STRATEGIC THINKING

Strategic Thinking and Effecting Change

[Name of Individual]

Strategic Thinking and Effecting Change

Introduction

Between the year 2007 and 2009, the business world underwent a financial crunch which affected the companies high and low. Ever since the global market went through recession, both the companies, private investors and their customers faced a financial loss. Despite the recession and the downfall, the only industry which was on a boom was the electronic market.

Bang & Olufsen (B&O) is a Danish audio/visual corporation, which was introduced in 1925 in Struer, Denmark. B&O has its business widespread all over the globe and focuses more on providing its customers with a combination of high-end technology, superiority, and Scandinavian design. In its tenure of 85 years, B&O had to face various trials and tribulations to launch itself in the market. But despite the challenges, the company also gained recognition by winning countless design awards. However, between 2007 and 2008, B&O had to face the challenge due to increased cost, competition, economic crunch, and poor management. B&O's management had to amend their sales level for the accounting year 2007/08 due to unsatisfactory sales number. This downfall also led to firing various employees, which produced a vulnerable image of the company in front of the B&O's investors (Brownsell, 2008, p. 1-24).

As the global recession started to come to an end, there was an improvement seen in the sales of B&O. Lately, B&O introduced a tactic to maintain their brand value and premium prices and bring themselves back in the global market. They attempted to refocus on their core products and address the problem areas to rise above their competitors. Therefore, this attracted the attention of investors to determine whether the current stock value of B&O is over or undervalued in contrast to its actual value (Pont, 2004, p. 1-6).

Products of B&O

B&O provides its customers with products such as television, surround systems, audio speakers and multimedia. In 2008, B&O was placed in the 4th number in the top 20 cool brands (Longhi, Kristensen, 2010, p. 669-671).

Discussion

Porter's five forces

When the strategic analysis of a company is done, the following peripheral factors should be evaluated, the overall environment, the competitors and the company itself.

Promotion of the environment and green production has a tendency to guide B&O towards success. In order to achieve this goal, B&O is making attempts to decrease the stand-by time, modification of packaging, and operating on Corporate Social Responsibility. The next step is to acquire the image of B&O in the eyes of the consumer as an environmentally responsible company. Moreover, it is also essential to contrast their price range with competitors such as, Samsung and Sony.

Source of image: http://pure.au.dk/portal/files/5503/Afhandling

Michael Porter introduced 5 basic forces on the basis of which a competitor industry was evaluated. Furthermore, the evaluation is done to determine the These 5 forces were the core factors which had a direct impact on the competition of a company; bargaining power of suppliers, bargaining power of buyers, threat of new entrants, threat of substitutes, and competitive ...