Strategic Analysis Of Lion Beverage Company: Using Decision Support System As A Strategic Information System

External Analysis

The strategic information system can be defined as those information systems, which could be developed for the corporation of the business initiatives (Galliers and Leidner 2014). The information systems are intended for providing several competitive advantages to the respective company. The strategic information systems always deliver several services and products, at an extremely low cost for focusing on the specific market segment for being innovative. This strategic information system is one of the most important and significant features for information technology and hence is termed as the basic requirement for any specific organization. The strategic information system even helps the companies for categorizing, storing, processing and finally transferring the information, which are to be created or received (Arvidsson, Holmström and Lyytinen 2014). Several analytical tools are being offered by this particular information system to help the organizations for applying to the repositories of information. Various significant opportunities are recognized for the growth and pinpoint the ways to improve the overall operational efficiencies and effectiveness.

The following report outlines a brief description on the popular beverage company of Australia, namely Lion Beverage Company. It is one of the significant organizations that produce several types of beverages for the users. There are two parts in this report, which are external analysis and internal analysis. The external analysis comprises of business background of the organization, PESTEL analysis, Porter’s Five Forces analysis, competitive environment analysis and opportunities and threats. The internal analysis comprises of the tangible and intangible resources, identification of capabilities and analysis of core competencies. A suitable information system is being recommended for Lion Beverage Company.

Lion is the popular food and beverage organization, which operates in New Zealand and Australia. This particular organization is responsible for producing as well as marketing the range of wine, cider, beer, spirits and RTDs. Apart from these beverages, the dairy and other beverages like plain milk and flavoured milk, cheese, yogurts, soy products and juices are also produced by them (Lion. 2018). Lion was founded in the year of 2003 by the New Zealand Breweries and the present Headquarters of this organization is in Sydney, Australia. The owner of the company is Mitsubishi and the total number of employees currently is about 7000. The total revenue of Lion Beverage Company in the year of 2015 was 5.6 million Australian dollars.

The organization of Lion Beverage Company belongs to the Food and Beverages industry. It is responsible for producing various types and categories of foods and beverages for its clients (Lion. 2018). The organization of Lion Beverage Company produces several significant types of products and services for the customers.

Internal Analysis

The PESTEL analysis eventually a specific tool that is utilized for the proper identification of the macro external forces, faced by particular company. The six letters for this PESTEL analysis are political factors, economic factors, social factors, technological factors, environmental analysis and legal factors (Pearlson, Saunders and Galletta 2016). The respective PESTEL analysis for the organization of Lion Beverage Company is described below:

1. a) Political Factors: The first and the foremost factor in PESTEL analysis is the political factor, which determines the limits to which the government or the government policies would be impacting on any particular organization or industry. The political policies, stability and trade, fiscal as well as the taxation policies are also included in these political factors. These types of factors play the most significant role for Lion Beverage Company (Willcocks 2013). The entire Australian government has eventually imposed a lump sum amount of excise duty on each and every alcoholic beverage. Hence, the alcohol consumption and sales have reduced to a specific level. The imposed taxes are the reason for this downfall of shares. However, this particular company even produces flavoured drinks as well as soft drinks and the costs of these products are not affected. This scenario is same in New Zealand, where the price of beer has increased 4%.
2. b) Economic Factors: The next factor is the economic factor. This particular factor impacts over the economy as well as performance and thus is directly affected to the company and its profit. These factors mainly include foreign exchange rates, unemployment or employment rates, costs of raw materials and interest rates (Cassidy 2016). Australian Drug Foundation has restricted the usage and manufacturing of alcohols and hence Lion Beverage Company is suffering from major economic and financial crisis. Moreover, the marketing is even hampered by this. The goodwill of the company will also be affected by this scenario.
3. c) Socio cultural Factors: The third factor is the socio cultural factor, which focuses on the specific social environment and then identifies the respective emerging trends. The requirement of the customer is also fulfilled by this (Whittington 2014). Lion Company has produced a low carb beer for those, who are concerned about their weight. Hence, the popularity of this organization is even more enhanced.
4. d) Technological Factors: The technological factors refer to those factors, which enable technological innovation within the business. These factors involve the alterations within the mobile technology (Tsang 2014). The Lion Beverage Company has utilized several significant technologies within their business for properly executing their business operations.
5. e) Environmental Factors: The environmental factors refer to those factors, which help in increasing the environmental benefits for the society. In Lion, the demand for the consumption of beer has decreased for several conditions of climate.
6. f)  Legal Factors: Lion Company is following each and every trading law and hence is termed as completely legal for any business.

The other factors are global and demographic (Hill, Jones and Schilling 2014). The global factors refer to those factors which make the business grow worldwide. The demographic factors refer to the target audience of the organization. Lion has clients in all over the world and hence these clients make them even more popular.

The explanation of the Lion Beverage Company is provided with respect to Porter’s Five Forces, which are supplier power, buyer power, potential entrants, substitute products and rivalry among competitors.

