Running Head: SUSTAINABLE STRATEGIC MANAGEMENT (UNDER ARMOUR) 1

SUSTAINABLE STRATEGIC MANAGEMENT (UNDER ARMOUR) 9

Sustainable strategic management (Under Armour)

Name

Institution

Date

Sustainable strategic management

SWOT Analysis

Introduction

According to the previous New York Times business journal report on exchange rates, there has been an increase in cash flow in the market, which is characterized by the existence of large firms. However, it is also anticipated that in the long run, if such companies do not take precautionary measures through the execution of sustainable strategic plans, there will be a drop in the level of cash flow in the market which will affect the economy due to inflation. The inflation will come as a result of the high level of competition, ease of entry into the market, high bargaining power of suppliers, high bargaining power of consumers, and the existence of substitute products in the market. When such precautionary measures are not taken care of, there will be an automatic decline in prices. The decrease in prices will affect the day-to-day operations of the company because the company will not manage to produce high-quality products at a low cost. This may eventually lead to a collapse of the firm. Having that in mind, a research study is hereby conducted to address sustainable strategic management for Under Armour Company and recommend some of the necessary changes it should embrace.

According to Stead &Stead, 2014, sustainable strategic management is used in business to evaluate, formulate and execute plans on how the company will take the market by storm by increasing sales and solidifying the customer base. To have sustainable strategic management, the Under Armour Company should have a mission that will act as a guide to achieving the objectives. The strategic management will help the company to make decisions that will give a solution to stiff competition from companies like Nike and Adidas. Some of the strategies that should be addressed include a periodic assessment of the goal set. This can be done using data collection methods. The evaluation should also evaluate the company’s resources and liabilities.

The company’s council, which consists of senior leaders like the chief supply chain officer, material advancement, licensing, and legal teams, should lead the process. The strategies council has the role of determining the company’s core competencies, which is core for competitive strategies. Learning core competencies help the company to come up with the stages that will guide the company into attaining the desired outcome (Stead & Stead, 2014). First, the company is required to come up with a strategic plan that will meet most of the demands made by its customers. Under Armour should also get local and international acceptance to guarantee a good market for the products. In sustainable strategy management, the company is supposed to follow the right steps that lead to competitive advantages.

Stages followed in sustainable strategy management

Strategic Analysis

In this step, the leaders are supposed to use all the models that will give a reflection of the strength, weaknesses, opportunities, and threats. SWOT and PESTLE analysis can be instrumental in this case. The PESTLE analysis will help the company to deal with external factors that can positively or negatively affect the company by assisting the company to know its current positions and identify areas it needs to invest (Admin, 2019). Under Armour, will Company will be able to set a higher goal that is achievable within a specified period.

Strategy formulation

Strategy formulation is the second step in this process. Here, the team will come up with ideas that will propel the company towards meeting the objectives that will be set. In this stage, the company focuses on the strategic plans and the tactics that will be used to maximize the opportunities and curbing threats. This stage is also concerned with the strategies that will steer the company towards achieving the mission that was set during the initial step. The company is expected to come up with both long-term and short-term policies. It is in this stage the company reduces the gap that exists between the current financial position and the anticipated one (Stead & Stead, 2014).

Strategy implementation

Here, the company is expected to execute the plans that were initially formulated are put into action. This means that the team should have a workable follow-up plan that will ensure every policy is implemented. The systems can also review and updated depending on market changes and consumer preferences. The review by the council will accommodate changes that will give the company an advantage over the other companies dealing in athletic wear. Policies implementation is the essential responsibility that the management team has to do (Stead & Stead, 2014). Managerial and supervision are done in this stage too.

Strategy evaluation

Strategy evaluation is the final step in the sustainable strategy management process. In this stage, the management monitors the headway the execution of the policies. The assessment will ensure that the company’s day-to-day activities are in line with the objectives that were set initially (Stead & Stead, 2014). The evaluation will show if there are any deviations from the goals and help the company to get back on track if such a case occurs.

Recommendations

The company should invest more in e-commerce. If a company takes full advantage of this opportunity, it will be able to raise more revenue and attract more customers. Ecommerce will enable the company to interact with customers who have different tastes and opinions about the commodities. The strategies’ core competencies should help the company to spot the gaps, be more accessible, reach a more comprehensive, and enter new markets (Salgado, 2017). The company has the opportunity to maximize sales of products all over the world through the internet. Ecommerce has been one of the latest trends where a client can check out the products they wish to buy and can get in contact with the sales department for inquiries. After that, the customer uses an online payment method to complete the transactions, and then goods are delivered at the appropriate time. The company can use this idea to increase more sales and attract more customers from different parts of the world.

