Analyzing Strategies and Their Impact on Macro Economic Factors of Jaguar Land Rover Automotive

This report analyzes the strategies of Jaguar Land Rover Automotive and their impact on macro economic factors. It includes a PESTEL analysis, examination of the internal environment and capabilities, and critical assessment of strengths and weaknesses. The report also discusses the use of appropriate frameworks and models for strategic planning.

Business
Strategy

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
Analyse the strategies and explain its impact over macro economic factors of an organisation 1
PESTEL ANALYSIS:.................................................................................................................1
Macro environment factors and strategic management impact over organisation......................4
Examine the internal environment and capabilities for Jaguar Land Rover Automotive with
the help of appropriate framework..............................................................................................5
Critically examine the internal environment to assess strengths and weaknesses of an firm's
internal capabilities, structure and skill set.................................................................................8
Illustrate Porter's Five Force Model............................................................................................9
Strategies for improving competitive edge and market position..............................................11
Define relevant theories, concept and model for strategic planning.........................................11
Strategic management plan for tangible and tactical strategic priorities and objective............13
CONCLUSION..............................................................................................................................14
REFERENCES..............................................................................................................................15

INTRODUCTION
Business strategy is explained as competitive moves which is prepared by top level
management in order to gain competitive advantages against rivalry (Basil and Basil, 2019).
This is formulated by management of business in order to outline how firm can reach out to the
desire result despite of numerous challenges prevailing in the open market place. On the other
hand, company is able to achieve set goals and objectives inspecified time frame. Whereas,
ineffective tactics brings huge financial loss to the company. By scanning the external
environment, business strategies should be prepared so that firm can flourish smoothly in global
market. Jaguar Land Rover Automotive is selected for completion of report. This is a leading
British automotive company situated in Whitley, United Kingdom. It was founded in year 2008
by Tata Motors. The CEO of this leading company is Ralf Speth. This assignment covers how
Brexit influence the business both internally and externally. Analysis of internal environment
and capabilities are done. Porter's Five Force Model is deeply studied in order to understand the
level power each step is holding like bargaining power of supplies, bargaining power of buyers,
threats of substitutes, competitive rivalry and threats of new entrants. Additionally, various
models and theories are determined to devise strategic planning for a company.
TASK 1
Analyse the strategies and explain its impact over macro economic factors of an organisation
PESTEL ANALYSIS:
This is a kind of mechanism and a framework that is used in order to analyse the factors
of a micro economic environment which will create a strong impact over organisation (Bhatt,
2020). These analysis is prepared to identify those external factors that can have both positive
and negative effect over an organisation. Elements covered in it are political, economical, social,
technological, environmental and legal. Organisation covered in this analysis is Jaguar and its
impact has been explained below:
Political Factors:
This factors covers the rules and regulation prepared by the government regarding market and
trade strategies. In other words, it can be explained as policies that are formed by government
related to various aspects such as tax, labour, foreign trade. At the time of Brexit, UK has
separated itself from European UNION that is going to impact in formation of policies. As the
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tax rate is rising due to the policies of government because of this Jaguar is not able to improve
its over all sales of its product.
Economic Factors:
This factor deals with all things which can impact economy and various aspects of it.
Elements included are growth of economy, rates of exchange, interest, inflation and disposable
income. After Brexit, policies of economy is going to change because UK is going to be open
for new market of other nations that can bring more competition within its market. Jaguar is
effected positively as growth of company in market increases because of more demand from
upper class society that is helping the company to gain more profit and maintain its stability
within market of UK. This is going to generate employment that eventually reduces rate of
unemployment (Blut and Floh, 2018). Positive impact is going to be upon the company .
Illustration 1: Pestle Analysis
Source: Pestle Analysis, 2018
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Social Factors:
It deals with the changing fashion, trends those are emerging and demolishing, change in
taste of people, population growth, income distribution and safety. The dimensions of society are
dynamic in nature and it is related to customs, norms, values of public within which an company
operates. After Brexit, as UK has become an individual market variations will take place in
standards of people. Being a luxury car manufacturer Jaguar is working according to the norms
and changing trends in the society which is automatically creating a positive impact upon the
organisation.(Camilleri, 2018)
Technological Factors:
They are related as the changes that are taking place from time to time in technological
sector of a country or nation. After Brexit lots of new technologies is going to be introduced in
the market of UK. Jaguar is effected in a positive manner as it is using latest and effective
technologies because of this it is able to accomplish its goals and maintain stability in market. It
has made Jaguar one of the first preference of higher class people.
Environmental Factors:
It explains about the things that are impacting environment and this has arise recently on
a larger scale. Factor is based upon condition of the ecological balance that has been disturbed
due to raw materials degradation, increase in pollution rate, and increase in usage of carbon.
