Impact of Strategies on Decision Making: A Case Study of Bang & Olufsen

This report evaluates the impact of various strategies adopted by Bang & Olufsen on their decision making and activities. It also analyzes the internal and external factors influencing the company and their response to such factors.

Strategic management

Table of Contents
INTRODUCTION...........................................................................................................................3
1) Evaluate how various strategy that has been adopted by Bang & Olufsen impacts the
decision making of the company............................................................................................3
2) Analyse the internal and external factors that influences Bang & Olufsen and the ways with
which company respond to such factors.................................................................................6
CONCLUSION................................................................................................................................7
REFERNCES...................................................................................................................................8

INTRODUCTION
Strategic management is the concept that deals with the planning, monitoring and
controlling the resources of the organisation so that the goals and objectives can be achieved.
With this the objectives are determined for the organisation that further facilitates them to
identify various actions that they need to take (Reuer, 2017). For this it is important for the
businesses to efficiently analyse their both internal and external environment so that they can
identify various opportunities and threats by combing them with their strengths and weaknesses.
To understand the impact of strategies and how they are adopted by the companies the case study
of Bang and Olufsen is taken into consideration. It is an organisation headquartered in Struer,
Denmark and it designs and manufactures various audio parts, telephones, television sets etc.
The products so offered by them are luxury products. In this report the evaluation of the strategy
so adopted by the company is taken along with the analysis of business environment is taken into
consideration that includes both internal and external environment so that its impact on the
organisation can be analysed.
1) Evaluate how various strategy that has been adopted by Bang & Olufsen impacts the decision
making of the company
Company background: Bang & Olufsen is a high end luxurious electronics manufacturer
that provides television sets, telephones, audio products etc. The company was started in the year
1925 by Peter Bang and Svend Olufsen. For the first time they designed a radio that can work
with altering current. Such a product was a revolutionary idea as with these convenient powers
can be provided to the radio.
Vision: The vision of the company is to modify the style with which people listen the
music and see the world around them with the help of various highly advanced audio and video
products.
Mission: The mission of the company is to provide differentiated and better quality audio
and video products to the customers that are highly innovative so that their satisfaction level can
be improved.
Objectives: The objective of the organisation is to decreased their strategic partners by
30% so that thy can manage long term and effective relation with the key partners. This will
enable them to focus open specific technology with specific partners who can facilitate them in

adopting such technology. In addition to this, they aim to integrate their technological platforms
with their products domains within a period of two years. Apart from this with the help of
various new technologies they want to be cost efficient in production.
Bang & Olufsen is facing stiff competition due to which they need to focus upon their
strategies so that they can deal with emerging competition. For managing this they are planning
to launch new products with the use of best technology and innovative solutions. This will enable
them in adding quality to the products along with various unique features (Albareda, 2017).
Various strategies which are adopted by the Bang & Olufsen are given below along with
their impact on the decisions and activities of the company.
Pole position: This is the strategy in which the focus of the company is to increase their
profitability by becoming product focussed. For this a clear goal is to be determined by the
company so that accordingly they determine various course of action (Ansoff and et. al., 2018).
With the help of this strategy a sense of urgency is created among the team members and other
employees so that their performances can be made efficient enough to achieve such goals. All the
roles and responsibilities of the individuals are delegated to each and every member so that the
possibility of the conflict and redundancy of the tasks does not occur. Also it will enable the
organisation to make efficient use of capabilities of their human resources that they have. The
impact of this strategy on the decision making of the organisation is with this they can efficiently
integrate all of their employees with the goals and objectives of the organisation. For this
coordination and collaboration need to be facilitated.
Product development for categories of the product: In this strategy the focus of the
company is on developing new product range which is audio and video products. With this they
can reduce the cost of manufacturing various products and services as all the products can be
manufactured together (Chen and Wong, 2015). This strategy has direct impact on the decision
making as with this the decisions regarding the use of various technology for different products
need to be taken. Along with this the focus of the company under this strategy is on producing
new products which will enable to offer better quality products which will be unique (Valeur,
Bang and Olufsen AS, 2016).
Focusing on technological digital platform for each product category: With this
strategy the organisation aims to launch advance technology in at least one category of their
products and services. It will enable them to launch new products effectively with reduced cost

