prepare a report, focusing on three issues:
1. An analysis of the external factors impacting upon the car industries in which the company operates and the rationale for the two companies to go together
This question refers to the reasons behind the merger/acquisition. Why did Marchionne make a multi-billion dollar bet? Why did he decide to buy a moribund Chrysler (it wasn’t the first time that Chrysler had gone bankrupt)? What external factors could justify this decision? The question is orientated to external factors but the firm/environment interface should not be ignored. A ‘reduced’ PESTLE (i.e. analyse only relevant elements, skip the rest) is of course useful, but other tools such as Porter’s 5 forces may be more analytical in revealing the industry key factors. (Using chapters 4 to 6 in Haberberg & Reiple as starting point).
2. How Fiat-Chrysler is likely to perform compared to its rivals and any competitive advantage it may obtain from going together; this includes the identification of critical resources
Here we are interested in your critical evaluation of Chrysler’s and FIAT’s performance (in a general sense) since the merger. General and specific performance indicators should be chosen in accordance with the elements revealed as critical in question 1. (Use chapter 11 in Haberberg & Reiple as starting point).
3. Three strategic options appropriate for implementation subsequent to going together
Strategy in a business context is about procuring above average sustainable returns (for profit making organisations at least). In this light, a strategic option is a means to an end; a tactic used in order to arrive at the final goal which is higher returns (the textbook is a little vague on this question and uses different words to mean strategic option). This answer should flow from question 2. What are the key issues at stake for the two firms (and in particular FIAT because they are in the driver’s seat)? How should these issues be addressed? Recommendations should be as concrete and developed as possible (imagine you are a consultant or the boss of FIAT), use a 5 to ten year framework. (Use chapter 12 in Haberberg & Reiple as starting point).
Remember, what you are required to do is build a justified and substantiated discussion using academic references—also known as analytical thinking and writing