Business Strategy: PESTLE, SWOT, and Porter's Five Forces for GM

This report provides a detailed analysis of General Motors' business strategy, examining both its macro and internal environments. The analysis begins with an introduction to business strategy and its importance, followed by a critical assessment of the macro-environmental factors affecting General Motors, utilizing the PESTLE framework. The report then delves into the internal environment and capabilities of General Motors, employing SWOT analysis to identify strengths, weaknesses, opportunities, and threats. Furthermore, the report evaluates the outcomes of these analyses using Porter's Five Forces model to understand the competitive forces within the automotive industry. Finally, the report applies various theories, concepts, and models to interpret and devise strategic planning recommendations for General Motors, culminating in a comprehensive conclusion and a list of references. The report covers various aspects of the company's mission, vision, objectives, and the impact of political, economic, social, technological, legal, and environmental factors on its operations and performance.

BUSINESS STRATEGY

Table of Contents
BUSINESS STRATEGY.................................................................................................................1
INTRODUCTION...........................................................................................................................2
TASK 1............................................................................................................................................3
P1.Critical analysis of macro environmental factors of General Motors and its vision and
mission....................................................................................................................................3
TASK 2............................................................................................................................................6
P2 Using appropriate frameworks analyse the internal environment and capabilities of a given
organisation............................................................................................................................6
TASK 3............................................................................................................................................9
P3 Evaluate outcomes of analyses using Porter's five forces models....................................9
TASK 4..........................................................................................................................................12
P4 Apply a range of theories, concepts and models, interpret and devise strategic planning for
a given organisation. ............................................................................................................12
CONCLUSION..............................................................................................................................15
REFERENCES .............................................................................................................................16
Books & Journals.................................................................................................................16

INTRODUCTION
There are various factors in market which directly or indirectly affects business
operations. In order to overcome these factors business strategy is prepared. Business Strategy is
a set of plans and procedures to accomplish company determined goals and objectives to achieve
growth for long term (Galpin, T. and Lee Whittington, J., 2012). Is is essential for each and
every businees organisations to formulate and adapt effective strategies according to constantly
shifting environment. In this report, chosen organisation here is General Motors which is an
multinational corporation in UK engage in designing, manufacturing, marketing and distributing
vehicles and vehicles parts. In this project discussions have been made on, impact and influence
of macro environment in an organisation, company internal environment and their capabilities.
Porter's five forces model and theories to interpret company strategic management plans has also
been described in this report. Outcomes of analyses using Porter's five Forces model in a given
market sector is also been mentioned in this project.
TASK 1
P1.Critical analysis of macro environmental factors of General Motors and its vision and
mission.
Businesses today are in bound in their own identity and functioning still they regularly
and time to time get affected by a common environment in which they are working. Broadly
considering, there are two types of business atmosphere namely internal and external. All these
factors collectively are known to affect long term market growth and development of every
business concern (Helms, M. M. and Whitesell, M., 2013). This report is based on a UK based
organisation General Motors.
General Motors Company very popularly known as General Motors is an American
multinational corporation which has its headquarters in Detroit. This business concerns works
towards designing , manufacturing, marketing, and distributing vehicles especially four wheelers
and their spare parts. Also, it is involved in dealing in financial services sector which has it
global headquarters in Detroit's Renaissance centre. It is assumed to be UK's largest car dealer
business concern.
Mission of General Motors: Mission statement of General Motors focusses on its
overall growth and development. It is a multinational business concern which is involved or

infused in various socially responsible business and welfare operations at a global level.
Managers of General Motors are very dedicated and aim towards providing excellent quality
products and services to its customers. Main objective of this business entity is to develop a
sense of trust and loyalty in its customers and staff members as well by ensuring them of
superior quality returns on their investment (Smith, D. J., 2013) .
Vision of General Motors: The vision statement of General Motors is “To become a
world leader in transportation products and its relative services as well”.
Vision statement of General Motors is just like its working culture committed and
continually improving. Vision of General Motors is to become a world leader in transportation
products and its relative services as well. It aims at earning or developing customers enthusiasm
and confidence through regular and continuous improvement taking help of key factors like
integrity , team work and innovation of managers and employees of General Motors. This
legacy has continued over a 100 years and is expected to grow for another 100 years.
Objectives of General Motors: Managers of General Motors have laid down certain
objectives such as:
 Becoming a global leader in auto mobile sector.
 Earn trust and loyalty of customers by continuously improving its services.
 Providing an excellent rate of return on investment to shareholders and investors.
PESTLE analysis of General Motors: Macro environment refers to an environmental
situation that occurs in a business economy which includes numerous external factors. These are
major external factors which influence decision making of an organisation thereby affecting its
overall performance as well as strategies. These factors include various key factors such as
economic factors, legal factors, political factors, social factors and technological factors as well.
Examples of macro environment include government policies, changes in tax rates, competitors
in market and so on.
Political factors: This factor of PESTLE analysis explains various effects of political
trends as well as conditions on business efficiency and operations of General Motors.
Specifically speaking, impact of government and its policies are taken into consideration in this
aspect. Political factors that have a significant impact on business operations of General Motors
are as follows:
 Promotion of public transport by UK government at cheaper price.( threat )

