Question

-What is analytics? -What are the Tools for analyzing business strategies - What is the general purpose and examples of: Porter’s 5 Forces, Three Generic Strategies, Value Chain Analysis, SWOT Analysis -What are Business Process Modeling/Diagrams: Purpose, Components, General Setup?

Answer 1

Answering the first 4 questions as per Chegg Guidelines:

1. Analytics is basically the study of data, identification of different patterns and the application of such patterns in the business process, so as to increase its efficiency and effectiveness.

The primary benefits of application of analytics to business are:

• Analytics helps a company to identify opportunities for expansion
• Customer trends and patterns can be identified and business can be adapted to capitalize on the same
• Analytics helps in enhancing overall business productivity
• Strategic decision making becomes quite easy with the incorporation of analytics

2. Some of the types and methodologies used under analytics are Big Data and Data Analytics, Predictive Analytics, etc.

Big Data and Data Analytics can prove revolutionary for the organization. Any strategic decision can be backed by first analyzing its probabilities with Big Data using Data Analytics. If the probabilities and potential is positive, the decision can be considered optimum. If not, then the alternatives for the scenario can be explored. Big Data has the potential of facilitating the achievement of the strategic objectives of the company. The companies must learn to apply the techniques of Big Data effectively in its business model, to reap its benefits.

Predictive analytics can be used to evaluate the various types of risk, which can impact or influence a system in future. Before considering any future projects, the management of the company uses predictive analytics to estimate the risk proneness for a project. Based on the results of the analysis, the project for the company is selected. The management, then tries to align the mindset and thought process of the employees with the project at hand, using emotional influence. The management highlights the benefits which the employees can gain, from successful implementation of the project. The analytical methods long with the emotional influence helps in successful acceptance and implementation of the project by the company.

3. Michael Porter’s 5 Forces is one of the most commonly used tools that can be used to assist in industry analysis. The 5 forces studied in this tool are Bargaining power of customers, bargaining power of suppliers, threat of new entrants, competitive rivalry and threat of substitution.

Though Porter’s 5 Forces is one of the most popular strategic tool used to analyze the competitive influences in an industry, there are certain limitations associated with this strategic tool. The Porter’s 5 forces model usually lays stress on the short-term changes in the industry. SO, if an industry has rapidly changing environment like the technological industry, then the Porter’s 5 Forces model will not give accurate analysis of the industry. Also the applicability of Porter’s 5 Forces model is limited to simple markets. It gets affected by its limitations if the industry is quite complex. So, the scope of Porter’s 5Forces model is quite narrow and restrictive.

Porter’s 5 Force Model for McDonald’s

• Bargaining power of buyers: Strong Force
  • This force is quite strong as the customers have an array of options available for switching. The customer do have an upper hand as they can switch from one provider to another, without much hassle.
• Bargaining power of suppliers: Weak Force
  • This force is quite weak as there are several suppliers available in the market. The absence of strong alliances among suppliers attributes to this weakness.
• Threat of new entrants: Moderate Force
  • Entry costs in the industry is quite low. Also there is high variability in the initial capital cost involved. Developing a brand power and goodwill for a new player is not quite easy as the customers have a variety of companies to choose from.
• Threat of substitutes: Strong Force
  • There are various fast food substitutes of McDonalds available in the market. As switching cost is low, customers do not think twice before switching to another company.
• Competition: Strong Force
  • There are several companies available in the industry, of various sizes as well as offerings. The overall force of rivalry in the industry is quite high.

4. SWOT Analysis is an insight about the internal factors and external factors which have considerable influence on the way, an entity performs. Here the internal factors are strengths and weaknesses. The external factors are threats and opportunities. A comprehensive SWOT Analysis helps in realizing the strengths and weaknesses of the business strategy adopted by the company, which the company can work on and also helps in identifying the market opportunities, which the market can capitalize, to enhance its overall business and profitability. So it results in good decision making, which will be good for the overall business sustenance of the company.

SWOT Analysis of Fitbit

• Strengths
  • Strong brand power
  • Big umbrella of loyal customers
  • Profit making company
• Weaknesses
  • Premium pricing strategy of the company, limits the customer base
  • High competition in the segment
  • Market saturation limiting its business options
  • Limited usability
• Opportunities
  • Enhance the product by adding more features
  • Global expansion in third world countries
• Threats
  • Customer switching cost comparatively low
  • Stiff competition in the industry
  • Emergence of mobile app based trends may reduce its customer following