1. i) Supplier Power: The supplier’s power is extremely high for the organization of Lion Beverage Company (Majchrzak and Malhotra 2013). It is a specific regional organization that has some of its suppliers, responsible for the product distribution in the entire Australia as well as New Zealand. The switching expenses of this particular company are quite high and the total number of suppliers is less. The respective suppliers could easily choose from any other organization for their product distributions. However, the organization of Lion Beverage Company comprises of some alternatives about the suppliers for distributing the several products.
2. ii) Buyer Power: The buyer’s power is also very high for the organization of Lion Beverage Company. Several other beverage companies are present within the market (Hill 2017). Furthermore, this organization has to eventually face a significant competition with all the popular companies of non alcoholic as well as alcoholic beverages.

iii) Potential Entrants: The third factor is the potential entrant. Various new entrants could easily enter into the market and take the respective position of the organization of Lion Beverage Company (Wheelen et al. 2017). Hence, this particular organization should keep in mind that they should not allow any organization to take up their place. The threat from the new entrants is extremely vulnerable and important for the company.

1. iv) Substitute Products: Several substitute products are present in the market. It is always in the mind of each and every customer to use products that are better and cost effective (Ogiela 2016). Although, the organization of Lion Beverage Company is on the top position of the food and beverage industry, there is always a high chance that the substitute products would be acquiring the market subsequently.
2. v) Rivalry Amongst Competitors: The final factor is the rivalry amongst competitors. The organization of Lion Beverage Company has several competitors and they should check for their competitors significantly so that there exists no loophole for their downfall in the market.

The competitive environment of the Lion Beverage Company is much important for this organization. They have a significant strategic group, who are responsible for checking the competitive environment of this company. Since, several new firms have come into the market; competitiveness has increased significantly and hence should be reduced at every cost. Several other organizations are present to provide similar products to their customers (Uçaktürk and Villard 2013). Lion would be facing major competitiveness in this particular case. The other organizations have taken up a unique strategy for providing better products. They are experimenting with the beverages and the tastes of the drinks are tested properly. Lion has major threat of high competitiveness within their organization.

There are some of the major opportunities and threats for the organization of Lion Beverage Company. The proper analysis of these opportunities and threats are responsible for the proper identification of several threats, this organization is facing in this current scenario (Morden 2016). The opportunities and threats of the organization of Lion Beverage Company are given below:

1. i) Opportunities: The first and the foremost opportunity of this company is the improvisation of their various products and services for the users. This helps them in improving the position within the market and hence bringing significant variety within the products (Eden and Ackermann 2013). Moreover, another important opportunity is that they would gain utmost popularity in the world, since they would be able to understand the demands of the clients.
2. ii) Threats: In spite of having various opportunities, the organization of Lion Beverage Company do comprises few important threats. The first and the foremost threat for this organization is the entry of the new entrants within the business. This helps in reducing their business growth to a drastic level (Peltier 2016). If the customers are getting better products within lesser prices, there is a high chance that the customers would be using those products. The cost of some of the beverages of this organization is extremely high and this is major threat for the organization.

The organization of Lion Beverage Company produces several types of beverages to the users. For this purpose, they are utilizing the several resources of the firm. These resources could be sub divided into two parts, which are tangible and intangible resources.

1. i) Tangible Resources: The tangible resources are those resources, which are used by the organization for obtaining opportunities and earning something for their economic benefits. These are considered as the most important and significant resources of the organization (Kummer and Schmiedel 2016). For the organization of Lion Beverage Company, the various tangible resources are the land, buildings, machines and many others. These specific resources are the most important as well as significant resources for the organizational competitive advantages.
2. ii) Intangible Resources: The intangible resources, on the other hand, are those resources that help the particular organization for gaining several benefits for the future. The various opportunities of the organization of Lion Beverage Company could be eventually considered as the intangible resources (Altameem, Aldrees and Alsaeed 2014). The various intangible resources of this organization are better quality of their products and drinks and even the good will of the organization. the expansion of the business is highly required in this case and hence it provides major advantages for the organisation.

Opportunities and threats

The proper identification of capabilities of this particular organization majorly indicates that the various opportunities, which are being achieved by this organization. The respective organization of Lion Beverage Company is leading the food and beverage industry. However, there is still scope for the organization to grow even better. There is a core capability for facing the major competition with all the other rivalries (Simon, Fischbach and Schoder 2014). There are some of the important factors that should be taken into consideration by them. The improvisation of their products is the first and the foremost factor. Some of the major parameters are present for indicating the organization of Lion Beverage Company’s position.

The significant core competencies of any organization help in the proper determination of the capability of the organization for making the respective strategic planning and competing within the market. The proper analysis of the core competencies of this organization is based on the four distinct criteria, which are as follows:

1. i) The strategy providing significant and important value for the overall company growth.
2. ii) The strategy helps in increasing the shares of the market (Wheelen et al. 2017).

iii) The rival or the competitors should be followed properly.