 Highly strict and aggressive taxation policies on combustible vehicles.(threat)
 Political stability in major markets.(opportunity)
These are various threats and opportunities as identified by managers of General Motors.
Highly strict and aggressive taxation policies on combustible vehicles is a threat for General
Motors as it will reduce its sale. General Motors should aim towards maintaining quality
standards for checking quality of its vehicles' combustibility to maintain market position.
These are various political factors that help General Motors in revealing notable threats and
weaknesses that must be considered by strategy formulation.
Economic factors: Business performance and operations of General Motors is
dependant on economic environment . Economic factors impact and affect competitive
advantage of General Motors. Also they help mangers in determining aggregate or average
demand and aggregate investment required in an economy. General Motors' company can use
various economic factors such as high growth rate of developing markets(opportunity), economic
stability(opportunity)and rising competition in developing market which is a threat. Company
must ensure competence to address rising competition. These conditions project growth of
General Motors if competitive advantage is ensured.
Social factors: Social factors refers to society's way and culture of carrying on business
operations in an environment (Khalili and et. al., 2013). Shared beliefs and thoughts of people
play a key role in deciding how marketers at General Motors will understand their customers
from a given market. Socio factors significantly impacting General Motors involve rising
demand for electric vehicles(threat), and increasing demand for self driving vehicles
(opportunity).Increasing or rise in demand for self driven vehicles will help in promoting growth
and profitability of General Motors.
Technological factors: Technology has almost become need of the hour . Automotive
sector has been transforming greatly since last 5 years. Due to this, many a times establish
business concerns could not even get enough time to cope up with changing environment. A
firm should always multitask at great speeds. Due to this , General Motors will get a little extra
time to cope with current market trend and help in profit maximisation. Factors which affect
are stated as under:
 Increasing development of electric vehicles.
 Rise in fuel efficiency level in auto mobiles.

All these factors act as opportunities in case of General Motors. This factor enables a company to
develop vehicles with competitive fuel efficiency ratings. Also, this factor helps in analysing
opportunities through innovations.
Legal factors: Every business concern has to mandatorily operate within certain laws
and rules that are set up in competitive market (Reich and Benbasat, 2013). General Motors has
never faced any such legal activities or issues as it follows all rules and regulations. A firm
should always carefully analyse legal factors before entering into any market as it may further
lead to many crucial issues like hampering overall competitive image. Factors affecting legal
environment are expanding regulations on automobile safety.(opportunity),stricter emissions
regulations(opportunity) and expanding environmental regulations(opportunity). All these factors
act as opportunities as they help in improving quality of products and services. These factors also
help in boosting corporate brand image of General Motors in competitive market.
Environment factors: Different markets have different environmental standards or
norms that affect overall probability of General Motors in competitive markets. Ecological trends
and changes affect supply chain , product usage and so on . External factors affecting General
Motors involve changes in climate pattern(opportunity), rising level of air quality
effect(opportunity)and so on. These opportunities help General Motors to improve its
sustainability standards and its brand image as well.
Based on all these factors, Managers of General Motors analyse and evaluate macro
environmental factors affecting it operational efficiency. Also , it helps in analysing its effect on
profitability.
TASK 2
P2 Using appropriate frameworks analyse the internal environment and capabilities of a given
organisation
A business strategy is a process to help a organisation in achieving their pre set goals and
objectives. It also help a business entity in improving their productivity for a longer duration
(Iacob, Quartel, and Jonkers, 2012). In this regard, the chosen organisation here is General
Motors which is largest automative corporation and operating its business operations at a global
level. It is necessary for General Motors to analyse external and internal environment in order to
gain competitive advantage in a business environment. This will help the chosen organisation in

