External And Internal Analysis Of XYZ: Resources, Competencies And Competitive Viability

XYZ Overview

An internal and external analysis is an exploration of business’s cost position, competencies, competitive viability, industry position, environmental analysis etc. in the marketplace. Conducting an internal and external aspect makes it easy for the business to make decision about performance of the company.

XYZ is one of the largest Australian companies. The company has extensive interest in the retail industry of Australia and the New Zealand market. The company mainly operates in the retail industry. It is second Australian largest company in terms of revenue. The main division of the company is Supermarkets, liquor, petrol, general merchandise, hotels, home improvements etc. the company mainly serves its products and services into Australia, India and New Zealand market (Kelly, 2012). The total number of employees of the company is 2,05,000.

External analysis:

An external analysis is an exploration of industry position, environmental analysis etc. in the marketplace to measure the overall performance of the business in the industry. The external environment of the business is as follows:

Business background:

The company has been founded in the year of 1931. It has been founded by Max Sonnenberg. The main operations of the company are offering the retailing services through its supermarket and the online portal. Along with Coles, XYZ is accounting round 80% Australian retail market (Edwards, 2012). The policies of store have been set according to the market dynamics and the demand of the customers, so that the performance of the company could be managed.  

Australian retail industry offers the retail products and the consumable products to the customers of the industry. This industry is among one of the highest growing industries in the Australian market because it offers the house and food products to its customers. The GDP worth of Australian retail industry explain about huge positive changes in the overall performance of the business. the below table explains about the total part of Australian retail sector in the Australian GDP and it explains that the improvement in the industry would enhance the performance of the companies which are working under it.

(Cutcher, Kirsch and Lansbury, 2012)

Environment analysis:

Economical:

The company is operating in the retail industry on which economical factors impact a lot such as the interest rates; bank loan etc influences the industry. There are various factors of macro environment such as foreign exchange, saving rates, economic cycle etc which also affect the economical performance (Kirsch and Wailes, 2012). The Australian economy is in the favour of retail industry and thus the performance of the company is better.

External Analysis

Socio-cultural:

This explains about the impact of society and the culture of the country on the industry. The beliefs and the shared attitudes of the citizen play a crucial role in order to improve the performance of the XYZ. The culture of the company has been set in such a way that Australian people could feel connected to the company.

Global:

The entry of the company at global level makes a company more competitive. Each international market is different from others in various ways and thus the diversification at international level reduces the economical risk of the business (Foster, Rasmussen and Coetzee, 2013). The XYZ has entered into the New Zealand market and Indian market to grab more market share.

Technological:

Technology plays the significant role in a business as it changes rapidly and a business is required to make the changes into the technology as rapidly. The latest technology helps the business to become more competitive. The performance of XYZ is quite better in terms of technological factors.

Political/legal:

The political and legal factors could influence the entire industry and the profitability position of the retail industry. The Australian government and the policies of the Australian government have not affected the Australian retail industry. All the policies are company and customer oriented which helps the industry to grow further. The company under the industry just have to follow few safety law, employment law and health laws for the employees.

Demographic:

Demographic factors include the race, income, gender and migration patterns of a business. It explains that which customers should be offered which product. It explains that the XYZ is offering the different products to the different people (Guest, 2016).

Industry environment:

Supplier power:

The supplier power of the industry is lower because there are various suppliers who are offering the raw material and products to the companies and the supplier relations of XYZ is also compatible.

Buyer power:

The buyer power of the industry is higher because there are various companies who are offering the same products to the buyer and thus they are in a position of bargain.

Potential entrants:

The new entry is always a threat for the retail industry business as there are no barriers to enter into the retail industry. The entry and exit in the retail industry is easy thus the level of threat is higher.

Business Background

Substitute products:

The threat from substitute products is also higher as there are various companies which are offering the similar products and so the threat level is higher (Kornelakis and Voskeritsian, 2014).  

Rivalry among competitors: 

It is also one of the important aspects of the business which measures the competitor’s level of the business. The competition is higher in the industry.

Competitive environment:

Strategic group:

The strategic group of XYZ is able to offer a great services and product to the customers so that the customers level and market base of the business has been improved. A strategic group is known as the group of various firms which work as subsidiary companies to improve the performance of the company. The main business of the company is Supermarkets, liquor, petrol, general merchandise, hotels, home improvements etc.

