Strategic Analysis of Venus Mobile: PESTLE, Porter's Five Forces, Product Life Cycle

This report provides a strategic analysis of Venus Mobile through PESTLE, Porter's Five Forces, and Product Life Cycle. It includes an evaluation of the present condition of the mobile industry, SWOT analysis, strategic options evaluation, and recommendations for increasing productivity. The report also discusses the external and internal analysis of the company, stakeholder summary, and concerns about increasing competitive benefits.

STRATEGY MODULE
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Authors Note

Table of Contents
Part 1..........................................................................................................................................3
o Introduction.........................................................................................................................3
o External analysis of Venus..................................................................................................3
PESTLE Analysis...............................................................................................................4
Porter’s Five Forces............................................................................................................8
Product life cycle..............................................................................................................10
o Internal analysis of Venus.................................................................................................10
Value Creation model.......................................................................................................10
o SWOT analysis for Venus.............................................................................................12
o Strategic options evaluation...........................................................................................14
o Strategic recommendations...............................................................................................15
Practical methods:.............................................................................................................15
Application of sustainable products:.................................................................................16
Concerns about increasing competitive benefits:.............................................................16
• Part 2......................................................................................................................................17
o Stakeholder summary........................................................................................................17
Conclusion................................................................................................................................18
Reference list............................................................................................................................19
Appendices...............................................................................................................................22
Appendix 1: Business life cycle of Mobile phone industry in UK.......................................22
Appendix 2: Net demand for the product by locations.........................................................22
2

Part 1
o Introduction
It is evident from the Case study, which Venus Mobile has performed in a very poor way
over the period of last years. Therefore, based on these factors of strategic analysis, the report
discusses the requirement of strategic innovation For Venus Mobiles. Venus mobile is facing
stiff competition from the other 4 companies within the international mobile phone market.
Previous year the company generated lowest sales and low profit amongst the other 5
companies. The major data on comparisons indicates that Venus mobiles have the lowest
investment spent on R &D and lowest on market share. In this context, the report illustrates
the external and internal analysis of the company through PESTLE, Porter's five forces,
industry life cycle along with the approaches of R&D and use of outsourcing approaches.
Moreover, the report presents a SWOT analysis to determine the opportunities and strengths
of the company.
However, the problem statement of the report is to evaluate the present condition of mobile
industry specifically Venus Mobiles in accordance to the future. The report, therefore,
provides some recommendations of strategic decision making by evaluating the internal and
external factors that are needed to be considered while developing an effective strategic
decision for increasing the productivity of Venus across the US.
o External analysis of Venus
Amongst all of these companies Venus Mobile is the one whose production and financial
condition is at stake amongst all the other companies. Mercury’s delivery production is the
most profitable amongst all the other companies as measured from the cumulative
shareholder return. It has been seen that that operation depreciation profit of Mercury is
highest at 56.24% and Venus profit is running at -107.04% that is the lowest among all other
companies.
Considering the environment of the industry it can be seen that there is a long conflict
between the US and China over the trade of media. Currently, the situation has declined a lot
more than before. It has been observed from the case study, there is an increased rate of
interest within the environment and sustainability policies that affect the organisation.
Therefore, it is highly necessary for the organisations to increase to increase and enhances
their performance standards in case of internal functions and supply chain process.
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PESTLE Analysis
Figure: Aspects of PESTLE analysis
(Source: Maslach, 2016, p.714)
Political
From the political point of view it has been found that there is a rising conflict between US
and China that has been known as trade war. The situation has been dragged a further since
both the countries have raised their tariffs of $25 on the routes if USA to Asia and Asia
towards USA. These conflict of tariffs has increased the combines cots of shipping of
products that has made the total cost of movement of mobile products to a direction if $41. In
this context, the cost of exportation of product from USA to Europe including logistics is
$12.6 in comparison to $8.3 from Asia to Europe (Benneworth et al., 2017, p.235). However,
considering the present currency market, USD currency has a possibility to have again on
both Euro and other currencies (Goetsch and Davis, 2014, p.23). Apart from this, rate of
interest may fall down in all the markets with an indication slowdown of corporate tax that is
lowest Asia with 22% in comparison to Europe 31% and 38% in USA. Considering these
political issues in Europe and USA, Venus needs to enhance its production performance for
improving their supply chains (Maslach, 2016, p.714). The corporate tax has been sustaining
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Political
Social
LegalTechnology
Economical

