Levis Strauss Case Study Analysis

IntroductionCompanies l send away oneself various strategy models to crumple their current status and formulate strategies for future directions they ought to take (Johnson et al., 2014). With the high take of dynamism than characterises the present-day agate line environment, companies need to be awargon of their inhering capabilities, and use them to deal with the external threats and opportunities. Among the models that can aid in this gatekeepers generic strategies, the PESTEL and prep ar frameworks and porters five forces (Zott, Amit and Massa, 2011). This com range presents an analytic thinking of a fiber study or so Levis Strauss three doormans generic strategies, and further determines the orders strategic position using SWOT analysis. mystifys2.1. Porters Generic strategies (From the case study) Narrow Market ScopeSegmentation strategy1.Older disaffected shoppers fans who love us provided quite frankly left us2.The baffled generation fans who dont reall( a)y hit the sack who we beBroad Market ScopeDifferentiation strategy1. Classic pieces of clothing such(prenominal) as button fly and trucker jacket that are the line of reasoning for the giant business organization of denim2. Return the sword to its roots succession moving forward3. Innovation- Levi Strauss is using high-tech by involving a team up of 30 people on its Eureka lab to work on 30 prototypes a week. The company encourages the conversion of ideas into design in slight than 24 hoursCost leadership1. Reduction of inflated cost structure by the new Levi CEO2. Progressive growth in sales volumes for straight years. Uniqueness CompetencyLow Cost Competency2.2. SWOT Analysis (From the case study) Strengths1. Popular and reinforced brand prepare2. Expertise and hump in the denim industry3. Focus on things other than profits- captioned profits through principles for examples, donations and scholarships4. Levi Strauss company has a visionary CEO in Chip Bergh Weaknes ses1. The company focuses too oftentimes on brand protection2. Limited business growth overdue to increase in competition from other denim companies3. Com bulge outncy in coming up with innovative designs for customers4. Delays in trends such as dusky jeans for women and more tailored jeans for men5. With 16200 employees, the company incurs high expenses in stipendiary wages. Opportunities1. The casual wear merchandise is growing fast2. Internationalisation into emerge trades characterised by low cost manufacturing and production3. High tech re-invention that is the use of technology to create a tech-advanced womens denim that fit depending on body shape.Threats1. Fast changing consumer tastes2. Increasing Competition from low end substitutes such as Lee and Wrangler because lower market share4. Very close competition for market share with rivals targeting the uniform high-end customer base Discussion3.1. Porter Generic strategiesMichael Porter suggests 3 abundant generi c strategies that can be used by a company to outperform its competitors (Porter, 2008). These are segmentation, differentiation and cost leadership strategies. From the analysis of Levi Strauss case, the strategies from Porters generic model are clearly exhibited. Cost leadership, match to the model, refers to a strategy where a company sets its prices below that of its rivals and is independent of the market structure. From the analysis, this strategy was implemented on entry of Chip Bergh the companys new CEO cut the cost and pricing structure that was antecedently inflated as it targeted high-end customers. The adopted prices might not be low in the industry, but is close to that of the companys key rivals, which withal slays Levi products to attract new price-sensitive customers and those that were lost to other cheaper brands. The differentiation strategy is excessively evident at Levi Strauss. Companies use different approaches to differentiate themselves from their comp etitors. These include initiation of unique designs, adoption of new technologies and making changes their brand images (Zott, Amit and Massa, 2011). Levis has used all these strategies to achieve uniqueness in the denim industry. The company capitalises on the particular designs that will attract consumers and win their loyalty, including those that had shifted to other less costly brands.In regard to the segmentation strategy, the company strives to meet the needs and specification of a given target market for instance type of product, location of sales or the category of customers it targets. In relation to Levis, the customer segments it targets are the previous(a) disaffected shoppers who genuinely left the company for alternatives that suited them better and the lost generation customers, who know nothing about it. By defining its customer segments, the company is able to design products and services that are tailored towards matching the needs and preferences of these gro ups. as argued by Porter (2008), a company that fails to stop any strategy in regards to the three broad categories defined by Porter is considered as being stuck in the middle because it will sport no competitive vantage in the market.3.2. SWOT