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Complete the case study of Under Armour. A formal, in-depth case study analysis requires you to utilize the entire strategic management process. Assume your group is a consulting team asked by the ABC Corporation to analyze its external/internal environment and make strategic recommendations. You must include exhibits to support your analysis and recommendations.

The case study must include these components: · A total of 10–12 pages of text plus the exhibits · Cover page (must include the company name, your group name, the date of submission, and a references page; the document must follow current APA guidelines) · Matrices, which must be exhibits/attachments in the appendix and not part of the body of the analysis (The Strategy Club has excellent templates/examples for exhibits and matrices: )

Case study deliverables (text must follow this order with current APA level headings for each component):

  1. Executive Summary
  2. Existing mission, objectives, and strategies
  3. A new mission statement (include the number of the component in parenthesis before addressing that component) Great mission statements address these 9 components:
    • Customers: Who are the firm’s customers?
    • Products or services: What are the firm’s major products or services?
    • Markets: Geographically, where does the firm compete?
    • Technology: Is the firm technologically current?
    • Concern for survival, growth, and profitability: Is the firm committed to growth and financial soundness?
    • Philosophy: What are the basic beliefs, values, aspirations, and ethical priorities of the firm?
    • Self-concept: What is the firm’s distinctive competence or major competitive advantage?
    • Concern for public image: Is the firm responsive to social, community, and environmental concerns?
    • Concern for employees: Are employees a valuable asset of the firm?
  4. Analysis of the firm’s existing business model
  5. SWOT Analysis (comes from researching the firm, industry, and competitors) It is important to know the difference between causes and effects in the SWOT analysis. Causes are important, not effects. Once the SWOT Analysis is created, each group needs to construct the SWOT Bivariate Strategy Matrix. Deliverables for this section include: a. SWOT Analysis b. Internal Factor Evaluation (IFE) Matrix c. External Factor Evaluation (EFE) Matrix d. SWOT Bivariate Strategy Matrix
  6. BCG Matrix (follow the Strategy Club’s template, not the textbook’s format)
  7. Competitive forces, Competitive Profile Matrix (CPM), and competitor’s ratios Deliverables for this section include: a. Competitive forces analysis b. CPM and analysis c. Competitor’s ratios and analysis
  8. Historical Financial Statements -(Income Statement (I/S), Balance Sheet (B/S) and Statement of Cash Flows) from the 3 most current years for the firm The financial statements must include changes (deltas) between years.
  9. Ratios from the most current and available 3 years with deltas and analysis
  10. Alternative strategies (giving advantages and alternatives for each)
  11. Pro-Forma Financial Statements (I/S, B/S and Statement of Cash Flows) with deltas out 3 years and analysis Each year must have 2 columns: 1 with your strategy and 1 without your strategy. a. Include Pro-Forma ratios for the first year out with deltas contrasting from the most current year’s ratios.
  12. Net Present Value analysis of proposed strategy’s new cash flow and EPS/EBIT analysis NOTE: To construct the first cash flow (cf1) at the very minimum, the new revenue from your strategy(s) must be discounted back to the present value by calculating EBIT and that figure will be your cfn for each year. cf0 (initial cost of your strategy), cf1 (discounted cash flow first year), r (opportunity cost of capital, the rate of the next best alternative use of cash/debt/equity resources).
  13. Specific recommended strategy and long term objectives Explain why you chose the strategy, and discuss how much the strategy will cost to implement and how much new revenue your strategy will create. Include your action timetable agenda for accomplishing your strategy.
  14. Proposed new business model Place the results of the case study analysis in a single document. Submit this assignment by Noon (ET) on Sunday

Paper For Above instruction

The strategic management analysis of Under Armour provides a comprehensive examination of the company's internal capabilities, external environment, competitive positioning, financial health, and future strategic directions. This analysis aims to guide ABC Corporation in crafting effective strategies to enhance Under Armour’s market position and long-term sustainability.

Introduction

Under Armour, founded in 1996, has established itself as a prominent player in the sports apparel and performance wear industry. Known for its innovation in moisture-wicking fabric technology and athlete-centric products, the company has expanded globally. The critical importance of understanding Under Armour’s strategic position lies in identifying growth opportunities and competitive threats, especially amid evolving consumer preferences and technological advancements.

Existing Mission, Objectives, and Strategies

Under Armour’s current mission emphasizes empowering athletes through innovative gear, focusing on high-performance apparel and footwear. Its objectives prioritize expanding market share, enhancing product innovation, and improving profitability. Strategically, the company invests heavily in R&D, brand marketing, and global distribution channels to sustain its competitive edge. However, challenges include intense competition from Nike and Adidas and fluctuating consumer demands.

A New Mission Statement

The proposed new mission for Under Armour aims to encapsulate a broader social responsibility and sustainability focus, alongside its core athletic performance objectives. It addresses all nine components:

  • Customers: Athletes, fitness enthusiasts, and environmentally conscious consumers worldwide.
  • Products or Services: Innovative athletic apparel, footwear, and connected fitness solutions.
  • Markets: Global, with particular emphasis on North America, Europe, and emerging markets.
  • Technology: Cutting-edge fabric technologies and connected fitness devices.
  • Concern for survival, growth, and profitability: Committed to sustainable growth and financial resilience.
  • Philosophy: Driven by integrity, innovation, and social responsibility.
  • Self-concept: A leader in innovative, sustainable sportswear.
  • Concern for public image: Actively engaged in environmental initiatives and community outreach.
  • Concern for employees: Fostering a diverse, inclusive, and innovative workplace.

