Difference Between An Article And A Case, Types Of Strategy, And Levels Of Analysis

Definition of Strategy

While we’re on the topic of reading, we should discuss the difference between an article and a case. We’ll use both forms of readings in this course and their content and purpose is quite different. An article is a full text document or literary work about a particular subject(s), such as what one might read in a journal or magazine. An article may contain clarifying information about a topic.

A business case (or case study) is an account of what has happened within a business (or industry) over a number of years. Essentially, a business case is a story that may include facts, graphics, and quantitative measures as support. The story presents a problem(s), good or bad, for contemplation, analysis, and potential resolution. Let’s begin by addressing a few topics, the first, a definition of strategy, followed by a brief explanation of different types of strategy. What is Strategy? Here are a few different takes on a definition. Strategy is: • A cluster of related managerial decisions and actions to help an organization attain one of its goals • Management’s action plan for running the business and conducting operations • Plan for achieving or sustaining competitive advantage that consists of broad explanation of competitive moves and business approaches.

Some confusion exists about levels of strategy - Corporate Strategy vs. Business Strategy vs. Functional Strategy – Corporate strategy asks you (senior management) to make decisions about in what industries and businesses you should participate, e.g. I’m on a river and doing ok, should I stay on this river or find new one to navigate?

GE, the corporation, for 4 example, makes decisions about overall corporate strategy including in which industries it will participate through its multiple businesses or business level units. It also decides what mix of businesses it should own in order for its portfolio to maximize profits, to provide diversity of risk within that portfolio, and (possibly) to provide the vertical and horizontal diversity necessary for the most efficient value chains of the businesses under the corporate umbrella. Most decisions about acquisitions, mergers, and start-ups for the corporation happen at this level where senior mgmt.

would view the corporation’s multiple businesses as parts of a whole. Business strategy asks you (senior management) to make decisions about what is the best way (approach) to complete in an industry, e.g. I’m on this river, how can I navigate and paddle best? We concern ourselves about how a business under the corporate umbrella operates as a singular unit and its strategy in doing so. Business strategy is the focus of our course. Functional Strategy (aka Operational Strategy or Departmental Strategy) centers around the day-to-day functions, activities, and operations of the business. We create weekly, daily, or hourly goals. To return to the river example, managers at the functional level might ask, when will need new paddle or canoe? How much lead time will we have for ordering? How will these get to the river? Would changing paddle design create more efficiency?

Levels of Strategy

Of course, in a singular business or one without multiple holdings, we may have fewer concerns about a corporate strategy, BUT we should be able to distinguish between the functions and requirements of each level of strategy. As a small business owner thinking about buying a small competitor, one would make corporate strategy decisions. The same small business owner, thinking about finding the best suppliers with whom to partner in a JIT inventory arrangement, one would make business level strategy decisions. The same business owner might spend part of the day creating a production schedule or employee work schedule. Although, not a part of our course, students asked questions about what happens beyond the strategy we propose.

So, I’ll address this here in simplified form. Once strategy is completed and approved within a business, we develop operational plans for the day-to-day function of the business. Along the way, we concurrently develop business level and departmental (or some other grouping scheme) levels, but we finalize these only after business strategy is approved. Once approved, management, at functional or product level: a. Begins to communicate the strategy at all levels b. Assigns responsibilities for strategy components c. Allocates resources to complete assigned components (critical to success) d. Implements strategy 5 e. Monitors and assesses feedback, usually through one or more cybernetic loops. f.

Adjusts (both tactics and overall strategy) for changing conditions and corrects course as necessary. Once we have conducted an analysis of where we stand within the task environment, in business-level strategy, as managers, we determine two major types of strategy under which to operate at the business level: i. Type of Overall Strategy to Follow, in which we choose whether to grow or maintain our market share (Offensive, Defensive, or End-Run strategies) – more below; and, ii. Generic Strategy, in which through what means or how we intend to grow or maintain our market share (Broad Low Cost, Broad Differentiation, Focused Low Cost, or Focused Differentiation). Some refer to this as a strategic approach.

