Business Strategy

Solution

It is well-known fact that organisations are using business planning strategies in order to drive the business in an optimal manner. They are adopting financial planning for allocating financial resources to the stakes in order to meet the strategic goals of the objectives of the organisation. In order to build reputation and popularity in the world’s market strategic planning plays an imperative role in the organisations. In other words, it is a planning which enables the organisation to develop a mission statement by thoroughly analysing the internal and external organisational environment.The main purpose of this report is to analyse the operational and strategic business of the IKEA organisation. This report is about an organisation namely “IKEA” which is engaged in the business process of designing and selling various products which involve kitchen appliances, ready-to-assemble furniture, home accessories, etc. By providing quality enabled products and services to the customer the company has become the world’s largest furniture retailing company.The base location of the company is in Sweden and it is founded in the year 1943. Due to the existence of large businesses, the organisation is having complex organisational and corporate structures. The organisation operates its business in near about 252 countries. It has been recorded in the year 2018 the company has earned €38.8 billion (US$44.6 billion). BY developing a business strategy, the organisation would be able to sustain in the competitive market without any threat of substitution. In the report, how the internal and external environment of the company inflames the performance aspects of the stakes would be briefly analysed. In order to evaluate the world’s market strategies, PESTLE analysis would also be conduct in the report for IKEA organisation.Moreover, in order to proactive analyse the market demand and strategic business of the organisation the outcomes of porter’s five forces model would be investigated effectively. Furthermore, in the report, the significance ofstrategic direction plan would be analysed and evaluated with a brief description. In the last section, a brief summary is mentioned in which
pg. 1 Nov 17 Assignment Brief RQF Unit 32 Business Strategy Unit level 5 Unit code K/508/0574 Term Start Date 16 /09/201 9 Hand out date 16 /09/201 9 Submission Deadline 25/11 /201 9 11:59 am ( Midday ) Lectures & Formative Assessments 10 Weeks Guided learning hours 60 Module Leader Khalid Karim Copyright © - All rights reserved - UK College of Business and Computing This document is the product and property of the UK College of Business and Computing and therefore may not be shared with any external third party; reproduced in full or in part; or used in any other related manner whatsoever, without prior expressed writ ten permission. This statement is for the attention of students, staff and external parties. In the case of copyright infringement, legal action will be exercised. pg. 2 Nov 17 Assignment title Business Strategy: Telecommunication Sector (UK) Suggested word count 3500 - 40 00 words Purpose of this assignment The aim of this unit is to develop students’ awareness of the different kinds of strategy which could be used in an operational, tactical or strategic role for an organisation. This will be underpinned by a thorough knowledge and understanding of the theories, models and concepts which could significantly support an organisation’s strategic choice and direction. On successful completion of this unit students will have developed enough knowled ge and understanding of strategy to make a positive, efficient and effective contribution to the development of business plans and operational direction. This could be in the role of a junior manager responsible for having a specific input into an organisa tion’s decision -making and planning. Case study – IKEA (UK) IKEA is a Swedish -founded multinational group that designs and sells ready -to-assemble furniture, kitchen appliances and home accessories, among other useful goods and occasionally home services. It has been the world's largest furniture retailer since at least 2008. It was founded in Sweden in 1943 by 17 -year -old carpenter Ingvar Kamprad, who was listed by Forbes in 2015 as one of the ten richest people in the world, worth more than US$4 0 billion. The IKEA group has a complex corporate structure, which members of the European Parliament have alleged was designed to avoid over €1 billion in tax payments over the 2009 –2014 period. It is controlled by several foundations based in the Netherl ands and Liechtenstein. As of June 2019, there we re 423 IKEA stores operating in 52 countries. In fiscal year 2018, €38.8 billion (US$44.6 billion) worth of IKEA goods were sold. The IKEA website contains about 12,000 products and is the closest representation of the entire IKEA range. There were over 2. 35 billion visitors to IKEA's websites in the year from September 2015 to August 2016. The company is responsible for approximately 1% of world commercial -product wood consumption, making it one of the largest users of wood in the retail sector. More information available on: https://businesscasestudies.co.uk/ikea/ You are allowed to use any other organisation from the UK, that you have worked or working for , or you have good knowledge of. pg. 3 Nov 17 Task 1 – Analyse the influence of environment on chosen company . LO1 Analyse the impact and influence which the macro environment has on an organisation and its business strategies. You need to identify the mission, vision and objectives of IKEA. You are to critically analyse how the macro environment impacts and influence s IKEA’s valid strategic decision and tactical actions . Tips: In your answer you are to use PESTLE analysis and Stakeholder analysis . The application of the models is crucial. Task 2 – Critically e valuating the internal environment and capabilities . Continue with IKEA (or your chosen organisation ), critically evaluate its internal