Strategic management analysis on:Strategic factor analysis – Domino’s
1. Strategic Factor Analysis of the Domino’s
Strategic factor analysis is the approach which is used for measuring the strength and weaknesses of the company’s position. It consists of analysis of internal as well as external environment of the organization (Lowson 2002). There are different strategic tools are available which can be used for making the analysis the strategic position of the organization. One of the most commonly used tools is SWOT, in which strengths and weaknesses of the organization assessed on the basis of internal environment, where threats and opportunities determined according to the external environment.
On the basis of the internal analysis of Domino’s, it can be said that its biggest strength is leadership. Leadership is considered as major source of competitive advantage and history of Domino’s shows that its leaders always took right kind of initiatives and decision which helped it grow and become the leader of the market. Marketing strategy adopted by management of the organization helped it to gain the trust of its consumers because of which Domino’s has loyal customer base; another major strength of the Domino’s. Lack in the variety of products can be considered as weakness for the Domino’s (Hitt, Ireland, and Hoskisson 2008).
Every organization needs to act according to the industry environment in which it operates. For Domino’s there number of opportunities and threats exists in the external environment. Changing in the eating habits of consumers and increase in the demand organic food are the major threats for the future growth. Whereas, strong brand image and emergence of new markets in the developing economies going to provide plenty opportunities to grow.
2. Future Challenges.
Presently, Domino’s is market leader and enjoys major share of the market. But in future there are certain decisions which need to be taken by the management to decide the future strategy of the organization. Currently Domino’s is known as a lo-cost service provider in the market (Michman and Mazze 1998). Because of this brand image, Domino’s was able to attract more customers in comparison to the other competitors. So far cost of the offerings was major aspect of the comparative analysis for the consumers. But now eating habits of customers are changing and it is observed that people are now more health conscious. Statistics shows that demand of organic food is increasing year by year as people now prefer organic food which is healthier. This shift in the eating and preference of the customers is indicator for the whole pizza industry to change their strategy and work on the origin of the food they provide (Hadish 2011).
Production of organic is much costlier than the traditional food and it is the major issue which can hinder the growth of the Domino’s and affect its position in the market. Challenge for the Domino’s is to maintain its image of low cost provider and fulfilling the demand of healthier food of the consumers (Hitt, Ireland, and Hoskisson 2008). If the organization wants to go for healthier products then it is important for them to develop a well balanced menu. It is important for them to analyze with which products they can continue and which offering are needed to be changed or eliminated. As products play an important role in defining the image of the organization and gaining a competitive advantage. The new offerings should be according the changing market trends and demands of consumers. Apart from that Domino’s also needed to be more technology oriented so that can communicate more effectively with their target customers. With a proper communication channel they will be able to analyze the changes in the demands and preferences of the customers more effectively and make better strategic decisions. This is the challenge which future posses for the Domino’s and pizza industry.
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