Possible Strategic Directions for Aston Martin

This report provides possible strategic directions for Aston Martin to meet its objectives and gain a competitive edge in the global automotive sector. It includes an analysis of the company's mission and values, micro and macro environmental impacts and limitations, and strategic directions based on the Ansoff Matrix. The report concludes with the recommendation of diversification as the most suitable strategy for Aston Martin.

Strategic Management

Table of Contents
INTRODUCTION...........................................................................................................................1
Possible strategic direction/s to meet the objectives of Aston Martin.............................................1
Company’s stated mission and values....................................................................................1
Micro environmental impacts and limitations........................................................................1
Macro environmental impacts and limitations.......................................................................3
Strategic Directions for the company.....................................................................................4
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................1

INTRODUCTION
Strategic management can be defined as the course of action as well as decisions
undertaken by an organisation with a view to attain competitive edge at market place. This is key
to achievement of organisational goals and objectives within due course of time. Strategic
management is executed by a business entity with the help of a number of analytical models as
well as theories. The present project is based upon Aston Martin which is one of the most
renowned luxury automotive organisations based in United Kingdom. The report seeks to
provide possible strategic direction/s to the company with the assistance of which it can realise
its objectives. The paper consists of mission and vision of the firm forming the objectives for
which it is functioning in market place. Further, it includes the macro as well as micro
environmental analysis to identify the probable strategies which can be adopted to obtain
strategic edge over rivals within global automotive sector.
Possible strategic direction/s to meet the objectives of Aston Martin
Company’s stated mission and values
Aston Martin is a top notch luxury automotive organisation engaged in production of cars
with distinct and unique features that can largely appeal to public at large. This auto-maker has
an extensive base of loyal customers who are not willing to shift to other brands regardless of the
hike in prices which is sometimes done by the management of the organisation looking on the
market demand. People across the globe relate this brand with luxury, quality and best in class
service owing to its past records. In this regard, the objectives of Aston Martin in terms of its
mission and vision are identified as follows:-
Mission:
“To offer cars which are a true reflection of luxury, comfort, ease and superior quality to
gain maximum satisfaction from people”
Vision:
“To become the leading organisation in global automotive sector by being at the heart of
customers”
Micro environmental impacts and limitations
It is important for an organisation to constantly analyse the micro environment in order to
devise effective and strong strategies which can provide edge to the firm over competitors
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present within same corporate sector. SWOT analysis is an effective tool which is applied by
organisation across the globe with a view to gain knowledge of the internal environment of
business. Thus, in order to assess the inner strengths, threat, opportunity and weaknesses of the
British leading auto-mobile company Aston Martin, SWOT analysis is hereby discussed for the
formation of further business planning by considering all the associated factors.
Strengths:
 Aston Martin is one of the leading luxury sports car manufacturers in UK that offers a
wide range of auto-mobile on a global level.
 The respective organisation has extensive brand recognition on a worldwide level in
terms of quality, luxury, performance and service.
 Aston Martin offers the best in class segments products as it is also popular for the
innovative cars and techniques within the super car industry. These are designed in a way
to meet the expectations and needs of various customers and provide the benefit of
greater cost efficiency.
 The use of technology in the cars of Aston Martin is the distinctive standard of the firm.
It emphasises on the futuristic techniques. The promotion and practice of innovative ideas
in the process is also a key representative feature of the organisation in the global market.
Weaknesses:
 Aston Martin has large number of giant competitors in the luxury auto-mobile sector
some of them are Jaguar, Land Rover, Rolls Royce etc. thus all these big competitors
increase the market division.
 This tends to decrement in pricing factor and also reduces the effective capturing of
market share as well as the profit margin of the sales of Aston Martin in the national as
well as in international markets.
Opportunities:
 The management of Aston Martin gives various opportunities to the organisation as to get
the effective technologies into the operational units to increase the quality and efficiency
of the final products.
 Aston Martin can surely sale its product by doing the online promotion and evaluating the
other sales alternatives that is available on various online sales portals.
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 There are certain opportunities for the firm in respect of expanding its operational cycle
by doing outsourcing and establishing manufacturing units in the developing countries.
Threats:
 The availability of more credit facility in relation to Aston Martin threatens the optimum
market share and this affects the prise and cost.
 The other one major threat to Aston Martin is the high rise in price of raw materials and
production process that is increasing the price of final product on a higher range.
 Being a global company the severe rules and regulation of different government of
respective nations are able to put the pressure on the trading of Aston Martin that will
impact on the overall procedures and other policies within the organisation.
Macro environmental impacts and limitations
The analysis of macro environment is essential in terms of identifying the external factors
and assessing their impacts on the operations and certain other elements of business. These
environmental factors are needed to be considered for the effective growth and efficient survival
of the company. In relation to Aston Martin, there are major external factors that affect the
business workings. These factors are evaluated by performing PESTLE analysis in context of the
enterprises. This analysis covers the 6 important factors of external environment which are
discussed as underneath:-
Political Factors: The political system within the confines of UK is dual party. This
system has remained since the year 1920. As the policies of the government remain consistent
over the course of time, Aston Martin benefits from the same. It acts within the constraints of
governmental regulations to gain acceptance from public as well as government. Further, it is
analysed that BREXIT is a factor against which Aston Martin should be concerned. This is so
because this phenomenon results in decline in sales as well as profits of the company.
Economic Factors: The economic conditions within UK over the course of time have
been affected by the phenomenon named BREXIT. This has resulted into a downturn for the
concerned economy, resulting into decline in the value of sterling. However, it has been also
noticed that the developments within the confines of this nation are well versed to provide
