Unit 32 Business Strategy

This report focuses on the appropriate frameworks that are used to influence the macro environment, strategies required in the business, internal environment and capabilities, competitive forces, and different theories, models, and concepts in order to devise strategic planning in the organization. The report suggests using SWOT analysis, PESTLE analysis, VRIO analysis, Porter's Five Forces model, and the value chain model to have a better understanding of the market and its operations, which will help the company to devise effective strategies and have a competitive edge over its competitors.

Unit 32 Business Strategy

TABLE OF CONTENT
INTRODUCTION...........................................................................................................................4
MAIN BODY...................................................................................................................................4
Evaluating macro environment and different strategies of organization.....................................4
Analysing the internal environment and capabilities by using appropriate models....................6
Applying Porter’s Five Forces model and evaluating the competitive forces ............................9
Applying a range of theories and models to devise strategic planning......................................10
CONCLUSION..............................................................................................................................13
REFERENCES .............................................................................................................................15

INTRODUCTION
Business strategy refers to the set of plans and actions that is prepared in order to have
more focus on the achievement of the objectives. By having the good business strategy it helps
the business to have more focus in the competitive market. The current assignment is based on
Morrisons which is the fourth largest supermarket in the markets of UK. It has 497 stores across
the England, Scotland and Wales. This report will put focus on the appropriate frameworks that
used to influence the macro environment. Further it will also discuss the strategies that are
required in the business. This report will also discuss the internal environment and capabilities in
the organization using different framework. Further this report will outline the competitive forces
of the company by using Porter;s Five Forces. Moreover, this report will also put focus on the
different theories, models and concepts in order to devise the strategic planning in the
organization.
MAIN BODY
Evaluating macro environment and different strategies of organization
Corporate strategy: Corporate strategy is termed as the long term plan that helps the
company to outline the clear objectives. This is basically the ultimate purpose of the company in
order to lead in the market.
Business strategy: It is defined as the set of plans and actions that supports the business
in order to compete in the competitive market(Chen and Li 2021). . As the business used to
produce the variety of products and services that must be properly managed by them.
Functional strategy: This is an approach of the business that used to take the
achievement of the corporate and objectives and strategies in order to maximize the productivity
PESTLE analysis of Morrisons
PESTLE analysis help the company to have the proper evaluation of the macro
environment in order to compete in the market. This makes the firm more profitable and have
better survivability in the market. The pestle analysis of cited organization is as described below:
Political factors: political factors in the market used to play an important role that has an
impact on the companies. As Morrisons is the leading supermarket, so they must focus on the
government policies which helps them to survive in the market. The government used to have
great focus on the retail industry which maintain the better environment in this sector. In order to

achieve success the company must focus on the every market and have systematic evaluation of
the political environment.
Economic factors: This factor basically includes the inflation rate, savings rate,
economic cycle, foreign exchange rate, etc. These are the most affecting factor in the market and
used to impact the profitability of the company. The cited company must focus on the economic
factor which helps them to have better production in the market (Nandonde, 2019). By having
the skilled labour and proper infrastructure it manages the working of the company. The Brexit
has caused the several fluctuations and created the inflationary gaps in the market.
Social factors: The culture of the society and the way of doing things in the market used
to impact the culture of the company in the market. As there is continuous changes in the taste
and preferences of the customers which must be taken in to focus by retail sector. By providing
the best quality and managing the taste and preferences helps the company to have better
reputation in the society. The social factors that will impact the cited company is rising of
population and education in UK.
Technological factors: This is one of the most important factor that must be taken into
account in order to have faster production. Morrisons must have the new and innovative
technology that helps the business to have more and faster production. By having the faster
production it makes the firm to manage the production and time limit. As the company is having
good technology it makes them to have better offerings in the market. The cited company uses
AI in order to have stock in the stores and have better sales.
Legal factors: The legal framework is the most important factor that helps the company
to have better survivability in the market. The cited firm can have the proper evaluation before
entering into the other market of UK (PESTEL Analysis of Morrisons, 2021). This helps the
company to have proper evaluation of the market in order to gain competitive edge. By following
the discrimination law, employment law, health and safety law, etc. makes the company to have
better existence in the market. The company has the legal rules and policies that supports them to
survive in the competitive market.
Environmental factors: As there are different markets and it has different environment
standards that used to have impact on profitability of firm. Morrisons used to operate in the
different market of UK, so they must focus on the different environment. They must also focus
on the climatic changes and the different laws relating to the environment which helps the