environment focusing on the strengths and weaknesses of its internal capabilities . To do so, you are required use ‘ VRIO/VRIN ’ analysis for internal capabilities and ‘Resource Based View’ framework for competi tive analysis . Tips: You can start with the RBV framework and then work on ‘VRIN/VRIO’ framework. SWOT analysis can be used to identify strengths and weaknesses of organisation’s internal capabilities. Task 3 – Evaluate and apply the outcomes of Porter’s Five Forces model. LO3 Evaluate and apply the outcomes of an analysis using Porter’s Five Forces model to a given market sector. As a part of business strategy, organisations continuously plan to expand. In this task you are required to evalua te Porter’s five forces for IKEA . You are required to produce strategic direction to improve the competitive edge. Tips: You need to use Porter’s five forces framework and based on the outcome of the evaluation; you can use Ansoff’s matrix to produce valid strategic directions LO2 Assess an organisation’s internal environment and capabilities. pg. 4 Nov 17 Task 4 – Interpreting strategic direction. LO4 Apply models, theories and concepts to assist with the understanding and interpretation of strategic directions available to an organisation. You are required to use Porter’s generic strategies to create a strategic plan for IKEA and what tool management can use apply these strategi es. THE END Submitting your assignment: You will submit your assignment to the appropriate submission link on Ulearn before midnight on the submission date. The assignment should be in a word document and preferably using Arial font size 12 and 1.5 spacing. Your assignment should be uploaded on the Turnitin Assignment submission section. It is advisable to use the Turnitin Plagiarism checker before uploading the final piece of work. Academic Misconduct’ Statement: ‘Academic Misconduct’ is a term used to describe a deliberate attempt by a student to take unfair advantage over other students to undermine the quality, standards and credibility of the programmes and qualifications offer by UKCBC. Academic Misconduct includes plagiarism; collusion; falsification; replication; cheating; bribery; and impersonation. A student suspected of Academic Misconduct will be investigated by the College and appropriate action will be taken. ‘Contract Cheating’ Statement: ‘Contract Cheating’ is defined by the Quality Assurance Agency (QAA) as occurring when , “a third party completes work for a student who then submits it to an education provider as their own, where such input is not permitted.” Such third -party companies have become known as ‘essay mills’, and it is the responsibility of students to avoid co ntact and association with such third -party companies throughout their entire period of study. A student suspected of Contract Cheating will be investigated by the College and appropriate action will be taken. pg. 5 Nov 17 Assessment criteria (Please do not use th is as the questions, try to follow the tasks ) Pass Merit Distinction LO1 Analyse the impact and influence which the macro environment has on an organisation and its business strategies LO1 , 2, 3 & 4 D1 Critique and interpret information and data applying environmental and competitive analysis to produce a set of valid strategic directions, objectives and tactical actions. P1 Applying appropriate frameworks analyse the impact and influence of the macro environment on a given organisation and its strategies. M1 Critically analyse the macro environment to determine and inform strategic management decisions. LO2 an organisation’s internal environment and capabilities P2 Analyse the internal environment and capabilities of a given organisation using appropriate frameworks. M2 Critically evaluate the internal environment to assess strengths and weaknesses of an organisation’s internal capabilities, structure and skill set. LO3 Evaluate and apply the outcomes of analysis using Porter’s Five Forces model to a given market sector P3 Applying Porter’s Five Forces model evaluate the competitive forces of a given market sector for an organisation. M3 Devise appropriate strategies to improve competitive edge and market position based on the outcomes. LO4 Apply models, theories and concepts to assist with the understanding and interpretation of strategic directions available to an organisation P4 Applying a range of theories, concepts and models, interpret and devise strategic planning for a given organisation. M4 Produce a strategic management plan that has tangible and tactical strategic priorities and objectives. pg. 6 Nov 17 Glossary of commonly used academic verbs Account for Give reasons for: explain why something happens. Analyse Examine something in very close detail and from several angles. Identify the important points and chief features and understand their relationships. Compare Show how two or more things are similar. Contrast Look at two or more things and draw out differences. State whether the differences are significant. Critically evaluate Weigh arguments for and against something, assess the strength of evidence on both sides. Describe Give a detailed account of the main features or characteristics . Discuss Write about the most important characteristics of something. Give arguments for and against, look at it from a variety of perspectives. Distinguish Identify the differences between two items. Evaluate Assess the worth or usefulness of something. Use evidence to support your opinion. pg. 7 Nov 17 Examine Look at something in detail. You may be expected to 'critically evaluate' it as well. Explain Make it clear why something happens or why it is the way it is. Identify Recognise name and briefly describe something. Illustrate Use examples to further explain or justify something. Could be visual or verbal. Interpret Explain the meaning or significance of information or data that you are presenting. Justify Provide evidence that supports an argument or idea. Adapted from Cottrell. S.(2003) The Study Skills Handbook. Basingstoke. Palgrave.