BSS058-6 Strategy and the Global Competitive Environment Assignment Sample
BSS058-6 Strategy and the Global Competitive Environment Assignment Sample
Slide 1: Introduction
- The logistics industry is one of the most crucial aspects of sustaining the world of business
- It entails activities such as procurement, distribution and more
- With time the aspects of the logistics industry are changing
It is safe to mention that without the logistics industry, the world economy and trading activities might come to a halt as the given business sector entails activities such as procurement of products and along with that distributing the same that enable the economy to sustain itself. However, with time the logistics industry is evolving to a great extent and more importantly, after the emergence of Industry 4.0 and technological advancements, a substantial number of operational activities that used to be conducted by humans are now being executed with the help of technology. On the other hand, another change that has also been noticed within the industry is the implementation of sustainable practices, meaning the majority of its activities are now being conducted by keeping the aspects of climate change and the deterioration of the environment in mind. Therefore, it might be stated that the changing face of the logistics industry is also changing the way businesses in the contemporary age conduct their business activities and therefore, the given presentation will attempt to highlight some of those.
Slide 2: Industry introduction
- The logistics industry includes entrepreneurial and trading activities among several parties
- The industry was worth 8.4 trillion euros in 2021 (Statista.com. 2023)
- It is expected to grow by 13.7 billion euros by 2027 (Statista.com. 2023)
It is evident from the above-mentioned information that the logistics industry is regarded as one of the most crucial parts of the world economy and trading activities and the significance of the business sector is further justified by the statistics that have been mentioned above. In that context, it might be stated that the Asia-Pacific logistics market is known to be the biggest market globally as the given logistic market alone is worth 3.9 trillion U.S dollars and the leading position has become reality as a result of the expansion of certain trading routes and the shift that has become prevalent concerning the industrial production to Asian countries (Statista.com. 2023). However, it also needs to be mentioned that the logistics industry was hit by the sudden outbreak of the pandemic and the global transportation system was extremely impacted as international trading activities plunged during the said year (Singh et al., 2021).
Slide 3: SWOT analysis
Strength
- It is one of the most important sectors globally
- Without the logistics industry trading activities will not take place (Christopher, 2018)
- The logistics industry is one of the most important economic drivers globally
- It gives employment to many people
Weaknesses
- It creates a substantial amount of pollution and generates waste
- It is not resilient against unprecedented threats completely
Opportunity
- There are certain opportunities to make it more sustainable
- By incorporating digital technology the logistics industry might be made more resilient to unprecedented threats
Threats
- It might be disrupted by natural calamities such as the Covid-19 pandemic
- It might make a substantial number of people unemployed
It has already been mentioned that the given industry is one of the main economic drivers and without the presence of the logistics industry everything will plummet since the logistics industry helps countries to export and import goods and not just countries, but also domestic transportation of goods is also dependent on it (Christopher, 2018). On the other hand, another strength of the said industry is that it gives employment to a substantial number of people and in that way it is also one of the biggest drivers of employment (Waters, 2021). However, despite being one of the most imperative business sectors the logistics industry is not without its vices. One of the main misconducts that are presented within the logistics industry is that it generates tons of waste and even though several attempts are being made to make the logistics industry completely sustainable, it has not been achieved completely. Therefore, it might be regarded as one of the main weaknesses of the given industry that needs to be addressed effectively for ensuring that these challenges are overcome.
On the other hand, another weakness that is prevalent within the logistics industry is that it is still not completely resilient against various threatening factors such as the Covid-19 pandemic that completely disrupted the logistics industry and led the global supply chain to be extremely negatively impacted (Kim, 2021). It is also perceived to be one of the most relevant threatening factors that the logistics industry also faces and that is also considered to be a threat to the entire industry. However, a significant number of opportunities have emerged that might be adopted by the entire logistics industry or the logistics companies to ensure that they are resilient against threats such as the Covid-19 pandemic in the future.
