Individual Strategic Management Report Assignment Sample

1.0 Introduction Of The Individual Strategic Management Report

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This report talks about the strategic management processes of the company Dyson. This process helps to set the goals, objectives and procedures so that the company becomes more competitive. Strategic management helps to efficiently handle the human and other resources of a company so that the company can achieve its goals. This process helps the company to grow in the right direction with the help of proper identification, assessment and evaluation of new business goals. This process also helps to identify that these new goals are achievable and appropriate for the business. The strategic management process provides a clear framework for making future decisions for the company. It helps to predict long-term benefits so that the company can create positive changes in its operations.

1.1 Company Background

Dyson Ltd. was established by James Dyson in the year 1978 and the company is in the manufacturing industry. The first product the company manufactured was the Ballbarrow which was very similar to the wheelbarrow. The headquarter of the company is currently located in Malmsbury, Wiltshire. The company is located in more than 80 countries all over the world and Asia is the fastest-growing and biggest market for Dyson (dyson.com, 2022). There are four branches available of this company in the United States and these branches are located in Malmesbury, Chippenham, Dublin and London. Almost 14,000 people work in this company from all over the world and its yearly revenue is £6.0 billion in the year 2021.

1.2 Industry Background

The products that are manufactured by Dyson are mostly home appliances. The biggest competitor of this company is TTI Floorcare along with Electrolux, Hoover and iRobot. Dyson first launched its products in Japan as neither the UK nor the US was licensing the company’s first product (dyson.com, 2022). The company achieved its first success 10 years after its establishment and the product that gained huge success was the Cyclonic Vacuum Cleaner. The company received the Prince Phillip Designers award and Lord Lloyd award for its constant success. It got elected to the Royal Society of London in the year 2015.

1.3 Current key challenges

The SWOT analysis will help the company to strategically plan its future actions so that it can avoid the challenges it is facing currently.

The strengths of this company are that the company produces various innovative products often and this works as an opportunity for the company. The designing and manufacturing of these products are very meticulous and the company focuses to maintain its high quality (forbes.com, 2022). The weakness is that the of the products is very high in comparison to its competitors. Dyson claimed that Amway and Qualtex have copied their design and filed a lawsuit against them. In return, they also filed a lawsuit against Dyson. This created a lot of controversy and criticism for the company.

The opportunities are that the company is expanding its market in different countries and currently, Asia is the biggest market for the company. It is constantly enhancing its product features as per the needs of its customers. Dyson has opened an online shop where customers can buy its products from retailers (moneyweek.com, 2022). The threats are the cost of the products is high and therefore the customers mostly decide to purchase low-cost products from other companies. Dyson takes a lot of time to release new products in comparison to its competitors and this creates a delay in its product launch (Peng, 2018). The competitors of the company are very high and it creates a serious threat to the company.

2.0 External analysis

The external analysis of the company would help it to assess the industry changes, as well as the changes, happening in the broader world so that it can estimate their effects on the operations of the business.

2.1 Macro (PESTEL Analysis)

• The index of political stability - 0.54 (thetimes.co.uk)
• Political integrity - 12.3%

The political factors of UK are the involvement of politics, its stability index and its integrity. The numeric figures for these factors are 21.6%, 0.54 and 12.3% respectively. The economic factors are the rate of unemployment and financial freedom and their numeric figures are 4.1% and 72.7 (thetimes.co.uk, 2022). The social factors are the current population and cultural inquisitiveness and the figures are 68.8 million and innovative. The improvement of technology and availability of information is satisfactory and sufficient whereas the index rate for innovation is 59.8 (Christodoulou and Cullinane, 2019). The environmental factors are the climate change crisis, Clean Air Act and Environment Act. Lastly, the legal factors are the active legislation development and loan provision in retail.

2.2 Micro (5 Forces Analysis)

Porter’s 5 forces help the analysts and managers of the company to understand the competition in the industry so that the company knows how to position itself in it.

