MBA FPX 5006 Assessment 3 Strategy Implementation
MBA FPX 5006 Assessment 3 Strategy Implementation Student Name Capella University MBA FPX 5006 Professor Name Submission Date ย Internal Analysis Slide 01 The value, rarity, inimitability, and organization (VRIO) framework used to conduct an internal analysis of Nike reveals some important resources and capabilities that give Nike a competitive edge. The major resources that can be leveraged include a strong supply chain network, association with celebrities, unique products, and corporate social responsibility. The various supply chain networks demonstrate Nike’s value in the footwear industry (Li, 2023). Intellectual property, together with a large network of suppliers, would give Nike a competitive edge in the market as compared to its competitors. In its business strategy, Nike has employed celebrities and athletes as its business partners, which exemplifies the rare aspect of the VIRO framework. As an example, a Michael Jordan collaboration with Nike will earn the company in the tune of 1.3 billion (Badenhausen, 2020). Nike is expanding on its working relationships with fashion designers, which has enabled the company to reach out to a variety of audiences through innovative product solutions (Spartaco, 2024). The organizational factor cannot be left out as a competitive advantage of Nike in accordance with the VRIO analysis. Nike has a variety of pricing plans to cater to particular target markets to fulfil the needs of consumers as well as achieve its organizational goals. The value-based approach assisted consumers in purchasing the products, which resulted in profitability (Yan et al., 2022). Therefore, good pricing strategies can also be used to formulate a competitive edge. Nike can be considered very unique in the growing market based on ecological awareness under the “Move to Zero” initiative, when combined with the environmental initiatives of sustainable practices (Kim & Oh, 2020). The constant striving of the company to utilize renewable energy helps consumers to consume sustainable commodities, which enhances sales and profitability. Results from External Analysis Slide 02 An external analysis involving political, economic, social, technological, legal, and environmental (PESTLE) and Porter’s Five Forces has shown that there are a number of issues that can influence the strategies that Nike employs. PESTLE Analysis The political reasons that influence the productivity and level of profitability of Nike in the market include the varying international trade policies and tariffs. As an example, in case of political instability, the customs clearance process could be stopped at some point, complicating the importation of products, which has a negative effect on the performance of the company (Li, 2023). On an economic basis, inflation has impacted the levels of purchasing power of customers, as this has decreased the sales of Nike products. Nevertheless, with cost reduction policies, Nike will be able to boost its sales, which will in turn result in profitability. Socially, the fact that the rate of athletes’ participation in a certain sport is increasing is boosting demand for Nike products, predominantly in sports gear (Li, 2023). Nike is no exception, and in order to create a positive social image in the market, Nike has also focused on attracting female customers. On the technological aspect, Nike has been able to use technology to enhance the customer experience, resulting in increased sales. As an illustration, digitized tools could present a hassle-free shopping experience to the customer, culminating in profitability (Patov, 2024). Lawfully, Nike complies with trade policies to avoid any lawsuits and conflicts, which would lead to improved customer loyalty. On the environmental front, Nike is resolute in coming up with environmentally friendly materials in order to reduce air pollution (Nada, 2023). An example is that Nike, too, utilizes renewable energy in order to reduce the waste products that negatively affect the environment. Slide 03 Porter’s Five Forces The use of the Five Forces model, developed by Porter, is useful in identifying the current market competition trends for Nike. First, competition in the shoe industry is stiff since Nike has to compete with other shoe companies, such as Adidas. Market share is used as a gauge for competition, as Nike has a 21.1% market share in the footwear market, complemented by Adidas, which has a 15.1% market share in the same footwear market (Li, 2023). Second, the threat of new entrants in the footwear market is very low since the expenses incurred to venture into the market are high. In addition, the brand image of Nike has also deterred the entry of new businesses in the market. Thirdly, cautiousness in relation to the presence of alternative products is moderate since footwear brands are endowed with alternative products. It highlights how Nike has come up with innovative products with varying ranges to eliminate the threat of substitutes (Lin, 2024). Fourthly, supplier power is low since Nike conducts its business all over the world and on a contractual basis, thus minimizing the chances of supplier bargaining power. Fifthly, the bargaining power of the buyer is moderate, with customers being conscious of the brand image of Nike and the outlets where the products could be purchased. Nike’s SWOT Matrix Slide 04 Strengths The greatest strength that Nike enjoys is the fact that the firm has a number of outlets in the world, which has contributed to the firm enjoying a strong brand image in the footwear industry. Moreover, Nike is also involved in corporate social responsibility (CSR) and is significantly committed to doing more than just providing environmentally-friendly footwear; it must offer a viable solution to an environmental issue in the form of a sustainable footwear solution, which does not have any harmful effects on the environment (Huang et al., 2022). The other strength is that the digital tools were used in a bid to make shopping easier for consumers. Adjustment of the e-commerce model, such as the DTC approach, is necessary to augment sales (Li, 2023). As an illustration, the Nike App can be utilized to have consumers order wear and apparel products online, increasing the company’s sales and profitability. Weakness One of the weaknesses that Nike has is that it majorly depends on the US […]
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