company to have better share in the market. The cited company should have the positive attitude
towards the renewable energy that helps them to survive in the market. By reducing the use of
plastics and have bins helps to maintain safety in the environment.
Analysing the internal environment and capabilities by using appropriate models
Meaning of internal environment: The internal environment of the company includes
current employees, internal management, behaviour of employees and culture of the
organization. These are the less effecting factors and helps the company to grow in the market.
Meaning of competitive advantage: This can be referred as the favourable position of
the company and helps the company to be more profitable from its competitors in the market.
Meaning of internal resources and capabilities and its strengths and weaknesses:
The internal resources and capabilities are the inner strengths which are basically tangible and
intangible in the market. These elements used to have strong effect the performance if the
company in order to meet the objectives.
The strengths of this is that it helps the company to grow in the competitive market by
having better resources.
The weaknesses are that it limits the production by having the adequate and limited
resources for production.
SWOT analysis of Morrisons:
Strengths
These used to consider the positive factors
related to the company. Morrisons is one of the
leading company in the market of UK. By this
company used to have good profitability and
have competitive advantage in the market. It
has the efficient supply of products and
services to the customers as it use AI
(Morrison Supermarkets (United Kingdom)
SWOT Analysis / SWOT Matrix, 2022). The
company also has the online retailing in the
market that helps them to have more target
customers.
Weaknesses
These can be considered as the negative factors
that used to have impact on the working of
company. The cited company has the certain
weaknesses that decreases the revenue of the in
the competitive market. The weakness of the
company is that it has limited geographical
area as by comparing with the other big
companies (Ariwibowo, Saputro and Haryanto,
2021). The company must open its new stores
in different market to have more existence.

Opportunities
The opportunities include the areas of
improvement that the company can adopt in
order to survive in the market. Morrisons can
have adoption of selling the organic products I
the market. The company can also have the
expansion in the international market that
increases the performance and profitability.
Threats
The threats for the business are those factors
that have negative impact on business. The
great threat for the cited company is that it has
many competitors in the market. The
government has also increases and change the
tax policies that affect the working of the
company.
VRIO analysis of Morrisons: This models help the business to have better analysis of
resources and capabilities in the market. The VRIO is as stated below:
Areas of
operation
V
(Value)
R
(Rare)
I
(Imitable)
O
(Organized)
Competitive
advantages
Relationship
with the
suppliers
Yes No No Yes Partially
Human
resources
Yes Yes Yes Yes Partially
Internal
management
Yes Yes Yes Yes Sustained
Brand name Yes Yes Yes Yes Sustained
Innovation in
sales mix
Yes No No Sustained
Strengths and weakness of VRIO
Strengths Weaknesses
By having the VRIO analysis it helps the
company to know about the internal resources
and have better competition in the market.
This framework is very difficult to use as in
this market demand is not determined. By this
it decreases the competitive advantage of the

company.
Porters value chain analysis:
Meaning of value chain model: This model helps the company to have proper
evaluation of the primary and supportive activities that makes the business to grow. By this cited
company is able to know about the full activities that the workers must perform in order to have
better competition in the market.
Meaning of inbound logistics: The inbound logistics are the materials and the other
different goods that are brought in the company (Pal and Altay, 2019). This basically includes
order, receiving, store, transport and management of the supplies by the cites company in the
market.
Meaning of outbound logistics: This type of logistics basically used to focuses on the
demand of the products and have proper supply in the market. In this the cited company has the
store and transportation of the products in the market. By this the customer get satisfied in order
to get the products and services on time.
Primary activities: the primary activities in the company is directly linked with the
physical creation, management, sales and support of the products and services. This includes the

