Strategic Management Analysis Example

Strategic Management Analysis Example Strategic Management Analysis â€" Essay Example > Introduction Sport Equipment Industry is one of the most lucrative industries in the world; sporting activities are on the rise and hence the need of more enhanced sporting equipments. The adidas Group is the second largest producer of sporting apparel in the world having a rich legacy of manufacturing high quality and technologically sound sporting equipments footwear in particular. World sports leading teams have trust in the adidas brand as it has helped them to achieve subsequent outstanding performance at times when they need it most. Across the globe, adidas commands approximately 22% of athletic footwear and apparel market second to Nike, which has 33% market share (Gay, 2010). With the current focus on innovation coupled with strategic marketing strategies, adidas will considerably expand its world market share. This paper seeks to discuss adidas group market environmental analysis together with its strategic analysis in order to understand the Sports Equipment Industry. C onsequently, the paper will discuss the strategic fit of adidas Group by providing a comprehensive SWOT analysis. The adidas Group Market Environmental AnalysisExternal environmental forces can affect an organization in a myriad of ways; understanding these forces helps an organization to tailor its activities in a manner that harnesses its competitive activities. External forces are factors outside the company that influence the manner in which firms in the same industry compete (Haberberg, et al, 2001). Owing to these facts, it is imperative for business organization to inherently understand these dynamics of its industries and markets for them to compete effectively in the marketplace. With regard to this, in order to understand adidas Group market environment, PESTEL and Porter’s five forces and how they affect the company will be discussed. The adidas Group PESTEL analysisPoliticalTurbulent political atmospheres always have greatest impacts on all business and adidas Group i s no exception. Countries within which the company operates have considerably favourable political environments that have allowed the company’s operations to thrive. In Germany, UK, France and the US for instance, have stable governments with trade laws that protect private businesses hence it is unlikely for them to introduce new controversial policies which may affect the company (Gay, 2010). The company also embraces protection and support of the rights of its employees by strictly following the current employment laws. With regard to this, the company is less likely to face economic strike threats from trade unions and other civil rights organizations. EconomicalThe adidas Group is a multinational company, and like any other multinational, the company is likely to be affected universal economic meltdown (Haberberg, et al, 2001). However, in order for adidas to maintain good economic relations in countries within which it operates, the company helps to decrease unemployment b y increasing its employees at its terminal factories. Since the initiation of the euro currency in 2002, exporting business is cheap and hence facilitating the company’s cross-border business. Labour salaries in some European countries like Germany and France are extremely expensive; owing to this, the company has relocated most of its production activities to Asia where labour is considerably less expensive.