1. iv) The strategy providing important competitive advantages for this particular organization.

After the analysis, it could be confirmed that Lion is in a better position than the other companies.

The recommended information system solution for the organization of Lion Beverage Company is the DSS or Decision Support System. Since, the organization is facing major competition for their business and products, a proper decision making process is required for them (Morden 2016). It helps in the support of the business for undertaking the decision making activities.

The Decision Support System is responsible for serving the management, planning as well as operations levels of the company and then helps the people for making proper decisions regarding the problems (Peltier 2016). DSS has the core capability to sort out the structured as well as unstructured decision related issues. The significant recommendation for the organization of Lion Beverage Company is to implement or use DSS or decision support system within their business. The most important advantage of this information system is that it helps in reducing the overall costs of business and provides relevant solutions to the difficult situations within the organization.

Conclusion

Therefore, from the above discussion, it can be concluded that SIS or strategic information system is the set of guidelines that help the organizations in setting the plans as well as strategies as per the existing principles. The most significant objective for the incorporation this system is that the entrepreneurs are allowed for assessing the several environmental alterations and using them for the beneficial aspects. There are three distinct classifications of this particular system, which are financial, operational and finally strategic. These three classifications are related on the basis of the businesses. The decision making processes are extremely easier with the respective support systems, which could easily streamline the business objectives and then align the information systems with the help of business strategies of that particular organization. The strategic information system can provide the enterprises with relevant solutions, which allow them for setting as well as meeting the long term and short term objectives of the business. Moreover, the specific organizations can even help the businesses for incorporating the data mining enabled databases and thus saving the confidential or sensitive information. The data collection processes are well underlined for easing the several opportunities of the marketing. The above report has properly outlined the strategic information system of the Australian beverage company, namely, Lion. The external and the internal analyses of this particular organization are properly done here. Moreover, a significant information system is being recommended for the organization that would provide major competitive advantages and hence the several issues related to the organizational business processes will be resolved.

References

Altameem, A.A., Aldrees, A.I. and Alsaeed, N.A., 2014, October. Strategic information systems planning (SISP). In Proceedings of the World Congress on Engineering and Computer Science (Vol. 1, pp. 22-24).

Arvidsson, V., Holmström, J. and Lyytinen, K., 2014. Information systems use as strategy practice: A multi-dimensional view of strategic information system implementation and use. The Journal of Strategic Information Systems, 23(1), pp.45-61.

Cassidy, A., 2016. A practical guide to information systems strategic planning. Auerbach Publications.

Eden, C. and Ackermann, F., 2013. Making strategy: The journey of strategic management. Sage.

Galliers, R.D. and Leidner, D.E., 2014. Strategic information management: challenges and strategies in managing information systems. Routledge.

Hill, C.W., Jones, G.R. and Schilling, M.A., 2014. Strategic management: theory: an integrated approach. Cengage Learning.

Hill, T., 2017. Manufacturing strategy: the strategic management of the manufacturing function. Macmillan International Higher Education.

Kummer, T.F. and Schmiedel, T., 2016. Reviewing the Role of Culture in Strategic Information Systems Research: A Call for Prescriptive Theorizing on Culture Management. CAIS, 38, p.5.

Lion. 2018. Retrieved from https://lionco.com/ [Accessed on 30 Aug. 2018].

Majchrzak, A. and Malhotra, A., 2013. Towards an information systems perspective and research agenda on crowdsourcing for innovation. The Journal of Strategic Information Systems, 22(4), pp.257-268.

Morden, T., 2016. Principles of strategic management. Routledge.

Ogiela, L., 2016. Cryptographic techniques of strategic data splitting and secure information management. Pervasive and Mobile Computing, 29, pp.130-141.

Pearlson, K.E., Saunders, C.S. and Galletta, D.F., 2016. Managing and Using Information Systems, Binder Ready Version: A Strategic Approach. John Wiley & Sons.

Peltier, T.R., 2016. Information Security Policies, Procedures, and Standards: guidelines for effective information security management. Auerbach Publications.

Simon, D., Fischbach, K. and Schoder, D., 2014. Enterprise architecture management and its role in corporate strategic management. Information Systems and e-Business Management, 12(1), pp.5-42.

Tsang, E.W., 2014. Case studies and generalization in information systems research: A critical realist perspective. The Journal of Strategic Information Systems, 23(2), pp.174-186.

Uçaktürk, A. and Villard, M., 2013. The effects of management information and ERP systems on strategic knowledge management and decision-making. Procedia-Social and Behavioral Sciences, 99(0), pp.1035-1043.

Wheelen, T.L., Hunger, J.D., Hoffman, A.N. and Bamford, C.E., 2017. Strategic management and business policy. pearson.

Whittington, R., 2014. Information systems strategy and strategy-as-practice: a joint agenda. The Journal of Strategic Information Systems, 23(1), pp.87-91.

Willcocks, L., 2013. Information management: the evaluation of information systems investments. Springer.