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New Balance Strategic Analysis: Internal And External Factors

Executive Summary

New Balance is a notable worldwide footwear organization that has been around for over a decade. In this essential examination, we have surveyed New Equilibrium’s internal and external conditions to recognize the organization’s assets, shortcomings, unique open doors, and dangers. Our analysis was based on a VRIO, value chain analysis, a PESTLE analysis, and the AFI strategic planning framework. Our examination found that New Equilibrium has solid interior capacities in item development and planning and a promise to fulfill social and natural obligations. Nonetheless, the organization has battled to stay aware of changing shopper inclinations, especially in the quickly developing athleisure class, and faces significant competition from industry monsters like Nike and Adidas.

Considering these discoveries, New Equilibrium should zero in on enhancing its item contributions, especially in the athleisure classification, while keeping up with its supportability and social obligation obligations. Moreover, the organization should put resources into advanced showcasing and web-based business abilities to reach and draw in its objective purchasers. By utilizing its interior assets and tending to its shortcomings and outside dangers, New Equilibrium can make long-term progress and gain the upper hand in the worldwide footwear market.


This essential examination evaluates the interior and outer variables that influence the drawn-out progress and supported upper hand of New Equilibrium, a worldwide footwear organization. Established quite a while ago in Boston, Massachusetts, New Equilibrium has a long history of delivering excellent athletic footwear, clothing, and frills to improve execution and advance general well-being. To address these difficulties and position itself for future achievement, New Equilibrium should have an unmistakable comprehension of its inward assets and shortcomings and the open doors and dangers it faces in the worldwide footwear market.

In this examination, we will apply the AFI necessary arrangement structure, as well as a VRIO or Worth Chain investigation and a PESTLE examination, to evaluate New Equilibrium’s essential position and give suggestions for future development and achievement. The company should focus on investing in innovation and technology, expanding its global presence, and strengthening its brand image to maintain long-term success and a sustained competitive advantage in the highly competitive sportswear industry.

Competency 1: Assessment of the Importance of Strategic Management for Supporting Long-Term Success and Sustained Competitive Advantage

Strategic administration is essential for organizations to make long-term progress and sustain competing advantages. It includes realizing and implementing the measures that adjust an association’s assets to its objectives and targets. According to Mongkol (2021), key administration “is the most common way of figuring out and carrying out techniques that assist an association with accomplishing its targets and make an incentive for its partners.”

AFI Strategic Planning Framework

The AFI (Adaptation, Focusing, and Implementation) planning framework is a broadly involved approach that helps associations create and carry out procedures for long-term achievement and sustained competitive advantage. The AFI structure includes three key parts: internal analysis, external analysis, and execution of the strategy (Strategic Management Research: AFI Strategy Framework, 2022). Internal analysis is the process of examining the weakness, strengths, threats, and opportunities in an organization. External analysis is the process of identifying and analyzing outside factors that influence the performance of an organization, such as customer behavior, market trend, and competitive environment. The final part is the implementation of strategies that are in agreement with organizational resources and adhere to the objectives and goals. The AFI model helps an organization to understand its strength and weaknesses and gives relevant guidance as per the organization’s objectives and goals.

Role of Leadership in Strategic Planning

In any organization, leaders are expected to set the pace for the workers. They give direction by setting the vision, mission, and direction the organization will take. Leaders should also be in a position to appropriately communicate the vision to the employees and engage them in decision-making so that they can own the vision (Pasaribu et al., 2021). After synchronizing the employees with the vision, the leader provides the relevant resources for actualizing the vision. Leaders also have a role of monitoring and evaluating the strategies to ensure long-term success and competition.

Competency 2: Apply Strategic Thinking Approaches to Resolve Business Related Challenges

To apply key reasoning ways to deal with resolving business-related difficulties, associations can utilize a mix of procedures. For example, an organization facing competition from new participants could utilize a SWOT investigation to recognize strengths, weaknesses, opportunities, and threats and develop products that meet customer needs afterward. The organization could utilize agile approaches to test and carry out arrangements rapidly and effectively. By utilizing these essential reasoning methodologies, associations can foster viable procedures to address difficulties and make long-term progress.

The Course of Action Recommendation

In the wake of breaking down the interior and outer variables influencing New Equilibrium, it is suggested that the organization center around item development and venture into developing business sectors to help its drawn-out progress and support the upper hand. New Equilibrium can foster new items and work on existing ones to remain competitive and meet clients’ changing requirements. For example, the organization can put innovative resources into making eco-accommodating and supportable items progressively popular (IMD, 2022). Also, New Equilibrium ought to expand its activities into developing business sectors to take advantage of new clientele and lessen dependence on customary business sectors like North America and Europe. The organization can zero in on nations with developing working-class populations, like China, India, and Brazil, and design its items to meet neighborhood inclinations (Tran & Nguyen, 2022). By extending its worldwide presence, New Equilibrium can diminish its reliance on specific business sectors and limit the effect of financial slumps or political flimsiness in any country.

