Impact and influence of macro environment on strategies of organisation

Business
Strategy

Table of Contents
INTRODUCTION...........................................................................................................................1
LO 1.................................................................................................................................................1
P1) Impact and influence of macro environment on strategies of organisation..........................1
LO 2 ................................................................................................................................................5
P2) Internal environment and capabilities...................................................................................5
LO 3.................................................................................................................................................7
P3) Use of Porter's five force model...........................................................................................7
LO 4.................................................................................................................................................9
P4) Strategic plan .......................................................................................................................9
CONCLUSION .............................................................................................................................12
REFERENCES .............................................................................................................................13

INTRODUCTION
Business strategy is basically defined as a combination and set of all decisions made and
actions performed and carried out by an an organisation or business firm to accomplish and
achieve desired business goals and also includes efforts made to secure a competitive position
and better strength in business market. Business strategy is considered as the backbone of any
company as it provide a roadmap and framework for coordinating all business activities to lead
them towards the desired level of targets and goal (Pramanik, Maiti and Maiti, 2018). Business
strategies are the only tool that make an organisation able to handle and cope with dynamic
changes going on in business environment through providing bets solution and facilitating
effective decision making which are necessary for ensuring free and smooth flow of operations.
Lotus cars Ltd is selected to accomplish this report on business strategy. Lotus cars Ltd is
well known British automotive company that is manufacturer of cars that mainly includes design
and building sports cars and racing cars. In this report a critical analysis of macro environment is
included with appropriate use of PESTEL analysis. Beside this, an evaluation of internal
environment and organisation's internal capabilities is also made. Further, this assignment also
consists use of Porter's Five Force model to improve competitive edge and market position. At
last, use of a range of theories and models is also there to produce a strategic management plan.
LO 1
P1) Impact and influence of macro environment on strategies of organisation
Sum total of all the external factors and forces that create impact and influence on the
operations and strategies of an organisation form a macro environment of a company. These
external factors include the political environment, social implications, economical changes,
technological advancement and many more (Sellitto and Hawking, 2019). Lotus cars Ltd is an
organisations which belongs to automotive sector of UK and it mainly includes manufacturing of
racing and sports cars. The headquarter of this organisation is in Hethel, Northfolk, United
kingdom. This organisations is famous for its creation and designing of sports and race cars
which are light weight and have fine handling characteristics. The top model of this organisation
includes Elan, Europa, Esprit, Exige, etc. Apart from this, its also take parts in various racing
tournaments and had success in Formal one with team Lotus. Beside this, Lotus cars Ltd also
owns a engineering consultancy firm which provide its services across various parts of UK,
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China, United States and even in parts of Malaysia. The main operations of Lotus cars Ltd is in
UK thus, business registries and operations get affected by any changes in bushiness
environment of UK. To have an analysis of macro environment and different external factors
which have significant impact and influence on business strategies and operations of Lotus cars
Ltd use of PESTEL analysis is made which is described below:
PESTEL analysis
It is the most effective and simplest tool that is used by an organisation to identify and
analysis key external factors of macro environment that includes various forces which creates
both opportunities and threats for an organisation (Perez-Franco and Phadnis, 2018). Thus, for
every company it is necessary to conduct proper PESTEL analysis as it is essential for an
organisation to form business strategies as per the prevailing situation and conditions to remain
successful in business environment. Therefore, following PESTEL analysis is conducted by
Lotus cars Ltd to analysis the impact of various macro factors over the strategies and strategic
management decisions. The various elements and factors of PESTEL analysis are described
below in context of Lotus car Ltd.
Political factors
Theses factors are directly related with the attitudes and level of interface and
intervention made by government and other political partiers of a country. Political factors are
the representative of political stability and insatiability of a nation which directly effects the
operations and strategies of an organisation (Marín, 2019). In political environment main factors
that impact and influence organisation strategies are local legislation, taxation, infrastructure,
ease of exporting/importing, availability of skilled workers and many other. The political
environment of UK are mainly stable but the recent decision of UK of braking away and exiting
from the European Union which is formerly known as Brexit issue is cresting hindrance for
automotive sector of organisation (HOW BREXIT WILL AFFECT THE AUTOMOTIVE
INDUSTRY, 2019). As per a study conducted by IHS automotive has predicted a drop and
overall decline in the sales of automotive vehicle which is a created a threat and negative impacts
on the business strategies of Lotus cars Ltd. Drop of UK from EU has reduced the ease of
importing and exporting and lead to strict foreign trade policy thus, the sales and exports of
vehicles has declined which has created pressure on Lotus cars Ltd to formulate strategies as per
prevailing situation of UK.
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