AnalysisSWOT analysis is a strategic tool that is used to subjectively assess information about a company or organisation outlining its strengths, weaknesses, opportunities and threats (Ommani, 2011). Whilst strengths and weaknesses are internal elements of an organisation, opportunities and threats are external elements that the company has no control of. From the analysis present in section 2.2, Levi Strauss draws one of its strengths from the fact that it has a big brand name in the denim industry with a lot of expertise and experience drawn from the fact that it is the oldest denim company. In addition to this, the company know to focus more on things related to the smooth flow of business than only on profits and it has a fast growth of retail shops. These strengths have enabled the company to survive the competition it has faced from companies like Zara and H&M.The major weakness that was noted about Levi Strauss is the complacency of the companys design team in coming up with unique products. such(prenominal) weaknesses make the company prone to competition from rivals that are committed towards providing the go around designs and are flexible enough to match the changing market trends. As stated by the companys CEO in the case, At Levi, designers sit in the companys archives and look at old Western shirts and jeansWe have one of the greatest brands in the world, but I think that there may have been periods where we thought the brand itself could carry us through thick and thin, there is no apparent movement that we got complacent.The opportunities that have been identified in the SWOT analysis higher up give the company a prospect for better performance in future, especially if it puts its strengths to ben eficial use. These opportunities include the increase in market collect for casual wear, opportunities to expand trading operations into new markets, and the technological developments taking place in the fashion industry, which can greatly increase production and marketing efficiency of the company. In regard to the probable increase in take away of casual apparel, the company needs to device strategies that will motivate its employees cancel complacency and embark on designing competitive products. Failure to do so will make the company to lose these potential clients to rivals because these opportunities are for all companies in this industry (Grant, 2013). The main threat, as highlighted in the case study, is the rivalry that exists in the industry. This has to be overcome by application of the strategies that were rather discussed in Porters generic strategy model. This will make the company a formidable competitor in the industry. Conclusion and Recommendations From the analysis above by the use of Porters generic strategies and SWOT analysis it has been identified that whilst the company may have some weaknesses, it withal possesses several capabilities if well utilised, will strengthen its brand position in the denim apparel industry. Several recommendation can however be made for Levi Strauss. One of these would be that the company should focus on the frequently changing needs of consumers in the denim market and secure that its operations and designs are flexible enough to match with these changing trends. Taking advantage of technological milestones in the fashion industry also recommended. This will ensure the production of unique yet trendy designs. From the Ansoff matrix below, the strategic directions that a company can use to position itself in the market are presented (Taylor, 2012).Two of the four strategic directions suggested by this model have already been adopted by Levi Company, that is, selling existing products to existing mar kets and extending existing products in new markets. It can however recommended that the company should adopt one of the 2 remaining factors of this model, which is the diversification through creation of more designs of products that suit a wider demographic scope of customers. This will lead to larger consumer base hence higher revenue.ReferencesCunningham, J., & Harney, B?. (2012) Strategy and Strategists. Oxford Oxford University Press.Grant, R. M. (2013) Contemporary Strategy Analysis. impudent island of Jersey Wiley.Johnson, G., Whittington, R., Angwin, D., Regnr, P., & Scholes, K. (2014). Exploring Strategy Text Only. UK Pearson Education, Limited.Ommani, A. R. (2011) Strengths, weaknesses, opportunities and threats (SWOT) analysis for farming system businesses management pillowcase of wheat farmers of Shadervan District, Shoushtar Township, Iran. African Journal of Business Management. 5(22). p.9448-9454.Porter, M. (2008) war-ridden Strategy Techniques for Analysing Indu stries and Competitors. New York Simon and Schuster.Tanwar, R. (2013) Porters Generic Competitive Strategies. Journal of Business and Management. 15(1). p.11-17.Taylor, E. C. (2012) Competitive Improvement Planning Using Ansoffs Matrix with Abells Model to Inform the Strategic Management Process. Academy of Strategic Management 10(1). p.21-25.Zott, C., Amit, R., & Massa, L. (2011) The business model recent developments and future research. Journal of management 37(4). p.1019-1042.