Leadership in Business 1

Running Head: Leadership in Business

Leadership in Business
 Leadership in Business 2

Introduction
The report is developed with an aim to analyze the use different strategic tools and model which
can be used in the decision-making of the organization. The report is based on an organization
named as Pohutu Wine Ltd which is primarily engaged in the business of winery and produces
wines of high quality. The company distributes wines through specialist stores, up-market hotels,
and superior restaurant. 80% of the revenue of the company comes from the sales of wine and
rest of the revenue is received from its restaurant business and wedding and events business with
12% and 8% contribution respectively. The internal issues of the company include the limited
sales of the wines in only three main centers namely Wellington, Auckland, and Christchurch.
Also, the restaurant business is running only at a capacity of 45% which is less as other
restaurants of same style are running at a capacity of 60%. The external issues of the company
include no international marketing due to which the potential of other markets are often unseen.
Also, the numbers of visitors are expected to increase in the near future so the company is
required to expand its capacity to cater their needs for the wines.
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Table of Contents
Introduction......................................................................................................................................2
Section 1: Strategic management tools............................................................................................4
a) Relevance of particular tool in context of the organization.....................................................4
b) Use of strategic management tools by Pohutu in making better decisions..............................5
c) Section 2: Decision making approach......................................................................................7
Section 3: Core values.....................................................................................................................7
Section 4: Mintzberg’s model..........................................................................................................9
Conclusion.....................................................................................................................................11
References......................................................................................................................................12
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Section 1: Strategic management tools

a) Relevance of particular tool in context of the organization
SWOT analysis
SWOT analysis a significant tool to determine the inside out of an organization. It is an
abbreviation of the strengths, weaknesses, opportunities, and threats. The strength and
weaknesses evaluates the internal aspects of the organization while the opportunities and threats
evaluate the external aspects of the organization. The tool is relevant for the organization as it
enables the company to examine both negative as well as positive attributes in just a single
analysis and determine the best way to gain competitive edge in the market. The strength of this
tool lies in mitigating the chances of the failure as it enables the organization to understand the
aspects in which it lacks and thereby eliminate the hazards that could be dangerous to the
company. The other strength is that it keeps a watch on the overall environment of the business
and exploit as well as recognize new opportunities speedily in comparison to the competitors.
The weaknesses of SWOT analysis include being impossibly subjective in the absence of right
information and the overload of information might lead to poor decision making and impact the
results negatively [ CITATION Min196 \l 1033 ].
PEST analysis
PEST analysis is a significant tool to determine the external factors of the organization and it
impacts on the organization in positive or negative manner. The external factors determined in
the PEST analysis include political, economical, social, and technological factors. The tool is
relevant for the organization as it enables the company to identify the significant changes in the
economical, political, technological, and social landscape and analyze the impact of these
landscapes on the business in future. With the critical analysis of these four aspects the
organization can develop a better understanding of whether its next move in the business is
idiotic or strategic. The strengths of the PEST analysis is that it facilitates the understanding of
the business environment widely and encourages strategic thinking by enabling the organization
to anticipate the external factors of the business and take actions for minimizing their impact.
The weaknesses of PEST analysis include regular analysis of the PEST factors otherwise it will
not be effective. This is because the external factors are dynamic and keeps on changing at faster
pace. Also, the information is easily available and when too much information is piles up then it
leads to too many assumptions which could be disaster to the company [ CITATION Bri193 \l 1033 ].
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Porter’s five forces

