USE THE RETAIL COMPANY: ADIDAS
GUIDELINES for CASE 1
The profitability of the Industry and hence the company is determined by the external environment which consists of three major components:
Section 1:
a. The
General Environment
is composed of dimensions in the broader society that influence the industry and the performance of firms within it. Refer to Chapter 2 in the textbook for more detailed information regarding the seven segments of the General Environment as follows:
1. Global
2. Demographic
3. Physical
4. Political/Legal
5. Economic
6. Technological
7. Socio-Cultural
Based on the information that you have gathered on your Company, textbook, and research, you are to determine which aspect(s) of the general environment affect your company. Select the Top Three segments with supporting evidences (scholarly articles, textbook references and the case study of the company) the impact the most.
Next, you will make an evaluation(s) as to whether they are opportunities or threats to the company’s performance.
b. The
Industry Environment: Porter’s Five Forces Framework
The industry environment refers to the forces that directly influences the profitability of the industry as follows:
1. Threats of new entrants
2. Bargaining power of suppliers
3. Bargaining power of buyers
4. Rivalry among existing firms
5. Threats of product substitutes. State, where necessary, if opportunities exist for product complement.
Porter’s five forces (and product complement) model is a conceptual framework for analyzing the industry environment. Based on the information gathered about your company, textbook and research, determine the importance of each force in Porter’s model; also, offer reasons and cite references.
For example, under the threat of new entrants, there are barriers to entry and how existing firms will react. Some of the barriers to entry include high initial capital set-up costs or government regulations that will make a weak or strong threat of new entrants. If so, what are the entry barriers? Also, a threat can arise form substitutes which may affect the firm’s market share and hence profit.
c.
Competitor Analysis
The competitor analysis focuses on how the company competes directly with other companies in the same industry. For example, Walmart competes with Amazon; Apple vs. Samsung; Home Depot with Lowe’s.
Identify the Top Three competitors in your industry and briefly discuss the followings:
1. Where/how does your company hold an advantage over the competitors?
2. What will your competitors do in the near future (next 6 months to a year)?
3. What should your company do to remain competitive?
Section II. The Organization’s Resources
Resources, capabilities and core competencies are the foundation of competitive advantage. For this section, you are asked to do the followings:
1. Briefly discuss the components of an Internal Analysis (Refer to Figure 3.1, chapter 3 in the textbook)
2. Include a discussion of Value Chain Analysis; Figure 3.3, Chapter 3.
3. Which value chain activity provides the most value to your company and why? Offer examples and cite references.
4. Does your company engage in any outsourcing activities? If yes, explain and offer an example.
Section III. Corporate Governance
Describe the company’s corporate governance about the guidelines in aligning the interest of the shareholders and the managers in terms of:
a) Board of Directors and state whether the CEO is also the Chair of the Board
b) Ownership concentration (large block of share) in decision making
c) Issue about executive compensation
NOTE:
Please be reminded that:
· This is an INDIVIDUAL assignment
· Paper 1 is worth 20% of your final grade