Competitive rivalry (high)

The household manufacturing industry has a high level of competition and the market share of this company is about 27%. Dyson is the second-highest leading company in the industry market right after TTI Floorcare (nytimes.com, 2022). The other major competitors of this organization are Electrolux, Hoover and iRobot. Each of the companies is making a positive and intense effect on the industry market. However, the company is still able to collect a high-profit margin despite its high competition.

Bargaining power of buyers (moderate)

This second force is moderate in the industry because the buyers can buy the required products from its competitors but they do not have much choice. Customers mostly choose the products depending on the cost of the product and they switch the company based on that. The buyer understands that the product quality of the company is very high and therefore the company moderately dominates the market (Bruijl and Gerard, 2018). Dyson continuously modifies its products based on the needs of the customers and that is why they buy its products. This creates a balance between the company’s revenue and the buyer’s bargaining power and the force becomes moderate.

Bargaining power of supplier (low)

This force is low due to the company's size and its dependence on suppliers for supplying the products. The company covers the global market and therefore the company has a high dependency on suppliers (Cho et al. 2019). Suppliers have high bargaining power and these things create a high strength for the companies to bargain. The dependency level on suppliers for this company makes the bargaining force of the suppliers very low.

The threat of new entrants (low)

There are various new companies that are entering the particular market industry. However, Dyson has already created a huge success within the market and the entrance of the new companies would not create many effects on the company. The skills for creating innovative technology products are the highest among the company in comparison to the new entrants (Schittekatte et al. 2021). The new companies would require a lot of new skill development for competing with Dyson. The new companies would also require a huge budget to make innovative changes that they do not have currently unlike Dyson. For all of these reasons, the new entrants’ threat is very low.

Threat of substitutes (high)

Any industry that is related to technology has a major threat of substitution since the technologies continuously keep evolving. House appliances also keep evolving every day since customers want new innovations continuously (Lawrence et al. 2019). This creates a high threat to the companies because either the products become outdated soon or it the company becomes outdated. This is why the company must stay outdated and this can only balance the effect of substitution.

3.0 Internal Analysis

The internal analysis of a company can be done in various ways such as by SWOT analysis, GAP analysis, strategy evaluation, VRIO analysis, OCAT, core competencies analysis, McKinsey 7S Framework and value chain analysis. The following internal analysis of Dyson is done by using VRIO analysis.

3.1 VRIO Analysis

The valuable resources of the company are supply chain network flexibility, the position of the market, leadership and team, brand awareness and budget allocation. These resources help the company to identify its competitive benefits over its competitors (Abbas and Toha, 2022). The rare resources of the company are supply chain network flexibility, market position, leadership and brand awareness. However, budget allocation is not a rare resource for the company because the products are very costly and the company generates a lot of revenue. The competitors and beginners of the market would be able to gain huge success if they can find these resources.

The procedure of imitation costs very high for the competitors of the Dyson Company. Either the rival companies can duplicate their products or they can create alternative items while changing the cost. However, this creates a disruption danger within the current market structure. The organization element helps to handle the company compatibility for positioning it in the current market (Diyanti and Anggoro, 2022). This helps to identify the productive usage of the market resources. Management advancement is completely dependent on the execution methods of the company. The company's skills can be improved with the help of decisions that are based on time and decisions related to the tactical development of the company’s capital.

4.0 Competitive Strategies

Competitive strategies help to find various advantages against the competitors of that company. The competitive strategy helps to develop and find various new ideas for the products of the company and its other services. It helps the company to explore new opportunities, retain loyal customers by providing them with better products and stay innovative regarding the technological changes in the market (Liu and Atuahene-Gima, 2018). The internal analysis of the company would help it to examine its internal resources and capabilities so that it can have a competitive advantage. The following analysis is done by using Bowman’s clock strategy.

4.1 Bowman’s Clock Strategies

Bowman’s clock strategy is a strategy tool that is efficient and comprehensive. The tool provides various options regarding the market positioning of the company as per its price and market value. This strategy is mostly used with the Ansoff matrix for its effectiveness and can be used as an alternative to Porter’s five forces. The strategy has eight positions that are spread across a clock and show the various strategies that are related to the market success (Weston and Nnadi, 2021). The first position is low price and low addition of the value, the second position is low price, the third position is hybrid, the fourth position is differentiation, the fifth position is focused differentiation, the sixth position is high margins with potential risk, the seventh position is pricing monopoly and the last position is market share loss.

