International strategy operation Coursework Example | Topics and Well Written Essays - 1250 words

International system operation - Coursework ExampleIn this context, the unattractiveness of the caboodle market segment of the automobile sedulousness would be based on the following fact the profits generated by the firms operating in the specific field are low. The above condition would be checked apply Porters Five Forces model. Through this model the competitive surround of an organization can be evaluated. In this way, a strategy can be identified so that the organization involved is better positioned in its market2. The above approach has been characterized as outside-in approach emphasizing primarily on each firms external environment and not on the organizational resources3. In the context of the Five Forces model, the mass market segment of the auto effort would have to face the following forces a) new entrants4 competition in the automotive industry is extremely soaring. fifty-fifty if the number of new entrants is kept at low levels, the market share of the industr ys leading firms is so high that it is difficult for medium firms of the particular industry to standardize their market position. Even the industrys major competitors often face difficulties in keeping their competitiveness high b) bargaining power of customers5 customers can choose among a high range of cars of the particular category. ... ?s major competitors there are firms operating locally increasing the challenges for the industrys multinationals8 e) substitute products9 in the context of the mass market it is quite easy for substitute products to appear at the level that the technology used in cars of the mass market can be well adopted by the industrys small manufacturers. According to the issues discussed above, the chances for profits in the mass market segment of the automotive industry are limited, a fact that harms the attractiveness of the industrys specific segment. 2. Explain why profitability is generally higher at the luxury and ultra-luxury end of the auto indus try. In order to understand why profitability is higher at the luxury and ultra-luxury end of the auto industry, it would be necessary to evaluate the characteristics of the above segment using an appropriate strategic tool, such as the PESTEL analysis. The above tool helps to analyze the macro-environment of an industry, or of an industrys segment, so that the current status and the prospects of the particular industry are effectively evaluated. The PESTEL analysis focuses on six elements of a firms macro-environment, as these elements are able to influence the performance of organizations operating in the industry involved Political, Economic, Social, Technological, Environmental and Legal. The PESTEL analysis for the luxury and ultra luxury end of the auto industry would be developed as follows a) Political policy-making conditions worldwide are not stable. Strong political conflicts are developed in most countries in the international community. In such political environment it would be quite difficult for an industrys profits to be standardized. The luxury and the ultra luxury end of