Week 5 final

Strategic Plan Part 2: SWOTT Analysis

Lauren Rudolph

University of Phoenix

Linda McKee

BUS/425

October 9, 2017

Strategic Plan Part 2: SWOTT Analysis

In order to create an effective strategic plan; an analysis of external and internal variable is important . In this case, the SWOTT is the best tool which can be used assess whether the division has some strength in the markets, the weakness the division may face, opportunities available for the company to utilize, threats which the division will experience and lastly the trends which we can utilize or make our products be successful or became obsolete in the markets. SWOTT analysis can be divided into two categories which include external environment and internal environment. Internal forces include all factors which affect the division positively or negatively.

On another hand, external factors include all forces which affect the company division either positively or negatively. The external factors under our discussion include legal and regulatory forces, economic factors, technological factors, environmental and competition analysis. The internal factors include strategy, structures, processes and systems, resources, strategic capabilities, culture, technologies, and innovations. The goal of the SWOTT analysis is to discover and evaluate information that will be useful when developing an effective strategic plan .

New Coca-Cola division must face and be able to withstand some of the external forces and trends that may affect the strategic plan. Legal and regulatory variables are some of the important forces a company must consider before the division enters into business. Coca-Cola Company has to adopt measures of protecting their intellectual property. For example, the company may adopt trademark rights to prevents other companies from coming up with the same brand. The key concern of the company is to develop a product which will offer health benefits to customers. Therefore in order to achieve that the company has to adopt trademark to protect their client from being sold a defect product by frauds purporting they are working with the company.

In case the division fails to adopt a trademark which will bar other firms from producing the same products then the company may face legal suit factors in case the fraudsters sell an illegal product which violates consumer acts. Legal suit is a costly affair and therefore the division should make sure they don’t fall prey of the same. In case other firm manufacture our new brand without our authority we may still sue them. Therefore in order to have a smooth operation then the new division should come up with a team of legal experts which will be advising the division on a matter which concerns the customers and governments. Economic factors affect the division and the company at large.

The economic factors such as money in supply, interest rate, inflation and GDP trends will affect the company operation in one way or the other. For example, the new division needs to acquire its own machinery and other production requirements . That machinery falls under the category of capital expenditure the company will budgets. In case of high-interest rate, the company may incur the high cost of acquiring loans. Money in supply also will affect the consumer's ability to purchase the company products as well as shareholder ability to invest. Consumer income level also determines whether the customers will be able to pay extra in order to purchase the new brand.

Therefore in order to survive during volatile economic times, the company should make sure the products are of high quality always and differentiated according to markets segments . Technological factors also affect the external environment of the new Coca-Cola division. For example with technological advances, a firm should adopt more innovative methods of production by reducing the number of employees working per machines. If a company utilizes that methods then it will be able to cut some cost associated with production even though some people may argue that it's ethically wrong to compare a human being to a certain value of a currency .

According to the division Mission and vision statements, the company target maximizes shareholders wealth and in order to achieve that then the management should ensure all decision are geared towards achieving shareholder wealth. Technology is a good opportunity for the company because it may be utilized to encourage customer's user-generated content as methods of boosting brand awareness and sales. However, the technology may offer threats to the division operation because it gives chances to competitors to observe some of the strategies adopted by the company hence they may end adopting the same strategies in order to gain more competitive advantage than our brand.

Environmental factors offer threats our division more so in periods of droughts. Our company needs more water than any other firm in order to achieve its production objective and in case there is water rationing then the company production will be affected hence posting challenging to our division production objectives. In order to achieve our business model objective, the division will utilize the already existing supply chains because our brands closely resemble Dasani. The only difference is the natures of the mineral and other variables content available in the two brands. In order to make everything a success in our supply chains we will connect our supply chains with the retailers to be updating the supply departments when orders level is low then the division will respond within the lead time indicated.

The division plan will take lesser time than the lead time indicated. Also, the division supply will be more efficient than our existing division. This strategy will help our division offer value to customers as well as creating more customers goodwill as well as fulfill other stakeholder needs.

The primary internal considerations for the development of strategic plan include structure and culture, workforce, competitive advantage and financial considerations. The strategic plan adopted should fit within the company culture and structure. The new division we propose will fits perfectly to the company structure and culture. The culture of the company was based on the production of sugary soft drinks but with time the company has accommodated other division which produces health products like Dasani water and energy water and coke zero and others . Therefore considering that trends the company can as well accommodate the new division products .

The workforce capabilities and weakness is a key consideration a company should consider while drafting a strategic plan. The company employed a pool of capable workforce with necessary skills, therefore, the new division will utilize the same workforce. The company has a competitive advantage over other companies because of the market share it enjoys as technologies and partnerships . Therefore the new division will utilize the same partnership and contracts the company has with other stakeholders to ensure the product gain market acceptance. The company has strong financial capabilities because it can utilize both shareholder equity and creditors funding. The company debt ratio to equity ratios is favorable and therefore it can accommodate another division with the same financial conditions .

Opportunities and issues

The division is faced various issues such as changes in customers tastes. In case the customers taste changes the company will lose market influence. Also, changes in climatic condition are affecting the operations of the new division because in some areas where the company has subsidiary branches and there is water rationing then the company operations are affected. However, the division still faces various opportunities, for example, the company has large market share and therefore the new divisions will utilize company loyal customers to achieve its sales objectives. Also, the division has opportunities of well-established supply chain networks. The division will utilize the existing supply chain network to achieve its sales objectives.

In conclusion, the new division faces various opportunities which arise due to the already established supply chain networks, huge markets share an existing brand name. Also, the companies have a chance to utilize low labor cost, especially where the company has subsidiaries in the developing countries. Also growing markets is another opportunity which the company should take advantage off. However, the company faces threats brought about by changes in climatic condition, economy, competitors, and an entrance of new local firm and business-like supermarkets which have started their own water packaging. In order to achieve milestone on both opportunities and threats, the company should establish a competent team and provide necessary financial support

Reference

Rao, C. A., Rao, B. P., & Sivaramakrishna, K. (2008). Strategic management and business policy: Texts and cases. New Delhi, India: Excel.

Jeffs, C. (2008). Strategic management. Los Angeles: SAGE.

Griffin, R. W. (2012). Fundamentals of management. Mason, OH: South-Western Cengage Learning.

Cole, G. A. (1997). Strategic management: Theory and practice. London: Thomson Learning.