After the Brexit now UK's laws relating to environment changes and new regulations related to
environmental factors is introduced. Its is having a negative effect over the company as they are
not developing environment friendly cars this is impacting there over all performance in market
of UK.
Legal Factors:
These factors deals with different legal aspects of laws related to consumer protection,
discrimination, child labour, anti trust laws, employment and patent laws. Under this, there are
certain rules that are mandatory to be followed by companies as they consist of legal aspects.
After Brexit laws are changing in UK. This is going to created a negative impact over the
company if they do not follow the regulation then they have to pay penalties for it which lead to
loss of Jaguar. (Chaffey and Ellis-Chadwick, 2019).
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Internal environment factors and strategic management impact over organisation
Internal factors have a very dynamic effect over the growth of an organisation. These
factors are those initial factors which company has to keep in mind before entering into market
of new and existing nature. Jaguar has to analyse over those element which is effecting over all
performance of the organisation. These factors are related to SWOT analysis that helps in
achieving basic objective and better performance in market. It helps in forming those ideas
which are helpful in giving faster and appropriate evolution in growth of an organisation. Jaguar
has to seek to the basic element of strength, weakness, opportunities and threats accruing towards
organisation. These are to be followed by the company so that goals of the organisation is
achieved in smoother and better manner. Strategic management decisions are those rules and
regulations that are formed by organisation, so that it uplifts it in positive manner. These
strategies increaser the efficiency of Jaguar by enhancing its performance and forms more
concrete structure to cover earlier faults. (Chang and Lu, 2015).
Examine the internal environment and capabilities for Jaguar Land Rover Automotive with the
help of appropriate framework
Jaguar Land Automotive is using SWOT analysis in order to understand internal
strengths and weaknesses of the company. This assist the top level management to frame strong
strategies in order to overcome the loop holes. By doing so productive results can be attained
easily in the cut throat competitive world. On the other hand it highlight opportunities prevailing
in the open market place. Business is benefited by this because they are able to mould other weak
area as their business success. It helps in gaining competitive advantages against rivalry in the
global market. Additionally, it showcase threats which I going to impact business in the coming
years. Strengths, weaknesses, opportunity and threats of Jaguar Land Automotive car is
explained as under:
Strengths of Jaguar Land Rover Automotive:
Popularity: In the global market, Jaguar is a luxurious auto-mobile manufacturer. It is a
popular brand across the globe. Organization is able to compete with it's rivalry because Jaguar
keep itself away from scandals. By this, goodwill is raised in the market which is a positive mark
for business. Because of the popularity, this auto-mobile firm is able to gain huge profit as
compare to its competitors.
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Upgrading distribution channels: Jaguar is in the leading position among its
competitors because of their upgraded distribution channels in the emerging economies. Due to
which organization is able to achieve their set standards in the set time duration. Management
modify their distribution channel according to the dynamic environment so that customers can be
made satisfied.
Conduct research and development activities: Organization is a top brand worldwide
because of its unique and advance features in their product. Management spend huge capital in
research and development activities so that innovative product and services can be offered to the
potential customers over the years. Because of Research and development activities, Jaguar Land
Rover Automotive is able to survive and sustain in the cut throat competitive world.
Increasing sales: Organization is able to compete with the challenges created by
competitors after the acquisition made by Tata Motors. This step was beneficial for Jaguar
because it has raised its sales ratio to a large extent. The acquisition with Tata Motors Jaguar has
become financially strong and stable because through this the sales of Jaguar product has raises
continuously (Deepak and Jeyakumar, 2019).
Illustration 2: SWOT analysis
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Source: SWOT analysis, 2019
Weaknesses of Jaguar Land Rover Automotive:
Product range: In the competitive market place, Jaguar has limited range of product as
compare to other rivals. To remain in the competition it is very essential for jaguar to raise their
range of goods in open market place in order to lure the targeted customers. As there is limited
product range, company is unable to gain huge revenue.
Brand Image: The another loop hole of Jaguar Land Rover Automotive is that the
product of Jaguar is not popular in many nation. Due to which it is unable to maximize huge
profit as compare to other firm who has expanded their business in several country.
Dependency on few models: The another area where Jaguar need to improve is their
design and model. Business has less customer base for their product because company is
dependent on few model. The design and appearance of the product are criticised because there
is no innovation in them. Due to which less customer approach their product and less market
share is captured by them in the global market (Du Plessis, 2015).
Opportunity for Jaguar Land Rover Automotive:
Target new market: Jaguar has large growth opportunity in the intense competitive
world. Business of Jaguar Land Rover Automotive can be expanded in the market of India and
China in order to get untapped customers potentail. By doing so customer base for the Jaguar
product can be raised tremendously. By setting up new production facilities in India and China,
sales ratio for the goods can be increased gradually.