Note that often students confuse business-level generic strategy with marketing (functional level) or product level strategies that use similar terminology. While a company may have low cost and differentiated product lines, the generic strategy of a company as a whole remains one consistent choice among the four stated above. More information about generic strategy follows in this Guide. Levels of Analysis For each organization we study (and especially the group case analysis), we’ll perform analyses at three different levels, Industry, Segment, and Company.

Types of Overall Strategy

Each level depends on the development of a usable Industry Definition. For our purposes, we develop the industry definition using case data or some other given information with little to no reference to external sources like insurance industry categories or NAIC codes. More detailed information about each of these analyses follows in this document and others to which you will have access as we move through the course. b.

Industry level analyses include and examination of the general and task environments within which an industry exists, Industry Characteristics, a measurement of the Five Forces of Competition within an industry, and Driving Forces within an industry. c. Segment level analyses include the creation of an industry Strategic Group Map framed by the industry level definition, determination of the Minimum Success Factors for the segment in which the company examined competes, and the identification and examination of Primary (Direct) Competitors within the segment.

d. Company level analyses include an examination of five year historical financial trends in graph form, Value Chain analysis, SWOT analysis, identification of Core Competences and Distinctive Competence, VIRO analysis, 6 determination of Sustainable Competitive Advantage status, determination of Sustainability Issues and Stakeholder Analysis. As a result of, or along with these analyses, you will determine a strategic course that includes and Overall Type of Strategy to Follow and a Generic Strategy approach. What follows in this Case Guide are notes an information that will assist and inform you as you prepare your weekly discussion answers or case examinations. Simplicity - In order to reduce the complexity of the case analysis and for you to complete your team assignment within the allotted timeframe, we have simplified some aspects, including the number of competitors.

Ordinarily, one would perform ongoing analyses for all competitors in your defined industry (or at a minimum all competitors within your industry segment). For purposes of the group case analysis, you should analyze one to three competitors (depending on the assignment section). Don’t make things harder for yourself by doing more. The same principle applies to outside research. Research – You will need to complete a minimum level of research to prepare the group case analysis and case discussions. That’s right, a minimum. Your assignments are not a 25-page research papers that require seventy-five sources. Instead, assignments ask you to incorporate what you know from your business education in this Program and elsewhere,

Generic Strategy

your managerial experience, your business vocabulary of properly used terminology, and the analyses and process you will learn in this course to construct a strategy for a business case assigned to your group members and you (and to some aspect of weekly case discussions prior to the group case completion). Your assigned group case will contain much of the information you need to complete your analyses and make decisions about your group’s choice of strategic direction. You’ll need to research some items like historical and updated financial information and a few other items, but you should not spend hours on research. References/Citations – Despite the minimization of research for this assignment,

you should have a slide (or two) of references included in the final submission of your team case analysis. If the works you wish to cite are relevant to one or two slides, you can post the reference in the footer (not the notes) of the slide. If the works you wish to cite cover the whole project or multiple slides, you should include these on the slide with your references at the end. Experience and integration from other classes do not require referencing unless the information you include comes from a text or other formal source (which you would cite in any other course).

At a minimum, please don’t forget the reference for your case from the case packet. 7 1. OBJECTIVES AND STRATEGY SECTION General Advice and Information You will probably document less than half of what you prepare. You should keep your case write-up very clear and concise. Do not include a lot of detail beyond what is outlined in this package. Your case assignment is like telling a story. Keep it as simple as possible. Remember this report should be considered to be for the board of directors. Your team is the new top management of the company. The board wants the big picture, not day-to-day operating plans. Although you might break up the work among team members, each person should be familiar with all parts of the case submission. This is particularly important since, as you will see, the case guide calls for integration across case sections. All team members should work on at least a part of Section 1. If your corporation has more than one business, you should concentrate only on the largest business.

The industry definition should include only this major business and not all of the businesses within the corporation. Thus, strategy development, industry analysis, and industry segment analysis should relate only to the major business. For example, if you were preparing the Nike case, only the shoe division and not the clothing division should be included. Company analysis, on the other hand, should include all aspects of the corporation. This will be addressed in more detail later. Developing major objectives for multi-business companies is a little tricky. Set the objectives for your case under the assumption that all other divisions will have the same goals as your business. Thus, state your business objectives as if they were for the entire company. We will make many similar simplifications to make the case more manageable. The following list outlines the recommended steps for completing you case: 1. Each member of your team should read the case and perhaps an article or two, in order to bring the case up to date.

