Strategy Development Tools and their use in Business

This paper explores the strategy development tools with an explanation of how they are used in business. The practical industrial example will be discussed under each tool. SWOT Analysis SWOT is a strategy development tool which helps managers evaluate and analyze the chances that a particular project will succeed. It is an acronym for the words Strengths, Weaknesses, Opportunities and Threats (Bull et al. SWOT approach creates internal strengths and weaknesses list of a project. (2016, 103) promote better business decisions. Proper application of this framework helps managers determine which projects are likely to succeed hence avoidance of costly mistakes. Analyzing the strengths and weaknesses helps the business in recognizing where to focus more energy on success as noted by Rauch et al.

PESTLE Analysis PESTLE is a mnemonic for Political, Economic, Social, Technological, Legal and Environmental. It is the strategy development tool used in categorizing the opportunities and threats in the SWOT analysis framework as expounded by Keller, Daronco and Cortimiglia (2017, 307). The importance of the PESTLE analysis to business cuts across all the aspects that constitute it. The political factors help in determining the level to which government is likely to influence the economy (Keller, Daronco and Cortimiglia 2017, 309). The economic factors determine the economic performance of the business. For example, an increase in the inflation rate affects how the companies price its services and products. Social factors are important as they scrutinize the social environment of the business market by measuring determinants such as demographics, population trends as well as the cultural changes as discussed by Kosinova et al.

Secondly, the Buyer power which assesses how it is easy for buyers to drive their prices is influenced by the importance of every buyer to the organization and the number of buyers in the market (Leonidou et al. The customers of the Under Armour products are the wholesale and the end customer hence buying power varies. Thirdly, the competitive rivalry influenced by the number and ability of competitors in the business market (Jarzabkowski and Kaplan 2015, 539). The market attractiveness of the Under Armour will increase if the competitors decreases. The fourth force is the threat of substitution which outlines the relationship of close substitute products in the market and the type of alternatives for customers (Eskandari 2015, 189). It is important for businesses to analyze all situations carefully before taking any decision.

This minimizes the chances of making mistakes in designing strategies that are non-functional. Relatively, strategy development tools are among the requirement for the success of any business organization. References Aithal, P. S. , Sitas, N. , Baulcomb, C. , Lambini, C. K. , Rawlins, M. and Kaplan, S. Strategy tools‐in‐use: A framework for understanding “technologies of rationality” in practice.  Strategic Management Journal, 36(4), pp. Keller, F. H. P. and Vaysbeyn, K. D. Development of Methodological Approach to Enterprise's Financial Strategy Based on Comprehensive Evaluation of Its Strategic Potential.  European Research Studies, 19(2), p. , Kucukvar, M. and Tatari, O. Integrating triple bottom line input–output analysis into life cycle sustainability assessment framework: the case for US buildings.  The International Journal of Life Cycle Assessment, 19(8), pp. Rauch, P.