamble, J., Strickland III, A.J. and Jain, A.K., 2013. Crafting & Executing Strategy 19/e: The Quest for Competitive Advantage: Concepts and Cases.     McGraw-Hill Education.
  • Wright, R.P., Paroutis, S.E. and Blettner, D.P., 2013. How useful are the strategic tools we teach in business schools?. Journal of Management Studies, 50(1), pp.92-125.
  • Wu, K.J., Tseng, M.L. and Chiu, A.S., 2012. Using the Analytical Network Process in Porter's   
  • Five Forces Analysis–Case Study in Philippines. Procedia-Social and Behavioral  Sciences, 57, pp.1-9.
  • Ziout, A., Azab, A. and Atwan, M., 2014. A holistic approach for decision on selection of end-    of-life products recovery options. Journal of Cleaner Production, 65, pp.497-516.
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