Demand: Across the globe, Jaguar car are luxury in nature. Product of the company are
quite expensive and can not be purchased easily. But over the years disposable income of people
has raised due to which they are investing more on luxury goods and services. This a great
opportunity for Jaguar because customer are capable enough to purchase the luxury products.
(Horton, 2019)
New technology: Business can survive in the competitive world when firm is capable
enough to face the challenges emerging in open market place. Hybrid technology is a modern
tool in manufacturing industry. It is implemented by many of the manufacturing company in
order to compete with its rivals. So, there is opportunity for jaguar to adopt this new technology
in their premises and come up with innovative idea.
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Environmental friendly products: The changing environment is a big concern for everyone.
Governing bodies are introducing new emission policies so that environment can be saved for
depletion. So, jaguar need to come up with innovative car which is ozone friendly so that
business can come survive for longer time duration in the competitive market palce.
Threats for Jaguar Land Rover Automotive:
Competitors: The biggest threat faced by Jaguar Land Rover Automotive is competition
from their rivalry. Competitors of Jaguar Land Rover Automotive are, Mercedes, Audi, Porsche,
Aston Martin, Bently and many more. All these leading car companies has successfully captured
huge market ratio. All these firms are dealing in same segments due to which competition is stiff.
Also, they are targeting the same customers so it is essential to come up with innovation in their
goods.
Raising raw material cost: The raising inflation rate is a threat to Jaguar Land Rover
Automotive because it raises their production cost and make their luxury product more expensive
in nature. Raising labour cost is a open challenge for the firm in order to overcome this modern
plant and machinery are implemented so that labour cost can be cut down. By this goods can be
offered to the customers in nominal rate.
Changing customer demand: It is another threat which Jaguar Land Rover Automotive
car is facing in the open market place. In the dynamic environment taste and preferences of the
customers are fluctuating rapidly. It is biggest threat for the company because manufacturing car
is incur huge investment it is not easy to make changes frequently in luxury car.
Critically examine the internal environment to assess strengths and weaknesses of an firm's
internal capabilities, structure and skill set
Jaguar Land Rover Automotive car is one of most well known brand in the whole world
by selling luxury car to their potential customers. The brand is achieved success from years by
using ethical practices and focusing on consumer service positively. Here are the VRIO analysis
of Starbucks that are as follows:
Value: Jaguar Land Rover Automotive has strong brand image in the market. They value
the type of design and model of car provided to the customers. By which large number of
customers can be attracted towards luxury car.
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Rare: Brand image is the rare thing which is not copied by any other easily. The threat
for competitors is that it requires huge capital in order to make changes in the car.
Imitable: The strong brand image that possess by them is difficult to imitate but can be
possible in long run. Jaguar Land Rover unique features and design is difficult to imitate as it
involves huge capital.
Organized: Strong brand image come under respective factors and innovative car model
assist to promote their products in the market easily. Additionally, provide customer retention
strategy so as to achieve desire results.
Illustrate Porter's Five Force Model Porter's five Force Model in context of Jaguar which are as
follows:
Professor Michael Porter has created Porter's Five Force Model. It is considered as most
popular business strategy tool and is widely adopted by many companies worldwide.
Organization adopts Porter's five Force Model to understand competitiveness of the firm's
environment and how it influence long term revenue generation. Below is the deep explanation
of the of Porter's five Force Model in context of Jaguar which are as follows:
Threat of new entrants: New entrants raises competition level to a large extent as well as
force business to cut down the prices. By this, goods and services are available to the customers
at affordable price. However, this impact business activities because new ventures come up with
innovative idea globally. However, in automotive industry there is lees competition because huge
capital investment is required. Also, many legal formalities are to be conducted which is not easy
to perform it smoothly. By this new entrance threat is low in market. By this Jaguar can easily
raises economies of scale in order to reduce manufacturing cost. (Kotane and Hushko, 2019).
Supplier power: Customers are exploited more when bargaining power of supplier is
high. This is because they charge high prices for raw material which are of low or bad quality.
The raw material which are used by Jaguar while manufacturing car are limited in nature. So,
when power is intense they seek high prices and make huge profit from customers as suppliers
are limited in number. This affect business productivity and profitability ratio.
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Illustration 3: Porter's Five Force Model
Source: Porter's Five Force Model, 2019
Bargaining power of customers: The degree of power is more when bargaining power is
in hands of the customer in open market place. It take place when there are many substitutes are
present in the market as well as offers high standards product and services at low price.