The bowman’s strategy clock helps to understand the market easily, provides a range and its comprehensiveness is high in comparison to its alternatives. However, the disadvantage of this strategy is that the line between the two clock hands can be blurry sometimes and this model only focuses on competitive markets. However, the market Dyson is highly competitive and therefore Bowman’s strategy clock would be a great fit for the internal analysis of the company.

The products of Dyson have a high cost and provide a high amount of value to the customers, therefore it does not fall under positions 1 and 2. The highly innovative technology of the products makes it hard for the company to provide the products at low prices. This strategy is mainly based on low margins and the main key of this step is cost reduction. The main focus of these two positions is producing high-quantity products. However, the company does not produce high-quantity products and mainly focuses on the quality of the products.

The third position hybrid focuses on low prices and differentiating the quality of the product. Here the price stays low but the product still provides innovation. The fourth position differentiation provides a high value to the customers with its products (Weston and Nnadi, 2021). The fifth position focused differentiation focuses on providing high-quality products to customers with a high price range. This position helps the company to generate high profits if it is done successfully but this position is very difficult to sustain. The sixth position risky high margin means the company is selling the products with high margin but it is not adding any value to its customers.

The customers very quickly lose interest in these products as they do not add any value to them. The seventh position is monopoly pricing and here the company fixes the product price as the company does not have any other competitors in the market. Dyson Company has many competitors in the market and it provides various values to its customers. The last position, which is the loss of market share, refers to the position where the customers have lost every interest in the company products (Falahatgar et al. 2021). The company has currently positioned itself in the fifth position and that is focused differentiation where the company provides high value to the customers while asking for a high price from them.

5.0 Strategic directions

This is the organization of the vacuum cleaners. This organization has the capacity to lead the industry but its strategic planning is not so clear. They have their strategic planning but if they use the Ansoff Matrix strategy then the marketing, product, and service part will be clear for the organization. The strategy of Ansoff Matrix is the best strategy to use by Dyson. This strategy is basically based on four parts (Clarissia, 2019). In this four-part, the strategy explains the marketing strategic plan.

In the first place, the strategy says about the market presentation. This part explains the increasing sales of the product in the market. The four options of the Ansoff matrix of Dyson market development, diversification, market penetration and product development. In this part, the organization has to make research on the markets. Also, think about the product to present. The next step is market development. In this stage, the organization after knowing the market applies its marketing strategy to get the full industry in hand (Sukma et al. 2019). The next step is product development. After examining the market the company has to develop its product to launch in the market. Organic growth is the internal growth of the company that sees from its operations and measured comparable sales. Inorganic growth is the growth of other businesses buying and opening new locations. Dyson mainly focuses on the development of innovative products. That will help to attract new buyers. After all these steps the last step of this is diversification. It means after creating new products the organization has to create an entirely new market. In this last stage of the strategy, the organization has to sell new products in the new market.

5.1 Markets, Products, Services

Dyson Company is a vacuum cleaning product manufacturer, and services provider, and sells the company. This company’s market value, product value, and service value are good in the market.

Dyson grabs the whole market in the UK technology cleaning industry (dyson.co.uk, 2022). To grow this market value they apply many strategies. In this segment, the company can use the Ansoff Matrix strategy to develop the market value of the organization. In this case study, Dyson has a very big market in the UK and US. They want to expand their organization throughout the world. To expand the company all over the world it is very important to make the service and the productivity be best in the market. Product quality depends on the employees and depends also on the market value (Hurry et al. 2022). The service of the organization has to be based on the region of the country. In which country the organization wants to launch there center also depends on productivity.

