Application of Frameworks to Analyse the Macro Environment

Business Strategy

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1: Application of frameworks to analyse the macro environment.............................................1
TASK 2............................................................................................................................................3
P2: Analysis of internal environment of an organisation.............................................................3
TASK 3............................................................................................................................................6
P3: Application of Porter's five forces model..............................................................................6
TASK 4............................................................................................................................................8
P4: Application of theories and concepts for devising strategic plans for an organisation.........8
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Business strategy refers to a combination of strategies applied by an enterprise and
decisions taken by it to gain competitive advantage and achieve its long-term goals and
objectives (András and Havran, 2016). It is a set of moves and measures which a business needs
to take in order to achieve high-level performance. It gives an outline of how business needs to
be carried out if desired outcome has to be reached. This project is based on Klarna which is a
Swedish Bank founded in 2005 providing digital financial solutions for its customers. It provides
solutions for online storefronts, direct payments, post-purchase payments etc. In this assignment,
focus will be made on analysis of impact and influence of macro environment on an
organisation, assessment of an enterprise's internal environment. Additionally, evaluation of
outcomes using Porter's five forces and application of different concepts to devise strategic plans
for a given organisation will be covered as a part of this report.
TASK 1
P1: Application of frameworks to analyse the macro environment
Macro environment refers to a set of external factors which have a bearing on the
operations of a company. PESTLE analysis can be used for analysis of an organisation's external
environment (Arasti, Khaleghi and Noori, 2017). It covers factors like political, economic,
social, technological, legal and environmental. As Klarna is a bank offering digital payment
solutions to its customers it is impacted by the influence put by all these factors which is
explained as follows-
Political factors- These factors are policy of the government, political stability, tax
policy etc. A change in any of them can lead to a change in planning of business. Thus its is
important for a company to effectively analyse them. Klarna is impacted by a change in any of
them as its strategies are affected directly.
 Opportunity- If there is a change in policy of the government and it becomes favourable
for business then it becomes an opportunity for Klarna as it can perceive a chance of
increasing its profits.
 Threat- Increase in taxes by the government by altering its taxation policy can impact the
profitability of Klarna.
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Economic factors- These factors are economic growth, exchange rates, interest rates,
disposable income of customers, inflation rates etc. A change in any one of them can alter the
financial plans of the enterprise (Arvidsson and Holmström, 2017). Klarna is impacted by these
factors as they can directly increase or decrease its level of profits.
 Opportunity- Booming economy due to high economic growth is an opportunity for
Klarna as it will substantially increase its customer base.
 Threat- Rising inflation rates are a threat for Klarna as it can directly impact the number
of customers it has.
Social factors- Social factors are population, heath consciousness, change in lifestyle of
customers, cultural barriers etc. Klarna is impacted by a change brought due to any of these
elements.
 Opportunity- Change in lifestyle of customers is an opportunity for Klarna as more and
more of them are adopting method of digital payments. This will directly help the
company in increasing its profits.
 Threat- Cultural barriers stop some people from keeping their money in banks for
savings purpose. This acts as a threat for Klarna as it affects its business model.
Technological factors- Technological factors are technological changes, R&D, level of
innovation etc. A change in any one of them can impact Klarna as they can either increase or
decrease its profitability (Bele, Panigrahi and Srivastava, 2017).
 Opportunity- Innovation in technology can positively impact Klarna as it will provide it
an opportunity to adopt more digital methods for payment solutions. This will attract
more customers towards it.
 Threat- Lack of awareness among people for technology is a threat for Klarna as it can
impact its business.
Legal factors- Legal factors are laws, rules and regulations framed by government etc. A
change in these factors can either benefit Klarna or can be a disadvantage for it.
 Opportunity- Relaxing of rules and regulations for doing business can positively impact
Klarna as it will allow it to increase its profits.
 Threat- Toughening up of laws by the government for the entire industry will also have
an impact on Klarna's business model as it can reduce its turnover.
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