Introduction
Strategic planning is a critically important aspect of any company’s work. It helps to establish relevant and achievable goals and consider creating a pool of resources for attaining success. For this reason, organizations devote much effort to this activity. However, effective strategic planning demands relevant and up-to-date information about the current state of the firm, its position on the market, the current demand for particular products, and the work of competitors. Under these conditions, there is a critical need for analysis tools top managers can employ to investigate the current situation and make strategic decisions. Thus, SWOT, BCG, and IE Matrices can be viewed as such tools helping to acquire the needed data and create the basis for successful strategic planning. Recommendations generated after using these methods will help to enhance forecasting results and generate a competitive advantage.
SWOT, BCG, and IE Matrices
SWOT is one of the most common analytic means used by numerous companies. This type of analysis helps to identify the selected organization’s Strengths, Weaknesses, Opportunities, and Threats, which is vital for the internal analysis supported by the external data. Looking at the corporation’s resources and activities, a manager acquires the opportunity to create a complete image of its functioning (Podeswa, 2021). Moreover, SWOT helps analytics to determine weak positions, which is critical for strategic planning and setting goals to eliminate existing flaws and attain new levels of excellence (Podeswa, 2021). At the same time, consideration of Amazon’s threats and opportunities involves evaluating the market’s state and rivals’ work, which helps to better understand how to act in the future to become more effective and generate additional income. Amazon’s SWOT analysis shows that its current strengths-opportunity strategies imply launching cryptocurrency and using discounts to attract new clients. Additionally, it will help to address the pandemic’s results and create the basis for evolution.
The Boston Consulting Group’s product portfolio matrix (BCG matrix) is another effective tool available to managers. It is created to assist with strategic planning and considering opportunities for growth by analyzing products’ portfolios (Podeswa, 2021). The enhanced understanding of the demand for a particular Amazon product, its current state, and customer interest results in better decisions about investing and developing products or stopping their support (Podeswa, 2021). The four quadrants help visualize market growth and share and make informed decisions. For instance, for Amazon, the BCG matrix outlines the company’s stars or products with high market share in high-growth markets and reveals offerings with low market share, which offers opportunities for strategic planning and enhanced decision-making. North American and International markets are attractive for the company because of high income, meaning that strategic planning should focus on this direction. For this reason, by using this tool, it is possible to select a product that should be considered the primary offering and focus on its development.
Finally, the Internal External (IE) matrix is another potent strategic planning and management method. The tool is employed to analyze, evaluate, and critically examine a particular organization’s vital position and functioning (Safarova, 2021). As it comes from the name, it depends on the in-depth investigation of both internal and external factors affecting an organization and integrating them into one mode simplifying planning and access to acquired data (Safarova, 2021). For instance, for Amazon, using the IE matrix, the strengths, weaknesses, opportunities, and threats can be researched and rated regarding their weight and significance. It will help to plan future expansion and consider the choice of resources and methods that can be used to attain existing goals. The overall scores are similar, meaning that there are opportunities for employing internal and external factors during strategic planning. At the same time, the IE matrix allows for acquiring total external and internal factors scores for their comparison and enhanced strategic planning.
In such a way, the given three tools help to acquire the improved vision of the current Amazon position and offer several recommendations. First, Amazon can launch its own cryptocurrency, which is proven by the information from SWOT and IE analysis (Amazon, 2021). The company will benefit from a new project and acquire a stronger position in the sphere of technology (Flamand et al., 2020). It will also add value to the brand as such incentives are popular nowadays and attract clients. Second, From the BCG matrix, the company should continue focusing on the international markets as they demonstrate high growth rates and acquire the top priority for global companies. The IE analysis also demonstrates that both internal and external factors are positive, and Amazon can consider investing in new ventures to acquire multiple benefits and generate a competitive advantage.
Conclusion
Altogether, SWOT, BCG, and IE tools are practical methods to analyze the work of any company and improve strategic planning. These tools allow managers to analyze the firm’s work and make informed decisions about future actions. For Amazon, these matrices demonstrate that the company remains a strong competitor with numerous strengths. Thus, using information from these analyses, it is possible to recommend investing in cryptocurrency and entering new international markets as a way to support the further corporation’s evolution. It will help to promote the brand’s leading position and ensure it will acquire new resources vital for its future growth. Under these conditions, SWOT, BCG, and IE are vital for an organization’s strategic planning and goal setting.
References
Amazon. (2021). Form 10-K report.
Flamand, O., Wisher, A., & Shannon, R. (2020). Strategic plan: Amazon. Undergraduate.Theses, Professional Papers, and Capstone Artifacts, 309, 1-33.
Podeswa, H. (2021). The agile guide to business analysis and planning: From strategic plan to continuous value delivery. Addison-Wesley Professional.
Safarova, K. (2021). The strategy visioning workshop journal. Firmsconsulting.com.