5.2 Expansion strategies

Marketing, productivity, and services are directly connected with this strategy. The strategy is very much applicable to this organization also. It is very important to apply this strategy to the organization. This strategy gives effect the organization’s service, productivity, and marketing. This strategy firstly says about the marketing presentation. After analyzing the market, the market will show the situation of that industry (Kurniawan et al. 2020). After that, the organization has to develop the marketing procedure to adjust in the market. After that, the organization has to focus on its productivity. The product attracts buyers so the organization has to focus on the product quality. After all these steps lastly the organization has to launch new products in an entirely new market.

Conclusion and Recommendations

Conclusion

After completing this study it is very important to conclude all the things together. In this conclusion, it is very clear to say that the Dyson organization is very much affected by the market. It is a well-known organization indeed but after analyzing the case study it is also very clear that in this situation if the organization wants to expand its business then they have to follow many strategies to achieve the goal. The Dyson Company made various products in the organization to evaluate their ideas and take many steps to implement them. This organization has to face many challenges to take these decisions. After applying all the strategic planning the organization does not grab the market because of the wrong diction-making process of the organization.

The organization’s strategic plan has failed many times, but after some time they focus on their products and services. The Bowman theory and the Ansoff Matrix theory are very important to apply in the Dyson organization. These two theories will help the organization to overcome the situation. These two strategies also help this organization control the budget and give focus on productivity. This productivity and service will help the organization attract people. After completing this study, it comes out as real that maybe Dyson is one of the well-known companies, and invent many unique products but their pricing segment and perceived value affect the product selling process.

Recommendations

After completing a study it is recommended that if, the company has followed its own rules and ethics that would be a tougher job to come back into the industry. Every company has its own perspective, ethics, and rules but in this case, if Dyson wants to follow its rules and ethics that would be very difficult because the company only focused on the product, what is the manufacturing price and what is perceived price is added to the product. For that reason, the organization cannot follow the rule. After following this rule, the product budget will increase day by day and the Dyson cannot compete in the market. Dyson focused on the development of high-speed, tiny and efficient motors over the past 20 years and they planned more ideas for maximizing the performance of energy. At the same point, other companies are inventing new products at a reasonable price, which is why they have to go backward in the market.

It is recommended that Dyson needs toinvest for adopting new technologies. Dyson toda announced a new £2.75 billion investment plan into new technologies and products over the next five years. They use fewer materials of thinner and stronger plastics to make and less to recycle for efficient motors.

It is also recommended that the organization has to follow the strategic planning of Bowman’s theory and Ansoff's Matrix theory. These two theories will very much fruitful to apply in this organization. The organization does not need to add pierced price with the product value if there is a point to choosing between two companies then the buyer wants to choose the quality product so in that case, the organization has to focus on its products and services.

Besides this, it is also recommended that after inventing new products the company has to market itself. Marketing is the main factor in any business industry. Before launching any product, a company should create a market for that product. If the buyer does not know about the organization, then there will be issues in selling of the product and Dyson should focus on its marketing.

References

Journals

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Websites

dyson.com, (2022), About us, Available at: https://www.dyson.com/ [Accessed on: 2nd December, 2022]

forbes.com, (2022), Dyson, Available at: https://www.forbes.com/companies/dyson/?sh=75b69c922bf0 [Accessed on: 2nd December, 2022]

iide.co, (2022), Elaborated SWOT Analysis of Dyson, Available at: https://iide.co/case-studies/swot-analysis-of-dyson/ [Accessed on: 2nd December, 2022]

moneyweek.com, (2022), Jack Dyson, Available at: https://moneyweek.com/authors/jack-dyson [Accessed on: 2nd December, 2022]

nytimes.com, (2022), Dyson Is the Apple of Appliances (and Just as Secretive), Available at: https://www.nytimes.com/2017/04/02/technology/dyson-british-consumer-electronics-company.html [Accessed on: 2nd December, 2022]

thetimes.co.uk, (2022), Dyson cleans up as profits rise, Available at: https://www.thetimes.co.uk/article/dyson-cleans-up-as-profits-rise-jjkwprvc9 [Accessed on: 2nd December, 2022]