International Business Strategy - Exam: Features of Multinational Enterprises, PESTLE Analysis, VRIO Analysis, SWOT Analysis

This exam on International Business Strategy covers the features of multinational enterprises, PESTLE analysis, VRIO analysis, and SWOT analysis. It explains how these frameworks help in analyzing the internal and external environment of a company for long-term growth and competitive advantage. The exam also includes a case study on Sainsbury's, one of the leading supermarket chains in the UK, and its internal and external environment analysis.

International Business
Strategy

Table of Contents
Answer 1..........................................................................................................................................3
Features of multinational enterprises are explained below-............................................................3
PESTLE Analysis.................................................................................................................3
Answer 3..........................................................................................................................................5
VRIO Analysis......................................................................................................................5
SWOT Analysis.....................................................................................................................7
References........................................................................................................................................9

Answer 1
Multinational global enterprises are companies that operate globally and have control over the
production of their goods and services in countries other than their home country. Multinational
corporations are significant businesses because they expand their operations into developing
countries (Silva, 2022). It also includes elements like proper worldwide management, improved
technology global targets, and more.
The following are characteristics of global corporations:
 Companies that are multinational firms are expected to have high earnings and financial
and physical assets. The company's aim is considered high in order to increase earnings.
Multinational corporations have marketing and production operations in multiple
countries as part of their network. It plays an essential role in enhancing the position of
national development such enterprises become one of the reasons for the growth of
foreign exchange in a particular country. For example, Cadbury has the best ability to
alter and modify its products continuously.
 Businesses must invest in their operations in order to maintain a healthy growth rate. To
achieve long-term growth, primarily in marketing and production. Apple, for example,
has contributed and made a positive investment in its business by providing the highest
quality items available. They put a priority on hiring the best people from around the
world and having the most advanced technical expertise, which allows them to think
creatively about their products and services (Shayb and Muşetescu, 2020). Amazon, for
example, makes it a point to recruit the greatest individuals from a variety of ethnicities
and backgrounds.
The following are examples of how the PESTLE Analysis is used and evaluated in the context of
various businesses:
PESTLE Analysis
PESTLE Analysis is one of the best-used frameworks to analyze the business as it helps in
understanding various aspects and situations for the company. It also examines a range of
external factors, including political, economic, social, technical, legal, and environmental
aspects. Identifying opportunities and threats of the business by analyzing external elements and
determining market growth, performance, decrease, potential, and operating direction. It is a
basic and widely used marketing technique for tracking macro-environmental elements that have

a significant impact on an organization and the sector in which it operates. It is performed to
evaluate the external environment factors of the business
Factors Explanation
Political Factors- Businesses are affected by how government policy intervenes in
economic and other concerns. Politics, traditions, law, bureaucracy,
tariffs, trade restrictions, tax policies, and other variables all play an
important role. Tesco, for example, works on a global scale, therefore
political issues are likely to have an impact on its profitability.
Government regulations and laws governing various food products also
affect Coca-Cola.
Economical factors Economic factors such as economic growth or decline, loan availability,
interest, currency exchange, inflation, living costs, and so on are all
considered. In the context of Adidas, sales are driven by customer
preferences and trends, and the company also utilizes cost management to
its benefit.
Social Factors Social factors included cultural standards, expectations, population
growth rate, age, health, and safety. These features help in the formulation
of strategies for businesses. Because unhealthy eating is not a popular
trend among customers, Sainsbury's, for example, must examine a range
of social characteristics.
Technological
Factors
Technological developments and developments that influence an
employee's performance are included in technology considerations.
Companies that do not keep up with market trends eventually lose sales. It
includes subjects such as research and development, automation, and
technology incentives, among others. Tesla, for example, strives to stay
current with new technologies in order to remain competitive.
Legal Factors This factor does have an internal and external impact on various
businesses. Laws are responsible for having a substantial impact on the
commercial environment of a country. There are laws covering

employment, discrimination, consumer protection, industry-specific
regulations, regulatory agencies, antitrust laws, and health and safety
legislation. Unilever is directly responsible for several rules and
regulations, as well as patent protection.
Environmental
Factors
These factors are mostly concerned with the effects of the surrounding
environment and environmental concerns. Among them are environmental
protection rules, water disposal laws, and energy consumption limits. For
example, Asda considers environmental concerns in order to maintain the
environment.
With the help of the above-mentioned framework, the companies monitor the various factors for
the overall development of the company. By making use of the above-mentioned factors the
company can attract better opportunities for growth in the market.
In order to increase its market share, the company focuses on growing its customer base
overseas. Such investments in any country will result in the creation of new opportunities that
will directly increase growth and revenue.
Answer 3
The corporate environment, its operations, and choices are all influenced by the internal
environment (Williamson, 2021). An internal environmental assessment helps in the
management of assets, resources, capabilities, and competitive advantages. As it allows the
company's strengths and weaknesses to be assessed, it aids the company's management in
making decisions and creating strategies. Sainsbury's is chosen company to explain this answer
as it is one of the biggest grocery chains in the United Kingdom. It was founded in the year 1869
and the company's headquarters are in London, England. It is known for supplying a wide range
of products.
VRIO Analysis
This is the tool that assesses the internal environment of a corporation, where V stands for value,
R for rarity, I for imitation, and O for organisation. for It is stated to be a resource-based study
that allows for the long-term creation of market competitive advantage.
Resources Value Rare Imitation Organisation Competitive

