Business Strategy: Impact and Influence on Company and Strategies

BUSINESS STRATEGY

TABLE OF CONTENTS
INTRODUCTION:..........................................................................................................................1
LO1. Analysis the impact and influence on the company and their strategies from the macro
environments:...............................................................................................................................1
LO2. Internal environments and capabilities of the company.....................................................3
LO3. Evaluation of the analysis by using the Porter's Five Forces model:.................................5
LO4. Theories and models to assist the understanding and interpretation of strategic decisions:
......................................................................................................................................................7
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION:
Business strategy refers to the actions and practices which used by the company for the
success and growth of the company. These strategies help to improve the performance of the
employees. The business strategy is the way to reach the success and reach the objectives of the
company. Business strategy is the effective planning of the company to stand in the competitive
market to achieve their desired objectives. It focuses on the best utilization of the resources and
minimize their weakness to achieve the specific objectives of the company in the long run. The
effective practices of the company will help the business in their future and present working of
the company. The aim of the organization is to maintain the position of the company and
increase their performance of the company. It will help to minimize the threats of the business
reduces the risk from internal and external factors. In this report IKEA is the organization which
is a furnishing company. This report will analyse the impact on the IKEA from the macro
environments and on the strategy of the business operations. There is also the description of the
influence of macro environments on the company. There have lots of benefits ability of the
internal environments.
LO1. Analysis the impact and influence on the company and their strategies from the macro
environments:
Mission:
The mission of the IKEA is to expand their business globally and achieve the and growth
of the business for the long run. And provide different types of the home furnishing products and
quality services (Aims and objectives of IKEA, 2019).
Vision:
The vision of the IKEA is to fulfil the demands of the customer by their effective
products and services and creates the perfect and better life for the people of the world.
Objectives:
 Maintain the good image of the brand in the competitive market
 Focuses earning the greater revenues
 Production of the furniture should be affordable to every one
 Maintain the customer loyalty and wins the trust of the customer (IKEA mission
and vision, 2019).
PESTLE analysis:
1

PESTLE analysis refers to the method and steps taken by the business to examine the
external factors of the company such as political, environmental, social technological legal and
economical. To increase the productivity IKEA measure all the externals which affects the
success of the company (Evans, and et.al., 2017). These externals factors are explained below:
Political factors:
This factors says that the interference of the government in the business operations of the
company by various laws, taxes, tariffs etc. IKEA uses this strategy to identify the effects of the
political on their business in the economy. The problems in the supply chain is the issue related
to the factors of political so the IKEA try to solve the issue to achieve their success. By maintain
the good relations with the governments, so they make the business of import and exports easier
with minimum taxation and law (Parnell, 2016). For remaining stable in the market and increase
their revenue IKEA is fully depended on these relationships. From this IKEA will extend their
business globally easily. The political environment of the IKEA is stable sop that their business
operations are successfully done.
Positive impacts: political factors helps to maintain the good relations with the govt. so it will
help to minimize the law and regulations across the sale of international boundaries and revenue
will increase.
Negative impact: These political factors influence the business of the IKEA because every
country have different rules and regulations so it is difficult to understand the rules of all the
countries.
Economic factors:
The business of the IKEA and decision-making is affected by various economic factors
such as growth of the economy, inflation rates, interest rates and exchange rates. With the help of
the global economy the business of the IKEA measure their profits and revenues in the
international markets. IKEA focuses to set their prices of the products and services at the
affordable rates so that it will help them to handle the pressure from the fluctuations in the
economy. In the IKEA these economic factors affects the strategy of pricing whenever they
wanted to raise their prices. IKEA is famous for the low prices products and services.
Social factors:
Culture, populations and age are involved in the social factors and these factors affects
the sales of the business. The business of the IKEA is affected by these factors because company
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