Environmental Scan

1. From early 1990s to 2004, the Lego Group, a long successful toymaker with a world-renowned brand, fell into the edge of bankruptcy. Compared with the highest revenue in 1999, the revenue in 2014 decreased by 35.6% while the net profit was negative, seven times less than that in 1999, the lowest in the past ten years. Its net profit margin and ROE were also the lowest. The gross margin and inventory turnover were all lower than its competitors. The strategic moves in the two main periods “growth period that wasn’t” (1993-1998) and the “fix that wasn’t” (1999-2004) lead to its poor performance.

At that time, the performance winners for LEGO were speed (of delivery), and flexibility (wide range of products, volume and delivery adjustments at short notice). Cost, dependability and quality were not as vital. To achieve these objectives, LEGO had made several operational decisions: Speed: • Maintain multiple distribution centres, close to key markets: 5 in Europe, 1 in USA • Maintain high stock levels, of finished product, and components so products could be assembled quickly. Flexibility: • Supply retailers both large and small, from relatively close distribution centres • Frequent, small, orders accepted • Introduce new products to the range, and discontinue old

The business environment of an organization reveals much about its competitiveness and the possible influences on the success of its strategies. The focus of this paper will be an environmental scan of the internal and external environments of two real-world firms, their competitive advantages and company strategies for creating value and sustaining competitiveness, measurement guidelines for verifying strategic effectiveness and their evaluation.

LEGO,  like  most  companies  in  the  toy  industry  are  fighting  to  stay  profitable  in  this

Harley Davidson is the company producing heavy motorcycles for its customers. It vision is to provide extraordinary motorcycles to its customers. It was first to launch “the ladies of Harley” for women. So, it has a first mover advantage among competitors. It has various strengths such as: strong marketing of its products, product quality, it has good brand recognition among competitors, good relationship with customers.

Based on the case study Lego appears to be using the Focus strategy. Michael Porter proposed three generic strategies Cost Leadership, Differentiation and Focus. Focus is a strategy where organization focuses on specific niche markets; this may include a particular geographic region or particular segment of customers. Organizations which use this strategy develop their products after having a study of dynamics of the segment and unique needs of customer. Lego before the appointment of the new CEO appear to use the focus strategy as their top priority was always to focus on innovation and creativity with taking profits into consideration. Add to that the case study also mention that Lego used to create products that primarily targeted boys. After the appointment of new CEO Jorgen Vig Knudstorp the company appears to have changed its policy form Focus to Cost-Leadership. Cost-Leadership is a strategy where organizations focus on gaining competitive advantage by offering products and services at the lowest possible price. They achieve this by increasing profits by reducing production cost and other way is to increase market share by reducing the prices of products compared to the competitors. Knudstorp after taking charge of Lego changed their focus on reducing the production

From using the Porter’s Five Forces framework, we can say that the industry faces threat from buyers, competitors and substitute products. Attention should be place on competitors and substitute products as they posed significant threat to the LEGO Group. We can see that competitors have been

In 1901, at the age of 21, William S. Harley created “a blueprint drawing of an engine designed to fit into a bicycle” (Harley-Davidson.com, 2015). In 1903, William S. Harley, and co-founder Arthur Davidson made “available to the public the first production Harley-Davison® motorcycle”; Harley-Davidson Motor Company was officially incorporated in 1907 (Harley-Davidson.com, 2015). What started out in a small wooden shed in Milwaukee has evolved into an iconic and massive multi-million dollar global organization. This paper will discuss the organizational effectiveness of Harley-Davidson by examining its financial health, strengths and weaknesses, internal processes, and core competencies.

In this paper we will perform a complete analysis of the Harley-Davidson Corporation including their corporate and business strategies, strengths and weaknesses, environmental opportunities, the five industry forces, and financial situation. Harley-Davidson has many attributes, which will be apparent in the following analysis. The paper will attempt to define the different components of the analysis and put them all together in a way that seeks to explain the way that they contribute to the overall success of the company and its stakeholders.