formulating a strategic direction for achieving their aims and objectives. In this context, swot
analysis will help General Motors in identifying their market strength and weakness.
Swot Analysis of General Motors
A swot analysis is a overall evaluation of a company's strengths, weaknesses,
opportunities and threats, which will help General Motors in using future opportunities as
competitive advantage.
Capabilities
(a) International knowledge
The market share value of General Motors is continuously increasing because of its right
decision making policy and business strategies. It is operating its business activities at a global
level successfully because of their international market knowledge, which helps them in
retaining their profitability in a business environment. Their right planning and proper execution
of their business policies helps them in enhancing their overall growth and development. This
international knowledge of market will leads in making them global leader of auto-mobile sector.
(b) Customer satisfaction
It is also the important strength of General Motors that helps them in improving their
performance as compared to their competitors in a business market. They always manufacture
best in quality products in accordance with their customer needs and requirement, which leads in
achieving customer satisfaction in a competitive business environment (Akter and et. al., 2016).
(c) Innovative ideas and technology
General Motors uses innovative business ideas for promoting their products and also uses
advanced technology, which help them in making their products effective and efficient in a
global market. They are changing their business operation in accordance with a continuously
changing business environment, which helps them in gaining competitive advantage in a
business environment.
Weaknesses
(a) Poor relationship
General Motors have poor relationship between top level managers and employees,
which results in decreasing their productivity in a business environment. They are
communicating less with their employees which directly effects their employees efficiency. This

will also make it difficult for the chosen organisation in adopting recent trends and technologies,
which eventually effects their overall growth.
(b) Brand awareness
In this context, the chosen organisation is not selling their products by their own name,
which leads in decreasing their brand awareness among their potential customers. It is the largest
auto-mobile sectors in the world but its competitors like Toyota and Hyundai are well known as
compared to General Motors. It is necessary for the chosen organisation to promote and advertise
products by their brand name also in order to enhance their overall growth and development.
(c) Low class products and services
They are providing low class products and services to their potential customers as
compared to their competitors, which results in effecting their goals and objectives in a business
environment. They are dependent more on government in order to generate revenue, which leads
in spending less on their manufacturing process that eventually effects quality of their products
and services.
Opportunities
(a) Right marketing strategy
The general motors should have an appropriate marketing strategy that will aware their
potential customers about their new schemes and products, which will help them in improving
their overall growth and development. It is essential for the chosen organisation to formulate
marketing strategy after proper analysis of market, which leads in manufacturing products and
services in accordance with their customer needs and requirement.
(b) Updating their vehicles as per trend
It is necessary for General Motors to always update their vehicles in accordance with
recent trends in a business environment. They should also introduce advance technology in their
cars which are helpful for their customer in future, this will leads in attracting their customers in
a business environment.
(c) Focus on global market
The General Motors should have to focus on expanding their business operations at a
global level, which will help them in increasing their customer reach. It is essential for them to
give more focus on foreign markets with US market in order to improve their overall
performance in a competitive business environment.

Threats
(a) Rising competition
In this regard, it is necessary for the chosen organisation General Motors to be
competitive and use new technologies because their competitor Toyota is currently using hybrid
technology in making their products. It is essential for the chosen organisation to be competitive
by providing discounts and various profitable schemes to their customers in order to increase
their sales.
(b) Increasing fuel prices
It is the biggest threats faced by every auto-mobile company including General Motors,
so it is necessary to manufacture electronic vehicles or vehicles that consumers less fuel. This
will helps them in improving their profitability in a business environment.
As per above mentioned scenario, there are some strengths, weaknesses, opportunities
and threats of General Motors which will help them in using these opportunities in order to gain
competitive advantage in a business market. In this context, the chosen organisation General
Motors is operating its business activities at a global level with international knowledge but they
need to adopt recent trends in order to improve their overall performance. It is also essential for
the chosen organisation to adopt right marketing strategy in order to gain competitive advantage
in a dynamic business environment. It is also essential for General Motors to build strong
relationship with their employees and also to manufacture cars that consumes less fuel, this will
helps them in overcoming its weaknesses in s business environment.
TASK 3
P3 Evaluate outcomes of analyses using Porter's five forces models
In order to evaluate organisation competitive position in market place is is very essential
for company to evaluate forces in environment which includes it's strength and weaknesses.
Hence, it is important for General motors to make their strategy accordingly to improve their
weak factors and take fair advantage of strong factors. In this regard, Porter's Five Forces theory
which was developed by Michael Porter to determine profit potential of market (Woodard and et.
al., 2012). With the help of this theory company can able to analyse their strength and weakness
and identify in which sector power lies in business situations. This theory also organisation to