Levels of Analysis

2. The team should develop an industry definition (See Section 3A for a description.) 3. Each member should then develop future five-year strategic objectives and a general strategic plan for achieving those objectives. This general strategic plan must stay within the industry as you have defined it. 4. At this point, all team members should discuss their individual ideas with each other. You should agree upon a specific set of major objectives and a general strategy. If the team cannot initially agree, do not do additional research. More research generally will not help the team come to consensus. Instead, flip a coin or vote to determine the exact objectives and strategy. Once a strategy is selected, dissenters should strongly support the choice. 8 5. For the objectives and all other forecasts, use specific numbers, not ranges.

For example, forecast Return on Sales should be 4%, not 3% to 5%. 6. Once you have agreed upon a strategic plan, conduct the industry, industry segment, and company analysis. This may seem backwards (goals and strategy before various analyses), but it works the best and generally is what top managers do. In preparing a strategy for a company there is no right answer, although there are wrong answers.

Wrong answers generally involve analyses not supporting the strategy. In doing these analyses, I recommend that you start with industry definition and then develop your strategic group map (in the Industry Segment Section). 7. After this has been completed, revise your strategy, objectives, and business model, as necessary, to align with your analyses. Generally, there are no changes, and if there are, these are not major. 8. Although your team will need to do research, again, this is not a course in research. Many items in your case document will require guesses or assumptions.

State them as such, but make them consistent with the overall story (strategy) you are going to submit. For example, if you are really not sure how important advertising is in your industry, make an assumption that supports your strategic plans (story). If one of your aspects of strategy is to gain market share via advertising, then obviously advertising must be effective in your industry or industry segment. More about the whys of such assumptions will come in a separate document later. 9. Refer back to the case analysis package to make sure that all parts of the report/presentation “fit” together. Integration of strategy and analyses is important. 10.Check your overall package.

Industry Level Analyses

I will primarily be looking to see if your strategy “fits” together and conveys a simple and concise story without too much additional detail. Whether or not I agree with you story is of little consequence. The founder of Federal Express wrote his Federal Express business plan in his strategy course in college and received a “C.” His professor told him that it was not a viable business plan. Well, the professor was obviously wrong. Federal Express found a large untapped market. 11.Also check for typographical errors, proper grammar, and proper formatting of all numbers. Make sure that all spreadsheets add up. Eliminate all inconsistencies due to rounding. You are the top management team. You are not constrained by current actual company actions or strategies.

You can change the direction of your company. I am looking for something new, not just an extrapolation of what is currently happening. A caution, many teams make their objectives too optimistic. For example, if the industry analysis suggests that the industry is very competitive and the company analysis suggests that your company has no specific advantages, then a dramatic increase in market share is probably not credible. Also be aware that in many industries (particularly mature industries) even small increases in market share are difficult to achieve. Consider the common trade-off between sales increases and profit increases. Although it is not always the case, increasing sales and market share may require either increasing 9 expenses or cutting prices. These actions will tend to decrease profits. On the other hand, increasing profits may require cutting expenses or increasing prices, which may negatively affect sales growth. Reports should be submitted as a single, 2010 PowerPoint file.

Slide numbers should be included for easy reference. Slide titles should conform to those outlined in this package. You may use the notes section of a slide, but the readability of your work might be improved by including a separate slide titled “notes” behind the related slide. The course reading materials include a sample report for Toyota (referred to as the Toyota Case Example). A. General Case Information and Assumptions Provide the following case information at the beginning of the report in order to provide context for your strategy. The first two items are a part of industry analysis and the third item is a part of company analysis. 1. The industry definition (which is also included as Section 3A)

Segment Level Analyses

2. The industry growth rate consistent with item 1 above, including its source (which is also included as Section 3B)

3. The company average five-year historical revenue growth rate (which is also inferred in the financial trends, Section 5A) State the major assumptions that you have made in your report. Examples include the length and breadth of the current recession or a five-year estimated inflation rate. B. Major Company Objectives This section should include a brief statement of the company's long-term objectives. Longterm objectives for this course are five years into the future. Objectives should be specific and quantified. Ranges should not be used. The time frame for completion (five years) should also be explicitly identified. Short-term objectives are not included in the report.

