PC World: SWOT and PEST Analysis

PC humanity jam and bloke synopsis turn out analysis is a celebrated technique that has been intentiond for decades flat to analyse the four major factors of an boldness namely forcefulness, failinges, opportunities and affrights. This helps in expose analysing each organisation, when conducting a strategicalal analysis often analysts as salubrious as engage it as a stepping st ane for their analysis. It is not only an analysis of the organisation itself plainly quite it is a more deep analysis of the grocery and all problem activities associate to the organisation1. The SWOT analysis is know as a strategic planning tool around and it has featured in business text since 1972, besides no whizz knows who originally invented SWOT analysis. Today it quarter be found al close to in either textbook on strategy, marketing and any other business disciplines. on that point have been many studies that were conducting in different business schools and some of the f amous ones even conducted in Harvard atomic number 18 backed up by Micheal Porter, Ansoff and writers such as Philip Kotler. Their studies have lead to the conclusion that SWOT be the tool to better lowstand the strategic fit between an organisations strategies and the environs in which it competes. This is as well as a redeeming(prenominal) tool to analyse such organisations which on the face have been delivering profits but atomic number 18 either declining or are losing market dower. For cause doing analysis of organisation such as Yahoo would be a dear(p) vagary which is a fat venture but is loosing its market heavily to Google (Adams, 2005).Importance of SWOT compendAn organization poop take the best advantage of the milieual opportunities if it discharge utilize the resources available to the organizations up to the optimum level. The person in quiver of designing the strategy who is excessively called the strategic leader of the organisation use SWOT can k eep his organise right over deciding whether the opportunity that is arising is good enough with the matched impuissancees and strengths of the organisation2. Keeping this in foreland one needs to keep his/her head right ab show up one thing that whenever they are analysing to pursue an opportunity always point out the related weaknesses and strengths, maybe a priority SWOT analysis can also be a genuinely good idea. A documentary opportunity can only be identified if the opportunity has a strategic fit between the environmental conditions and the resources that the organization possess3.SWOT might not be the only perfect tool for strategic analysis while there have been greater criticism on SWOT. The reason creation that people consider it to be in truth halcyon and based on that people just do it just standardised that without giving proper thought on the ideas behind a strength/weakness or an opportunity/threat. While doing SWOT one scarpers to force out many other facto rs such as the financial factors and in this faux pas other strategic tools can be more key however even though SWOT holds its own importance (De Witt and Meyer, 1998).The main place consists of two inherently different types of military ranksInternal evaluationExternal evaluationInternal Evaluation(S)trengthsStrengths are the good and the power parts of the organisations. They formulate what the organisation is good at. This is not only on the organisational level but all wide. This explains the organisations strength in terms of customers, suppliers, utilisation of resources etc. ordinarily when conducting a strength analysis it is important to consider that strength is something at which the organisation is not only good at but also better than its competition. It provides them the competitive edge in comparison to their competition. This is one cogency at which they are rattling(prenominal) good at4. When describing strength companies tend to be ignorant about things s uch as CRM (customer relationship management), or SCM (Supply chain management) but they can also be considered as strengths if they are effective and contribute to the profit financially or non financially.(W)eaknessesA weakness is defined as a deficiency in an individual and this equivalent fits to an organisation as well where weakness of an organisation explains something at which they arent good at. Organisational weaknesses are areas where they are not good against their competition. Now they can be areas of great strength at one time but and then later lost to the competition due to not being taken care of. Its necessary that the customer point of view is brought into consideration rather than conduction the weakness analysis of only the organisation. Its hard to ingest the areas where one is not good at and in this case organisations need to admit but often this doesnt happen.External Evaluation(O)pportunitiesOpportunity is just exchangeable a term in an individuals lif e similar when it comes to trhe organisation but the scope of opportunity is bigger, the opportunities that come to the organisation are everywhere in every nook and corner its just that they need to realise it and use it with the current set of resources. Opportunities are also related to trends that the organization has been see in the past, they can also be buying behaviours. They can also come in by identifying a particular market element which was not being looked after before but is now being looked after very carefully5. Finally some opportunities come from the remote environment and acting on the right time is the most important agenda.