Threat of substitutes:There are many competitors of Jaguar Land Rover Automotive like,
Porsche, Aston Martin, Bently and many more. Slight changes in the prices and design of the car
customer can easily switch to other brand of car like, Porsche, Bently etc. More substitute
product affect business because end user easily switch to other car which are available at low
cost. The threat of substitute is low because lot of capital and time is required to come up with
innovative goods nad services. (Macarthy, 2018).
Competitive rivalry: In the open market place, power of competitors is intense when,
there are many competitors, low customer loyalty, exit barrier is high and so on (Sahaf, 2019).
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The competitive rivalry is high. In order to compete with this organization scan the external
environment before planning the strategies. By this firm can be in the leading position among its
rivalry.
Strategies for improving competitive edge and market position
Organization is using numerous strategies in cut throat competitive world to gain
competitive advantages against rivalry. By this business can survive for longer time duration in
the global market. There are various strategies to gain or improve competitive edge and market
position are elaborated as under:
Promotion strategy- Innovative goods and services can be commercialized in market by
promoting them globally. It directly helps in improving competitive edge because goods are
promoted globally and huge customers are attracted to purchase it. Strong market position is
gained by firm because it through effective promotion tools sales ratio raises rapidly.
Price strategy- Organization set prices by scanning the external environment. By this large
customer base can be raised for the Jaguar's car in the global market. Effective pricing strategy
benefit organization to compete with the rivalry prevailing in the open market place.
Additionally, huge revenue is maximized which is a positive mark for the business. Additional it
helps in gaining competitive edge because by setting nominal prices of the customers can easily
purchase it from the market and can use it in their day day to life. Whereas, good pricing strategy
helps organization to gain strong market position because they are able to build loyal customers
for their luxury car as compare to others.
Define relevant theories, concept and model for strategic planning
Ansoff Matrix came into existence in the year 1957 by Igor Ansoff. It is used by Jaguar
Land Rover Automotive because it assist manger to accumulate potential growth strategies and
compare level of risk associated with each other. However, it is followed in the strategy stage of
marketing planning process (Malhotra, 2015). The relevant theories, model and concept for
strategic planning are stated as under:
Market penetration- In this case, present
goods is sold in the present market. Jaguar Land Rover Automotive is selling its car in the
existing market. By this huge profit is maximized because car models are sold in the same
market to their target customers.
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Illustration 4: Ansoff Matrix
Source: Ansoff matrix, 2019
Market development- In this particular case, organization come up with existing
product but in new market. Jaguar Land Rover Automotive car is expanding its business
and its existing car model in other developing nation so that sales ratio can be raised
tremendously. By this large market ratio can be captured easily.
Product development- In the existing market company come up with innovation in their
product (Parsons and Lepkowska-White, 2018). Jaguar Land Rover Automotive car is coming
up with other innovate car model of car in the existing market so that competitive advantages can
be gained against rivalry.
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Diversification- In this particular stages market and product both are new in the market.
Jaguar Land Rover car demand changes frequently due to which level of risk is more because of
the raising inflation rate in the market. Company need to diversify their car model and design so
that business can be in the leading position among its rivalry. Jaguar is expanding its business in
India and China so that huge market ratio can be captured by firm in the initial stage (Rather,
2019.).
Jaguar Land Rover Automotive car is adopting market development strategy so that
existing car model can be sold in the new market. By this productivity and profitability ratio
raises tremendously. This helps the organization to gain competitive advantages in the global
market which is a positive mark for the business in the international market.
Strategic management plan for tangible and tactical strategic priorities and objective
Tangible strategies are explained as those products which are physical present and can be
felt. This is promotional strategy that is used to gain consumer loyalty. The objective of Jaguar
Land Rover Automotive car is to provide electric car in the market sop that environment can be
saved from depletion. Firm is adopting market development aspects in order to sales out their
luxury car in the new market. Before launching current car in the new market they are scanning
the external environment so that teste and demand of the customers regarding the car can be
ascertained.
CONCLUSION
From the above discussion it can be concluded that it is the core task to prepare business
strategy by an organization. This helps the firm to grow and develop sustainably in the open
market place. Effective marketing strategies helps organization to achieve their set goals and
objectives timely. Pestle analysis is conducted in order to understand their impact on business
after Brexit. Political, economical, social, technological, environmental and legal factor are
deeply examined so that management can frame tactics in order to over the issues emerged by
them. On the other hand, SWOT analysis is evaluated to know the strength, weaknesses,
opportunities and threat. By this, opportunities prevailing in the global market can be identified
and can be mould into business profit. However, through this threats can be identified and
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strategies can be formulated to overcome them. Porter's Five Force Model is deeply explained to
known the level of power each stage is holding. By this competitive advantages can be gained
against rivalry.
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