Critical Analysis and Writing

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Critical Analysis: What
What to do:
Analyse decisions made by business people
Understand their rationale (reasons for
making that particular decision)
Provide recommendations about future
actions
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Critical Analysis: Why
1. Learn to solve
complex
problems
2. Deal with the
unexpected
3. Persuading
others
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Descriptive
Analytical
Critical
Analysis
Persuasive
Critical Analysis and Writing
1. Understand
the question and
context
What is the
questions
asking?
What else do
we know?
2. Conduct
research and
analyse the
situation
What
information
are we
missing?
What do we
need to
research?
What is
happening to
the business?
3. Develop
possible
solutions and
evaluate options
What does
analysis
suggest?
What are the
possible
options?
Which ones
are better?
4. Recommend a
course of action
and argue for it
State your recommendations
Build an
argument to
support them
Key steps:
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1. Understand the question and context
What is the question
actually asking?
What is happening?
When?
Who is involved?
What are the facts?
Do we have additional
information about the
case?
What is our deliverable?
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Critical Analysis Example : Food wars
You are a junior strategy
analyst at Coles. Given the
recent controversy around
food discounting (Food wars),
you have been asked by
senior management to provide
a recommendation as to
whether Coles should continue
the discounting or not.
In your answer provide a clear
rationale for your
recommendation.
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Food Wars
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What is happening in the case?
Understanding the case
What happened?
- When?
- Who was involved?
- What are the facts?
Milk Wars
Coles selling milk at
below cost prices to
attract customers
Milk producers fear
pressure to lower their
prices
Woolworths sides with the
milk producers
Coles continues to discount
the milk, denies plans to
pressure producers
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What is happening in the case?
Understanding the case
What happened?
- When?
- Who was involved?
- What are the facts?
Fruit Wars
Coles introduces weekly
fruit deals selling fruit
and vegetables at high
discount
Fruit and vegetable
producers fear further
pressure from supermarkets
Coles and Woolworths
remain profitable, analysts
attribute this to decreasing
margins for certain products
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Understanding the question
Provide a recommendation as to whether Coles
should continue the discounting or not
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2 Options to argue for
Discounting is
good for Coles
Discounting is
bad for Coles
Understanding the question
Based on the particular
case, you may be asked
to:
Argue for one option
Choose between a set of
options
Generate a set of
options yourself and
recommend one
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2. Conduct research and analyse the situation
Find out more about
what happened
Research similar
situations
What kind of things we
could look for here?
Use your business
knowledge, concepts
and frameworks to
conduct analysis
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Retail consumer
behaviour
Cost leadership
strategy in food
retail
Supplier
relationships and
consumer demand
3. Develop possible solutions and evaluate options
Continue discounting
Increases sales of
discounted product (e.g.
Milk)
Increases customer traffic
so people buy other
products (Gruen Transfer)
Positive for brand as it is
good for everyday
Australian
Stop discounting
Damages supplier
relationships
Damages brand image
through Farmer abuse
Creates stronger
ethical image for
competition
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3. Develop possible solutions and evaluate options
Continue discounting
Increases sales of
discounted product (e.g.
Milk)
Increases customer traffic
so people buy other
products (Gruen Transfer)
Positive for brand as it is
good for everyday
Australian
Stop discounting
Damages supplier
relationships
Damages brand image
through Farmer abuse
Creates stronger
ethical image for
competition
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How to decide on the best recommendation and
rationale?
The rationale is the
argument to persuade
your reader that the
recommendation is valid.
1. Use quality research
2. Apply key concepts and
frameworks
3. Use a A-CA-R format
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4. Recommend a course of action and argue for it
Developing an informed answer
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Recommendation : Coles should proceed with discounting
Rationale: Reasons why discounting is good
Argument for discounting Theory/Concept
Coles attracts more customers who
buy more items than just food staples
giving Coles higher market share.
Sustainable
competitive
advantage/Return on
Assets
Coles creates an image of caring
about the averageAustralian by
offering cheaper staple goods like
milk and fruit.