Slide 4: Porter’s 5 forces
Competition within industry
The competition prevalent within the logistics industry is extremely high (Niu et al., 2020)
Bargaining power of suppliers
The bargaining power of suppliers is relatively low since the logistics industry has a substantially extensive range of suppliers
Bargaining power of buyers
The bargaining power of buyers is also relatively low within the given industry
The competition within the industry is high since several companies are operating within a similar business sector and after the emergence of globalisation, it has increased even more. It is safe to say that after the emergence of globalisation trading activities among countries have become relatively more common and for that the competition within the logistics industry has also risen to a great measure (Niu et al., 2020). The power of suppliers is also low since the rising competition within the business sector and it is further justified by the fact that it is one of the trillion-dollar industries and without suppliers and buyers it might not have been possible. Similarly, the power of buyers within the logistics industry is also quite low as similar to an extensive network of suppliers the number of buyers is also a lot which allows the businesses to conduct business operations with many people.
Slide 5: Contd…
Threats of substitution
The threat of substitution is low as without the logistic industry the supply chains will be disrupted
Threats of new entrants
It is also low similar to the aspect of being substituted since the logistics industry is the most important determinant of trading activities
The threat of substitution is intense for the businesses that might not hold as much importance within a business landscape as in that context, the importance of the global logistics industry has already been established and therefore, it might be implied that it would be challenging to replace the entire system (Niu et al., 2020). However, the corporations that are operating within the logistics industry such as manufacturing companies might be substituted by another corporation due to the intense competition that is currently prevalent. Similarly, the threat of new entrants is high for the companies that are operating their business activities within the given industry.
Slide 6: Key trends
- Significantly more digital technologies are being incorporated within the given industry (Tijan et al., 2019)
- Several countries are attempting to include sustainable and green practices within the logistics industry
One of the fundamental trends that are being noticed within the logistic industry is that the number of tasks that used to be conducted by human have now decreased to a great measure and are now being carried out by several technologically innovative devices that further helps to make the logistic industry more flexible and its operations relatively more enhanced. Research has established that as a result of the various complexities and lack of transparency prevalent within contemporary supply chains, it has become one of the greatest interests of the stakeholders involved in the process to introduce blockchain technology to enhance the process of logistics in the supply chain and make it more sustainable (Tijan et al., 2019). Apart from that, it also needs to be mentioned that the integration of Artificial Intelligence or AI and Machine Learning makes it significantly easier to conduct demand forecasting and planning with significantly more accuracy and that also helps in making the logistic industry more flexible (Woschank et al., 2020).
On the other hand, making green transportation indicates using electric vehicles instead of traditional diesel and combustion engines to ensure that less pollution is created with them. Research has also mentioned that for the benefit of the global environment and to preserve the same, government bodies of several countries are trying to increase the sales of electric vehicles and especially, in the logistics industry in which transportation is a significantly big part (Bi and Tang, 2018).
Slide 7: Cone of plausibility
Pestle analysis
| Political | The political condition of the UK is somewhat chaotic at the moment |
| Economical | It is one of the main economic superpowers globally |
| Social | They have relatively less corruption and more literacy rate |
| Technological | Extremely advanced technologically |
| Legal | The country has strict legal laws |
| Environmental | The UK is attempting to become a net-zero country with the 25-year-old environmental plan |
The pestle analysis of the UK has been conducted to evaluate the external environment of the logistic industry of the nation. From the given evaluation it has been derived that the political condition of the UK is extremely chaotic, to say the least. It has been reported that the current prime minister of the country, Rishi Sunak is the third prime minister in 2 months (Bbc.com. 2023). On the other hand, due to Brexit, the exit of the UK from the European Union has also left a significant impact on the supply chain of the nation as it became difficult for several businesses to conduct cross-border business activities (Moradlou et al., 2021). Even though the UK is considered to be one of the economic superpowers globally, the unprecedented arrival of the pandemic has disrupted it to a great extent and now it is one of the ways of recovery (Alradhawi et al., 2020). The corruption rate in the UK is relatively low and for that, the nation has been ranked 18th out of 180 countries in the given index (Transparency.org.uk. 2023). Additionally, 99% of the people living in the country are literate (Worldpopulationreview.com. 2023). Apart from that, the legal structure of the country is also quite robust since the employment and labour laws restrict people below the age of 18 to work more than 40 hours a week (Gov. uk. 2023). Lastly, the country wants to be also one of the first nations that have zero carbon emissions and for that the UK has developed a plan which will allow the UK to become net-zero by 2030.