Rivalry:

Various competitors companies are there who are offering huge competition to the company. The Wesfarmer’s and Telstra are the main competitors of the company. This competitor’s company are also running strategic groups which could be cause of threat for the company (Williams, Kedir, Nadin and Vorley,2013).

Capabilities:

It is important for the relevant firms to manage the ability to improve the performance of the company in the market. The company’s ability to expand the business at international market and into various new products is quite compatible.

Strategies:

The main strategy of the company is diverse from other competitor companies as it offers various retail products to the customers. It manages the various strategies to improve the performance of the company in the industry.

Threat:

The threats of the company are from the competitors and the economical recession. The increased competition is the main threat of the business (Haipeter, Jürgens and Wagner, 2012).  

Opportunities and threats:

Opportunities	· The company has opportunity to promote the brand through various ways such as promotions, advertising and sponsorship etc. · Seek the growth through franchise model · Seek the growth through strategic acquisition in emerging economies
Threats	· Rise into the price of raw material · The cost of food and non food items could be affected · Economical recession · Competition at international market

(Geppert, Williams and Wortmann, 2015)

Internal analysis:

Firm’s resources:

The main resources of the business are plant and equipment, various supermarkets and the buildings. There are mainly two kinds of resources which are tangible and intangible assets of the business. The tangible assets of the business are all the fixed assets of the business such as buildings, land, current assets etc. the list of tangible products of the business are as follows:

XYZ BALANCE SHEET
Fiscal year ends in June. AUD in millions except per share data.	2017-06	2016-06	2015-06
Non-current assets
Property, plant and equipment
Other properties	19105	19000	20316
Property and equipment, at cost	19105	19000	20316
Accumulated Depreciation	-10667	-10738	-10254
Property, plant and equipment, net	8438	8263	10062
Equity and other investments	507	638	498
Goodwill	4216	3637	3826
Intangible assets	2316	2341	2418
Deferred income taxes	372	1110	755
Other long-term assets	72	86	117
Total non-current assets	15922	16075	17676

Further, the non tangible assets of the business are as follows:

Human resources:

The human resources department of the company is a separate department which handles all the operations related to the employees of the company. It sets the training program, incentives plan, salary and various other operations of the company. The department of the company is quite competitive and helps the business to motivate the employees and the performance of the company (Torugsa, O’Donohue and Hecker, 2012).

Environment Analysis

Financial resources:

It is a different department of the company which handles all the financial resources of the business. It elaborates and manages all the financial activities and funds of the business. The company is managing all the funds in better way through investing it in different operations and the projects. It depicts that the funds have been invested by the company in better way (Bayly, Scollo and Wakefield, 2014).

Technological resources:

The role of technology is quite significant in the business. The technological factors of the company are quite better and it makes the company more competitive. The latest technology of the company enables the customers to become more loyal.

Capabilities identification:

The financial performance of the company explains that the overall operations of the company have been managed in a great way. Company is not liable for any further actions. The total revenue of the company has been improved in last 3 years because of the changes into the activities and the strategies of the company. The diversification strategy of the company has helped it to improve the overall operations in the industry. The quality and variety of the products are also competitive which helps the company to manage the performance (Azizul Islam and Jain, 2013). The organization has different products which are sold at the market of Australia, New Zealand and Indian market. The main products of the company include Supermarkets, liquor, petrol, general merchandise, hotels, home improvements etc. Total employees of the company are around 2,50,000 which manages all the operations and activities of the business (Price, Bailey and Pyman, 2014).

The mission and vision the company is also strong which assist the business to manage all the operations and meet the common goal of the business. The company has different departments to handle all the activities and operations of the company. The team of the company is quite effective in order to handle all the system.

The company’s core competency depicts the significance of the process in order to manage the stockholder’s value of the organization. On the basis of evaluation, it has been found that the competition level is continuously improving day by day because of the various firms who are operating their business in the same industry. The customer’s value is the main focus of the business which is managed by the business through handling the focus on the quality and other operations of the business. The core competencies of the organization are to offer the quality product to the business (Price, 2016). The main competency of the business is to focus on the needs of the desires of the business. The company is following the cost leadership strategy to sell their products in the market and grab the share of the market.