(T)hreatsThreats can be organisation relate and the ones that are not in this case the threats are being considered the ones related to the organisation. Now the threats can also be seen as the opportunities that were not grabbed and later turned onto threats. Threat is a unfavourable situation in which the organisation doesnt want to see itself. a couple of(prenominal) threats can be the entrance of smart competitors, slow market growth, increase bargaining power of key buyers or suppliers, technological changes etc.PEST AnalysisMacro environment comes in as the naked as a jaybird hotheaded force in the industry where the macro environment tends to play a major role in the entire effort of competition. The business environment is just like a moving film and it is necessary to dock down any changes that are happening around the business. The organisational related factors that play a part in the macro environment need to be brought under consideration. Its nessecary to bring in a number of key vital factors into throwaway that can influence different areas of the organisation, these areas can be supply related demand related and even directly related to the legal issues of the upstanding6. 1993 The radical and ongoing changes occurring in society pee-pee an uncertain environment and have an impact on the func tion of the whole organization (Tsiakkiros, 2002). To scram a strong environmental analysis PEST has proven to be the best technique and such a technique that looks deeply into the pores of the business and extracts out information related to different areas of the macro environment. A plague analysis not only needs to identify the factors that can view the policy-making, technological, legal and environmental issues but it is also an analysis that is employ to create a relation among things. The analysis sees and examines the impact of these factors and their affect ion one some other and then the combined affect on the organisation. The results can be used to perform various tasks such as understanding the emerging strategy, exploring the future opportunities in the environment7.Further explanation of each of the factors that count is a pest analysis is as follows(P)oliticalPolitical factors include legal and restrictive factors like elections, employment law, consumer pro tection, environmental regulations, industry-specific regulations, competitive regulations, inter-country relationships / attitudes, war, terrorism, political trends, giving medicational leadership, taxes, and government structures8.(E)conomicEconomic factor includes factors like taxation, government spending levels, disposable income, railway line growth/unemployment, exchange rates, tariffs, inflation, consumer confidence index, import/export ratios, and production levels9.(S)ocial well-disposed factors include factors like demographics (age, gender, race, family size, etc.), lifestyle changes, population shifts, trends, fads, diversity, Immigration laws, health, living standards, lodging trends, fashion, attitudes to work, leisure activities, occupations, and earning capacity.(T)echnologicalTechnological factors include inventions, new discoveries, research, energy uses/ sources/ fuels, communications, rates of obsolescence, health (pharmaceutical, equipment, etc.),manufacturi ng advancements , information technology, internet, transportation, bio-tech, genetics, waste removal/recycling etc.Selected Company (PC founding) outline Introduction of Selected CompanyThe selected company PC origination is part of the electronic retailer giant DSGi Plc. DSG international is one of europiums leading specialist galvanic retailing groups. It operates a multi-channel approach to electrical retailing. More than 100 one million million million customers shop in-store and online every year with DSGi (DSGi, 2010). The business of DSGi can be shared out into three major categoriesPC World is Britains largest specialist chain of reason superstores. The superstores entreat more than 5,000 product lines including extensive ranges of PCs, laptops, printers, software, peripherals and accessories from the major brands, as well as many PC World exclusive products. In-store PC Clinics plead on the spot advice and service. Component Centres offer a one-stop shop for cust omers with move technical knowledge, providing a vast choice of PC components and upgrade products at competitive prices. In 2007, PC World won Retail Weeks harvesting Innovation of the Year award, for its Data Recovery service. Every PC World store has an in-store business centre staffed by experienced business specialists. They offer local companies face-to-face help and advice