identify their area of strength while improve their weakness and avoid any future mistakes. In
relation to this, this theory have been mentioned below to examine competitive forces in a
market for general motors:
Competitive Rivalry: This factor of Porter's model defines that strength of competitors
and determines number of existing competitors in a marketplace. Competition is generally high
in market when there are few companies equally selling goods and services. Competition mainly
increase when there are large numbers of same business firms. It is an external factor which
affect growth of business firms. There are numerous competitors in market like Volkswagen and
ford that are having large number of buyers in marketplace. They can adversely affect on general
motors and hamper their growth. Therefore, in order to overcome these situation General motors
need to develop effective marketing strategies to attract large numbers of consumers towards
them. These factors can lower the growth and profit rate of company. Therefore, it is essential
for General motors to formulate strategies to gather information of their rivals like they can
evaluate number of competitors in market, product differentiation , competitors size. After that
make effective plans and procedures to attract consumers in unique way. Company can take
advantages of high advertising and aggressive price cuts to enhance their profitability.
Bargaining power of customers: This factor mainly deals with ability of buyers to drive
process down. It is generally affected by numbers of consumers company have. Consumer
impacts upon any organisation in strong manner. As different costumers are having different
types of taste and preferences so if they don't get what they want then they easily shift on
different products and services. There are large numbers of customer associated with General
motors. Therefore, it is very essential for company to evaluate all factors prevailing in this sector.
Hence, it is necessary for company to make effective strategies to overcome all these factors.
This situation generally arise when there are only few number of buyers exit in marketplace
substitutes are easily available and when buyers are price sensitive. As costumer is essential
element for all business units and this factor can rapidly decrease demand of General motors
products and services. Therefore is is necessary for General motors managers to examine number
and size of buyer and make their strategies effectively. By firmly implementing these strategies
company can able to increase their productivity and profitability.
Bargaining power of suppliers: This factors determine ability of suppliers to drive high
prices. It is generally affected by uniqueness of their goods and services, switching costs,

importance of business sector, number of substitutes, product standardisation and vertical
integration (Schrader, Freimann, and Seuring, 2012). All these factor allow market suppliers to
sell their low quality products in high range to buyers. It is essential of managers of general
motors to understand this factor because it can affect them thoroughly. They have to pay more
prices for material which adversely affect their profit margin. Supplier have power to sell
products according to their wish this will greatly impact on business functions of general motors.
Therefore, it's very important for general motors to make effective strategies. In order to
overcome this factor managers need to evaluate number of suppliers in marketplace. Company
have ability to find substitute material and cost of switching to other alternative material. By
making effective organisation strategies according to their research company can easily achieve
more competitive advantages and profitability.
Threat of new entrants: Profitable markets easily attract new entrants. But there are
several forces that acts as an barrier to enter in a marketplace. These forces includes economic of
scale, patents, government policies and capital requirements. All these factor can adversely affect
growth of General motors. Threat of new entries is generally when there is low capital required
to enter in market and aslo there is no government rules and regulations, low consumer loyalty
and organisations do not posses trademarks, brand and patent reputation. In order to overcome
this situations it is very essential for managers of general motors to examine amount of capital
when they enter into any new market, they need to abide legal implementations, product
differentiation techniques, brand reputations and government regulations. Also by firmly
accessing to suppliers and distribution company can able to increase it's productivity. As general
motors is an well established company and their gowth and productivity is hard to replace by any
new entrants so they need to mainly focus on developing quality of their products to gain
competitive advantages.
Threat of substitute products or services: It is a situation when a consumer is able to
get close substitute of any product or services (Oestreicher and Zalmanson, Rothaermel, 2015).
This situation arise when price is high or they get better quality of product in marketplace. This
factor decreases power of suppliers. In relation to General motors this situation can bring down
number of their costumers. So in order to overcome this situation managers of this company need
to analyse and implement strategies to expand their competitive advantages. They need to focus
on techniques like increase their profits while reducing cost or increase their market share while