Strategic Analysis of WRSX Group
Phrase one. Analyzing the strategic position
In this stage, is analyzing the strategic position of WRSX Group.
By using the PESTEL framework we can analyse the many different factors in a firm’s macro environment. PESTEL analysis is a useful tool for understanding the “big picture” of the environment, in which you are operating, and the opportunities and threats that lie within it. By understanding the environment in which you operate (external to your company or department), you can take advantage of the opportunities and minimize the threats. (Ghemawat, 2008). The Five Force frameworks will response to the industry analysis. Five Forces is a framework for industry analysis and business strategy development. It is consisted of five key factors; entry barriers, buyer power, supplier power, substitute competitions and industry competitor. (Johnson and Scholes, 2009) The SWOT is useful when we are analyzing the internal environment of WRSX Group. It is a strategic planning method used to evaluate the Strengths, Weaknesses, Opportunities, and Threats. (Strengths: characteristics of the business or team that give it an advantage over others in the industry. Weaknesses: are characteristics that place the firm at a disadvantage relative to others. Opportunities: external chances to make greater sales or profits in the environment. Threats: external elements in the environment that could cause trouble for the business). (David, 1995)
For the current situation of whole industry of advertising, it is under high level competition. A considerable numbers of agencies live in this industry. The range of their scale is quite widely, it covers large international agencies to small local business firm even only two people involved. Meanwhile, lots of business opportunities in advertising. Under the whole world economic is increasing background, firms are comfortable to put budget on advertise part. Generally speaking, the advertising industry is trend to maturely and prosperously. However, lots of elements could be influence advertising industry. The industry trends to mature, then the problem come out, which is market shrink. New media develops. Due to the outstanding advantages of it, whole advertising industry has to move the core to new media filed.
Competitive advantages in advertising industry mainly deriving from creative & innovative capability, range and breadth of services or products. The creative & innovate capability is the most important for any agency in advertising industry due to it is the key thing to clarify differentiation of products or services what they are supply . At the same time, this is also a significant factor to attract clients.
The key stakeholders in the WRSX Group, expects a long – term global brand developments and achievements. In somewhere, conflicts may exist different stakeholder groups. (Johnson and Scholes, 2009, p.106 )
Currently performance of WRSX Group is relatively successful. However, some aspects should be enhanced. The attraction & Retention: WRSX Group scores highly on its market research capability and its understanding of market segments and channels, also scores highly in terms of its creativity and innovation, but not in USA. The breadth of services matches the industry average. The Leadership Capability: some offices perform well but others perform badly in terms of Management of Operations, Information Management and Administration. This is the reason for why its score of this below industry average. Management of Risk: the WRSX Group has performed well in management of Financial Risk, but it has dropped below average due to some acquisitions have not been perceived as financially astute. Corporate Social Responsibility (CSR): Previous analyses have shown high scores for WRSX Group in terms of its ethical stance and its social profile but lower for corporate governance. After the discussing processing in the presentation group, some of strategic issues are find out. The first one is relation to marketing. The revenue of WRSX Group in Asia Pacific has some problems due to the WRSX Group does not focus on the new media and digital media filed. It leads to lose attraction to clients. The second one is the financial problem. The WRSX Group get high level staff costs, while the revenue is not good enough to support this behavior. The third one is the management issue, including the corruption, the weak leadership capabilities and the bad procurement. The WRSX Group losing talent people in firms, which influence the creation and reputation. The awful acquisitions make WRSX Group losing financial supports to develop brand value. Broadly speaking, the WRSX Group has matched average score in advertising industry. Meanwhile, there are something above have to enhanced or revised, which aim to achieve the global brand development of WRSX Group.
Phrase Two. Making Strategic Choices