with choosing the best IT solutions. there are 157 stores in the UK and 10 in the Republic of Ireland. (PC World, 2010)SWOT Analysis of PC WORLD(S)trengths healthful high street presenceMulti channel approachStrong distribution channelsHuge base of domestic customers(W)eaknessesEmployees integrity less customer focus(O)pportunitiesNew mega stores2012 Olympics apples growth in European markets harvest-festival in the IT Gadget Industry(T)hreatsSlow frugal growth banish customer perceptionThreat of new competitorsFalling market share(S)trengthsDSG has a very strong high street presence. In any big retail park or high street we can easily find either a PC World , Currys or Currys Digital. Moreover it has a multi channel approach retail stores, e-commerce and B2B. There are very strong distribution channels of PC World. Just for an example the whole of Apple products distribution is done via the distribution channels of DSGi. There is a very strong base of domestic customers in UK for PC World as a brand which serves as one of the most vital strengths of PC World.(W)eaknessesPC World has history of strong inducing based pay schemes. The employees get heavy commission based on sales. Initially it did work out to work pretty well. But the employees do take it to their advantage. The results is unsatisfied customers who are miss sold. This also leads to the next weakness which fewer focus on customer needs. The focus is more on sales and KPIs, hence the customers benefit are overshadowed by the sales KPIs.(O)pportunitiesThe idea of new two in one Currys PC World Mega stores is very a ppealing. Customer get more choice in terms of products and serve under one roof. The Olympics 2012 is one occasion on which almost every single business is relying as an opportunity for growth and profitability and PC World can also take advantage of this Global event. Apple products are getting global attention and likewise in Europe as well. PC World controls the entire distribution of APPLE products in UK Europe. This can serve as a very strong strategic alliance and PC World can be benefited out of this. A very recent example was the launch of IPAD. PC World was accustomed a head start of 60 days from APPLE for merchandising IPADs in their stores. The IT Gadget sectors are seeing a very forceful increase and PC Worlds main flings are these gadgets and IT products and services.(T)hreatsThe first and the most all important(p) threat is the negative perception of the customers. As highlighted in the weaknesses sales and KPIs are given preference over customers benefits due t o the traditional structure of PC World. It is also evident by the comment of DSGis CEO John Brawett. The biggest challenge for us is to change the perception of our customers. In recent times PC World has seen falling shares part of the fact can be attributed to the ecological niche but customers negative perception has also affected. There are new competitors coming into the market like BEST BUY, ARGOS and John LEWIS are offering extensive IT Solutions as well.PEST Analysis of PC WORLD(P)oliticalUK has seen a very recent change in the political structure. Due to the economic downturn the investors are not very confident specially the foreign investors. The Govt. Is making the efforts to reassure the foreign investors, but the cap put on the international immigrants served as a big threat to the foreign investors. Mr David Camerons take to task to India was an attempt to promote the trading relationship with India. The share price of the company reflects this fact. The company s hare price slumped from 36p to 21p in just 3-4 months time (DSGi, 2010). The political factors are in favour of the company.(E)conomicThe UK sparing is seeing a very slow growth and some experts have shown the danger of a double dip recession. The new Govt. has raised the taxes in order to boost the economy but the economy is still growing at a very slow rate. The economic factors are not in favour of the company. In 2008 the overdraft limit of the company was reduced from 4.5 million to 2.5 million. The consequences were seen as 300 employees from the head office were made redundant.(S)ocialThe socio-cultural factors are a mix of both good and bad. The markets love the new innovative products IPAD made record sales in the Apples history followed by a successful launch of IPHONE 4. PC World controls the distribution of APPLE products throughout Europe and APPLE products are adequate increasingly popular and famous in the European markets. On the other hand the negative customer p erception is a big threat to the PC WORLDs growth. Hence there is a mix of social factors bear on the external environment of PC WORLD.(T)echnologicalPC Worlds tagline is bringing life to technology. PC World is always at the fore fronts in the process of introducing new technologies to the UK markets. PC World was the only retailer except APPLEs retail stores to line of business the IPAD for 60 days after the launch. The challenge for the organization is to keep up with the rate of change in technology, because the technology changes at a very rapid rate.