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Assignment 1

Deadline: 19/10/2019 @ 23:59

For Instructor’s Use only

Instructions – PLEASE READ THEM CAREFULLY

· The Assignment must be submitted on Blackboard (WORD format only) via allocated folder.

· Assignments submitted through email will not be accepted.

· Students are advised to make their work clear and well presented, marks may be reduced for poor presentation. This includes filling your information on the cover page.

· Students must mention question number clearly in their answer.

· Late submission will NOT be accepted.

· Avoid plagiarism, the work should be in your own words, copying from students or other resources without proper referencing will result in ZERO marks. No exceptions.

· All answered must be typed usingTimes New Roman (size 12, double-spaced) font. No pictures containing text will be accepted and will be considered plagiarism).

· Submissions without this cover page will NOT be accepted.

Learning outcomes:

1. Understand the basic concepts and terminology used in Strategic Management. (Lo 1.2)

2. Understand the Corporation Social Responsibility (Lo 1.4).

3. Understand issues related to strategic competitive advantage in organizations (Lo 2.2)

Assignment Questions: (5Marks)

Question 1. (2 marks)

Discuss the relationship between thesocial responsibility of a corporation and its competitive advantage. Enrich your answer by examples. (Max 700 words).

Your answers should include outside references (other than the slides and textbook) using a proper referencing style (APA). Using references from SDL will be highly valued.

Question 2. (3 marks)

To prepare for this assignment, review Figure 4.3 entitled ‘ forces driving industry competition’ from your textbook (Figure 4.2- Ch4- Slide no 18) and the text relative to Porter’s Five Forces of Competition framework. Consider the role of the following key forces of suppliers, substitutes, buyers, and potential entrants.

Select a Middle Eastern company of your choosing and assess the power of each of five forces on that firm:

a. How powerful are the buyers, suppliers, and substitutes? How formidable are the barriers to entry and how intense is the rivalry among existing firms? (2 marks)

b. Which of the forces has the biggest impact on the firm? Why? (1 mark)

Answers:

Question 1.

The connection between competitive advantage and CSR is sometimes perceived as promising if the environmental limits, corporate interests, and social needs are well coordinated in it. It gives a mutual value to the community and the company. in case the responsibility is validated to be effective in terms of cost, a number of conglomerates may be pressured to implement it in practice (Alharbi,Dowling& Bhatti, 2019). The CSR, as well as competitiveness, are connected via three strategies of management which include responsibility, stakeholder, and strategy. CSR influences competitiveness for the reason that it improves the sustainable development of a corporate vision via corporate strategy, enhances the correlation with major stakeholders via stakeholder management, and expands the comprehension if CSR complex surrounding.

Question 2.

a.

Forces Driving Industry Competition

The company selected in this section is the Saudi Electricity Company (Alharbi, Dowling & Bhatti, 2019)

Buyer’s power

If a market is composed of a strong group of buyers, this affects the buying and selling decisions of a company. The strongest power which is exerted by the buyer is low price, this can, in the end, influence the profit potential. Buyers can cause an increase in competitiveness particularly when they demand the provision of high-quality services forcing various firms to enter into price wars.

Supplier’s Power

Suppliers exert pressure on business by increasing the price, lessening the availability of their commodities, and lowering quality. Supplier powers influence the ability of the firm to attain profitability and competitiveness in the industry (Seidi et al., 2015). A strong supplier can pressure the buyer by reducing the availability of the product, lowering the quality of the product, as well as raising prices.

Threat of Substitutes

The force poses a great threat and in particular when a buyer can easily find a substitute product with an attractive price or better quality or if he can shift from one commodity or service to another which is cheaper.

How Formidable Is the Barrier to Entry?

For Saudi Electronic Company, a number of the barriers that exist include regulations from the government, intellectual barriers, corporate capabilities, reactions of business rivals, as well as economic and market conditions (Wheelen& Hunger, 2011). Saudi Electronic Company favors the barrier that constrains competition in the market and claims large market shares.

How Intense Is the Competition?

The competition in the market is intense as each one is looking forward to grabbing a higher proportion of the market share. Nonetheless, lack of differentiation of the commodities in the industry has played a major role.

b.

The force which has the biggest impact about the company is the threat of the substitutes – a commodity from another industry that provides the same benefit as the one manufactured by the Saudi Electronic Company. Substitutes good confuses consumers as most of them do not differentiate counterfeit and original (Wheelen& Hunger, 2011). Some of the products bear the name of the company which taint the image of the firm especially when they fail to function efficiently.

References

Alharbi, M., Dowling, P. J., & Bhatti, M. I. (2019). Strategic planning practices in the telecommunications industry: evidence from Saudi Arabia. Review of International Business and Strategy

Saeidi, S. P., Sofian, S., Saeidi, P., Saeidi, S. P., &Saaeidi, S. A. (2015). How does corporate social responsibility contribute to firm financial performance? The mediating role of competitive advantage, reputation, and customer satisfaction. Journal of business research, 68(2), 341-350

Wheelen, T. L. & Hunger, J. D. (2011). Strategic management and business policy. New Jersey: Prentice-Hall