Delivery in day(s): 5
Diploma in Business
Unit Number and Title
Unit 7 SWOT and PEST Analysis
Strategic business policies play a vital role in the success of the business, as these business strategies are very helpful in the long run by providing direction and scope to the business. In this challenging environment, strategic planning helps in the configuration of resources for fulfilling the stakeholder expectations and market needs. In this assignment Sainsbury has been taken as the subject of study to study the various factors associated with the strategic analysis and formulation of a right business strategy so as to manage its competitiveness in the fast changing business environment. The whole assignment is divided in 4 major tasks consisting of formulation of strategic plans, their effectiveness, SWOT and Pest analysis of Sainsbury, significance of stakeholders and implementation of strategy for Sainsbury. The below mentioned tasks would be explored in the present paper:
These learning objectives would be obtained in the present research context with special reference to Sainsbury so that successful strategy adoption can be done in the organization.
J Sainsbury Plc. is a leading UK based food retailer organization offering its products into many countries around the world. Sainsbury has 455 supermarkets and 301 convenience stores across the country which helps in serving 16 million customers each week. The company is having a workforce of around 148,000 colleagues committed to deliver ‘Great food at fair prices’. Sainsbury sell almost £6bn of British food every year (Addmour & Ayish, 2005). In order to make local food available to the customers, Sainsbury work closely with small local suppliers and is successful in expanding the local network to over 3500 local suppliers. In the increasing globalization and fast growing business environment Sainsbury is planning to enter the markets of emerging countries like China, India, Brazil etc. by the way of joint ventures or partnerships.
In the present task mission, vision and scope of objectives of Sainsbury would be discussed. Here, steps of strategic planning and the planning techniques to meet the desired objectives of Sainsbury would also be identified.
Sainsbury main aim is to provide a world class service to the customers by incorporating quality and ethical principles in delivering the services. For determining an appropriate strategy for Sainsbury, an assessment of the mission, vision, objectives and goals of the company is essential.
Mission of Sainsbury: Sainsbury Company’s mission is to be the customer’s first choice for food, delivering products of outstanding quality and to provide great service at a very competitive cost by working on the agenda of ‘faster, simpler and together’.
Vision of Sainsbury: Sainsbury Company is having a clear vision to be the most trusted retailer for the people where they want to love to work and do shopping. This vision shows that Sainsbury focus is to improve the core UK supermarket chain’s performance and to continue to explore growth opportunities.
sbury Company’s main goal is to offer great quality and service to the customers at fair prices and in doing so make the life of customers easy. Along with it Sainsbury aim is to maintain the high social, ethical and environmental standards (Arazy & Gellatly, 2012).
Strategic planning is very essential for the companies. Strategic planning process is implemented by companies in year one in which planning is conducted and then embellished in later years with activities. Thus, the strategic planning process is not a one off issue but rather it can be considered as a continuous process.
The different levels of management with their respected responsibilities for implementing vision, mission, and setting objectives and for planning strategies can be illustrated with the help of the below table:
Levels of Management
Top level Management
CEO, Board OF Directors
Controlling and overseeing the entire organization. Develop goals, vision, objectives and strategies for the business
Middle level management
Department or Branch managers
Execute organizational plans and inspire and guide the low level managers by forming individual mission statement
Low Level management
Supervisors, section heads
Guiding and supervising employees.
Ensuring quality and quantity of production
Make recommendations and suggestions to the upper level from the feedback received from workers.
Practically implement the strategies and action points by doing the work and by providing services to the customers personally.
1.3 Explain Ansoff matrix, BCG growth-share matrix; directional policy matrices as planning techniques to meet the objectives of shareholders.
For Sainsbury Company, three strategic planning techniques can be suggested to meet the objectives of shareholders.
Ansoff Matrix: Under this growth matrix four strategies can be offered to Sainsbury. As Sainsbury has an ability to serve over one million clients, so it should give customers a replacement product along with existing services. The four strategies of the matrix with different risks are:
BCG Growth Share Matrix: In this matrix 4 types of consequences that may be faced by the company can be viewed. By putting products in a BCG growth share matrix Sainsbury may face 4 different market problems as:
It signifies that there would be risk in making Dog product as market share is low and company may incur loss.
Directional Policy: ctional policy matrix acts as a competitive weapon in strategic planning. It helps in allocating resources to each division or strategic business units. It also helps in assessing the future commitment levels to specific divisions. With the help of this tool, first variable that is evaluated is measuring the competitive position and the market performance of Sainsbury. The second variable evaluated under this tool is the business sector. For Sainsbury it will evaluate that whether the particular sector is growing or declining (Gudonaviciene & Rutelione, 2009). The DPM provides a different perspective from BCG Matrix as shown in the below table:
Table: Measures Used in BCG Matrix vs. Directional Policy Matrix
The BCG Matrix
The Directional Policy Matrix
Relative Market Share
Market Growth Rate
Under this Task, for Sainsbury an adequate strategy would be formulated considering the various factors by understanding the SWOT Analysis and PEST Analysis of Sainsbury. Also the significance of stakeholder analysis would be studied for developing a new strategy.
