The following sample essay on Internal And External Scanning discusses it in detail, offering basic facts and pros and cons associated with it. To read the essay’s introduction, body and conclusion, scroll down.
Evaluation of the internal and external environments is then followed by crucial decisions grading long and short-term goals and finally organizes for the implementation of the plan of action. The internal and external environments of Logo and Harley Davidson companies are described using an environmental scan. Environmental Scanning According to Wheeled & Hunger an environmental scan “is the monitoring, evaluation, and dissemination of information from the external and internal environments to key people with the corporation” (Wheeled & Hunger, 201 0, p. 8).
External environments are identified by the possible opportunities and threats outside the organization. Internal environments are identified by the strengths and weaknesses within the organization. In addition, successful businesses analyze the following forces that drive industry competition, threat Of new entrants, rivalry among existing firms, threat Of substitute products or services, bargaining power of buyers, bargaining power of suppliers, and relative power of other stakeholders.
Logo’s Internal Environment According to Metcalf & Alfresco (2013), inbound logistics, which emphasizes on raw material, is fundamental in the company’s operations. It acquires her main bulk of chemical materials from Leanness, a German company that provides standardized ingredients without any bottleneck that may interfere with Logo’s company. Logo further focuses on their product’s future demands by ensuring proper product mix. Although it is a cumbersome and technical forecast, the company has always done it successfully via utilization of software and analytical approach in achieving their goal.
Scanning Internal And External Environment
Moreover, Logo has optimally managed their manufacturing process in a way that high quality products are produced with minimal incidences of faultiness and wastage. The company’s patented plastic ingredient ensures durable product and desirable colors as well as adherence to the European CE-labeling thus ensuring conformation with the European Union legislation (Hauser & Robertson, 2009). Additionally, Logo has outsourced their distribution to DEL Excel Supply Chain in Eastern Europe hence reducing excess capacity during Summer when sales are low.
It further helps them to concentrate in the production services and letting experts do their distributions. Logo has also diversified their operations such as entering into a strategic partnership with organizations such as Lucas Arts and Warner Pros that has enabled Star Wars and Harry Porter act as the savior of Logo (Metcalf & Alfresco, 2013). Hauser & Robertson (2009), posit that several businesses combinations that Logo has entered itself in make it enjoy indirect marketing thus contributing to their dramatic increase in sales.
The company has been expanding their production facility closer to their customers as well as numerous promotional strategies such as conventional media and philanthropic charity. The company also uses superior prices and avoids any engagement in price tragedy and associates their high prices with better quality. It has also integrated some of their programs with educational institutions as a way of improving their products. Logo’s External Environment Considering Logo’s bargaining power, their significant supplier is within the chemical market that is very competitive thus reducing the supplier’s bargaining power.
The company has categorized their suppliers based on rockiness hence making their largest suppliers to be in low risk countries and smaller group of suppliers in high-risk countries. Companies in the toy industries including Logo have ensured low suppliers’ bargaining power. Retailers play an important role in selling and distributing Logo’s company (Hauser & Robertson, 2009). Additionally, Logo has huge cost advantage since it does their production in low waged regions as well as the advantage of economies of scale. Logo also enjoys a vast variety of expertise that enables them to make competitive decisions.
In addition, they have high brand equity that have been created for a long time. Metcalf & Alfresco (2013), argue that Logo has addressed the issue of threat brought about by computer games by paving to electronic gaming. Logo enjoys loyal customers worldwide with exclusive licenses, solid distribution network, financial liberty as well as market experience. Harley Davidson Internal Environment According to Agnostic (201 3), Harley Davidson is amongst the leading motorcycle companies that have applied technology to their image thus making it stay competitive.
The organization possesses a lot of internal resources that strengthen their long-term strategies. It has a great corporate structure that counts as amongst the first divisional structure that used just in mime inventory strategy. It is involved in a diversified kind of business that not only includes motorcycles but also includes other related products and financial services. Moreover, the company’s decision-making process is decentralized and every department is accorded responsibility to deal with various issues.
Harley Davidson is so much concentrated on deep emotional customer link via their services and products and this greatly attracts many customers who feel that the company cares for them. The company’s relationship of employees is so close and awesome as the top management is loosely bonded to other employees thus easing decision-making process. Harley Davidson culture is aimed at preserving and maintaining the organization through constant product and service quality as well as achievement of financial success.
The company always works at adding value to their products as well as creating image and attracting new customers. It has successfully licensed their products and this has really enhanced their image. The organization sells their products through a wide network of dealers who have ensured a wide customer base especially in America (Agnostic, 2013). Harley Davidson treats their customers by offering them 1 year membership to the Harley owners group and further conducts rallies that help in showcasing and demonstrating their new products.
It uses value over price strategy and provides company information online. Harley Davidson has strong financial position making it be in a favorable position to withstand falling prices and increased costs. It further uses strong R&D by investing in new technology that makes it manufacture powerful, lighter, stronger and finest motorcycles possible (Robertson & Equalize, 2010). Harley Davidson External Environment According to Robertson & Equalize (201 0), demand for motorcycles in the sporting industry has grown very high and Harley Davidson is so much trusted due to their high quality production.
Being a IIS based company it enjoys a wider market segment because most people trust and love made in U. S products particularly when it comes to motorcycles. Harley Davidson enjoys efficient supply of sheet metal, coils and other raw materials from the favorable supply bases. The company dwells on its success in the heavyweight motorcycles beating highly competitive substitutes such as Yamaha, Honda and Sukiyaki. Measurement Guidelines Both Harley Davidson and Logo use profit and increase in revenue as the measurement guidelines of the effectiveness of their strategies.
The number of sales made and the ability to beat competitors in terms of revenue generated and the number of units sold remains integral way of ascertaining the effectiveness of the companies’ strategies. Also, Harley-Davidson and Logo focus on the wide market coverage especially the overseas market as a way of achieving their effectiveness. Measurement guidelines for both companies are indeed very effective and positive since they focus on the main objective of every business, making profit.
Unless business’ revenue rises and profit increase is experienced, a business cannot be said to be making a progress and achieving their objectives. Conclusion Both Logo and Harley Davidson have demonstrated that environmental scanning has been essential to their success in identifying internal and external environments. Their long-term strategic plan has been successful because their ability to focus on what works and what do not in regards to internal and external forces. They were able to gain and maintain nominative advantage over their competitors by knowing their strengths and weaknesses.