at 22% in Asia, 31% in the UK and 38% in the USA. As a result of which there is a stark fall
down of the rate of interest in this market (Hornstein, 2015, p.292).
Economical
From the case study it has been seen that the Venus is running at a declining profit with a
production loss of $05bn whereas the summary of the income shows that in the previous year
Saturn has earned the most profit with a total income of $2bn. Again the cumulative
shareholder return shows that Mercury has outpaced the other entire organisation with a
cumulative shareholder total of 247% and Venus with – 18.1 % that is the lowest amongst all
(Dodgson, 2018, p.34).Again the sales revenue for the last 6 years of the companies shows
that Mercury has the highest revenue of sales with $3265, 450bn and Venus the lowest with
$113,353bn with a lowest profit with -516,865.
From the CESIM case study it has been found that economical tensions in between USA and
the government of China may influence the rate of tariffs on the exportation of Asian goods
almost at a double rate of cost with $7 for each of the mobile products than the last year.
Again, Venus covers 15 plants that are present in USA and 3 in Asia, despite this in R6 the
company managed to produce no economical revenues. Apart from this the company has two
other plants that are under construction in USA, 2 in Asia. Therefore, in R8 the company will
have 17 US plants along with 5 Asian plants, these insufficient of plans is not sustainable and
needs urgent action. Therefore, the company needs an efficient method to utilise these
resources in a proper way. Apart from there are no noticeable changes within the cost of
manufacturing. These may increase the requirement for manufacturing domestically in Asia
for limiting he influence if tariffs and cost of logistics along with the fall down if labour cost
(Prajogo, 2016, p.254). In this context, Europe has been expected to grow at a percentage of
15% and USA 20%.
Social
Social factors common in the course of establishing new generation at the same time have to
be careful about choosing the taste of products that face improvements. In case of social
trends it has been observed from the case study that Tech 1 is highly popular all the market,
Tech 2 is popular in USA, Tech 3 is popular in Asia and Tech 4 in Europe (Lewis, 2014,
p.60). In this context, mobile network for tech 3 and tech 4 continues to increase slowly
within the market that may over grow the Tech 2. Moreover, according to the case study Euro
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has been expected to fall down that put pressure on the consumers. Therefore, one response
from the suppliers may reduce the cost that may be possible for achieving a strategy of
differentiation for those that are not ready to produce in lower process (Pisano, 2017, p.750).
Technology
Technology has drastically increased in the case of mobile phones. In CESIM study
technology it can be said that although mobile handsets are not very different from each other
but there may variations within the product features. For instance, different is design cover
colour, ringtones, games and may depend on the impact of the different market location
(Simsek et al., 2015, p.476). Network coverage is a necessary factor in technology that helps
to determine the demand of technology. In this aspect, the attractiveness of technology may
vary with the location of market. People nowadays prefer new technology other than
traditional ones (Wirtz et al. 2016, p.37). Therefore, Venus has an opportunity to invest on
modern technology. However, it has been found that in house budgets of the technology are
determined by upper part of R&D. In this context, there is a declining marginal profit with
the increase in budget. These indicate that it will be cheaper for Venus to establish
technology along with increment of several rounds, and then get the production in one round
(Norman and Verganti, 2014, p.78).
Legal
In case of legal fluctuations it has been found, if Venus tries to invest on the global market,
they need to consider the Indian market that remains closed for this international
organisation. This is because the Indian government tries to expand at least one National
champion that can compete with the international market. It is necessary to take a note on the
fact that Africa and Latin America does not have significant opportunity for the period of 5
years owing to the delay in developing mobile network in few limited urban locations (Yi et
al., 2016, p.436).
Environmental
From the case study it has been found that there is growing interest in the Environmental,
sustainability as well as Governmental policies that may influence Venus therefore, it is