It is a model of business analysis which helps in understanding the competitive forces which are
potentially impacting the industry. The five force model is used in measuring the intensity of the
competition and attractiveness as well as profitability of the market or the industry. The model is
relevant in determining the probable potential of the industry in terms of profitability by
determining the five major forces impacting the industry. The strength of this model is that it
provides meaningful information related to suppliers, buyers, new entrants, and threats from new
entrants as well as substitute products. The weakness of the model is that the market structures
are never static and it keeps on changing thus the model only provides a snapshot of the business
environment [ CITATION Fre191 \l 1033 ].
b) Use of strategic management tools by Pohutu in making better decisions
SWOT analysis
When it comes to decision making, SWOT analysis can be a significant tool as it provides an
overall picture of the strengths, weaknesses, opportunities, and threats of the organization. With
this tool, Pohutu can analyze its strengths and realize how it distinguishes the organization from
other industry competitors. For instance, the company is known for its high quality wine and
therefore company can consider it as its strength and make better decisions in access other
sources which could help in maintaining the quality and improving it further. The tool is also
significant in identifying the weaknesses of the company and developing the strategies to
overcome the weaknesses. For instance, the restaurant business of Pohutu Winery Ltd is running
at occupancy lesser than the other restaurant. This is internal to the organization and Pohutu can
develop marketing strategy in order to increase its business. The potential opportunities for the
organization can also be determined with the use of SWOT analysis by Pohutu. The
opportunities can be matched with the strengths of the organization in order to make better
decisions. For instance, it is observed that the numbers of tourists will be increasing in the
coming time and therefore Pohutu can use its strengths in particular direction to attract the
tourists by providing them with high quality wines. Also, the company can plan to grow its
market in other countries SWOT analysis can be used by Pohutu Wines to identify potential
threats and develop strategies to counteract them. For instance, the company can face threat from
other companies which are offering substitutes of wine such as brewery. Therefore, the company
can decide to make changes in the organizational structure and plan to engage in development of
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new products which could compete with the substitute products. Thus, it can be said that SWOT
analysis is an effective tool in making better decisions by analyzing its strengths and using it to
seize opportunities and overcome the threats by working on the weaknesses [ CITATION Ref20 \l
1033 ].
PEST analysis
While making important decision, PEST analysis can be used as a significant tool in the business
plan as it helps in identifying the significant changes in technical, social, economical, and
political landscape. The business of Pohutu is impacted with these landscapes and with pest
analysis the organization can develop a deeper understanding of these landscapes and determine
if the next move could be useful for the organization. For instance, the political factor is
concerned with the rules and regulations of the sales of liquor in particular regions. So if the
company plans to expand its business in other country then it has to consider the laws of the
nation as the sale could be prohibited. In the similar manner, the technology is being continually
advancing and more apps and products are being developed for streamlining the decisions in
business. Pohutu can introduce artificial intelligence in their system to deal with customer
queries. Advancing the technology can also open new opportunities of business for Pohutu.
Porter’s five forces
Porter’s five forces model is a significant tool which can help Pohutu in making better decisions
as it analyzes the level of competition in the industry. If the organization knows the competitive
level of the industry then it can plan strategies in accordance with it and stay ahead of the
competition. For instance, the threat of new entrants in the Winery industry is low as it requires
high investment cost for its establishment. Moreover, the license can also not be obtained easily.
Even if Pohutu experience any threats from the new entrants then it can makes decisions on the
basis of experience for cutting costs and increasing levels of service. Likewise, the bargaining
power of the suppliers is high because the supply of quality grapes for making wines is limited.
Knowing this fact, the company makes decision for choosing international offerings which will
add value to the organization [ CITATION Res97 \l 1033 ]. The bargaining power of buyers is high
as there are ample numbers of customers who buy wine. Therefore, the organization can plan
strategies in terms of marketing and pricing in order to remain competitive in the market. Thus,
porter’s five forces analysis can be used effectively in making decisions on the basis of analysis
of the market competitiveness.
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c) Section 2: Decision making approach