and within the time limit so assigned for the launch. Such strategy has impact on the decision
making and activities of the organisation as with they can launch new product and services with
the existing technological advancement. It will reduce the cost of undertaking various research
for launching new products and development (Fozer and et. al., 2017).
Concentration on one global sales organisation: As per this strategy the focus of the
company is on one sales organisation. This will enable them in dealing with all the authorised
stores located worldwide. With this similar services will be offered to the customers across stores
along with same products as they all are governed by the same office. The standards can be
established for the quality of the products for all the stores and it will make the sales department
of the organisation efficient enough in contributing to the sales of the organisation.
Adjustment in the structure of the cost on the basis of market conditions: With the
help of this strategy the company can ensure their profitability even in the unfavourable market
situation. For this they monitor the structure of their cost so that significant changes can be made
as per the prevailing changes. This will make them capable enough of competing with others and
formulating effective pricing decisions so that sustainability of the business can be ensured.
The strategies so adopted by the company have impact on their decision making and
activities. Such impact will be in context of the market segmentation of the organisation for the
products that they offer. The focus of Bang and Olufsen is on the high income group people who
can afford their luxurious products (Hill, 2017). Then they need to focus upon the targeting of
the customers and they do it effectively with the help of various promotional activities. With
such activities they aim to create awareness about their offering and various offers, schemes for
making purchases etc. They focus upon various digital media marketing and various others
sources such as T.V, print media, social media etc. Lastly the important strategy on which they
need to focus upon is positioning. With the help of this they can position their products above the
competitors by introducing innovation in their offerings and making them more advanced. This
is because the people from the elite class focus more on quality of the product rather than the
prices. So it will make them efficient enough for making their customers loyal.
Various approaches that are adopted by the Bang and Olufsen are: Competitive approach: They focus upon adoption of various technologies so that they
take competitive advantage over others. For this they have their showrooms in such

locations that can easily be accessible to the customers along with various augmented
services that contribute in improving the satisfaction of the customers. Differentiation approach: The organisation aims to provide differentiated products and
services to the customers which are unique and innovative features, designs etc. The
focus of the company is on the unconventional solutions of the issues faced by the
company, intelligent technology and many more (Kolios, Read and Ioannou, 2016). Quality approach: By adopting the changes taking place frequently they improve the
quality of the products and services so that satisfaction level of the customers can be
improved.
2) Analyse the internal and external factors that influences Bang & Olufsen and the ways with
which company respond to such factors
For the businesses it is important to analyse various internal and external factors that has
impact on the business. The functions and operations also get influenced due to various strategies
of the organisation. The analysis of external factors for Bang & Olufsen is given below: Political: The political conditions of Denmark are stable and it is part of EU due to which
they may have to face various restrictions as technological requirements changes
frequently. Various trade implications are imposed by EU that has direct impact on the
organisation as they are operating in many countries so they have to comply with them.
This enables them to operate efficiently in the international market (Moutinho and
Vargas-Sanchez, 2018). Economic: Bang & Olufsen has a large market in UK and due to which they have highly
progressive customer base. The people in UK have higher purchasing power that offers
an opportunity for them to expand their business. For grabbing this opportunity the
company focuses upon innovation in the features of the products and improved quality
which has positive impact on them. The customers because of high purchasing power can
afford their products easily. Social: These factors are related with the perception of the people and their taste and
preference. The people of Denmark consider Bang and Olufsen as a luxurious brand as
they have positioned themselves for better quality and of better technology. As the
preference of the customers of UK is better quality products and this has positive impact
for Bang and Olufsen.

 Technological: The rate of technological advancement is so frequent and high due to
which the businesses need to cope up with this so very frequently for ensuring their
sustainability. The focus of Bang and Olufsen is on innovation and adding new features
so this has positive impact on them.
Along with external factors various internal factors must also be analysed by the company. Such
analysis is done for Bang and Olufsen with the help of SWOT analysis:
Strengths: Bang and Olufsen has a strong brand image at international level due to which
they have the opportunity to expand. Also their focus on providing innovative products and
services is their strength with which they can easily expand their market share and size.
Weaknesses: For fulfilling the aim of providing innovative products they have engaged
efficient and qualified workforce which help them in achieving their objectives but such
workforce if quite expensive. Also the bargaining powers of the suppliers are high which has
impact on their business (Sridhar and et. al., 2016).
Opportunities: As they have brand recognition at international level so they have
opportunity to open up various branches and manufacturing units in various other countries. This
will enable them in untaping the market where they are not yet operating.
Threats: The stiff competition that the company has been facing has threat on their
operations. The emerging competitors such as Samsung, Sony offers low cost products which
influences the customers base as the high income group people mat shift to them.
CONCLUSION
It is concluded from the above report that it is important for the organisation to focus upon
various strategies that they have adopted as they have direct impact on their decisions making
and activities. For ensuring the sustainability of the business various strategies such as that of
segmentation, product development etc. needs to be taken into consideration. Along with this it
is important to analyse the internal and external market with the help of SWOT and PEST
analysis respectively so that effective strategies can be formulated for dealing with various
situations.

REFERNCES
Books & Journal