Analyzing the Impact of Macro Environment and Internal Capabilities on Business Strategy

BUSINESS
STRATEGY

Contents
INTRODUCTION...........................................................................................................................3
PART 1............................................................................................................................................3
TASK 1............................................................................................................................................3
P1 Applying appropriate frameworks analyze the impact and influence of the macro
environment on a given organization and its strategies. .............................................................3
TASK 2 ...........................................................................................................................................5
P2 Analyze the internal environment and capabilities of a given organization using appropriate
frameworks. .................................................................................................................................5
TASK 3............................................................................................................................................8
P3 Applying Porter’s Five Forces model evaluate the competitive forces of a given market
sector for an organization. ...........................................................................................................8
PART 2............................................................................................................................................9
TASK 4............................................................................................................................................9
P4 Applying a range of theories, concepts and models, interpret and devise strategic planning
for a given organization. .............................................................................................................9
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Business strategy is very important for a company when it seeks to grow in the market in
the strategic manner. While putting it in simple terms, it is set of plans, goals and actions which
outline how the business shall compete in the market with its product or service. It is vital that
business must take into account many factors such as market competitors, business environment,
company’s structure, its strength, weakness and many others(Yuan and et. al., 2020).The
organization chosen is Starling Bank, a digital challenger bank which is headquartered in United
Kingdom. This report shall cover the influence and impact of macro environment, capabilities of
internal environment, porter’s five forces and theories and model for strategic planning.
PART 1
TASK 1
P1 Applying appropriate frameworks analyze the impact and influence of the macro environment
on a given organization and its strategies.
Macro environment is a conditio0n which exist in whole economy rather than in
particular region. In order to analyze the influence and impact of external factors, the following
framework is being applied which are narrated below-
PESTEL analysis
It is a framework which is used to analyze the macro factors of the economy which are
discussed below in context to starling Bank- Political- It consists of the political environment of the country where the business is
being operated. In relation to Starling bank, the Brexit uncertainty have delayed its
expansion in European nations which have resulted in delayed expansion of the Bank. Economic- It includes the economic factors like inflation, fluctuation in foreign currency
etc. The Starling Bank has been impacted by the slow economic growth of United
Kingdom due to pandemic of Covid 19. This has affected its grow and success. Social- It includes the socio cultural factors like demand, supply, behavior of people etc.
In relation to Starling Bank, the company has advantage that millennial are ready to adopt

the digital financial services with flexible feature which helps in attracting the young
generation which will ultimately help in growing business(Moktadir and et. al., 2020). Technological- It includes the technological up- gradation which supports the business.
The starling bank deals with digital financial services and increased cyber safety concerns
have affected the company as it may cause the loss to the company due to cyber-attack. Legal- The new policies in Europe have been rewritten due to general data protection
regulation which have offered to citizens of EU the protection on new level. The bank has
obligation to protect the data of its customers and comply with all GDPR regulations in
order to promote customer trust and engagement. Environment- It involves the environment sustainability in order to protect the
environment. In relation to starling Bank, it has an advantage of attracting customers as it
has small carbon footprint as compared to other banks which deal in digital medium. A
study showed that people get attracted to such organization which works in eco-friendly
manner.
Stakeholders analysis
The power interest matrix bifurcates the stakeholders of the company on the basis of their
power and interest in company. In context to starling Bank, the stakeholders analysis is discussed
below- High power- High interest- It involves the stakeholders who are required to be managed
closely(Farrukh and et. al., 2020). The board of directors and key personnel of bank are the
one who are to be satisfied fully and make their engagement. High power- less interest- It involves the stakeholders who are to be keep satisfied. In
relation to Starling bank, It includes the employees of organization who have power in
organization but keeps less interest in working. They manage the working of bank. Low power- High interest- It includes the stakeholders who are required to be informed
only. In relation to Starling bank, the customers are the one who have less power vut high
interest in the working of bank as they are dependent on their working. Low power- low interest- It includes those stakeholders who are required to be monitored
only. In context to starling bank, it includes the suppliers as they are only to be monitored
but does not require excessive communication (Kong, Yang, Liu, and Yang, 2020).
Ansoff matrix