Economical

Suitable information system:

The information technology rule is higher in the industry. XYZ uses the different database to manage the operations of the business. Different software is used by the business to manage the inventory, customer information, logistic and different operation of the company. The information system of the company has been managed in better way to run the business and management effectively in order to manage the information about entire operations of the business. The information system has helped the business to manage the customers, suppliers and internal operations of the business in an effective and efficient manner.

Recommendation and conclusion:

On the basis of the internal and external evaluation of the business, it is recommended to the company to use the latest technology to manage the competitive level of the business. It is required for XYZ limited to focus on the R&D so the business could get to know about the market and preferences of the customers. Along with the technological system the business could also focus on the decision making process and evaluate the data in order to manage the statistics and other information about the company (Sutton-Brady, Kamvounias and Taylor, 2015). It would help the business to maintain the entire operations of the business.

It is concluded that the company is one of the largest companies in the Australian retail industry which offers various services to the company. the company has adopted numerous strategies to improve the overall activities and operations of the business.

References:

Azizul Islam, M. and Jain, A., 2013. Workplace human rights reporting: a study of Australian garment and retail companies. Australian accounting review, 23(2), pp.102-116.

Bayly, M., Scollo, M. and Wakefield, M., 2014. No lasting effects of plain packaging on cigarette pack retrieval time in small Australian retail outlets. Tobacco control, pp.tobaccocontrol-2014.

Cutcher, L., Kirsch, A. and Lansbury, R.D., 2012. The ‘lucky’LME: the mediation of globalizing effects on employment relations in the Australian auto assembly and retail banking industries. The International Journal of Human Resource Management, 23(10), pp.1999-2015.

Edwards, P. 2012. Industrial relations: theory and practice. John Wiley & Sons.

Foster, B., Rasmussen, E. and Coetzee, D., 2013. Ideology versus reality: New Zealand employer attitudes to legislative change of employment relations. New Zealand Journal of Employment Relations, 37(3), p.50.

Geppert, M., Williams, K. and Wortmann, M., 2015. Micro-political game playing in Lidl: A comparison of store-level employment relations. European Journal of Industrial Relations, 21(3), pp.241-257.

Guest, D.E., 2016. Trust and the role of the psychological contract in contemporary employment relations. In Building trust and constructive conflict management in organizations(pp. 137-149). Springer, Cham.

Haipeter, T., Jürgens, U. and Wagner, K., 2012. Employment relations in the banking and automotive industries in Germany. The International Journal of Human Resource Management, 23(10), pp.2016-2033.

Kelly, J., 2012. Rethinking industrial relations: Mobilisation, collectivism and long waves. Routledge.

Kirsch, A. and Wailes, N., 2012. Varieties of employment relations: Continuity and change in the global auto and banking industries. The International Journal of Human Resource Management, 23(10), pp.1967-1982.

Kornelakis, A. and Voskeritsian, H., 2014. The transformation of employment regulation in Greece: Towards a dysfunctional liberal market economy?. relations industrielles/industrial relations, 69(2), pp.344-365.

Price, R., 2016. Controlling routine front line service workers: an Australian retail supermarket case. Work, employment and society, 30(6), pp.915-931.

Price, R., Bailey, J. and Pyman, A., 2014. Varieties of collaboration: the case of an Australian retail union. The International Journal of Human Resource Management, 25(6), pp.748-761.

Sutton-Brady, C., Kamvounias, P. and Taylor, T., 2015. A model of supplier–retailer power asymmetry in the Australian retail industry. Industrial marketing management, 51 (4), pp.122-130.

Torugsa, N.A., O’Donohue, W. and Hecker, R., 2012. Capabilities, proactive CSR and financial performance in SMEs: Empirical evidence from an Australian manufacturing industry sector. Journal of business ethics, 109(4), pp.483-500.

Williams, C.C., Kedir, A., Nadin, S. and Vorley, T., 2013. Evaluating the extent and nature of the informalization of employment relations in South-East Europe. European Journal of Industrial Relations, 19(2), pp.91-107.