Strategic management is simply a way of collecting comprehensive information regarding current ongoing processes and activities an organization utilizes in order to align its resources and systematically coordinate actions in accordance with the organization’s vision, mission and strategy. Activities in strategic management transforms the previously set static plan into a System which provides strategic performance feedbacks to decision making so that a plan is able to grow and evolve when requirements and circumstances change.
Strategic management of an organization entails three ongoing processes which are analysis, decisions, and actions. This includes the analysis Of strategic goals (vision, mission, and strategic objectives) along with the analysis of the internal and external environment of the organization. For this paper, we shall be comparing the strategic management of Prouder and PROTON. The SOOT analysis shows that both companies has different strategic management.
Looking into the strengths of both companies, Prouder is leading as a low cost dealer in Asia, With the help of its own industry, they have successfully created a low cost automotive mentality among their workforce that would work together in a flexible, critical and highly committed manner to keep Prouder on top of its game. Similarly, PROTONS strength is in its competitively priced products as well, Cars offered by PROTON targets people of the lower income group. An example of that would be the Viva model which can be seen in the streets of Malaysia.
However, the drawbacks of PERIODIC is their over dependence on the domestic market, government support, and the foreign partnership through an indirect engage to Toyota for the company’s survival and growth. This brings a weak brand image of PERSONAL in the international market and in turn, makes it difficult for them to reduce the cost Of products and be competitive When the trade barrier falls. Besides that, PROUDER is also notorious for the lack of quality in certain models and their small model range due to low safety measures in the design of their small car models.
Hence, PROUDER should consider looking at newer markets as their horned markets are getting saturated, take advantage of he current situation of increasing fuel prices that will drive the society to switch to smaller cars in hopes of saving fuel, and change their market targets which are more favorable to smaller cars as future opportunities. Without much difference, PROTON’s reputation is also poor when it comes to product performance and functionality.
Due to their short history in the car making industry, PROTON has been falling short when it comes to producing high quality cars, Beyond that, it is also observed that PROTON lacks variety in its product portfolio. Such example is clearly seen when PROTON is unable to meet the demands of the power Window Function in several of their product models. This puts PROTON in a situation whereby the company is no longer a competitive and economically viable entity as compared to global leaders.
Thus, it is suggested that PROTON should venture further into hybrid vehicles as they have already made a headstand by investing in the said technology. Through complete research and development (R), PROTON would be able to come up vivid more innovative products to ensure its brand name remains in the industry. This would later on lead to other opportunities for the company to emerge as a new market and make expansion abroad possible for an increase Of sales and reputation.
Despite all the pros mentioned, both company face the same threat of substitutes from competitors. To begin with, PROTON and PROUDER has been threats to each other for a very long time. Putting the effects of economic recession aside, whereby both companies will face an over-budget problem when sales of the year is not met, plenty of low cost substitutes are being marketed y Chinese manufacturers. Furthermore, with the current macro-economic situation, both PROUDER and PROTON are led to lower sales.
This only means that cheaper and various quality to substitutes in terms to car models and spare parts are highly abundant in the market, With the APT (SEAN Free Trade Area) policy enforced, there is a reduction of duties on imports from other Southeast Asian countries as to less than five percent. To name a few, Honda, Ionians, Toyota, Chevrolet and other brands are currently competing with PROTON and PERIODIC in giving consumers a wide variety of choices at an affordable price.
To further analyses and determine the ultimate profit potential of the companies, a study was carried out on PROUDER and PROTON through The Porter’s 5 Forces, which consists of (i) Threat Of Entry, (ii) Bargaining Power Of Suppliers; (iii) Bargaining Power of Buyers; (iv) Development of Substitute Products; (v) Rivalry among Competitors. Porter Five Forces 1. Competitive Rivalry 2. Threat of New Entrant 3. Threat of Substitutes 4. Buyer Power 5. Supplier Power http://YMMV. Academia. Due/8056000/Proton_Case_Study