Analysis of the Firm’s Existing Business Model

Under Armour’s current business model leverages product innovation, direct-to-consumer sales, and brand partnerships. The company relies on high-performance materials and athlete endorsements to differentiate itself. Its distribution channels include retail stores, e-commerce, and wholesale partnerships. However, the model faces risks from supply chain disruptions, intense competition, and changing consumer preferences toward sustainability and digital engagement.

SWOT Analysis

SWOT Analysis

Strengths: Strong brand equity, innovative product portfolio, global presence, athlete endorsements.

Weaknesses: High manufacturing costs, limited market diversification, reliance on North American markets.

Opportunities: Growth in athleisure market, expansion into emerging markets, digital fitness trends.

Threats: Intense competition, supply chain risks, fluctuating raw material prices, Brexit and geopolitical uncertainties.

Internal Factor Evaluation (IFE) Matrix

Using key internal factors, Under Armour’s IFE score indicates its core competencies and weaknesses, aiding strategic focus.

External Factor Evaluation (EFE) Matrix

The EFE highlights opportunities and external threats, guiding strategy formulation.

SWOT Bivariate Strategy Matrix

Combining internal strengths with external opportunities suggests growth strategies, such as leveraging innovation for market expansion. Conversely, internal weaknesses could be mitigated by external threats through diversification.

BCG Matrix

Under Armour’s product lines are positioned variably within the BCG matrix. Core products like performance apparel are Stars, while emerging categories may fall into Question Marks.

Competitive Forces and Competitive Profile Matrix

Competitive Forces Analysis

Porter’s Five Forces reveal high rivalry and buyer power, moderated by brand differentiation and technological innovation.

Competitive Profile Matrix

The CPM assesses Under Armour’s relative position compared to competitors like Nike and Adidas, indicating areas for strategic improvement.

Financial Analysis

Historical financial statements from the past three years show revenue fluctuations, profit margins, and cash flow patterns, essential for investment and strategic planning. Notably, recent years reflect recovery from prior losses, emphasizing operational resilience.

Ratio Analysis

Financial ratios such as return on equity, debt-to-equity, and profit margins reveal efficiency and financial health trends over the examined period. These ratios guide resource allocation and risk management strategies.

Alternative Strategies

Potential strategic options include diversification into lifestyle and wellness sectors, digital transformation investments, and sustainable product lines. Each alternative offers unique advantages such as expanded market reach and enhanced brand reputation, but also entails risks like increased operational complexity and investment costs.

Pro-Forma Financial Statements

Projected income statements, balance sheets, and cash flows over the next three years under different strategic scenarios demonstrate potential financial impacts. The analysis compares strategies with a baseline to inform decision-making.

Net Present Value and EBIT/EBITDA Analysis

Discounted cash flow models estimate the present value of future strategic cash flows, assessing the feasibility and profitability of proposed initiatives. Variations in revenue, costs, and investment levels influence the NPV and guide strategic prioritization.

Recommended Strategy and Long-term Objectives

The favored strategy involves expanding sustainable product lines and integrating digital fitness technology, aligning with market trends and consumer preferences. Implementation costs, projected revenues, and timelines are detailed to ensure clarity. The strategy aims to improve profitability, enhance brand loyalty, and achieve leadership in sustainable sportswear within five years.

Action Timetable

A phased plan is proposed, starting with R&D investment, followed by pilot testing, market introduction, and scaling operations over a three-year horizon. Continuous evaluation and adjustments are incorporated to adapt to market developments.

Proposed New Business Model

The new business model emphasizes sustainability, digital engagement, and direct consumer relationships, underpinning long-term growth and resilience. It integrates innovative manufacturing, e-commerce enhancements, and social responsibility initiatives.

Conclusion

In conclusion, Under Armour’s strategic analysis underscores the importance of innovation, sustainability, and market diversification. The proposed strategies are designed to capitalize on emerging trends, mitigate risks, and foster sustainable growth. Implementing these initiatives requires strategic investments and careful management but holds promise for elevating Under Armour’s competitive position in the global sportswear industry.

References

  • Barney, J. B., & Hesterly, W. S. (2015). Strategic management and competitive advantage: Concepts and cases. Pearson.
  • Grant, R. M. (2019). Contemporary strategy analysis. Wiley.
  • Hitt, M. A., Ireland, R. D., & Hoskisson, R. E. (2020). Strategic management: Concepts and cases: Competitiveness and globalization. Cengage Learning.
  • Ketchen, D. J., & Short, J. C. (2020). Mastering strategic management. SAGE Publications.
  • Porter, M. E. (1980). Competitive strategy: Techniques for analyzing industries and competitors. Free Press.
  • Thompson, A. A., Peteraf, M. A., Gamble, J. E., & Strickland, A. J. (2018). Crafting and executing strategy. McGraw-Hill Education.
  • Grant, R. M. (2019). Contemporary strategy analysis. Wiley.
  • Under Armour Inc. (2022). Annual Report. Retrieved from https://about.underarmour.com/investors/financial-reports
  • MarketWatch. (2023). Under Armour financial data. Retrieved from https://www.marketwatch.com/investing/stock/uarm
  • Statista. (2023). Sportswear market statistics. Retrieved from https://www.statista.com/topics/964/sportswear/

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