Component 2: Strategy analysis and proposal development

Critically assess the competitive advantage of Thermax Ltd as a result of their strategy using the tools taught during the term. Develop issues pertinent to Thermax Ltd in the light of the success factors developed in component

VRIO analysis

The competitive advantages of Thermax Ltd can be analysed by applying VRIO analysis, which supports to identify the competitive benefits achieved by the organisation through different resources. This framework is effective to concentrate on valuable, rare, imitable and organised resources that are present in the organisation and supports them to achieve the competitive benefits (Buzatu et.al 2019). Every resource related to the energy organisation mainly contains important position in the business growth by which sustainable and other competitive benefits can be achieved by the organisation.

With the support of above evaluation there are some of the resources related to Thermax Ltd has been analysed that plays important role to achieve the competitive benefits. Based on the analysis, brand awareness, digital strategy, alignment strategy, innovation, leadership approach and customer community are the important resources that are considered as the internal competencies for the organisation. These resources please different rule in the organisation based on the value and other elements (Hernández et.al. 2018). For instance, brand awareness is considered as the valuable and rare resources for Thermax as well as these are not considered as the imitable resource for the organisation. Brand awareness in the context of organised may be considered as the strategy to maintain the stable position in the market.

Sustainable competitive benefits can be achieved by the organisation through brand awareness resource in this competitive market. Apart from this, resources including leadership approach, customer community and digital strategies are analysed as most effective resources that are beneficial for achieving competitive benefits in the market. These resources are valuable as well as imitable for the organisation through which Thermax can maintain sustainable position in the market (Raut et.al. 2017). The competitive benefits are mainly associated with the different services and products delivered by them to the client customers. Under this context, Thermax is focused towards improving technological aspects by aligning the corporate strategy with the brand strategy so that latest technologies for energy production can be used.

Issues related to success factors

The success factors discussed in the previous section mean the covers economic factor, technological factor, social factor and environmental factors that influence the success criteria for energy production organisation. Thermax Ltd is dealing in energy production or renewable energy production sector due to which its success factors depend upon the external factors that are present in the competitive market. In addition to this, there are certain issues that are associated with the success factor development which influence the competitive benefits for the organisation (de Sousa Jabbour et.al. 2018). The changes in the external market including government regulation, economic prices, fluctuation in market, change preferences of the customers, lack of resources and poor implementation of technology.

These issues or challenges generate negative impact for the organisation when they decided to align the corporate strategy, which are the analysed success factors. It is also important for the organisation to identify strategies that can be adopted by them to reduce the issues and achieve the decided success criteria. Sometimes due to change government regulations and policies regarding energy production may influence the existing strategy for the organisation (Hernández et.al. 2018). The regular upgradation in the technology also influences their infrastructure development and other strategic planning for the organisation.

Prioritise the issue and develop strategic options that address at least three of them. Assess these options and create a strategic proposal including an explanation of the resultant the strategic direction of Thermax Ltd

The above evaluation has determined some of the issues that may affect the success sector development for the Thermax organisation. It is further important for the organisation to identify the strategies through which these issues can be mitigated and managed by the organisation. This section is related to identify at least three action plans for every issue so that its negative impact on the business growth can be avoided.

Changes in the government regulation

The first issue is related to certain changes in the government regulation due to which strategic planning of the organisation related to environment success sector may get affected. In this context, Thermax organisation can conduct regular market research and evaluation to identify the changes in the government regulations. The government regulations regarding environment protection and other pollution related policies might get change, which needs to be followed by energy production organisation (Liu et.al. 2019). In addition to this, Thermax organisation should appoint research and development team that helps them to regularly track the changes, which are initiated by the government.

Apart from this, they need to regularly modified strategies and try to align them with the government regulations so that legal obligations can be avoided. On the other side, the organisation should also lead strategic plan under which changes can be initiated by the organisation according to the changed regulations by the government through which infrastructure development and other growth for the organisation can be planned (Baumgartner and Rauter, 2017). These actions support the Thermax organisation to evaluate the uncertain changes in the government regulations due to market changes so that they can align the activities accordingly and try to monitor the changes, which may affect the success factor development for the organisation.

Poor technological implementation

Another issue is related to technological implementation date me influenced the infrastructure and team development of the organisation. The technology in the competitive market has been rapidly growing due to which it become a sensual for energy production organisation to regularly tractor updates and upgrades their technology accordingly (Axelson et.al. 2021). Sometimes, due to poor team management and internal competencies it become challenging for the organisation to adopt the technological changes which may negatively affect the growth of the business. This issue can we mitigate it by the organisation through appointing expertise that will monitor the changes in the technology.