The exact formats outlined in the examples shown below should be used. The following long-term objectives (at a minimum) should be included: 1. A sales growth objective (This should be compounded.) 2. A return on sales objective (There are a couple of different formulas for this depending upon the source you use. For purposes here, use Net Income after Taxes divided by Total Revenue.) 3. A return on equity objective (Then show and label the calculation.)

4. A return on assets objective 10 5. A market share objective for the primary business (Show and label the calculation of the current year company market share.) Examples of major company objectives (The numbers are for illustrative purposes only): The sales growth objective for Ford Motor Company is to grow at an average of 2.0% per year for each of the next five years from the current 2008 sales of $176.4 Billion to $194.8 Billion by 2013. The return on sales objective for Ford Motor Company is to attain a level of 0.5% ROS by 2013 up from our current 2008 level of –3.4%.

The return on equity objective for Ford Motor Company is to attain a 10.1% ROE by 2013 up from the current 2008 level of –60.0% ROE. (Note: a small equity base accounts for the large swing in this objective.) A return on equity objective for General Motors is not meaningful because current equity is negative. This is not forecast to change over the next five years. The return on assets objective for the Ford Motor Company is to attain a 4.0% ROA by 2013 up from our current 2008 level of – 32.1% ROA. The objective for the Ford Motor Company is to limit our decrease in market share from our current 2008 market share of 22.1% to 19.7% market share in 2013.

Company Level Analyses

The market share objective for the Boeing Corporation is to increase our current 2008 market share of 49.3% to 51.2% by 2013. C. Vision and Type of Strategy to Follow Part 1: Briefly describe your vision for the company. What kind of company would you like to have in twenty-five years? This will be a qualitative rather than a quantitative statement. You will create this and should not research or use the company’s current information. You are the company’s new top managers and are making a report to the board of directors. You are in charge of the company and should not follow the current vision or strategy identified in the latest actual annual report or from other sources.

Part 2: Select one primary strategy from the following list. Also identify “one” major competitor that you will focus upon for this case report. Selecting one competitor is intended to make the analyses for this course less complex. In real life, you would need to perform a separate assessment and plan for each major competitor. Do not confuse “Type 11 of Strategy to Follow” with “Generic Strategy” which will be discussed under company analysis. Types of strategy to follow include: – Offensive against a stronger rival (Include the name of the selected competitor here.) - Attack competitor strengths (list them) and/or - Attack competitor weaknesses (list them.) (Attacking a stronger competitor’s strengths is very difficult and if selected, your supporting analyses should be compelling.) – Offensive against a weaker rival (Include the name of the selected competitor here.) -

Attack strengths (list them) and/or - Attack weaknesses (list them.) – End-run offensive (Describe the new area of the industry you will be moving into and where no companies are currently competing. If applicable, list the competitor that you are most concerned will follow you.) Briefly explain how you will either: - Move to new area of the industry where nobody is competing or - Preempt rival moves into a newly emerging attractive area of the industry. – Defensive strategy (Include the name of the selected competitor here.) - Against stronger rival (Very briefly justify why you consider them stronger.) Suggest the competitor’s single strength or weakness that you are most concerned with. -

Against weaker rival (Very briefly justify why you consider them weaker.) Suggest the competitor’s single strength or weakness that you are most concerned with. Notes to Section 1C Part 2 1. For purposes of this course, when determining offensive versus defensive strategies, assume that a planned increase in your market share (i. e., revenues growing faster than the industry) indicates an offensive strategy. Maintaining or losing market share would be a defensive strategy. End-runs could be either. 2. If your industry contains a large number of very small companies and you feel that collectively these small companies are your major competition, then you can aggregate these as “generic small competitors” as.

Simplicity

your primary competitive focus. However, when listing a strength or weakness, do so for a single small competitor and not for the small competitors combined. 12 D. Strategy Overview and Key Aspects of Strategy Part 1: Briefly (1 slide) describe your overall strategy. This is in essence your “story” and should set the stage for understanding the key aspects of strategy shown below.