Advantage
Alignment of
the
company's
numerous
activities
Yes No Every business
has a plan that
fits its
requirements.
Yes, the
chosen firm
has the
organizational
ability to bring
in talented
employees.
It is necessary
to make
changes.
Pricing
Strategies
Yes No Pricing
strategies are
those that can
be duplicated
in the
marketplace.
Yes, a
company has
it.
It is temporary
Track record
of Leadership
Yes Yes Other
companies
will not be
able to copy
this.
Yes
Having a high
competitive
advantage
This organization is founded based on various resources that have helped in the development of
its vision and strategy. This is based on resources that have been chosen based on capabilities,
resulting in inefficiency in the creation of effectiveness based on the firm's capabilities. The
VRIO analysis is also used to discuss Sainsbury's evaluation, which is explained below-
Valuable- The term "valuable" refers to an organization's high-quality goods that contribute to
the attainment of goals aims and objectives. Several outstanding resources have been mentioned:
Model design- The structure followed by the respective organization is incredibly effective,
which has helped in the innovation process being completed more efficiently.
This feature is based on a range of goods and controls a variety of characteristics inside those
products.

The camera has extraordinary features, according to the manufacturer, that has helped people
change their life by snapping crisp photographs within it.
Personnel- Each organization's employees are highly educated, innovative, hardworking, and so
on, all of which help them achieve their objectives.
Rare- This category focuses on products that are unique to a company and help it gain a
competitive advantage in the marketplace. The following are some Sainsbury's items that are
used regularly that are sold by competitors:
Advance feature- When compared to its competition, this company has garnered a diverse group
of customers.
Daily usage products: These are based on the distinctiveness of the specific organization and
help with client retention daily.
Imitable- This refers to a company's products that cannot be copied in any way by another
company. There are several types of products based on services that a company has supplied
about features and items that the company sells, such as:
Electronic items include: Sainsbury's, for example, uses electrical items that are highly
advanced and help them achieve their objectives faster (Maniora, 2018).
Employees are members of a company's workforce who have specialized expertise that cannot be
copied.
Organize- It is concerned with estimating the resources required to organize things over various
periods. Various resources are structured in each organization to build sophisticated features and
items by generating resources that are necessary throughout time. Some resources are based on
time-based task scheduling. In terms of resources, cutting-edge methods were used to develop a
structured model. According to the concept, an organization has used a variety of resources to
spur innovation, which helps the business deliver more successfully.
SWOT Analysis is a theoretical model for determining an organization's present plans and
supporting a corporation in evaluating its strengths, weaknesses, opportunities, and threats to its
future. It's a method of assessing a company's reputation and formulating strategic plans. SWOT
stands for strengths, weaknesses, opportunities, and threats.
SWOT Analysis
Strengths Sainsbury's attracts a large number of customers by
maintaining high-quality products and customer relationship

management. It is that brand that sells products in all price
ranges, from high to low, as well as specialized items for
different markets. It has made several contacts in order to keep
in touch with customers and obtain feedback.
Weakness Many people find it unattractive because it does not give deals
to its customers. The company has suffered financial losses in
recent years, affecting overall sales and profit. Because of
market competition, the corporation is lowering its profit
margin in order to attract more customers.
Opportunities The company can keep up with current market developments in
the UK, which will provide it with new opportunities. The
company has the ability to expand globally in order to reach a
larger audience. It was previously amalgamated with Asda.
Connecting grocery store channels and online food buying is
another opportunity for future growth.
Threats Covid-19 influenced the global world, and the economy slowed
as people's spending power fell. In addition, the chosen firm
has been embroiled in several disputes, including ethical issues,
price manipulation, and environmental concerns. These
scandals harm the company's market image. Companies are
rapidly expanding their marketplaces to engage with people all
over the world as the world evolves and technology progresses.
As can be seen, every firm has a set of rules that can put the
company at risk.
Sainsbury's is one of the leading supermarket chains in the UK, according to the above data,
and it performs well in the market by providing excellent customer service. The company has
employed a variety of social media sites to recruit clients. The pandemic has been one of the
major causes of the company's difficulties. The corporation is looking to technology to help it
compete in an increasingly competitive market. PESTLE analysis aids in the construction of

several external aspects that lead to the long-term development of an organization (Hamilton and
Webster, 2018).

References
Books and Journals
Hamilton, L. and Webster, P., 2018. The international business environment. Oxford University
Press.
Maniora, J., 2018. Mismanagement of sustainability: What business strategy makes the
difference? Empirical evidence from the USA. Journal of Business Ethics, 152(4), pp.931-947.
Williamson, P.J., 2021. The Oxford handbook of international business strategy.
Shayb, H. and Muşetescu, R., 2020, July. Business Strategy during crisis. In Proceedings of the
International Conference on Business Excellence (Vol. 14, No. 1, pp. 263-272).
Tsang, E.W., 2021. Multi-theoretical approaches to studying international business strategy.
In The Oxford handbook of international business strategy.
Silva, P., 2022. Historical Research on International Business, Management and Strategy: An
Approach and Framework Development. Methodological Innovations in Research and Academic
Writing, pp.179-201.
Capers, K.J., 2018. The effect of the external environment on bureaucratic representation:
Assessing the passive to active representation link. The American review of public
administration, 48(4), pp.301-317.
Bowie, N., 2019. The moral obligations of multinational corporations. In Problems of
international justice (pp. 97-113). Routledge.
Kamminga, M.T. and Zia-Zarifi, S. eds., 2021. Liability of multinational corporations under
international law. BRILL.
Cohen, R.B., 2018. The new international division of labor, multinational corporations and urban
hierarchy. In Urbanization and urban planning in capitalist society (pp. 287-315). Routledge.