To help with these drives, New Equilibrium should likewise consider putting resources into its store network and strategic abilities to develop effectiveness further and lessen costs. The organization can investigate associations with neighborhood providers and wholesalers in developing business sectors to smooth out activities and better serve clients. Moreover, New Equilibrium can put resources into advancements, for example, blockchain, to upgrade straightforwardness and discernibility in its production network, which can assist with building buyer trust and work on the organization’s standing.

Competency 3: Analyze the Internal and External Environments of an Organization

Internal Environment Analysis

To assess New Balance’s internal strengths and weaknesses, we will use a VRIO, or value chain analysis. The VRIO analysis assesses an organization’s resources based on their value, rarity, imitability, and organizational support. Meanwhile, the value chain analysis examines the organization’s value-adding activities, including inbound and outbound logistics, operations, marketing and sales, and service.

New Balance has several strengths that can provide a sustainable competitive advantage in the footwear market. The organization’s solid image, notoriety, and faithful client base are significant assets that can assist it in enduring competition from different brands (Grant, 2019). New Balance has a few inner shortcomings that might influence its drawn-out progress and support. One of these areas for improvement is the organization’s restricted showcasing spending plan, which has blocked its capacity to advance its items and grow its client base. Another shortcoming is the organization’s somewhat small size compared with its bigger rivals, which restricts its assets and may make it hard to compete on cost.

External Environment Analysis

We will utilize a PESTLE investigation to evaluate New Balance’s extreme climate. This investigation examines six external variables that might influence the association: political, monetary, sociocultural, technological, legitimate, and natural. Political elements allude to the effect of government strategies and guidelines on organizations. For New Equilibrium, political elements might incorporate exchange approaches, levies, and work guidelines, which can influence the organization’s capacity to import commodity items and deal with its worldwide store network (IMD, 2022).

Financial variables connect with monetary circumstances’ effects on organizations, such as expansion, loan costs, and purchaser spending. For New Equilibrium, financial variables might remember changes in purchaser spending designs, changes in return rates, and vacillations in the worldwide economy. Sociocultural factors refer to the impact of societal trends and cultural norms on businesses. For New Balance, sociocultural factors may include changing consumer preferences for sustainable and ethical products, the increasing importance of health and wellness, and the growing trend towards casual wear (Bussiness Review, 2019).

Natural elements connect with the effects of ecological patterns and worries on organizations. For New Equilibrium, natural variables might remember the developing concentration for maintainability and eco-neighborliness in the business, the effect of environmental change on store network strategies, and the rising significance of waste reduction and reusing (IMD, 2022). Natural elements connect with the effects of ecological patterns and worries on organizations. For New Equilibrium, natural variables might remember the developing concentration for maintainability and eco-neighborliness in the business, the effect of environmental change on store network strategies, and the rising significance of waste reduction and reusing.

Competency 4: Communicate Business Needs, Opportunities, And Strategies With Multiple Stakeholders.

Communication effectiveness is significant for organizations to convey their necessities, open doors, and strategies with different partners. The initial step is to distinguish the partners and design a communication way to address their needs. To communicate business needs, associations can utilize different channels, like email, media, sites, and pamphlets. The message should be clear, succinct, and pertinent to the crowd. The utilization of visual guides, for example, infographics, recordings, and outlines, can likewise assist with passing on complex data in a more open organization.

To impart valuable open doors, associations can feature the potential advantages of putting resources into their items or administrations. They can utilize contextual analyses, tributes, and examples of overcoming adversity to exhibit how their answers have assisted different associations with defeating difficulties. To impart strategies, associations can utilize webinars, studios, or workshops to share their vision, mission, and objectives. It is vital to assemble input from partners to guarantee that the delivery approach is practical.


By focusing on item advancement, venturing into developing business sectors, and putting resources into its production network and strategic abilities, New Equilibrium can situate itself for long-haul achievement and a supported upper hand. These systems can assist the organization in remaining ahead of competitors, meeting changing client needs, and diminishing risks related to reliance on specific business sectors or items. The PESTLE examination uncovered a few outer elements that could influence New Equilibrium’s business, like expanding guidelines, moving purchaser inclinations, and arising innovative progressions. The organization can use its obligation to supportability and shine a spotlight on the developing pattern of athleisure wear to acquire an upper hand.


VRIO analysis;

VRIO analysis

Figure 1 VRIO analysis

Value Chain analysis;

Value Chain Analysis

Figure 2 Value Chain Analysis

PESTLE analysis

Pestle analysis

Figure 3 Pestle analysis

Five Forces analysis

Five Force Analysis

Figure 4 Five Force Analysis


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