The Environmental Influences and the Strategic Capabilities of an Organization - Case Study Example

?A SWOT analysis explores the relationship between the environmental influences and the strategic capabilities of an organization compared with its competitors Organizations are moving ahead and that too at a fast pace. It is this pace that makes the organizations feel at par with the industrial norms which keep on getting better and advanced with each passing day. An organization would be immensely supplemented by its own strategic capabilities and the environmental influences which happen on one pretext or the other. These strategic capabilities and environmental influences are very significant because they tell the exact basis of success that an organization or a brand achieves and the limitations that are imposed on it from a current standpoint as well as in the long run. Critically speaking, it is a fact that an internal strategic capability analysis puts the entire focus on the way the environment gets in contact with the product that is marketed under the aegis of an organization. The direct link with the competitors is always apparent in the case of one such analysis. However, what is most important here is that the product is compared against its own basis nonetheless. The manner in which the link between the environmental influences and the strategic capabilities of an organization is made clear is something that brings sanity within the realms of an organization. It puts the basis right of many an undertakings within the business enterprise and tells the senior management where they are going wrong and what corrective steps need to be taken under their aegis (Devane, 2007). Therefore a SWOT analysis is a good enough beginning for finding out where the product is at a particular period in time. It finds out where it will be in a given time as well. This is important because the product within the aegis of an organization is moving from one position to another, and discerning new avenues of growth and development all this while. This consistent race to reach the coveted top position within the industrial settings ensure that the product will bring in new standards and advancements to make sure success comes about in full circle (Richter, 2009). The SWOT analysis would eventually be the difference between how things are being managed and how these shall be taken care of in the coming days. It is of fundamental significance to realize the gravity of the situation at hand because the SWOT analysis presents a clear cut picture of where the strengths and weaknesses lie within the internal realms and how the opportunities can be cashed upon and the threats be reduced to larger proportions. The entire understanding of the SWOT analysis emanates from finding out where the organizations are being handled properly and where they are losing ground on most of the occasions. However it is always a difficult proposition to begin with and it is imperative to know how the product under the realms of an organization aims to determine its strong points and the problems that lie close to its own basis. In keeping with this discussion, this paper tries to establish the link between the environmental influences and the strategic abilities and capabilities so that a better understanding of the product and indeed the organization is made in the long range scheme of things. Essentially the use of the Porter’s Five Forces Model suggests that success could only be achieved within the SWOT analysis if proper efforts and undertakings are incorporated within it. This would mean that the new entrants are tapped, their threats are analyzed and foreseen and the required steps are taken beforehand to thwart any hiccups that may so arise at a later point in time. The Porter’s Five Forces Model is indicative of the fact that the SWOT analysis will be done in an effective and efficient manner. It highlights the exact ways and means through which different threats are analyzed and thus countered with the passage of time (see Appendix 1). These five forces surround the discussion of the new entrants which could come about at any time, the role of the suppliers and distributors as concerns to their bargaining power that they have within their fore, the customers’ role, the rivalry amongst existing competitors for the organization and lastly the threat of products and services that are considered as substitutes in the sheerest sense of the word. When the Porter’s Five Forces Model is properly scrutinized and checked for its adequate usage, the SWOT analysis is seen as a good enough starting point as to where organizations are going wrong and what corrective steps need to be taken on their part to rectify such maladies and shortcomings. Similarly, the opportunities and threats must always be countered by the organization because these lie in the environmental influences of this business enterprise and should therefore be handled in a proper and diligent way nonetheless (Andersson, 2011). An example of this is the renowned brand Mars which brings a number of chocolates under its flagship umbrella brand. When Mars encounters issues within a global marketplace, it assures that all the problems are taken care of by localizing products so that the target audiences do not feel left out. They also enact measures to guarantee that the taste remains the same of these chocolates and indeed the products no matter which location of the world they are sold within, however regional changes within the packaging and manufacturing areas are always varied. Therefore the strength here