Financial and Strategic SWOT Analysis: MNC Versus SME

When a certain point is reached regarding a company’s success, a set of different opportunities arise and partnerships may unfold. However, with every possible strategy available, risks and benefits also come into play; without discarding any of them beforehand, every option is a strong candidate until a final decision is made. In this case study we will analyze the current business strategy pertaining

Globally, the U. S. steel industry is one of the largest as measured both by production as well as consumption. In 2010, the U.S. was third in global crude steel production with almost 6 percent share (Market Research.com, 2011).

Small and Medium Enterprises (SMEs) as defined by the US business Act of 1953 refer to business enterprises that is independently owned and operated and that isn’t dominant in its operation. One with fewer than five hundred employees. According to Bank of Ghana (2006) under the Funds for Small and Medium Enterprises Development defined small and micro enterprises as firms with assets (excluding land) of between 25million Ghana cedis and 5million Ghana cedis. A lot has been said and written about SMEs the world over. It has also formed the subject of discussions in so many seminars and workshops both locally and internationally. In the same vain, governments at various levels (local, state

This academic paper will be exploring the key term, joint ventures. This concept is of interest because in today’s business environment due to the economy downfall, many organizations recourse to this strategy in order to easily infiltrate in a foreign market. Companies are seeking more opportunities to expand their market share and a joint venture is an attractive option to do so. Getting involved with a foreign market come with several obstacles and challenges. It is for the same reason that organizations engage in a joint venture whit a partner that knows and understand the culture and preferences of that specific nation.

This article dwells upon the post recession (of 2008) changing global business environment for the companies of developed countries. The author here predicts that the next decade will be characterised by weak global growth, high unemployment, costlier capital, stricter regulations and taxation and even increased protectionism. The author however has revealed the huge potential in the emerging markets (namely China and India) by stating the World Banks projection saying that the two countries will account for the 50% of global GDP by 2050. So, this article has tried to explain how a change in the strategic approach of the multinational companies (MNC) can help them benefit from these opportunities.

SWOT stands for strengths, weaknesses, opportunities, and threats (Ferrell and Hartline, 2014, p. 39). A SWOT analysis evaluates both the internal factors (strengths and weaknesses) and external factors (opportunities and threats) that create advantages and disadvantages to a company when serving its customers (p. 39). A SWOT analysis is extremely beneficial in helping a company determine areas of improvement (p. 39). Internal factors examine the actual company being analyzed while external factors examine the external market (customers and competition) (p. 85).

SWOT analysis has been identified as a defective tool used in the strategic planning due to its unsystematic and its non-quantitative nature that which does not have a predictive power. The Meta-SWOT has been introduced as an alternative because it does not consider market as one of the major determinants of the environment, but gives an opportunity in the resources and the potential in establishing the competitive advantage. The Meta-SWOT is crucial in making various decisions and how they can be utilized in future. The resources and capabilities are usually utilized based on the VRO method, they are categorized based on rarity, inability to imitate, and the company. The criteria used to analyze the market are ensured that it matches the

The first extremely important aspect for MNCs to consider is the legal and political differences the organization will encounter when expanding into new and unfamiliar territories. Obviously any organization successful enough to expand into an MNC should have the resources and foresight to understand the importance of performing their due diligence in these areas. The ability to be

Five Forces Model (p. 64) – Michael Porter identified five key competitive forces that determine an industry’s weaknesses and strengths and those managers need to consider

In this era of world, it is necessary to be updated about all perspectives to run an organization. Organization can do different analysis such as PESTLE, Porter five forces, Value chain; to know the market demand and essentially of the products. On the other hand, Organization should have their strategies and knowledge about the market. Strategic management is the process to get different terms of planning, monitoring, analysing and assessments which are necessary to operate an organization. In the other word, it can be defined as the continue process of making decision and actions by which organization can match or fit with different environments for the most effective way to work Strategic management can be taking when one wants to make wise decisions for betterment of organization. Strategic management also give ideas about corporate governance, core competencies and helps to setting up goals. There are many tools available for the strategic management such as, PESTEL, Porter’s five forces and Value chain analysis. To sum up, it can be say that strategic management gives ideas to make different decisions which helps organization to be a best or to survive in this competitive environment. So, to know about an organization, first it is good to understand its strategies which can be implemented by using different theories and practices of strategic management. Here, applications of the strategic management theories can be understand by the example of Cochlear

influenced them to invest in the USA. This globalization and localization pressure communally create strategic path for MNCs in terms of their relationship with SMEs as shown below

Generally, MNEs have operations all over the world but sometimes there is a specific focus on some geographic areas due to growth opportunities, production costs or the convenience of locations. This global presence requires constant innovation in order to maintain a local competitive advantage, at the same time, some partnerships are established with small medium enterprises SMEs that help the companies to compete in niche markets but most importantly, to understand better the market, its needs, and the business culture around it.

Various steps need to be taken so that this project can achieve any results. The first step to be taken is to research what an SME is and what an SME network entails.

In Williams paper “Resources and Failures of SMEs: Another Look,” he studied the possible reasons for failure by analyzing failed companies. This was a unique approach to that of previous research that looked at failure from successful firm’s point of view, where he hypothesized several possible areas of concern (networks, location, age and size). He determined that spending too much time on developing and maintaining networks (formal and informal) led to a negative return on investment (ROI). As well, firm size, measured by export sales, growth, profitability and internationalization, concluded that large firms are less likely to exit the market. They have the ability to achieve economies of scale (competitive advantage) because they have the ability to absorb fixed costs. Although, there is research to support the fact that

When entering new markets, multinational corporations (MNCs) often form strategic alliances with local companies. An alliance is where two or more organisations integrate to form a strategic, business relationship (Finlay, 2000). The potential benefits of such alliances include access to knowledge and resources, building a global network, market access, recognition and access to a distribution network which can all provide MNCs with a competitive advantage in a foreign market. However, MNCs also face many challenges when forming alliances in other countries including loss of intellectual property, different expectations, various challenges of globalisation (e.g. more stringent regulations being imposed on foreign firms), ethical and cultural considerations and change management. This essay will focus on two of these challenges in depth - change management and cultural adaptation. However within these sections, certain other topics will also be considered including leadership, innovation and diversity and globalisation. This essay will critically discuss and analyse these challenges drawing on real world examples, academic theory and additional research. It will also highlight and consider potential solutions to these challenges.