Porter’s Five Forces Model

This is one of the models used to analyze the competitive strengths of the organization. The analysis helps the company to deal with threats that are posed by companies that are entering the market. The strategies will cover risks like the introduction of new products and the prices of commodities. Substitute products can be a challenge to Under Armour. Porter’s five models will help the company to deal with substitute products and services while maintaining a customer base (Omsa, Abdullah & Jamali, 2017). The model will also determine the bargaining power of the buyer. Under Armour will be able to prioritize the bargaining power depending on the number of purchases they make. Larger companies might have more considerable bargaining power compared to retailers. The model also aids the company in knowing the bargaining power of suppliers depending on the uniqueness, quality, and price. Porter’s five forces model will guarantee that the company offers similar products that cannot be imitated by rivals (Brett, 2018). This will help the company maintain its brand and serve loyal customers.

Lewin’s democratic leadership style

The leadership theory will help the company to get fresh ideas as all stakeholders are involved in the decision-making process. This style will also increase the satisfaction rate of customers as commodities will be crafted creatively. The laissez-faire style of leadership also allows the employees to raise their concerns, making them more comfortable with their workplace (Fiaz & Saqib, 2017).

Cost leadership

Cost leadership strategies will ensure that the company minimizes the cost of production, and prices are kept lower compared to other companies dealing in the same line of commodities. Under Armour has attained cost leadership, and this can help the company to control costs and compete effectively. Under Armour has a steady flow of raw materials, so it needs cost leadership to reduce wastage and maximize its opportunities (Brett, 2018). This helps the company to ensure that customers are satisfied, and prices are within the ceiling and the floor. It becomes more comfortable for the company to change the designs because there are a lot of materials and technological advancements that can accommodate the changes and costs are low.

Access new markets

Under Armour should enter new markets too. The Chief Executive Officer should have a clear strategic vision to guide the team on how to access the international markets. The company has been dominant in the U.S but has been able to sell more commodities across the world. This has been attained through technological advancements, brand recognition, and a good distribution network. In the past, Under Armour increased the sales margin by 57% by 2017 (Salgado, 2017). However, the company should expand the scope of its operations worldwide.

Technological Advancements

Over the years, Under Armour has come up with better designs, shoes, and other merchandise. This has been done through advanced technology that the company has adopted (Admin, 2019). This maintains the flexibility as demand increases and taste and preference of the customers’ change. Under Armour can use this opportunity to come up with creative inventions that will be more appealing to the customers and ensure the broader market is reached. The old designs can be improved to cope with the competition.

For Under Armour to achieve sustainable strategic management, the council should have meetings from time to time to ensure that desired results are achieved the team guarantees that the company improves over time and meet the goals that were set. The team should also advise the management on how Under Armour should deal with competition in the coming years. The council should evaluate and suggest strategies like early entry into the market or fundamentally becoming a late mover so as the company reduces mistakes and unnecessary costs (Salgado, 2017).

Capitalize on low inflation rates and subsidies

Under Armour Company should also make the best use of low inflation rate subsidies by the government. Since the company enjoys inflation rates that will be experienced for the next two years, it is expected to produce more and market its commodities. This will help the company to earn more revenue as the cost of production will be low, and customer and customers’ needs can be met (Salgado, 2017). Under Armour is also one of the companies that delight in subsidies since it deals with environmentally friendly commodities.

Triple bottom line

The company focuses on the triple bottom line by observing environmental and social distresses. Tipple bottom line ensures that the Under Armour compile with the government policies and the terms produced are acceptable by the public (Stead & Stead, 2014). Ways in which Under Armour Company utilizes the concept of the triple bottom line is by ensuring safe products that meet the government standards. The company produces environmentally friendly products, which gives it the potential to grow bigger.

Conclusion

In conclusion, sustainable strategy management will play fundamental roles in establishing ways that will help the company to compete effectively. Therefore, Under Armour is required to observe the core competencies to increase the sales margin and win over the customers. The company has more strengths and opportunities that it can capitalize on. The chances that are in Under Armour’s disposals should be used to beat the threats and weaknesses posed to the business. The company should also have a long term strategic plan that will guarantee more success in the coming years. A proper leadership style should also be adopted to warrant the smooth running of operation and quality products.

References

Admin-J.-L.M.W. (2019, December). The History of Under Armour and their Logo. Retrieved from http://blog.logomyway.com/history-under-armour-logo/

Brett, M. R. (2018). Cost Leadership or Differentiation? Applying Porter’s Competitive Strategies in Ecotourism: A Case Study of Mkhuze Game Reserve.

Fiaz, M., Su, Q., & Saqib, A. (2017). Leadership styles and employees’ motivation: Perspective from an emerging economy. The Journal of Developing Areas, 51(4), 143-156.

Omsa, S., Abdullah, I. H., & Jamali, H. (2017). Five Competitive Forces Model and the Implementation of Porter’s Generic Strategies to Gain Firm Performances.

Salgado, O. S. L. (2017). SWOT analysis of the competitive intelligence in small enterprises in the clothing industry.

Stead, J. G., & Stead, W. E. (2014). Sustainable strategic management. Routledge.