Strategic Management - Case Study Example

This company is now selling their products in almost all countries through out the world. Imperial says that combining the fourth and fifth largest cigarette companies in the world on a friendly basis makes compelling sense and would be a good strategic fit, and analysts say there would be no major competition problems. (UK's Imperial Tobacco makes $15billion bid for Spanish rival Altadis) SWOT Analysis- SWOT analysis is intended to provide information that is appropriate for the company's resources and other factors for the purpose of maintaining its prevailing market position.

It means analyzing the Strength, Weakness, Opportunities, and Threats. All these four factors should have an equivalent role in retaining its market strategy. Strength of a company indicates about its competitive advantage, mainly in respect of its patents, brand name etc. "SWOT Analysis highlights the weaknesses of the company and the threats to which it is exposed; the strengths of the company and the way the company has positioned itself to take advantage of the opportunities." (Imperial Tobacco Group PLC, Corporate Analysis). . At the same time Threat creates a critical situation within the company's environment.

It is a framework for the company to analyze the strength and weakness and for matching the company's opportunities with its threats. The major strength of Imperial Tobacco is that of innovation in the whole business areas. The company is delivering high quality products to their customers through which they are retaining and finding loyal customers for selling their products. The industry average in management practice is only up to 87%, but as far as the company is concerned, Imperial Tobacco achieves 88% towards its performance.

Thus it becomes evident that they are the leaders in the industry.VRIO framework is a tool for analyzing an organization's capability for operating its business activities in an effective manner. This is a tool, which is internally applied within an organization for reviewing and improving its functioning. VRIO indicates Value, Rarity, Imitability, and Organization. Value means a firm's capability to utilize an opportunity and to defend any threat from others. It also provides a specification about the resource capacity of an organization.

It is helpful for planning the future performance of a company and to defend against competitors. It enhances a company's productivity, which is more beneficial for improving its profitability as compared with its competitors. In order to maintain the Value concept, certain elements like corporate culture, effective management system, developing a friendly work atmosphere, and the adaptation of certain innovative techniques are essential. Rarity means an organization's ability to maintain its resources in the hands of a few personnel.

Due to the scarcity of resources, it is not easy