Slide 8: Contd…
Baseline
- The baseline scenario generates one of the worst-case scenarios through which the logistics or supply chain industry might suffer tremendously due to the pandemic
Plausible
- With time the curve of the pandemic will flatten and that will lead the logistics industry to get back to normalcy
Wildcard
- The government might have to stop trading activities completely which will be an extremely intense approach that might disrupt the business environment
According to research, the cone of plausibility might be utilised by individual analysts and also by groups and the same might also be implemented through the means of limited resources as these might be conducted within a single session and do not require resources beyond those that are already available at the beginning of the process (Dhami et al., 2022). Through the means of the above-mentioned possibilities, it might be implied that the logistic industry might run into some unprecedented impediments, however, there is a low possibility that all the trading activities will have to be prevented and the disruptions might also be managed successfully by adopting relevant strategies by the government.
Slide 9: Scenario
- Scenario 1(Sudden outbreak of an epidemic)- Unprecedented arrival of a pandemic such as Covid-19
- Scenario 2 (Recession)- Sudden recession all over the globe might reduce demand for goods and thereby, supply
- Scenario 3 (Digital Technology)- The implementation of digital technology might make it more flexible and sustainable
- Scenario 4 (Unprecedented war between countries)- Such acts of violence might also negatively impact the logistics industry (Ngoc et al., 2022)
These are some of the plausible scenarios that might take place concerning the logistics industry. For example, the sudden outbreak of a pandemic such as Covid-19 might disrupt the global value chain completely due to the shut-down of international borders and the same has already happened in recent years (Alam et al., 2021). Therefore, it might be implied that a similar scenario might also occur in the future and without the relevant measures it might also be proven as fatal as it has in recent years and diminish the global supply chain.
Apart from that, a sudden recession or inflation will also cause unemployment and the prices of goods will increase to a great extent which will subsequently reduce the demand for the goods among the general population and for that the logistics industry or supply chain might also be heavily impacted (Giovanni et al., 2022). On the other hand, with the emergence of technological innovation, Industry 4.0, which has already been discussed, will also leave a huge impact on the logistics industry. It might be taken as an example that the integration of blockchain technology will help in increasing transparency within the supply chains and that will make it more sustainable and flexible for trade and procurement-related activities.
Lastly, another scenario might also impact the logistics or supply chain industry if a sudden war breaks out between two countries. For instance, the war that became prevalent between Russia and Ukraine also made a significant impact on the logistics and supply chains globally and it is safe to mention that it is one of the highly unprecedented events that no one is capable of predicting. Research has established that economists are concerned that troubles within the logistics industry might impact global economic growth and the current tension present between Russia and Ukraine is felt extremely strongly in Germany specifically as the country is heavily reliant on Russia for energy supplies (Ngoc et al., 2022).
Slide 10: Conclusion
- It may be concluded that the logistics industry holds great importance
- However, it is subjected to many risks
- Relevant strategies might make it resilient
- The generated scenarios are quite plausible and might leave a significant impact on the same
Finally, it might be concluded that the logistics industry is one of the main business sectors that is a strong determinant of global economic growth and the slightest disruption in it might be extremely consequential for the world. However, it is still not as resilient as it is required to be since the recent pandemic has disrupted the global supply chain. Although, other possible scenarios might also impact the industry either positively or negatively and for that effective measures have to be adopted.