For example: We intend to be the global leader in producing low-cost small appliances. Part 2: List two to three key aspects which will make up your strategy. Assign a percent of total effort (based upon money to be spent) that will be devoted to each of these key aspects of strategy. These major key strategic efforts must equal 100% and must not overlap. For example if one key aspect is to expand overseas and another is to introduce new products into the marketplace, then you must clearly separate new products to be sold overseas

(in order to resolve an apparent overlap of your two key strategic thrusts). A sample of this is shown in Section 1D Part 3 below. Possible key strategic aspects include: – Pruning marginal products and models – Creating value chain innovation – Implementing cost reductions – Increasing sales to current customers – Developing additional new customer bases (Be specific.) – Making acquisitions – Expanding internationally (But stay within your industry definition.) – Employing flexible manufacturing – Retrenching or using a turn-around strategy – Attaining market-share leadership (This often uses a low-cost strategy.) – Negotiating strategic alliances – Develop new products (R&D) – Other(s) (Be specific.) Notes to Section 1D Part 2 1. For simplicity, all strategic thrusts must remain in the industry as you have defined it. 2. Later in the case preparation .

you will develop pro-forma income statements and strategic capital expenditures reports. These detailed statements of costs must align with the percentages developed here. Being an iterative process, the initial percentages that you come up with in this section might change. Generally any changes will not be large. 3. This part will only include percentages, not monetary amounts. Part 3: Provide detailed aspects for each of the strategic initiatives listed in Section D1 Part 2 above, if appropriate. That is, list the first Part 2 initiative and then follow it by related Part 3 details. Then repeat this format for the other strategic initiatives from Part 2. 13 Assign a percent of total effort (based upon money to be spent) that will be devoted to each of the detailed Part 3 aspects for each major initiative (again, 100% total and no overlap). An example is shown below. Some possibilities of detailed aspects of strategy include:

Research

Technology Human resource management Legal/government relations Organization & information management Manufacturing Distribution Marketing Other(s) Provide actual actions (even more detailed) for each item selected above (that is, for each of detailed aspects of strategy). For example, if you chose marketing that is related to introducing new products into the domestic market (Part 2), then identify the target group(s), the type of marketing (for example, advertising), and a specific advertising effort down to basic advertising themes and/or advertisements. Strategy for Company

A – Expand internationally by selling new and existing products: 50% (brief description) - Distribution (60%): detailed description - Marketing (40%): detailed description – Increase domestic sales by introducing new products: 50% (brief description) - Marketing (20%): detailed description - Human resources management (10%): detailed description - Distribution (10%): detailed description - R&D (15%): detailed description - Manufacturing (45%): detailed description (Worldwide R&D and Manufacturing are allocated to this strategic initiative in this example.) Note: Do not use “financial” as a key or detailed aspect of strategy. An example of this would be a leverage strategy. Financial aspects it will be covered separately in Sections 1E and 1F. E. Cost of Implementing Strategy The cost of the items from Section 1D above should be estimated and shown in two spreadsheets; a “Pro-Forma Income Statement” (Part 1 below) and a “Pro-Forma Strategic Capital and Non-Expensed Payments Statement”

(Part 2 below). An example, unrelated to the previous examples of major objectives and key aspects of strategy is shown below. 14 Part 1: Tax strategies for the pro-forma income statement should not be used and the tax dollar amount should be calculated based upon net profit before taxes rather than from sales (use 30% for convenience). Once you have calculated taxes, show taxes as a percentage of net sales on the spreadsheet. Actual expenses from the base year should be used as the first column of the pro-forma income statement. Use data from the latest company financial statement as the base year. Most company financial statements include a significant number of detailed line items.

Two examples would be “Deferred Taxes” and “Other Income.” On the other hand, financial statements often do not break information down into the detail needed for your case. An example of this would be “Marketing Expense.” On most financial statements this number is included in “Marketing, General, and Administrative Expense.” In order to understand the financial aspects of your strategy we will simplify the presentation of actual financial information. The number of expense items should only highlight your strategy and will not reflect the number of items in the company’s financial statement. The actual revenue, cost of goods sold, and net income after taxes from the company’s financial statement should exactly match these items in the first column of your spreadsheet. Looking at the sample “ProForma Income Spreadsheet” below, you can see that the strategy will involve R&D and marketing expenses.