Stakeholder/Increasing
revenues
A-CA-R
Argument
Statements in support of
your position
Counter Argument
Potential challenges to your
position
Rebuttal
Supporting your original
statements why the
challenges are not persuasive
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4. Recommend a course of action and argue for it
Considering counter-arguments
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Issues/Risks counter arguments
Coles behaviour is unethical and
puts profits before the well-being of
farmers and growers, creating fears
that it will push the discounting
through to producers. This may drive
customers away and lower profits.
Woolworths supports food producers
and depicts Coles as a heartless
corporate giant that exploits its
market bargaining power over small
producers by not caring about the
average Australian.
Argument for discounting
Coles attracts more customers
who buy more items than just food
staples giving Coles higher market
share
Coles creates an image of caring
about the averageAustralian by
offering cheaper staple goods like
milk and fruit
Step 4. Developing the Rationale
Dealing with risks: rebuttal (dismissing) the counter-argument
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Dealing with the risks
(Rebuttal)
Coles actually promised
NOT to force the
producers to sell at lower
prices, which makes the
first counter argument
speculative.
By discounting food,
Coles is indeed
maximising the utility of a
larger number of people
all Australians
compared to a small
number of producers.
Argument for
discounting
Coles attracts
more customers
who buy more
items than just
food staples giving
Coles higher
market share.
Coles creates an
image of caring
about the average
Australian by
offering cheaper
staple goods like
milk and fruit.
Issues/Risks counter
arguments
Coles behaviour is unethical and
puts profits before the well-being of
farmers and growers, creating fears
that it will push the discounting
through to producers. This may
drive customers away and lower
profits.
Woolworths supports food
producers and depicts Coles as a
heartless corporate giant that
exploits its market bargaining
power over small producers by not
caring about the average
Australian.
Rationale
There are two main reasons for Coles to continue discounting food
items in their stores. Firstly, by discounting milk Coles is ensuring that
customers are attracted by lower prices and will buy other products
together with their milk and fruit (J ohnson 2012). This will have a positive
impact on Coles market share and profits. Those who oppose this move
might argue that discounting is unethical as it exploits food producers and
that Coles damaged reputation will actually drive customers away to
competition (Lee 2011). However, as Coles has provided multiple public
reassurances that it does not intend to pressure producers to drop the
price of produce, this viewpoint lacks sufficient grounding to pose a
credible threat at this point in time (Davis 2011) .
The second reason to continue food discounting is . . .
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Rationale
There are two main reasons for Coles to continue discounting food items in
their stores. Firstly, by discounting milk Coles is ensuring that
customers are attracted by lower prices and will buy other products
together with their milk and fruit (Johnson 2012). This will have a
positive impact on Coles market share and profits. Those who oppose
this move might argue that discounting is unethical as it exploits food
producers and that Coles damaged reputation will actually drive
customers away to competition (Lee 2011). However, as Coles has
provided multiple public reassurances that it does not intend to pressure
producers to drop the price of produce, this viewpoint lacks sufficient
grounding to pose a credible threat at this point in time (Davis 2011) .
Persuasive rationale: ARGUMENT FOR
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Rationale
There are two main reasons for Coles to continue discounting food items in
their stores. Firstly, by discounting milk Coles is ensuring that customers
are attracted by lower prices and will buy other products together with their
milk and fruit (J ohnson 2012). This will have a positive impact on Coles
market share and profits. Those who oppose this move might argue
that discounting is unethical as it exploits food producers and that
Coles damaged reputation will actually drive customers away to
competition (Lee 2011). However, as Coles has provided multiple public
reassurances that it does not intend to pressure producers to drop the
price of produce, this viewpoint lacks sufficient grounding to pose a
credible threat at this point in time (Davis 2011) .
Persuasive rationale: COUNTER-ARGUMENT
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Rationale
There are two main reasons for Coles to continue discounting food items in
their stores. Firstly, by discounting milk Coles is ensuring that customers
are attracted by lower prices and will buy other products together with their
milk and fruit (J ohnson 2012). This will have a positive impact on Coles
market share and profits. Those who oppose this move might argue that
discounting is unethical as it exploits food producers and that Coles
damaged reputation will actually drive customers away to competition (Lee
2011). However, as Coles has provided multiple public reassurances
that it does not intend to pressure producers to drop the price of
produce, this viewpoint lacks sufficient grounding to pose a credible
threat at this point in time (Davis 2011) .
Persuasive rationale: REBUTTAL
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