Slide 11: References
Alam, S.T., Ahmed, S., Ali, S.M., Sarker, S. and Kabir, G., 2021. Challenges to COVID-19 vaccine supply chain: Implications for sustainable development goals. International Journal of Production Economics, 239, p.108193.
Alradhawi, M., Shubber, N., Sheppard, J. and Ali, Y., 2020. Effects of the COVID-19 pandemic on mental well-being amongst individuals in society-A letter to the editor on “The socio-economic implications of the coronavirus and COVID-19 pandemic: A review”. International journal of surgery (London, England), 78, p.147.
Bbc.com. 2023. Three PMS in two months, is political chaos the UK’s New Normal?, BBC News. BBC. Available at: https://www.bbc.com/news/uk-63383616 (Accessed: February 15, 2023).
Bi, X. and Tang, W.K., 2018. Logistical planning for electric vehicles under time-dependent stochastic traffic. IEEE Transactions on Intelligent Transportation Systems, 20(10), pp.3771-3781.
Christopher, M., 2018. New directions in logistics. In Global logistics and distribution planning (pp. 27-38). Routledge.
Dhami, M.K., Wicke, L. and Önkal, D., 2022. Scenario generation and scenario quality using the cone of plausibility. Futures, 142, p.102995.
Di Giovanni, J., Kalemli-Özcan, Ṣ., Silva, A. and Yildirim, M.A., 2022. Global supply chain pressures, international trade, and inflation (No. w30240). National Bureau of Economic Research.
Gov.uk. 2023. Contracts of employment and working hours (no date) Contracts of employment and working hours – GOV.UK. Available at: https://www.gov.uk/browse/employing-people/contracts (Accessed: February 15, 2023).
Kim, K., 2021. Impacts of COVID-19 on transportation: Summary and synthesis of interdisciplinary research. Transportation research interdisciplinary perspectives, 9, p.100305.
Moradlou, H., Reefke, H., Skipworth, H. and Roscoe, S., 2021. Geopolitical disruptions and the manufacturing location decision in multinational company supply chains: a Delphi study on Brexit. International Journal of Operations & Production Management.
Ngoc, N.M., Viet, D.T., Tien, N.H., Hiep, P.M., Anh, N.T., Anh, L.D.H., Truong, N.T., Anh, N.S.T., Trung, L.Q. and Dung, V.T.P., 2022. Russia-Ukraine war and risks to global supply chains. International Journal of Mechanical Engineering, 7(6), pp.633-640.
Niu, B., Xie, F., Chen, L. and Xu, X., 2020. Join logistics sharing alliance or not? Incentive analysis of competing E-commerce firms with promised-delivery-time. International Journal of Production Economics, 224, p.107553.
Singh, S., Kumar, R., Panchal, R. and Tiwari, M.K., 2021. Impact of COVID-19 on logistics systems and disruptions in food supply chain. International journal of production research, 59(7), pp.1993-2008.
Statista.com. 2023. Topic: Logistics industry worldwide, Statista. Available at: https://www.statista.com/topics/5691/logistics-industry-worldwide/#dossier-chapter2 (Accessed: February 15, 2023).
Tijan, E., Aksentijević, S., Ivanić, K. and Jardas, M., 2019. Blockchain technology implementation in logistics. Sustainability, 11(4), p.1185.
Transparency.org.uk. 2023. Corruption and the UK (no date) Transparency International UK. Available at: https://www.transparency.org.uk/corruption-and-uk (Accessed: February 15, 2023).
Waters, D., 2021. Logistics An Introduction to supply chain management. Palgrave macmillan.
Worldpopulationreview.com. 2023. Literacy rate by country 2023. Available at: https://worldpopulationreview.com/country-rankings/literacy-rate-by-country (Accessed: February 15, 2023).
Woschank, M., Rauch, E. and Zsifkovits, H., 2020. A review of further directions for artificial intelligence, machine learning, and deep learning in smart logistics. Sustainability, 12(9), p.3760.
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