PESTLE Model for Environmental Analysis Vodafone
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Added on 2020-10-05
PESTLE Model for Environmental Analysis Vodafone
Added on 2020-10-05
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BUSINESSSTRATEGY
Table of ContentsINTRODUCTION ..........................................................................................................................1TASK 1............................................................................................................................................1PESTLE model for environmental analysis................................................................................1Ansoff's growth vector matrix to analyse strategic position of organisation..............................3TASK 2............................................................................................................................................5VRIO model to analyse strategic capabilities possessed by chosen organisation.......................5Strengths and weaknesses associated with organisation.............................................................6SWOT analysis............................................................................................................................6TASK 3 ...........................................................................................................................................7Appropriate strategies to improve competitive edge of organisation in market.........................7TASK 4..........................................................................................................................................10Produce a strategic management plan for organisation showing clear strategic directions......10CONCLUSION..............................................................................................................................13REFERENCES................................................................................................................................1
INTRODUCTION Business strategy is the means by which an organisation formulate plans so that desiredobjectives can be attained in an effective manner. It is defined as a long term business plan. Anappropriate business strategy can be implemented for about three to five years depending uponthe targets and aims of company (Bentley,Omer and Sharp, 2013). This assignment is written incontext with Vodafone which is a Britain based telecommunication conglomerate, situated inLondon. Registered office of company is in Newbury, Berkshire, England. Company issuccessfully operating at global level and operate in around 75 countries. This report will coverframeworks to identify the impact of macro environment on an organisation along with internalenvironment and capabilities of an organisation. Beside this, to evaluate competitive forceswithin given market sector, porter's five force model is used. At last an effective strategic plan isprepared so that an organisation can achieve its desired objectives. TASK 1PESTLE model for environmental analysisEnvironmental analysis is a strategic tool which is used to identify different internal andexternal elements which can impacts the performance of an organisation. This analysis will helpsin analysing the risks and benefits associated with an business. Evaluation form these analysisare then interpreted into decision making process by aligning the formulated strategies withenvironment of organisation. Vodafone is a leading company in telecommunication sector.Vodafone listed in London Stock Exchange and have the largest revenue amongtelecommunication companies. According to report 2010, Vodafone is the biggest service brandbecause of its efficient services and excellent signal strength. It's global presence and strongbrand image make it popular in telecommunication industry (Bharadwaj and et al., 2013). In caseof Vodafone which is a multinational telecommunication company, PESTLE analysis is carriedout below so that environmental analysis can be carried out in an effective manner:Political factor: These aspect involves stability of government, trade policies, tax andcustom duties which can impacts the overall business productivity of any company. Incase of Vodafone, the company operates in wireless communication at global level due towhich it exposes itself to different political system risks and environments. It is essentialfor manager in Vodafone to consider rules and regulations formulated by governments of1
different nations to run business in a smoothly manner. For example, Operating businessin war prone area like Middle East Asia, is a risky task and can results in heavy loss ofrevenue to company. Recent conflicts in Europe has also impacted the profitability ofcompany but as government in UK is stable, hence company have wide opportunitiesthere to achieve high growth and profitability.Economic factor: These factors are related with per capita income, GDP, economicalgrowth of a nation. As Vodafone operate in more than 75 countries, it is important forthe management of company to consider these aspects before initiating business projectin a region or state. More developed regions will offer more profitability to the company.Good GDP of a nation will indicate good disposable income of population due to whichthey will prefer to spend more on latest communication technology. Beside this, globaleconomic crisis have impacted the working of Vodafone in a negative manner but toovercome that company has formulated different strategies and plans (Bharadwaj and et.al., 2013). Social factor: These factors totally depends upon the culture and beliefs of people wherecompany is operating or planning to expand its business operations. As Vodafone is aEuropean company and it sets its regulation and pricing policy in accordance to Europeanmindset, company is performing well in European nations like UK, France etc. Butcompany can face issues while operating in other countries such as Africa, Thailand etc.which are not financially and socially developed as compared to European nations. Tomanage social factors in a positive manner, Vodafone is required to be flexible in itspolicies and regulations so that targets of company can match the aspirations andpreferences of local people. Technological factor: Vodafone is popular for technological advancement andinnovation as company prefer to follow contemporary trends. As company have manyrival companies performing well in same sector, it is essential for Vodafone to be onestep ahead in Technology so that high customer base can be sustained. As company dealsin wireless communication, high investment is required in innovating and upgradingtechnology (Blackburn Hart and Wainwright, 2013). In case company avoidstechnological up-gradation, this can results in less sales, low revenues and reduced brand2
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