Business Strategy of Organization

BUSINESS STRATEGY

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
Analysis PESTLE and SWOT of the organization ....................................................................1
Porter's Five Force Model for competitive environment............................................................4
TASK 2............................................................................................................................................6
Create Strategic Management Plan ............................................................................................6
CONCLUSION .............................................................................................................................10
REFERENCES .............................................................................................................................12

INTRODUCTION
Business strategy can be interpreted as the course of activity and set of decisions that aid
the entrepreneurs in accomplishing particular objectives of business. It is the important plan that
administration utilise to secure competitive position in the marketplace. Business strategy is the
long range description of desired image, direction and goal of the company (Bansal and
DesJardine, 2014). It is strategy of corporate purpose and activity which is carefully planned and
flexible formed with the aim of accomplishing effectiveness, using chances, securing beneficial
position, meeting challenges and threats of the firm. It is set of competitive moves and activities
that are utilised for attracting consumers, compete successfully and achieving the objectives.
This study is based on L’Oréal. It is world largest cosmetics firm and has evolved activities in
the area concentrating on hair colour, skin care, make-up, perfume and men's skincare. This
report will analysis PESTLE and SWOT of the organization. It will prepare analysis of
competitive environment utilising Porter's Five Forces Model.
TASK 1
Analysis PESTLE and SWOT of the organization
PESTLE Analysis of L’Oréal:
It is the tool utilised to analysis and monitor the macro-environmental factors which have
intense impact on performance of organization. This framework is useful when beginning new
business and entering foreign market.
Political Factors:
It involves regulations and policies which is regulated by government that company have
been working. Political factors involves taxation policies, working class regulations,
commercialism limitation etc. It also involves products as well as services that authorities wants
of give which directly affected by legislation for advertising (Martinez-Simarro, Devece and
Llopis-Albert, 2015). For example, globalization in terms of technology which is involved in
political factors that directly impact on L’Oréal positively. For instance: changes in taxation
policy is highly effected negatively on operation of L’Oréal.
Economic Factors:
It includes economic growth, interest rate, inflation rate and exchange rates in all the
nations which they are operating in. The recession element is also one of thought components in
heritage of company. The formulated states with high manlike improvement index as well as
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great efficiency can be more prostrate to branded goods such as organization. Exchange rate
influence costs of exporting products and supply as well as price of imported commodities in
economy. For example: Increasing the inflation rate is highly effected negatively on the selling
of products and services of L’Oréal. For instance: decreasing the inflation rate is effected
positively omn selling of goods and services of L’Oréal.
Social Factors:
It includes technological tendency in society. The modern society are more than
concerned in fashion trends in the company product. Current trends and demand of products
involves in social factors which is affected operations of firm (Evans and et.al., 2017). Social
factors involve ethnic feature, well-being awareness, population, growth rate, career attitudes and
accent on safety. For example: changes in the consumer needs and tastes which are highly
effected negatively on selling of good and services of L’Oréal. For instance: Increasing the
consumer awareness about L’Oréal brand which is beneficial for selling of company.
Technological Factors:
It involves environmental aspects like research and development, technology, automation
etc. L’Oréal has embraced the technological invention in various ways. They can define barrier
to entry, minimum prompt production level which is influenced on origin judgement. Moreover,
technical modification can affects costs, choice and lead of invention. For example: Adopting
the technological advancement in delivering the products and services of L’Oréal which is
positive impact on business. For instance: High cost and time are consuming in technology
advancement which are negatively effected on L’Oréal.
Legal Factors:
It involves various laws such as discrimination, consumer law, employment, health and
safety regulations. These factors have direct influence on operations, costs and demand of
product of organization. It is brand of high middle class and selected of every social group
(Hittmár, Varmus and Lendel, 2014). Company are more taken up about all legalities for running
the business smoothly. For example: If the company has not followed discrimination
regulations, so that its impact on negatively on the operations of L’Oréal. For instance: If the
company has followed health and safety for ensuring the well-being with the workplace. This
impact positively on operation of L’Oréal.
Environmental Factors:
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