inbound logistics, marketing, services, operations, etc. that must be managed by the cited
company in order to have better performance in the market.
Supportive activities: These activities used to support the primary functions that makes
the company to have better survivability. This includes the procurement, human resource
management, technological development and infrastructure of the company (Eling and Lehmann,
2018). The cited company must follow these activities to have better development in the
competitive market.
Strengths and weaknesses of value chain model
Strengths Weaknesses
By using this model it helps the company to
have proper evaluation of the operations and
increases the efficiency in each area of
operation.
The weak point of this model is that the
accounting system is not properly designed in
order to manage the costs (Öncer, 2018).
By this there will be negative impact on the
accounting record of the company.
Applying Porter’s Five Forces model and evaluating the competitive forces
Porter’s Five Forces model helps in identifying and analysing various competitive forces
that help in shaping any industry and also evaluates it various strengths and weakness.
Moreover, this model would help Morrison in guiding the business strategy so that competitive
advantage could be maintained across various regions. Also, list of elements that are associated
with this model are as follows:
Competition in the industry: It can be said that in UK there is lot of competition within
the industry as lot of new players are entering into the market (Olson and et.al., 2021). However,
this factor would not impact much on the firm as it has already established brand image in
various markets. Thus, it needs to only keep the close observation on market changes so that
same might be applied within the existing operations of the firm.
Potential of new entrants: In retail sector new small firms entering into the market tends
to bring innovative products and services thus it might put pressure on Morrison exiting working.
However, this factor is currently low as Morrison is continuously building up new capabilities

and trying to bring new attributes in its existing products so that it is able to maintain brand
image in long run.
Power of suppliers: It is medium to low for supermarket like Morrison as it is having
large number of suppliers that are ready to supply various services to the firm on daily basis
(Brown and Brown, 2019). Furthermore, the switching cost is very low hence this is positive
factor of the firm to earn maximum revenues through incurring the least cost on it various
suppliers that are responsible for maintaining the efficient supply chain of the business
Power of customers: Customers are considered to be supreme as all the goods that are
sold by the business are based on their choices and preferences. Moreover, in context of
Morrison it can be said customer loyalty is very high and thus to maintain this the firm had to
conduct market research so that best services could be offered in the lowest prices.
Threat of substitute: It can be said that this factor is also high for the firm as UK retail
industry is very huge and therefore it offers goods and services that are not only unique but also
reasonably priced. Moreover, with this aspect more number of different products are launched
into the retail market every day. Furthermore, Morrison need to assure all its products are not
only unique but are also good in quality so that it is able to compete with the other competitors
and ensures success in various regions in short run.
Justification of the model
Thus, from the above interpretation it can be said that this model would help the
Morrison to devise various strategies in right and appropriate manner. Also, it would help in
providing the right direction so that company resources are not wasted and maximum
efficiencies is derived from conducting various business operations (Kong and et.al., 2020).
Furthermore, it would allow the business to keep the close check on market and its activities so
that there is not much negative impact of the factors on the working of the firm in long run.
Moreover, Morrison need to devise the strategies such as product differentiation and
manufacturing reasonably priced goods so that more customers might be attracted towards the
business and its services.
Applying a range of theories and models to devise strategic planning.
Morrison in the recent times had been trying hard to position itself in various markets so
that easy market expansion would help in increasing the overall revenues and would also help in
attracting new customer segments from target market. Furthermore, the strategic planning

would help Morrison and its management to focus on all efforts in right direction so that
maximum efficiencies are gained in the end. Moreover, the best strategic plan for the cited firm
is as follows :
Aim: To offer the products that are sustainable and healthy and assures that products are made
available to large number of customers at reasonable prices.
Mission: To be recognized as one of the smart provider of products and to offer things that could
be easily bought by masses at affordable prices (Stocker and et.al., 2022). Also, competitive
advantage need to be maintained so that firm is able to sustain and operate in various markets.
Objectives: It would set through SMART objectives that is as follows:
 To maintain the customer satisfaction in various regions
 To increase the market share by 20% by the end of 2022.
 To increase the profits of the company by 50% by end of this quarter
Market strategies: It is very important that right market strategies and analysis is done by the
firm so that maximum efficiencies and positive outcome is derived in the end. Furthermore, this
could be achieved through applying various models one of being is bowman clock strategy that
would allow the firm to position itself in market it is currently operating or wish to operate in the
future. Moreover, it consists of various elements that are been described as follows:
Low Price and Low Value Added: This strategy is concerned with selling low price and
low value added goods in the target market. Moreover, this strategy is successful only when the
customers do not consider much about the quality and just want to fulfil their list of choices
Low Price: It is basically concerned by keeping the lowest prices as possible so that
more profits margin could be covered in short span of time (Introduction to Bowman’s Strategy
Clock, 2022). Moreover, high quantity levels are been produced so that more customer are bale
to purchase the company goods.
Hybrid: Under this strategy the firm is concern more over keeping the competitive prices
and ensuring product differentiation so that customers are able to experience new goods that are
reasonably priced and available in the market.
Differentiation: This strategy helps in providing in wide diversity of products that have
unique features in the products. However, to position at this the company needs to do extensive
market research