remains the Mars bar which is indeed a sign of significance for it while the weaknesses remain within its distribution to far flung territories of the world (Sledge, 2011). It must be remembered here that a SWOT analysis is a good way to find out where organizations are going wrong and what corrective steps need to be taken at certain points within its life. However, forgetting the strengths and areas of possible opportunities would not bring in success for the business enterprise and it is always a good starting point to look at such matters beforehand (Harrison, 2010). On the same token, the manner in which the organization views its own self is very significant towards gaining quite a bit of understanding, and more so when the talk goes out loud regarding the strengths and weaknesses of the products and domains which come under its due folds. These are properly given the much needed emphasis by the different forces present within the Porter’s Five Forces Model (Nixon, 2010). The need of the hour is to be sure that both these strengths and weaknesses are handled amicably well with the proper role of the Porter’s Five Forces Model because these will be compared against one another to find out what the strategic abilities, capabilities and skills of the organization are, and how these shall be taken care of in the long range scheme of things (see Appendix 2) (Peng, 2008). An example of comprehending the Porter’s Five Forces Model is therefore found out through the world’s premiere automobile maker BMW. BMW has to face pressure from different organizations of the world, and especially the ones who are manufacturing cars as these are the direct competitors. The brand BMW is thus in a constant war with the new entrants like Kia, Jaguar and so on while the intense rivalry from Mercedes is also giving it a tough time. The regional changes happening at different locations of the world which eventually result in bargaining concerns raised by suppliers, distributors and customers alike are some of the more important problems that must be taken care of by BMW to make sure that it remains steadfast with its approach to bring forward cut-throat technology and design in the form of the renowned BMW series of cars all around the world (Pugh, 2011). The need is to comprehend that the SWOT analysis shall always aim to explore where the organization has hid its strengths and then highlight the same for its best and proper usage in the coming times through the different dimensions of the Porter’s Five Forces Model. Similarly this model will also determine the basis of pinpointing the weaknesses which will safeguard it from further problems and concerns that will crop up in the future (Kurtz, 2011). This will help solve the quandaries that the organization finds itself plunged within because a clear cut direction is envisaged which shall save it for the future reigns and give it the direction that it would savor in the future. This is an important understanding because it helps resolve the manifold issues and concerns that surface within the minds of the senior and middle management realms (Teece, 2011). It removes the concerns that these people have and gives them a sense of comprehension which they were unable to attain in the past. Speaking particularly from the angle of the Porter’s Five Forces Model, if the strategic capabilities in the wake of these strengths that are related with a product are taken care of, the direction would automatically be drafted and in an easy going way. This will also take care of the past glitches that exist within its folds, which indeed are its weaknesses (Hartley, 2010). The strengths and weaknesses hand in hand and with proper consideration under the heading of the Porter’s Five Forces Model, would care for the strategic tilt of the organization and aim to bury the hatchet that surrounds the entities of the organization, giving it the much needed mileage and direction that shall win favors at the end of the day. These strengths must always be weighed against the weaknesses and vice versa because these give a good enough picture of how things shape up in the present day and age. It also offers a range of opportunities for the organization to understand its own basis in a much better way when the strengths and weaknesses were not presented in front of it (Porter, 1990). The Porter’s Five Forces Model along with the SWOT analysis serve to take care of the customers worldwide and not to forget the world markets which are drawn up in the name of consumerism. This is such an important facet of the global enterprise that success can only be dawned upon if the organizations possess opportunity areas that could be cashed upon with a proper vision and a sense of direction. Hence the understanding of the strengths and weaknesses within an organization in the line of the Porter’s Five Forces Model is such that nearly everyone is interested (Williamson, 2003). The senior management wants to know what is happening within its fore while the middle management is more concerned about what statistics and numbers are being debated upon. The stakeholders also would like to inquire about the resources that are being used to the best possible effects within the organizations and which ones amongst them are not being exploited upon in entirety. An example of this is the Enron Scandal which broke new grounds and touched base with the employee attitudes and change in behaviors once the news broke out. This highlights the basis of negligence that an organization would show in the first place and end up meeting complete and abject failure once