Competition is high in the winery industry of New Zealand as there are many brands selling high
quality wines to the customers. Taking high competition into consideration, the mangers of
Pohutu Wines Ltd are making decisions constantly to choose between strategic alternatives so
that a competitive edge can be developed and high returns can be earned. Although Pohutu is
producing quality wines but the industry is mature and traditional due to which the quality of
product alone cannot be used for achieving competitive edge. The wine industry has certain
characteristic which include low degree of asymmetric or private information as well as low
resources with limited substitutability of strategy [ CITATION Sci15 \l 1033 ]. Thus, Pohutu can use
de-centralized approach in decision-making so that opinions of team members and outside
experts can be used. This will be beneficial for the company as the team mates and experts will
come with innovative ideas and opinions which will be helpful in making the business more
competitive. With the use decentralized decision making, the responsibility of making decision
will be delegated and the burden on top management will be eased. In addition to this, it will
facilitate diversification and provides opportunities to executive level employees in the decision
making. Due to limited resources, the involvement of staff members in the decision making can
be used as an effective tool to promote business by using the distinct ideas from the employees
[ CITATION Sma195 \l 1033 ] . Taking advice from the experts is also significant for the organization
to gain competitive edge as they may suggest ideas which will be beneficial for the organization.
Section 3: Core values
core values of our company is doing exceptional and excellent work in our domain. Inculcating a
habit of doing work with honesty, integrity and responsibility, it affects the social sphere where
we live. Business practice should be done in harmonious way in which profit making can be
amalgamated with the social responsibilities. There should be coherence of business strategies
with land of Mori people. Land used for business purpose should be taken care of like a guardian
and it should be preserved for future generations. These core values are beneficial in short term
and long term in a way that it gives a clear distinction about their working and customer
satisfaction. In short term we have to prioritize our problems first and problem in our scenario is
related to the usage of land and Maori people connection to land. We have clearly defined in our
core values that we will use land as our child and take care of it is our utmost responsibility.
Secondly, in situation of short term crisis we have clearly defined in our core values that we have
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to act in accordance with the values and principles that we have acquired that is to do exceptional
work, induce habit of honesty, integrity and reliability in our work. This will overcome any crisis
situation faced by the organization. thirdly, dealing with the issues faced by people, our core
values suggest that we should treat Maori community with utmost respect and also treat land
own by them as our child. This induces coherence and comradery between company and the
owner of land which is Maori community in this case. Core values are important in long term
also and core values of our company also suggest the same. Firstly, direction and future
orientation is important and that is mentioned in our company’s values that work with
responsibility and address the needs of future markets so that it won’t come as a change to the
company and should not become haphazard to meet the change. Our company also has a very
well reputation in markets as a long-term wines producer and 80% of our company’s revenue is
generation by wine sell only. For long-term market company is investing in diversified fields so
that it can adjust with the future needs of the people. one of the most important need for long-
term is developing and healthy culture for business purposes. In our core values we have defined
about using the land in harmonious way and protecting it for the future generation in for long
term benefits. core values of the company also play a vital role in customer dealing and customer
satisfaction. Every company does not share or acquire same values, our company looks for
inhibiting reliability, Maori tradition, honesty and responsibility. These are some important core
values that we celebrate with customers so that becomes imperative for the customer to get
attracted towards our products. Also, values defined in our company is a common objective of all
the employees to achieve some futuristic goal and it feels like all are engaged in some activity to
achieve a high objective. This keeps the employees and the customers motivated about the
company. customer satisfaction is also based on the relationship of the employees with them.
Employees should be trained accordingly and their orientation should be matched with the needs
of customers. Employees engagement with customers should also be incentivized so that
additional support is given to employees for their better work. Rewarding the best should
become a value and culture of the organization so that every employee will be motivated to give
their best. Core values also affect employee motivation in a way that employees if love the
values and culture of the company then it become so easy for them to work and they will always
be motivated to work for the company. Also employees in an organization tend to do work when
they know that my work have some impact in the society and our organization clearly stated in
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its core values that it works within the ambit social sphere. Core values of our company is
directed towards incentivizing the employees so that it can motivate the employees to work hard
and benefits of the work is given to them in rewards [ CITATION Let20 \l 1033 ]. Values of the
company should always be relevant, inspiring and motivating for the employees so that it can
drive the urge in employees to work hard for the company. core values of company clearly
demarcate a purposeful role for every employee and how they can contribute to achieve a goal.
Core values should be used as a guiding principle for all the employees. Also a wider base of
core values can attract a wider pool of aspirants for job which can induce a competitive
environment in company.
Section 4: Mintzberg’s model
Mintzerberg’s model identifies management basics and recommends that the roles and
responsibilities of management shall be broken down in order to organize the workplace and
simplify the concepts which seem complex for the organization. According to this model, there
are 10 different management roles and responsibilities and they shall be divided in three main
categories such as interpersonal, informational, and decision making [ CITATION Man20 \l
1033 ].The roles defined in this model are required to develop relationships with peers, carting
negotiations, resolving conflicts, motivating subordinates, establishing networks of information,
making decisions with ambiguous information, and allocating the resources. This model can be
used by Puhutu Wines Ltd to define managerial roles and facilitating growth in number of ways
which are as follows:
Interpersonal roles
Figurehead: In this, the management of Pohutu shall be held responsible for the ceremonial,
social and legal matters in order to represent the company in professional manner. For instance,
if the company plans to expand its business internationally then the legal matters shall be taken
care of by the figurehead.
Leader: All managers of Pohutu shall act as leaders and communicate and inspire the team
members. They shall be held responsible for guiding and supporting the team in order to make
the business more efficient.
Liaison: The management shall be held responsible for networking outside the company to make
new contact and foster the growth of the company.
Informational roles
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Monitor: The management of Pohutu shall seek information from outside and within the
company in order to assess the operations of the company and identify issues which requires
change. This will benefit the organization is resolving issues and moving ahead.
Disseminator: These should relay information which is valuable to the employee and delegate
the work accordingly.
Spokesman: The management shall relay information outside the organization and act as a
spokesman of the brand. This will help the organization in creating awareness about the brand
and letting the potential customers known about the specialty of the brand.
Decision-making
Negotiator: The management shall appoint a person who will be held responsible for the
directing and participating negotiation within the organization. This will help in resolving
conflicts within the organization and promotes growth within the organization.
Entrepreneur: Change and innovation shall be inspired by the management in order create ideas
which are new to the organization. This will facilitate growth as new ideas will be implemented
within the organization.
Resource allocator: The resources and funding for operations and equipments shall be allocated
by the managers in order make better use of them and promote growth of the organization.
Disturbance: The managers shall be held responsible for the internal as well as external issues.
This will help the organization in removing the roadblocks to success and foster growth of the
company [ CITATION Bus18 \l 1033 ].
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Conclusion
On the basis of above analysis it can be concluded that SWOT analysis, PEST analysis, and
porter’s five forces analysis are effective tools which can aid Pohutu Wines Ltd in making
decision. SWOT analysis is relevant for the organization as it enables the company to examine
both negative as well as positive attributes in just a single analysis and determine the best way to
gain competitive edge in the market. PEST analysis can be used as a significant tool in the
business plan as it helps in identifying the significant changes in technical, social, economical,
and political landscape. Porter’s five forces model is a significant tool which can help Pohutu in
making better decisions as it analyzes the level of competition in the industry. If the organization
knows the competitive level of the industry then it can plan strategies in accordance with it and
stay ahead of the competition. The roles defined in this model are required to develop
relationships with peers, carting negotiations, resolving conflicts, motivating subordinates,
establishing networks of information, making decisions with ambiguous information, and
allocating the resources. These roles are useful in facilitating growth of Pohutu Wines Ltd.
 Leadership in Business 12

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Leadership in Business 13