Analyzing Impact and Influence of Macro Environment on Vodafone

This report analyzes the impact and influence of the macro environment on Vodafone, a leading telecommunication and mobile services provider in the UK. It examines the political, economic, social, technological, legal, and environmental factors that affect Vodafone's business strategies. The report also discusses the Ansoff growth vector matrix and its implications for Vodafone's market penetration, market development, product development, and product diversification strategies.

Business Strategies

Table of Contents
INTRODUCTION......................................................................................................................1
TASK 1......................................................................................................................................1
P1 Analysing impact and influence of macro environment on Vodafone.............................1

INTRODUCTION
Business strategies are plans formulated by top management and strategic thinkers of
organisations in order to accomplish set goals and targets at desirable time. Business
strategies directly reflect on the actions which will be taken by organisations in future to
secure competitive advantages. In this context, the following report will focus on analysing
the impact of business strategies formulated by telecommunication sector of UK by
reviewing strategies of Vodafone. Vodafone is one of the leading telecommunication and
mobile services provider headquartered in UK. The influence of external environment on its
business strategies will be determined by using specific models. The internal environment
and organisational capabilities will be assessed in this report. The competitor analysis of the
organisation and understanding of strategic direction will be made in this assignment.
Eventually, this assignment will aid in enhancing the knowledge and understanding regarding
business strategies formulated by Vodafone.
TASK 1
P1 Analysing impact and influence of macro environment on Vodafone
Macro environment refers to the external environment which affects the growth and
development of organisation externally. In order to assess the impact and influence of macron
environment, strategic tools such as PESTLE and Ansoff growth vector matrix will be used.
(i) PESTLE model
 Political Factor: Political factors refer to the factors that influence organisational
strategies due to interventions and transformations in policies and legislations. The
main political factors affecting Vodafone include EU Roaming Regulation that aims
to decrease charges for mobile phone usages abroad by 70% and increasing level of
consumer rights within Europe, and decisions made by European Union Regulatory
Framework for the communications sector.
 Economic Factors: Economic Factors such as inflation rate, interest rate, growth rate,
unemployment rate of the country that drastically influences the business strategies of
the organisations. The current economic condition of United Kingdom got
destabilised due to BREXIT which affects major sector including telecommunication
sector. Albeit Vodafone devised plans such as lowering cost of specific plan helps
them to sustain in recessive economy of UK.
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 Social Factors: Societal tastes and preferences are dynamic in nature. Social factors
include customers’ needs and expectations. In global competitive environment,
everything is easily accessible to customers which enhance their needs and
expectations. In order to sustain in competitive environment it is essential and
important for organisations to fulfil needs and expectations of customers. Vodafone
have immense and variety of options available for every segment of customers in UK
and all over world.
 Technological Factors: Since industrial revolution, uses of technologies have been
greatly increased in industries. Digital technologies have transformed the perception
of organisation of 21st century. Vodafone in their premises used latest and up to date
technologies in order to sustain in competitive advantages. The technologies are rare
and hard to imitate.
 Legal Factors: Legal Factors involves legal laws and legislations which are
formulated by Government of United Kingdom. In order to prevent legal
uncertainties, Vodafone must follow certain laws and legislation formulated for
telecommunication sector of United Kingdom. These laws include Data Protection,
Employment Rights, Consumer Health and Safety, Environment protection, etc.
 Environmental Factors: Environmental factors affect the business strategies of
organisation greatly. As business are thriving in present era due to enhancement in
technologies but it also negatively affects the surrounding environment. Glaciers are
melting rapidly due to increase in global warming. Vodafone in their CSR initiative
devised strategies and plans to protect the environment. Government also mandates
organisation to follow policies to safeguard environment.
(ii) Ansoff Matrix
Ansoff Matrix is efficient strategic model that helps in analysing the impact of macro
environment and also tells about direction in which organisation must go in order to
obtain higher profits and growth.
 Market Penetration: Market penetration is the strategy where organisation thrives
in existing market using existing products with the help of effective marketing
strategies. Here, management of Vodafone with the help of its efficient marketing
tactics retain in United Kingdom with their existing products. This is low risk
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strategy as all management has to concentrates on enhancing their marketing
strategies.
 Market Development: Market development is the strategy where organisation
seeks for newer market by launching existing products. Management of Vodafone
search for newer markets by launching their products and services which becomes
hit in previous markets. This helps them in enhancing their market share and
growth.
 Product Development: Product development is the strategy where firm launches
new products in existing market. In order to do that firms have robust impression
among customers as this is risky strategy in case of product fails to obtain
adequate attraction. Management of Vodafone in order to sustain in competitive
environment launches new products as per customer’s needs.
 Product Diversification: Product diversification is very risky strategy as firms
tends to launch new products in new markets. Management needs to develop
immense brand reputation in order to succeed in new market. Management of
Vodafone have robust brand reputation which helps them to thrive in newer
markets with new products.
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