References/Citations

R&D will most likely be listed separately on the financial statements and can be used directly on your spreadsheet. All of the other items on the financial statement, except for interest expense, can be put in “administrative” on the Pro-Forma Income Statement. Since the financial statement does not list marketing separately, estimate a number for marketing. Subtract this number from administrative expense and list it separately. It is often easier to calculate this marketing number by using a percentage of sales. This is a number that you will estimate or guess. Also add actual taxes paid into administrative expense and recalculate taxes as 30% of net income before taxes.

The other (forecast) columns contain numbers that you make up. I strongly suggest that you formulate the last year of your income statement forecasts first and then complete the other columns. In the example below, this would be 2013, the two columns (dollars and percentages) on the far right of the spreadsheet. Although you will make up many of the numbers, certain numbers must match other parts of your report. Base year (2008) and the out-year (2013) revenue numbers must match those that you stated in your major company objectives (Section 1B above). Also your pro-forma return on sales percentages must match your related major company objectives.

The connections for ROA and ROE will be discussed in Section 1E Part 2. The reader should be able to infer your basic strategy from your pro-forma income statement. In the example below, the strategy would include a major marketing, as well as 15 R&D effort. One explanation for the drop in COGS percentage of sales over time is that the R&D is process R&D that will lead to significant increases in productivity. Since you have already detailed your strategy in Section 1C and 1D above, no explanation is needed here.

However your detail in Sections1C and 1D must be consistent with and clearly identifiable in your pro-forma statements. Do not use “other” or “miscellaneous” expense. People will just ask what it is. Calculate interest expense in the forecast years to include any additional planned debt that you accrue or pay off. Like taxes, this is a separate calculation based upon total debt. State the percentage that you used to determine interest expense. For example, weighted average interest on all debt might be 7%. Again, create these numbers up based upon what you feel is reasonable. Do not conduct research. Total debt in the out -year forecast is a number that you construct. Although we will discuss it under company analysis, you might want to take a look at your current leverage position in determining how much debt to have in you out-year forecast.

This debt level will also be listed in Sources of Funds for Implementing Strategy shown in Section 1E below. It is not unusual to have difficulty making your out-year expense percentages equal 100% of sales. With your strategic initiatives, the initial number often comes out higher than 100%. Do not just reduce administrative expense to make the numbers work. For example if administrative expense drop from 20% of sales to 10% of sales you must have a credible explanation of why. A 20% to 10% seems very difficult to explain. Notes to Section 1E Part 1 1. If your company has more than one business and you are focusing upon the largest business, then this analysis is somewhat distorted because it uses company data.

This is acceptable. Although some company financial statements may have segment information in the notes, not all segment information will match the major business as you define it. Therefore, everyone should use company information and not segment information. 2. As you prepare very detailed forecasts, it is important not to spend too much time reaching consensus within your group as much as consistency with the strategic story. 3. Be careful not to do too much research. Our intent is to learn the process of developing a strategy and providing supporting analyses.

In a real work situation you would need to do more research, but at this high level of reporting you might be surprised at the number assumptions that you would still have to make. Often these assumptions would have more of an effect than the research in real world settings. 4. You may notice some inconsistencies presented in the financial information here in this Guide and the Toyota Case Example. Most (but not all) are intended to provoke questions about the connections among the parts of Pro-Forma financials you need to prepare and the connections to the Key Aspects of Strategy.

• Business policy defines the roles and responsibility of top-level management, which influence organizational decision making process and organizational success
• The presentation will evaluate the business policies of Best Buy Company
• Best Buy is an American multinational consumer electronics corporation
• The presentation will present the Minimum Segment Success Factors, VIRO Analysis, Sustainability Issues, Stakeholder Analysis to be implemented in the organization

Best Buy Industry Segment Analysis 

• The most attractive segment is the high quality segment and high efficiency segment
• The least attractive segment is the followed by low quality and high price (Wells & Ellsworth, 2017)
• The potential entrants in the attractive segment with high quality

 

  

