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    Swot and Strategic Objectives: Activity 6.3

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    Lissa Montiel
    LVM owns an assembly plant for laptop computers and supplies major brands. At a strategic review meeting: 1) Marketing reported sales exceeding expectations as laptops replace desktops, and expanding into Asian markets could increase orders. However, mobile phone/internet technology may threaten laptop sales. 2) Operations noted factory automation was completed without job losses. However, capacity was too low to fulfill a big order, and more space/training is needed. 3) Finance said profits are steady but cash flow is tight from investments. Borrowing is needed but rates rising could cause trouble, while exchange rates impact costs. Strategic options must consider these internal strengths and weaknesses as well as external opportunities and threats.

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    Swot and Strategic Objectives: Activity 6.3

    Uploaded by

    Lissa Montiel
    154 views1 page
    LVM owns an assembly plant for laptop computers and supplies major brands. At a strategic review meeting: 1) Marketing reported sales exceeding expectations as laptops replace desktops, and expanding into Asian markets could increase orders. However, mobile phone/internet technology may threaten laptop sales. 2) Operations noted factory automation was completed without job losses. However, capacity was too low to fulfill a big order, and more space/training is needed. 3) Finance said profits are steady but cash flow is tight from investments. Borrowing is needed but rates rising could cause trouble, while exchange rates impact costs. Strategic options must consider these internal strengths and weaknesses as well as external opportunities and threats.

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    LVM owns an assembly plant for laptop computers and supplies major brands. At a strategic review meeting: 1) Marketing reported sales exceeding expectations as laptops replace desktops, and expanding into Asian markets could increase orders. However, mobile phone/internet technology may threaten laptop sales. 2) Operations noted factory automation was completed without job losses. However, capacity was too low to fulfill a big order, and more space/training is needed. 3) Finance said profits are steady but cash flow is tight from investments. Borrowing is needed but rates rising could cause trouble, while exchange rates impact costs. Strategic options must consider these internal strengths and weaknesses as well as external opportunities and threats.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    154 views1 page

    Swot and Strategic Objectives: Activity 6.3

    Uploaded by

    Lissa Montiel
    LVM owns an assembly plant for laptop computers and supplies major brands. At a strategic review meeting: 1) Marketing reported sales exceeding expectations as laptops replace desktops, and expanding into Asian markets could increase orders. However, mobile phone/internet technology may threaten laptop sales. 2) Operations noted factory automation was completed without job losses. However, capacity was too low to fulfill a big order, and more space/training is needed. 3) Finance said profits are steady but cash flow is tight from investments. Borrowing is needed but rates rising could cause trouble, while exchange rates impact costs. Strategic options must consider these internal strengths and weaknesses as well as external opportunities and threats.

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    of 1

    1 BUSINESS ORGANISATION AND ENVIRONMENT

    SWOT AND STRATEGIC OBJECTIVES planning are usually needed before strategic choices can
    The SWOT diagram focuses on the key issues under each be made.
    heading. A brief outline of each of these could then accom-
    pany the diagram to make it more useful to the managers SWOT EVALUATION
    responsible for strategic planning. This approach helps Subjectivity is often a limitation of a SWOT analysis as
    managers assess the most likely successful future strate- no two managers would necessarily arrive at the same
    gies and the constraints on them. A business should not assessment of the company they work for. It is not a quan-
    necessarily pursue the most profitable opportunities. It titative form of assessment so the ‘cost’ of correcting a
    may stand a better chance of developing a competitive weakness cannot be compared with the potential ‘profit’
    advantage by identifying a good ‘fit’ between the fi rm’s from pursuing an opportunity. SWOT should be used as
    strengths and potential opportunities. In many cases, a a management guide for future strategies, not a prescrip-
    business may need to overcome a perceived weakness in tion. Part of the value of the process of SWOT analysis
    order to take advantage of a potential opportunity. SWOT is the clarification and mutual understanding that
    is a common starting point for developing new corporate senior managers gain by the focus that SWOT analysis
    strategies, but it is rarely sufficient. Further analysis and provides.

    ACTIVITY 6.3
    Read the case study below and then answer the questions turn down a big order from a big name brand last month
    that follow. due to too little factory capacity and shortages of skilled
    labour. I do urge you to agree to my plan to extend the
    Strategic Analysis of LVM Ltd factory space by 35% and to train more new recruits.
    LVM owns an assembly plant for laptop computers. It Research into the lighter, faster computer that was agreed
    supplies products to some of the major brand names in on last year is making excellent progress and we will
    the computer industry, but it does not sell any under its soon have to decide whether to proceed to the production
    own name. Every six months the managers hold a key stage.’
    strategic review meeting to consider the current position Lukas Klimas – finance director: ‘Our profits are
    of the business and the long-term plans. The following are holding steady, but cash flow remains a concern due to
    extracts from the most recent of these meetings: the expenditure on automated machines and research
    Imran Khan – marketing director: ‘Sales of our latest costs. We would need to borrow substantially to finance a
    large screen models have exceeded expectations and the factory extension. We would be in trouble if interest rates
    switch towards laptops from desktop PCs is expected to increased – there is already some government concern
    continue. The chance for computer companies to break about inflation rising. There is a new range of grants avail-
    into the expanding Asian market when trade barriers are able for businesses relocating into high unemployment
    lifted should lead to increased orders too. We need to areas. We must stay aware of exchange rate movements
    undertake some market research in Asia as this market too – the recent depreciation helped our international
    has higher growth potential than Europe, where most competitiveness.’
    of our computers are marketed. The development of
    the newest mobile phone technology and links with the 20 marks, 36 minutes
    internet remain a concern for us. We decided two years
    ago not to develop this technology, and, if our competi- 1 Prepare a SWOT analysis based on your assessment
    tors succeed in getting a major breakthrough, then sales of the internal and external factors that influence
    of laptops will dive in some markets.’ LVM’s success. [10]
    Liz Collins – operations manager: ‘The automation
    2 Identify and evaluate two potential strategic options
    of the screen assembly section is now complete. We
    available for LVM Ltd by using the SWOT diagram
    managed to push this through while maintaining excel-
    prepared in question 1. [10]
    lent staff relationships. This was helped by our continued
    expansion, which meant that no jobs were lost. We had to

    65

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