The organisation can also conduct regular training and development sessions for its employees so that they can also try to adopt new technologies, which are relevant to achieve the digital strategy of the organisation. Based on the success factor development related to technology it is important for the organisation to improve digital elements of the business so that they can compete in the market (Stawicka, 2021). Apart from this, it is also important for the organisation to improve the digital strategy and its direction according to the technological changes through which they can align the activities accordingly. The technological changes and its issues can be improved by identifying the technology used by the competitors in the market. With the support of these actions and strategies the organisation can effectively adopt new changes in the technology and improve infrastructure development.

Lack of resources

Lack of resources and its planning is another issue that affect the economic and social success factor for the organisation. This issue may also affect the internal financial and other planning of the term X organisation. This issue can be mitigated and managed by the organisation by taking appropriate actions related to strategic planning. It is important for the organisation to regularly identify other resources that are present in the organisation and try to maintain the inventory record to track the resources (Urbaniec et.al. 2021). Apart from this, resource crisis can be mitigated by proper allocation of the resources among the team members so that misuse and other issues can be avoided. Thermax organisation can also use work breakdown structure to allocate the resources among the business activities through which proper resource planning can be initiated and used in the further project.

The above-analysed issue and its action plan needs to be applied by the Thermax organisation by creating appropriate proposal. This proposal mainly covers strategic planning, mission and vision evaluation, alignment of strategy, team communication and its implementation. This proposal to apply this strategy supports them to continue the achievement of success factors and try to achieve competitive benefits.

Consider whether any stakeholder group would be adversely affected by the proposal

Thermax organisation has internal and external stakeholders who may get affected by the strategy planning initiated by the organisation. In this context, it is analysed that mainly internal stakeholders including employees, the proposal may affect workers and other technical staff members. The technological changes planned by the organisation also need to be adopted by the employees and for which they need to upgrade their skills (Nataliia et.al. 2018). Some of the challenges maybe faced by the internal stakeholders while adapting to the technologies and that may adversely affect their performance and business productivity.

On the other side, the proposal may also affect community and investors who are considered as these external stakeholders. The government regulations and exchanges influence the strategic planning towards the energy production and that may influence the quality of product and services delivered by the organisation. This may affect the trust and commitment of client base towards the organisation. The poor performance of the Thermax organisation may also affect the investor and their planning for return on investment. The poor implementation of government regulations and their policies may also reduce the interest level of the stakeholders from the project, which is not effective for the competitive position and sustainability of the Thermax organisation.

Defend your proposal and preferred strategic direction by explaining why each stage of the analysis was needed in order to ensure your proposal is robust

Summary

The proposed strategic plan for Thermax organisation is mainly based on applying the above mentioned strategies to mitigate the issues in the success factor. With the support of this strategic direction it becomes easy for the organisation and its team to evaluate the strategies that can be used to plan and execute the proposal. Below is the detailed explanation of the proposal by including objective and other strategy planning for the proposal.

Objectives

The strategic objective of this proposal is to achieve the competitive benefit for the organisation. Apart from this, Thermax organisation is looking forward to maintain the business sustainability in the market and for this they need to create strategies that help them to achieve success factors (Rout et.al. 2018).In addition to this, the objective is to improve the productivity of business by around 10% in next six months by improving the strategic planning and business operations of the organisation.

Tactics and strategy

According to the application of Ansoff Matrix, The strategy development team of Thermax organisation can identify the appropriate strategy, which is effective to achieve the created objective of the organisation. This model supports to identify that market penetration; product development, market development and diversification are the options that can be selected by Thermax organisation. Among all the factors, it is analysed that market development is the appropriate strategy that can be applied by Thermax organisation (Luthra et.al. 2018). With the support of this strategy the organisation can deal in existing products but select new market to improve the customer base as well as market share in the competitive market. With the support of existing product they can enter in the new market and try to target new customer base through which business productivity as well as profitability can be increased.

Planning and designing of the plan

Apart from Analysing the strategy and Objective of the plan now it is important to create plan and design for the proposal. In this context, the organisation should plan resources and strategies to implement the plan. Further is important to identify the activities, risk, quality management, communication plan and other important directions to achieve the objective. Further, the team with the support of work breakdown structure and time scale can do design of the plan. This will also support them to manage the time and duration of the project so that it can be applied effectively (Park et.al. 2017).

Implementation and monitoring and controlling

This plan can be applied immediately so that objective within six months can be achieved. It is also important for the organisation to execute the plan so that further tracking of the process can be done. Monitoring and controlling of the plan is also required after implementing the plan. This monitoring supports to track the progress of the project as well as areas that need further improvement.

Conclusion

The above report has concluded that business strategy can be managed by the organisation after analysing the external factors. This report has analysed external factors, which influence the strategic planning of the Thermax organisation, which is currently dealing in energy production sector. With the support of above evaluation it has determined that success factor related to technology, social, economic and environmental development could be achieved by organisation by regularly monitoring the changes in the external market. This report has analysed that due to certain changes in government regulation, implementation of technology and resource planning may affect the success factor management but using appropriate strategies can mitigate it. Based on the provided strategic plan the organisation can overcome the issues and achieve the competitive benefits.

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