increasingly necessary for Venus to enhance their performance both internally as well as
externally and supply chain to cope up with the environmental policies (Demil et al, 2015,
p.11). It is not just the matter of profitability that the company needs to consider, the
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company as well needs to consider the environmental concerns related to the green
environment.
Porter’s Five Forces
Some factors these external forces are as follows:
Power of the suppliers
It occurs when a brand tends to focus more on the quality of the products. In this phase, it is
necessary for the Company to select effective suppliers for the manufacturing of the
products.. It is evident from the case study that the cost of the mobile devices product is
relative to the entire cost. Moreover, the company has lack of product differentiation and
rising competition in between the suppliers that threatening the suppliers of the organisation.
Such measures of quality include not only the durability of products but also the features are
also a necessity, all these aspects are enough to increase the threat of the suppliers (Wang et
al., 2016, p.776).
Power of the buyers
It is when a specific product has increased accessibility in the market; consumers have the
additional assistance to negotiate over the products. Therefore, there are high chances that
respective consumers can get the same products from another brand as well. Therefore,
viewing the growing power of the consumers in the mobile phone industry, Venus Mobile
has to consider extra characteristics within the product along with the presence of cost
leadership. (Petrakis et al., 2015, p.1437). On the contrary, it is necessary to fulfil the
customer's necessities that attract new business opportunities.
Competitive rivalry
It is evident from the mobile industry report that demand for mobile phones is growing
strongly. From the CESIM case study it can be seen that the level of competitive rivalry is in
moderate situation that may grow with the maturity of the industry. The demand for products
is growing intensively as mobile industry is an attractive industry. Therefore, the industry
capability may exceed the demand. However, the percentage of growth is expected to fall
down in the coming years. In this context, manufacturing capacity may exceed the existing
demand with the increasing number of plants that are under construction. Therefore, the
entire organisation operated with an identical model but with a high fixed cost. High fixed
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cost of exits and dependence on the industry shows that high differentiation on product is
possible that can be offered by similar products, as a result of these combined issues
competitive rivalry may increase within the industry. Again, plant Capability in the US may
face high rate of tariff and logistics while exporting to Asia, that mat increase the burden to
add he global capability in Asia. The cumulative shareholder return shows that Mercury has
outpaced the other entire organisation with a cumulative shareholder total of 247% and
Venus with – 18.1 % that is the lowest amongst all (Yun et al. 2016, p.24). Companies like
Apple can be high competition for Venus mobiles.
The threat of the emerging companies
In case of Venus Company as observed from the CESIM Case study, the threat of entry is
specifically from the outsourced producers that are generally high and moderate from the
other organisation. Increase in the capital requirements and consumer cost of switching and
increase in differentiation of the product along with governmental and legal barriers there
may increase threat from the emerging organisation (Layton, 2015, p.302).
Challenges of substitution
There is a possibility for the customer propensity to switch their preference to another
organisation. Apart from these, relative prices and improved performance from the substitutes
may pose a threat for substitution on the organisation. The threat of substitutions is low as
seen from the CESIM case study. However, Venus Mobile phones need to apply such
innovative features in terms of quality and price to avoid the challenges of being replaced by
substitutes (Savignon, 2018, p.7).
Product life cycle
The net demand in the previous year was seen to be 28.9m units. In this context, analyses are
expecting that the growth of sales may vary in the different marker. For which Asia has been
estimated to encounter growth within a rate of 25% to 30%, Europe with 6% to 10% and
USA with 15% to 20% for R 6. However, it has been seen from the CESIM case study that
8