Best Buy: High Quality Segment
Minimum Segment Success Factors 

• Technology Related: Use of most advanced technology in the electronic products
• Distribution Related: Use multichannel distribution strategy for enhancing sales volume (Wells & Ellsworth, 2017)
• Marketing Related: Training to the employees for better store experience of the customers

 

 Best Buy: High Quality Segment(Continued)
Minimum Success Factors 

• Skills Related: Use best sales experts for effective store sales facility
• Organizational Capability: Work with vendors for innovation and driven service
• Geographic: More focus in international business success
• Service Related: More informative interaction with the customers within the physical stores (Wells & Ellsworth, 2017)

 

 VIRO Analysis (Continued) Wide Distribution Network

• Maximize multichannel Product and Service Delivery (Wells & Ellsworth, 2017)
• Customer convenience through smooth delivery of product
• It will lead to sustained competitive advantage over the rivals

Leading Edge Technology

• Early adopters are coming to Best Buy
• Best Buy could access to new and innovative technology
• However, such technology is not inimitable and it can create only competitive parity 

Innovation

• Launch more innovative and value driven electronic products
• Customers can avail the innovative electronic products on both the website and physical store of Best Buy
• Innovation can foster sustained competitive advantage over rivals

Unique Vendor Groups

• Investment made by vendor partners in the store will increase stock of variety of products
• Vendor support will help in collecting unique electronic products (Wells & Ellsworth, 2017)
• Unique vendor groups are directly responsible for fostering business innovation, which can lead to sustained competitive advantage

International Growth

• More focus will be given on international growth of business
• However, international growth is not inimitable and not rare, which can lead create only temporary advantage over rivals

Strong Online Sales

• Best Buy will give strong focus on enhancing online sales over e-Commerce companies
• However, online sale is not inimitable and not rare, which can foster only temporary advantage over rivals

Competitive Pricing

• Competitive pricing will keep the price of consumer electronic products low
• Best Buy will clear the misconception of the customers regarding the competitive pricing
• Such pricing is not rare in the market, which can only lead to competitive parity

Highly Skilled Store Staffs

• Best Buy will employ highly skilled employees in the stores for more informative interaction with the customers
• Such skilled employees are not inimitable and not rare in the market, which can only lead to temporary competitive advantage

Increased Stock in Stores

• Best Buy will increase the stock of electronic products in the physical stores for increasing store sales volume (Wells & Ellsworth, 2017)
• It can lead to sustained competitive advantage over the retail rivals

 

 

Sustainability Issues

• E-Waste: The E-wastes of the consumer electronic products can have huge affect on the air, soil and water component of environment
• Energy Consumption: High energy consumption by electronic products hamper the quality of environment

 

• Exposure to Hazardous Chemical: Exposure of the employees to hazardous chemical can be risky for their health
• Hazardous materials: Hazardous materials used in the consumer products can have high impact on the environment

 

Measures for Sustainability Issues

• Recycling: Best Buy has already taken initiatives of recycling for minimizing the amount of e-Waste (Wells & Ellsworth, 2017)
• Energy Efficiency: The organization will source energy efficient consumer electronics for environmental sustainability

 

Measures for Sustainability Issues (Continued

• Eco-Leveling of Products: The organization will start eco-leveling of consumer electronics for ensuring environment friendly materials
• Regulations: The organization will be adhered with strict regulations for protecting the employees from hazardous chemicals of electronic products

  

Important Stakeholders: Stakeholder Analysis

• Company Owner: Funds and Frame business Policy
• Manager: Manage business operation for achieving business success
• Employees: Input their effort towards achieving organizational success

Customers: Ultimate target to sale products (Wells & Ellsworth, 2017 

 

• Suppliers: Source unique consumer electronics materials
• Government Authorities: Frame legal policies for business
• Communities: Must consider communities' support
• Media: Spread positive image in the market

Conclusion

• Best Buy is considered to be in most attractive segment of retail industry having high quality and affordable price
• The organization will focus on high innovation and value driven business
• Best Buy has already concentrated on recycling process for minimizing the issues of sustainability
• The important stakeholders of the organization should be managed closely for keeping up organizational success

Reference

Wells, J., & Ellsworth, G. (2017). Reinventing Best Buy. Harvard Business School. Retrieved 4 February 2018, from