Utilizing Swot Analysis in Corporate Strategy

Utilizing SWOT analysis in corporate strategy

-Take ZTE as subject investigated

Introduction

Competition is the inevitable result of the running market economy. As long as the market economy exists, the competition will never disappear. On the condition of market economy, every economic entity makes its full effort to contend for a limited number of resources. Competition becomes the mainline of the enterprise operation. In order to survive, companies must keep continuous self – innovation together with proper business strategy. But, in pace with the changing economic environment, only promptly adjust the strategy, can a company smoothly develop itself.  So, strategic decision making research is provided with significance practical and theoretical value.

In order to carry out properly strategic decision making research, some useful tools should be paid more attention, such as PEST analysis; Poter Five Force analysis; Vrio analysis and so forth. Coming back to this paper, SWOT analysis will be the leading role.

So, this essay will firstly discuss the definition and source of strategy and SWOT analysis methods. Following this, it will explain the role of SWOT analysis and the shortcoming as well. Finally, the most important part, how to use the SWOT method to analyze a real world company and raise useful suggestion about its strategy. In order to better reveal the useful analysis method, I choose a well-known corporation, ZTE as an example.

Strategic Definition

The word “strategy” comes from military terminology, which means plan and prepare for the war. Corporate strategy stands for making the company’s objective, together with planning how to develop in the changing economy environment. “Raising every significant problem in a war, to a higher level to resolve. It’s what the strategy should do.”Mao Zedong said.

Strategy considers company’s responsibility and function, as well as opportunity and threat. It also discusses comprehensive decision problem across several functional areas. Strategy tries to ignore the details, which means treats the company as a whole, in order to solve the overall development problems.

Michael Porter （2004）defined strategy as: Strategy means create a unique, valuable position, which refers to a round of different operation activities. Moreover, strategy creates adaptability among corporate operation activities. The essence of strategy management is to choose different operation activities with competitors.

Gary Hamel and C. K. Prahalad （1996）had raised the strategy definition as expanding and lever. Managers can make better leveraged use of resources, including five basic aspects, like: pooling of resources, accumulation of resources; resources supplement; resources storage and recovery of resources.