Impact and Influence of Macro Environment on Strategies

Business
Strategy

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1 ........................................................................................................................................1
LO 1 ...............................................................................................................................................1
P1) Impact and influence of macro environment on strategies..............................................1
LO 2.................................................................................................................................................3
P2) Analysis of internal environment and capabilities of organisations ...............................3
LO 3.................................................................................................................................................7
P3) Application of Porter's five force model to evaluate competitive forces.........................7
TASK 2............................................................................................................................................8
LO 4.................................................................................................................................................8
P4) Understanding and Interpretation of strategic directions.................................................8
CONCLUSION .............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Businesses strategy is basically a course of action or set of business decisions that assist
or guide an entrepreneur in achieve its targets. It provides a long term sketch or framework to
secure a competitive position in the market through increasing efficiency of operations of a firm
(Quinlan, and et. al., 2019). It provides a set of actions that strengthen performance of an
organisation and attract more customers which lead to increase in productivity and probability of
organisation. For this report the chosen organisation is Tesla which is a well known American
automotive and energy based company providing a range of electric car and also deals in solar
panel manufacturing. This report includes an internal and external analysis for evaluation of
environment and internal capabilities. Beside this, Porter's five force model is also included to
analysis competitive environment of an organisation. At last, a strategic plan based on
environmental analysis is also included in this assignment.
TASK 1
LO 1
P1) Impact and influence of macro environment on strategies
Macro environment is the sum total of conditions prevailing or exists in economy as
whole and consists different factors that provide opportunity as well as poses threat for an
organisation. Tesla is a famous American multinational energy and automotive company that is
having specification in manufacturing of electric car (Habib and Hasan, 2019). It was founded on
1 July, 2003 and its headquarter is in California, U.S. The mission, vision and objectives of Tesla
are provided below:
Mission
The mission statement of Tesla is, ““to accelerate the world’s transition to sustainable
transport”.
Vision
The vision of Tesla motors is, “to create the most compelling car company of the
21st century by driving the world’s transition to electric vehicles.” This vision shows the focus of
company on renewable energy. Tesla addresses electric vehicle market as one of its major
avenue for better growth and success in global market.
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Objectives
Following are the some important objectives of Tesla motors:
 To generate better demand with the aim of driving sales up for TESLA Motor’s
especially for its electric car
 To build up long-term brand awareness and to effectively manage corporate reputation
 To manage existing customer base of TESLA's to create loyalty in customers.
Strategy and strategic direction of Tesla
Strategy is the actions that are taken by business managers to attain organisational goal
and objectives more efficiently. Strategy provides a set of directions and guidelines to company
to achieve it desired level of performance. A strategy is all about integrating organizational activ-
ities and utilizing and allocating the scarce resources within the organizational environment so as
to meet the present objectives. Strategy it is essential to consider that decisions of firms are not
taken in a vaccum while it is based on proper analysis and evaluation of affected, competitors,
customers, employees or suppliers. The strategy of Tesla are focused towards entering a high
end of the market, where customers are prepared and ready to pay a premium prices, and then
drive down market as fast as possible to higher unit volume and lower prices with each succes-
sive model. To have an effective strategy for achieving desired objective a PESTEL analysis is
used by mangers of Tesla as it a framework or tool which is used by marketers to analyze and
monitor the macro-environmental (external marketing environment) factors that have an impact
on an organization. To analyse the impact and influence of macro environment on performance
and strategy of Tesla use of PESTEL analysis is made.
PESTAL analysis
PESTEL analysis provides a theory or model for evaluation of macro environment of a
firm that have significant effect and impact on strategy and performance of organisation. The
different factors included in PESTEL analysis and its impact on Tesla is described below:
Political- This factor reflects the degree of government intervention in business
operations. It include government policies and rules, political stability or instability at national
and international level, tax policy, foreign trade policy and restriction etc. The government of US
and other international political authorities has taken many stances and steps to improve the
development of electric and hybrid engines thus, Tesla motors has having a major advantage of
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