assistance to the organisations in launching new products at rapid intervals of time. By launching
new offerings at the market place, the respective automotive firm is able to gain the attention of
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large number of individuals and thereby appeal to them in an effective manner. This inflates the
level of revenues for Aston Martin within the domestic market.
Social Factors: Looking upon the awareness of consumers regarding the latest patterns
and styles within the automotive industry, Aston Martin launches new models of cars at due
intervals of time. This helps a great deal in appealing to large base of audience prevailing at
market place. On the other hand, there are high probabilities that a social trend can be anticipated
by a rival automotive company before Aston Martin. This would result in substitution effect and
the customers of Aston Martin would automatically get shifted to the rival brand with market
disruptive offerings (cars).
Technological Factors: Looking upon the emergent tech trends, Aston Martin comes up
with new offerings or manufacturing procedures. In this regard, the company has automated
some of its manufacturing stages so as to reduce the burden on human resources and get the
work done in an efficient and effective manner. However, the negative part associated with this
aspect is the increment in overall cost of operations that takes place as a result of execution of
any of the tech systems, techniques or procedures.
Environmental Factors: Looking upon the growing awareness among people regarding
environmental protection, Aston Martin has initiated to decrease the carbon release and minimise
waste. It leads to increase in goodwill of corporation at global market place. However, it is
acknowledged that such a measure involves huge cost invested by the company to execute
sustainable practices within the confines of organisation. This inflates the overall cost for the
entity, thereby increasing the financial burden for Aston Martin.
Legal Factors: The management of Aston Martin ensures abidance with all the essential
legislations pertaining to automotive sector so that the goodwill of company at global scale does
not get hampered. An instance of non compliance with any of the legislations would prove to be
adverse for the respective organisation as this would harm the goodwill as well as market
positioning of the respective firm.
Strategic Directions for the company
This model is basically used to make strategic planning of marketing of opportunities to
generate the revenue for business development with new and existing products and services in
similar and new market. In this regard, it is acknowledged that Ansoff matrix is also known as
"Product-Market Matrix". This model has been applied by the management of Aston Martin with
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a view to determine the most suitable strategic direction for the firm in context of future course
of time. The strategy selected out of the 4 strategies pertaining to this model would provide aid in
inflating the positioning of Aston Martin within global automotive industry. With respect to this,
Ansoff matrix has been applied to the respective automotive company in a detailed manner as
follows:-
Market Penetration:
This can be defined as the practice of selling existing products in existing markets. By
using the strategy of penetration i.e., the selling of existing product to the existing customer, the
company can quantity and acquire the new customers also very efficiently. In this regard, it has
been analysed that Aston Martin can execute this strategy in an effective manner by
implementing competitive pricing and developing attractive and appealing ad campaigns. These
would be very useful to execute penetration strategy within the premises of respective
automotive organisation. Aston Martin can also come up with special offers on its cars to
increase the sales as well as profits within its domestic market.
Market Development:
This strategy can be referred to as the business growth by selling the existing product in
the new market. Aston Martin can implement market development strategy by selling the current
organisational offerings in developing or emerging markets. For this, the company would have to
facilitate expansion from UK to other regions around the world. The concerned automotive
company can execute this strategy by effectively devising and developing marketing strategies
and gaining the attention of people prevailing within the confines of new markets. In this regard,
it can be analysed that this strategy would result in increment of the customer base for Aston
Martin. Also, it would imply inflated level of revenues as well as profitability.
Product Development:
This strategy can be defined as the practice of new product coming into the existing
market of company. In this regard, it has been analysed that Aston Martin can effectively
implement this strategy within its confines by introducing new cars with stylish, innovative, tech
and market disruptive features. This is one of the most effective strategies as hereby new
products are developed and sold within the domestic territory of the entity. By launching new
cars with stylish features or entering into new product categories such as perfumes, bags,
footwear; Aston Martin can successfully formulate this strategy. This strategy provides aid to the
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enterprise in tapping the attention of new customers by providing them with unique offerings at
market place. This facilitates increment in global market share by provision of new offerings
within existing audience.
Diversification
The implementation of diversification is very difficult as it involves selling new products
to customers in new markets. Aston Martin can execute this strategy by gaining entry into new
markets with the help of new and innovative products. This is considered as a risky strategy as
the chances of failure and success within this strategy are quite equal. In this relation, it has been
analysed that Aston Martin has the scope of tapping the attention of people present within
emerging markets with the new offerings. This will enable the firm to enhance its existing share
of market as well as customer base.
On the basis of above analysis of the 4 strategies, it can be identified that diversification
would be the most suitable strategy for Aston Martin. This is identified to be effective as UK is
currently affected by BREXIT and thus entity needs to facilitate a shift in its focus in order to
recover the decline in sales as well as profits in UK with the earnings made in new market. This
would further provide aid to the respective automotive company in appealing to a large number
of individuals in new territories. It will aid Aston Martin in ensuring its sustainability in market
place for a long period of time.
CONCLUSION
On the basis of above discussion, it can be said that strategic management is an important
part of each and every business organisation. It forms the base on which the strategies as well as
decisions of the company are undertaken. Further, it is analysed that macro and micro
environmental analysis is important to be conducted so as to identify an appropriate direction for
the firm through which it can attain a competitive advantage at market place. The macro
environmental factors are better analysed with the help of PESTLE analysis. Apart from this,
internal analysis is usually done by organisations via the usage of SWOT analysis. The strategic
direction for an entity can be effectively identified on the basis of analysis of 4 strategies of the
Ansoff Matrix. Selection of the most suitable strategy from the 4 strategies of this business
management model is essential for determining the course of action which has to be undertaken
by an enterprise to ensure long term sustainability within the market place.
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