As their name and ideal, Lego has been beloved by the children as well as the parents for decades. Not only as plastic toy bricks, but also effective educational tools, the LEGO Company enjoyed continuous growth and broaden the global brand value. The LEGO brand moved to third place in 2002/2003 with only Coca-cola and Kellogg having greater respect among families with children. Even though as the overall toy market faces challenges, LEGO’s revenue and profits are increasing rapidly, especially since 2005. This profitability didn’t change even in the current recession in the global market. The LEGO Group achieved record-breaking profits in

Successful organizations do not happen by chance, but through hard work, strategic planning, and understanding the company inside out. It takes continuous forward thinking and actions by leadership to remain relevant in industries where new technology can push one forward or backward in the time it takes a season to change. Therefore organizations must conduct environmental scans to determine their internal and external environment as part of the strategic plan process. There are numerous organizations using environmental scanning to develop their strategic plan. Today the author will look at three successful companies, which are Southwest Airlines, Target, and Whole Foods Market. The purpose of this paper is to

Moreover, the emergence of these competitors is ironically at least partially the result of the fact that Harley’s production did not meet market demand. While new production capacity and facilities will certainly go a long way towards meeting short-term demand for touring and custom motorcycles in the domestic market, all indications are that there will be continued strong demand in the home market as well as growing demand in the larger European market. Looking towards the future, Harley-Davidson management must decide how to best match the company’s vision and resources (which now include Eaglemark Financing and Buell performance motorcycles) with the opportunities and threats in the global motorcycle market.

Lego is one of the most recognizable companies across the world. The Lego Group was founded in 1932 by Ole Kirk Kristiansen and has since been passed down from generation to generation, currently owned by Kjeld Kirk Kristiansen. The Lego Group has headquarters in Billund, Denmark and main offices in USA, UK, China, and Singapore. The Lego name originated from the abbreviation of two Danish words “leg godt” meaning “play well”. The present-day Lego brick was launched in 1958 with the interlocking principle which allowed for an infinite amount of building possibilities. Because of the Lego Groups mass size there also comes a very precise corporate structure. The Lego company is operated in a five-member Management Board. The Management Board consists of the Chief Executive Officer(CEO), Chief Marketing Officer(CMO), Chief Financial Officer(CFO), Chief Commercial Officer(CCO), and the Chief Operations Officer(COO)/Chief HR Officer(CHRO). From there it is further broken down into a 21-member Corporate Management and a board of directors. This corporate structure allows for individual departments to work successfully within the larger corporation. With the Lego Groups mission to “inspire and develop the builders of tomorrow” they have become one of the world’s largest manufactures of toys, valuing imagination, creativity, fun, learning, caring, and quality.

Environmental scans play a crucial role in the strategic planning process by helping organizations take a look at their competitive advantages and identify ways to sustain the advantages. Wheelen and Hunger (2010) describes environmental scanning as “the monitoring, evaluation, and dissemination of information from external and internal environments to key people within the corporation” (p. 10). Metrics or measuring tools are implemented in order to measure or track the progress of a strategic plan. Internal and external factors help an organization in the decision -making process of

The competition is another feature of the external environment which has influenced their strategy. Bigger companies entered the sector with advanced electronic games. Thus they needed to reconsider their traditional strategy which included their traditional brick. Even if they introduced a ‘Fitness’ programme to cut costs and restructure, the company just shortly made profit. External features like the rapid change of the environment, difficulties in financial control and logistics and longer lead times needed for running in new activities such as the new LEGOLAND parks were responsible for their fluctuating profit. Moreover the customers are an essential external feature. The customer needs changed from traditional to innovative which is reflected in the success of bigger companies with electronic games. It turned out that younger customers expect more of their toys then before and that the using time of traditional bricks decreased. For that reason LEGO came up with play themes which connected LEGO and movies to extend the life span of LEGO bricks – LEGO Star Wars was introduced. To satisfy the customers within the ‘new media’ age they created a new digital strategy where they developed an online multiplayer (LEGO Universe). Also the internal action of renaming LEGO DUPLO into LEGO EXPLORER affected the external factor customer who did not approve this change and that is why sales decreased. In addition retailers