the cat was out of the bag. In essence, the role of the outside world is also relying a great deal on how things get shaped up within the strengths and weaknesses that exist within an organization, and how these form up a vital link between the strategic capabilities and the echelon which deems much significance at the end of the day (Giles, 1989). The environmental influences can always be taken into consideration when the discussion of the opportunities and threats is made but for now it is quintessential to comprehend the due role of the strengths and weaknesses which shall in essence have a great amount of say within the drafting of the strategic capabilities that lie hidden within an organization, and which bring forward the notion of a positive change – a change that will eventually discard or do away with the weaknesses and strengthen the already discerned and determined strengths within the aegis of the organization (Morrison, 2006). The environmental influences track down the comparisons with rivals and hence it is mandatory for an individual to read through the opportunities and threats that an organization or for that matter a product faces from time to time, or in a regular and consistent way. The opportunities are areas which have either not been tapped as yet or if they have, the results have not been magnanimous due to lack of foresight on the part of the organization or a general unwillingness on the part of the management (Tarcy, 2000). Similarly, the threats are posing issues and problems which have been staring in the face of the organization for a long period of time and nothing conclusive has been done of late to address the maladies that have cropped up. Realistically speaking, what the SWOT analysis in relation with the Porter’s Five Forces Model does is to create room for understanding of the different tasks that are held in close association with one another within the organization. It also allows the individuals within an organization to have the best possible feel about the things that are going to come up next and how these will be managed in quantifiable proportions. Even significant is the reckoning that is held closely with the understanding that organizations will grow over a period of time and manifest their success to the opportunities that came in close terms with how they planned things and the threats that were taken care of by the management domains as and when the time was deemed as appropriate. This is the reason why many competitors for one such organization will have a problem in following up with the standards which have been drawn up by such enterprises (Fleisher, 2008). The need is to analyze the significance of such companies and then move forward by devising the organization’s own repertoire and skill set. However, there could be some difficulties when forecasts are drawn up because the threats exist without any doubt and could come up without any notice whatsoever (Zawacki, 2004). At some instances, there are some threats that have no reckoning and significance whatsoever but are handled by the management domains so that they do not have any bad taste in the mouth as organizations take up a lot of resources and are built after a great amount of thought and comprehension. It is for this matter that organizations are now being more diligent than ever and enacting ways and means to make sure that these remain committed to the cause no matter how tough the times are and what the situations and circumstances turn out to be in entirety. Therefore the opportunities and threats give a good enough indication of how well the organization is faring with respect to its competitors and what new steps it needs to undertake to make sure that it remains a winner in the long term (Amason, 2010). What is required within an organization is to make sure that the strategic capabilities interact with the environmental influences, and then only find a way that their success is guaranteed without removing any resources from the related settings. The top management must have a clear cut insight into the things that are going on and which shall have to be measured, corrected and rectified for the sake of the business enterprise and indeed the organization (Hussey, 2001). When such measures are properly drawn up, then the essential talk of finding out the opportunities is discussed because these opportunities look to explore the finer points which will exponentially enhance the basis of the business and increase its chances of survival within the related territories and areas of business domains. All said and done, the Porter’s Five Forces Model and the SWOT analysis are given the credit for being different as they reveal quite a great deal about the different processes and activities which exist within the folds of the organization under differential circumstances and situations. Appendix 1 SWOT Analysis Appendix 2 Porter’s Five Forces Model Bibliography Amason, A., 2010. Strategic Management: From Theory to Practice. Routledge, 1st ed. Andersson, T., 2011. Strategic SWOT analysis of public, private and not-for-profit festival organizations. International Journal of Event and Festival Management, 2(1) Devane, T., 2007. The Change Handbook: The Definitive Resource on Today's Best Methods for Engaging Whole Systems. Berrett-Koehler Publishers, 2nd ed. Fleisher, C., 2008. Analysis Without Paralysis: 10 Tools to Make Better Strategic Decisions. FT Press, 1st ed. Giles, W., 1989. Making SWOT Analysis Work. Marketing Intelligence & Planning, 7(5/6) Harrison, A., 2010. 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