Focused Differentiation: Under this strategy company position it various products
through offering high value and prices to the target customers. Furthermore, such type of strategy
is not good for those companies that does not have established brand image in the market
Risky High Margins: It is one position in the clock in which the high prices of the goods
are kept by the firm without adding much value in the respective products (Indrawati and et.al.,
2021). Also, it is quite riskier strategy as company have chance of losing the market
Monopoly Pricing: it is type of strategy where few seller sin the market tries to set prices
for whole market and rules according t their manner. However, such type of pricing strategy does
not last longer due to new entrances within the industry
Loss of Market Share: It is the worst position in the clock that states that overall market
share of the company is declining at faster rate either due to people do not like the products or
company is completely moving into new market segments.
Moreover, Ansoff matrix is another strategy that would help the firm to identify the relative
attractive growth strategies and also helps in choosing the best ones according to its future goals
and objectives. Furthermore, the four of these strategies are as follows:
Market Penetration: It is one where the company is concerned over the increasing the
sales of the existing products in existing market. Also, it can be done either through increasing
the marketing efforts or decreasing prices to attract more customers.
Market Development: It is type of strategy that is concern over selling existing products
into completely newer markets (Ansoff Matrix, 2022). Furthermore, through catering the
completely new customer segment the firm would be able to earn higher revenues within short
span.
Product Development: it is method of introducing new products to an existing market.
Moreover, this technique would help in ensuring continuous running within the market and
assure that it is able to maintain the competitive advantage in long run. Also, it requires that
proper market research is done so that best products might be offered.
Diversification : It is concept that is related with entering a new market with altogether
new products so that more customers might be attracted towards the business (Habib and Hasan,
2021). Furthermore, it would require that detailed research is conduced so that there is no
wastage of resources in the end.

Thus, from the above two analysis it can be said that one that should be adopted by firm is
diversification strategy that would allow Morrison to cater to the new segment and enhance its
current product line into various other things for gaining continuous success.
Stakeholder matrix.
It is type of matrix that helps in showing the level of interest of particular set of people
towards the organization. Furthermore, it can be understood through following elements:
Keep satisfied: Company senior executives, directors are the ones that need to be kept satisfied
so that best decision could be made in the future
Monitor: These are the people that needs to be monitored by the firms and consist of workers or
employees that are having low power and low interest in activities of the firm (Galletta, Mazzù,
and Naciti, 2021)
Keep informed: Government comes under this is as they have high power but low interest
within the firm activities as they observe that things are carried out in right manner
Manage closely: These consist of the managers of the company that are concern over all the
activities of the firm that are undertaking.
Monitoring and controlling: This would be done through setting various key
performance indicators and benchmarks so that the current performance of Morrison could be
compared with past performance or certain standards so deviations are easily found and
corrective actions are taken on time.
CONCLUSION
From the above report it can be concluded that Morrison had been operating successfully
in different markets due to highly qualified employees and best planning within the workplace.
Further, the report had described about impact of micro and macro environment through

conducting PESTLE and SWOT analysis in detail so based on that future plans might be made.
Also, the study had conducted the porter five forces so that Morrison is able to maintain the
competitive advantage in long run and also able to the devise the best strategies for the future
working of business. Moreover, Bowman and Ansoff matrix had also been discussed in detail
under this report so that positive outcomes in form of revenues could be derived in end. Lastly,
report had presented detailed strategic plan that will help the firm to conquer new markets and
regions in the future in effective manner.

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