British Telecom SWOT & PESTLE Analysis

BUSINESS STRATEGY

CONTENTS
INTRODUCTION.......................................................................................................................................1
TASK – 1....................................................................................................................................................1
THE EXTERNAL ENVIRONMENT OF BRITISH TELECOM................................................................1
Mission and objectives of British Telecom..............................................................................................1
PESTLE analysis.....................................................................................................................................2
Ansoff Matrix..........................................................................................................................................3
TASK – 2....................................................................................................................................................4
INTERNAL ENVIRONMENT AS WELL AS CAPABILITIES OF BRITISH TELECOM......................4
VRIO Model............................................................................................................................................4
Strength and weakness of British Telecom..............................................................................................5
TASK – 3....................................................................................................................................................5
EVALUATION OF TELECOMMUNICATION SECTOR........................................................................5
Porter’s five force analysis......................................................................................................................5
TASK – 4....................................................................................................................................................7
COMPREHENSION AND INTERPRETATION OF STRATEGIC DIRECTION.....................................7
Bowman’s Strategy Clock model............................................................................................................7
Strategic direction and options for British Telecom................................................................................9
CONCLUSION...........................................................................................................................................9
REFERENCES..........................................................................................................................................11

INTRODUCTION
Telecommunication sector incorporates numerous numbers of operations and is one of
the dynamic sectors in the world. For this sector, technology is quite vital and plays a pivotal
role. Showing insight towards the mobile telecommunication sector, its importance is growing at
the fast pace in UK and all across the globe. Almost 53 percent of people of age group 16 to 75
years use smart phones in United Kingdom (Cole, 2006). Further, the income being generated by
this sector is showing increasing trends. Wide range of companies is successfully carrying out
their business in the UK market like EE, British Telecom, Vodafone, Three, Giff-Gaff and many
more. Because of these global players, competition within the telecommunication sector is
getting intensified. It becomes challenging for the companies to withstand in the market and
expand their operations in the international markets.
Pertaining to this, the main focus of the present research report is to evaluate the internal
and external environment of the firm. The organization taken under consideration for this project
is British Telecom. It has commenced its operations in the year 1969 and deals in the products
like TV, mobile, fiber as well as fixed in UK and different other nations of the globe (British
telecom, 2018). The main vision of BT is to hold the position of leader in the mobile
telecommunication sector by enriching the life of clients and supporting them to get connected
all across the world. However, number of factors act as road block in the path of achievement.
Hence, the current research report will analyze all such factors that impact the strategic decision
making of BT. Moreover, various approaches and models will be applied to assess the internal
capabilities of the firm. The strategic options being available for British telecom will be
investigated in the final section of the research project.
TASK – 1
THE EXTERNAL ENVIRONMENT OF BRITISH TELECOM
Mission and objectives of British Telecom
The main purpose of British Telecom is to offer world-class telecommunication services
as well as information products to their valuable customers. Further, the main objectives of the
business strategy of British Telecom has a future proof, intelligent and flexible network that
allows the firm to deliver communication services that significantly helps in achieving the
requirement of customers in the coming decades (Lynch, 2009). Further, they have a very clear
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vision of where they want to be and are taking specific steps to accomplish the goals. The
business strategy as well as transformation program has three key objectives i.e. enhancing the
experience of customers, reducing the cost base of British Telecom and accelerating the product
to market times. In addition to this, the new network of the firm will be more efficient and will
respond quickly to the changes in the market demand. It also claims that they will launch
multimedia, converged services and that the client will have more control over the account
management.
PESTLE analysis
Political
 Alteration of government, legislations and laws
 High rate of inflation pressurizes the firm to reduce the prices
 Various trade restrictions
 Political stability (Mansell, 2006)
 Due to economic globalization and widespread use of technology,
British telecom has to cop up with competition and dynamic external
environment
Economical
 Rapid economic development enhances the chances of expansion of
British Telecom
 Good gross domestic product of UK shows more income level of the
people
 Economic slowdown in Asian and European nation forces the firm to
cut their prices and profits.
 The global uncertainty forces firm to change their strategies
Social
 It relates with the cultural values, beliefs, society, beliefs and values
of people wherein the British Telecom operates their business
 Company develops such policies which are related with the culture of
the local nation (Grant, 2005)
 Around 53 % of 16 to 75 years of people utilize smartphones in the
UK
 British Telecom consider recent trends in technology and
communication
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