In order to identify the key issues, Sainsbury Company’s SWOT analysis should be done which would help in identification of internal and external factors related to the company. SWOT means strength, weakness, opportunities and threats related with the company. In the context of Sainsbury these can be explained as below:
Stakeholder Mapping: In order to get initial thoughts on the stakeholder community and to form a management strategy for Sainsbury this mapping is done. It will help in identifying specific stakeholder interest against high level activities and potential outputs.
Mendelow’s Stakeholder Mapping of Sainsbury
IT managers, skilled staff, Promotional department staff
CEO , CFO, Top directors
Lower level Employees , suppliers
Stakeholder’s analysis: Generally, there are two types of stakeholders’ i.e. internal stakeholders and external stakeholders. Internal stakeholders for Sainsbury include employees, shareholders and management team. External stakeholders for Sainsbury would include customer, suppliers, government bodies, financial institutions and society. The different roles and expectations of the different stakeholders with regard to Sainsbury is explained in the below mentioned table.
Interests to defend
Managers and employees
Interest/ Pressure groups
This task would evaluate all the market entry strategies related to the organic growth and substantive growth of the business organizations. The analysis would show a clear picture to adopt the most suitable approach for Sainsbury in order to gain competitive advantage in the industry and to accelerate its business management growth.
There can be different market entry strategies such as organic growth, merger, and acquisition, strategic alliance, licensing and franchising which can be explained as:
Out of the available options for market entry, Sainsbury may adopt for Franchising and strategic alliance model so that it can create its presence in foreign markets. In order to get market share overseas, Sainsbury may use Franchising approach by circulation franchises in distinct locations. Also, strategic alliance for Sainsbury would help in order to gain knowledge of overseas markets. This way Sainsbury will be able to develop business expansion opportunities by connecting to other businesses. Sainsbury can have strategic alliance with the small retailers in the area so as to enhance their presence in urban areas with their small size stores. Here, Sainsbury need to understand the consumer feedback on their newly opened small size urban stores to get favorable and positive response from the consumers for such stores.
The horizontal and vertical integration strategies are the strategies for substantive growth of business and can be described as:
Horizontal Integration: It is procedure of integrating with the competitors or leading business providing the same goods and services. The merits and demerits of horizontal integration are as:
Vertical Integration: It is the process in which the production or distribution of a product or service are controlled by a single company or entity so as to increase that company’s or entity’s power in market (Schultz, 2006). Some of the major merits and demerits of vertical integration can be described as:
Appropriate Future strategy for Sainsbury
In alignment to perplex the market, Sainsbury needs new notions which can be cooperative for them to flourish the market. So for contemplating future concern they can enquire their market need and come up with some development of the new merchandise so as to diversify their services. Sainsbury should follow the vertical integration by connecting with the suppliers and vendors. Six important strategies can be implemented for Sainsbury as a new strategy and these strategies would include development of a strong brand in retail industry, using data management for having customer oriented culture, keeping cost very low, customer should be heart of marketing, deal suppliers with strategic context and focus on fast & strengthening partnership (Weygandt, 2009). To make benefits through the proposed strategy of Sainsbury it is highly important that staff and other technical resources are enhanced in the organization and proper training is provided to the human resource for their performance improvement.
Roles and responsibilities of master strategist and personnel
CEO of Sainsbury has the responsibility to turn the ideas into reality and to articulate the transcending goals by considering the vision. Director’s role is to lay down high performance standards for each functional unit viz. operational, human, financial and marketing division. Managers’ responsibility is to inspire and influence the workers to execute the policies undertaken with efficiency and effectively. They should well communicate with their subordinates to encourage them to develop their own strategies and to involve them in the successful implementation of strategic plan. Such communication may help in satisfying the accomplishment of targets resulting in worker satisfaction and coherence in job surroundings.
Estimated resource requirements
To understand and evaluate the resources of Sainsbury, the organization has to decide the precise materials and their place within the right departments. This estimation can be done by Sainsbury through cost analysis. In the strategy implementation cost evaluation helps in evaluating the gains and losses from the relevant activities. With the help of assessment, the limited or minimum resources can be utilized fully (Lind, 2009). The cost analysis would help in identifying the resources which will be needed to deliver the interventions. This analysis will help in estimating the direct cost of service provision. Direct cost can be capital cost or operating cost related to service, delivery or other factors. Sainsbury being a leading company within industry must choose the effective materials to confirm the sturdiness and safety of the customers along with timely delivery of services.
Timescales for implementation: The timescale for strategy implementation would be as:
Present paper has explored the evaluation of the strategies implemented by Sainsbury for achieving their strategic objectives. The whole analysis as shown in the present paper has explored the relevance of strategic planning process in defining the aim, vision, mission and objectives of Sainsbury. Moreover, the study shows the issues faced by Sainsbury in strategic planning and various strategic planning techniques suitable for Sainsbury have been well evaluated. In the present paper, stakeholder analysis for Sainsbury has been carried out to understand the different perspectives of the stakeholders. Strategy evaluation has been done by exploring various market entry strategies for Sainsbury. Also, the roles and responsibilities of personnel charged with strategy implementation has been evaluated and the resource requirement estimation has been made for Sainsbury with the timescale required for implementing the strategy. All the assessment has been devised For Sainsbury to enhance the brand image and to explore new market segments in the industry by implementing appropriate strategy for Sainsbury.
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