Figure: Industry life cycle
(Source: Hohberger et al., 2015, p.1474)
Asia accounts for almost 44% of the international demand and has the highest regional
growth in the market. However, the present growth rate shows that the industry in the
momentum of growth with no implication as to progress towards maturity. On the contrary,
industry demand may be affected by the pricing of the organisation and promotion along with
the cost of network service and the major complement (Hohberger et al., 2015, p.1474).
Competitive advantage:
As seen from the CESIM case study, that pricing data Venus, Mercury and Saturn are alls
following the trend of low cost pricing strategy. However, high levels of R&D had been
invested by R &D sby Mercury and Saturn along with the flow of the market and with the
introduction of Tech 2 that signifies that there might be move towards the other technologies.
The other entire organisation failed to meet the rising demand that is created through the
demand of pricing. On the contrary, Mercury’s investment in Asia shows that there is
aggressive expansion of capacity and a focus on reduced cost production.
Internal analysis of Venus
Value Creation model
Employees
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These are the individuals that are identified by the need of the employees whether they wat to
communicate with the employees. In his context, Venus needs to set up business by receiving
end of an interaction approached by both internal and external system of information. All the
employees are connected by E2C, E2E and S2E communication.
Systems
These are processes that are operated by the business to create backed up process.
Specifically, it is when a staff is involved in a wireless accessibility of the business
organisations planning of resources like C2C, C2S and C2E interactions.
Consumers
These are individuals that interact with the employee through the medium of SMS or email in
wireless way (Hill et al., 2014, p.53). In this the process the possible interactions are S2C and
C2C associated with business activities.
Connections
It is the creation of value through a development of wireless infrastructure that provides the
ability to the mobile employees to have 24/7 hours of connectivity assistance anywhere at any
location while communicating and exchange of information (Layton, 2015, p.302).
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Figure: Business oriented value creation
(Source: Brook and Pagnanelli, 2014, p.47)
o SWOT analysis for Venus
Strength
 It has been seen from the case study
that there are almost 22plants in USA
 8 plants in Asia
 In case of R&D the company
completed for Tech 1 with 6 features,
Tech 2 with 8 features, tech 3 with 3
features and tech 4 with 6 features
 The market share has been seen to be
increasing from 20% to 32%
 Reduced cost of borrowing
 High cumulative spend on the market.
(Manufacturing/ Assembly of Mobile
Phones, 2017).
Weakness
 There is a US plant usage of almost
43% that may influence the
production of Venus
 Low sales of Tech 3 again may
impact the growth of the company
 Increased cost of tech 1 and tech 3
production may affect the cost of
investment of the organisation
 Venus has poorly developed
strategies for future purposes that can
face severe influences (Hill et al.,
2014, p.53).
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
Opportunities
 Increased demand of tech 4 in Europe
offering a strong opportunity for the
organisation to invest on tech 4
(Dobbs, 2014, p.33).
 Strong demand for tech 3 in Asia
 High demand for tech 2 in USA
 Again tech 1 consistently remains
popular globally.
Threats
 International demands are seeking to
grow thereby increasing the threat for
Venus Mobiles. (Klettner et al., 2015,
p. 396).
 Reduced cost of tech 1 mobile from
the focused limited cost
manufacturer
 Low cost for tech 3 mobile from the
focused low cost manufacturer
 Increased rate of tariffs and cost of
logistics that may threat on the
production of the company.
VRIO ANALYSIS
Value
The company lowest sale and share from the market, therefore, the value of the company is
extremely low. Therefore, the company needs to outsource their own resources for
manufacturing the end product.
Rareness
The resources used in the manufacturing of the mobile products are rare in accessibility,
therefore, making the resources easy to find in the market.
Imitate
The product and resources are highly susceptible to imitation. Therefore, all the resources
related to mobile phone have alternative and can be easily manufactured by other companies
for reducing cost and reliability on others.
Organisation
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Venus mobile company has its own share in manufacturing the products in their departments
that takes care of all the resources. However, all the resources have been accumulated with
the approach of manufacturing the end product and producing in the target market.
o Strategic options evaluation
International standards
Since profit depends on the high volume of sales, there is requirement of market share of at
least 23% in within the market. There must be anticipated yearly production if almost 28
unites of which 22 units that will be needed in Asia to build plants in Asia for turning their
business more competitive. The company needs to invest for units in Plan along with limited
n umber of R&D as limited features are available. US plant usage need to exceed 50% in
relation to the new Asian plants.
Transformation method
The company needs to charge high prices and accept reduced share of the market by
assuming 15% of their units. They needs increase the cost of R&D to assists all the 4techs to
invest on additional R&D. The company needs to charge high cost of manufacturing
relatively wit reduced construction of plant. In this context, yearly production may gives 56%
usage of the existing plants. Moreover, the company needs to set up only R&D for only three
techs.
Viewing the existing the condition of the market the specific organisation is obtaining
attention from some potential group of consumers. On the contrary, if a company has average
reputation of brand the company needs not to bother about the loss of brand awareness
(Miranda Silva et al, p.1034).
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Figure: Strategic evaluation options
(Source: Manufacturing/ Assembly of Mobile Phones, 2017)
o Strategic recommendations
In most of the cases, business enterprises tends to follow a method by which organisational
risk and hazards can be prevented for those that have optimum amount of business
productions (França et al., 2017, p.156). However, For Venus it has its own obligations in
case of organisational situation. Therefore, for sustaining a long term stock and a brand
venture, there is requirement for providing additional stress on the expenditure. It is evident
that resources along accessibility of opportunities are necessary features for considering new
planned strategy. In this context, recommending strategies for Venus are:
Practical methods:
In this context, the company is required to fulfil demands made by the customers and needs
to make an improvement of the mobile products for increasing the sales within the UK
market while developing the reputation of the brand (Rayna and Striukova, 2016, p.214).
Venus needs to offer the unique pricing value in terms of techs as well as the combination if
features thereby delivering increasing value to the consumers each of the year. Moreover, the
company needs to stop investing for tech 2 thereby launching tech 4 in their next round in
Europe, USA and Asia in other round. They company needs to discontinue the production of
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Cost Leadership
Technique
Reduced
Expenditure
R & D Activities.

tech 1 after round 6. Apart from these, the internal R&D of the company needs to focus on
tech 3 and 4 with additional features on Tech 1 on a daily basis. Therefore, Venus needs to
evaluate such practical understanding of the market for increasing productivity and
introducing new strategy in their operation. By doing so, Venus will be able to be more
concerned about the technological innovations.
Figure: strategic recommendations for the company
(Source: Rayna and Striukova, 2016, p.214)
Application of sustainable products:
From the existing case study it has been found that Venus has weakened some of their
product vales owing to poor technical characteristics as well as external look. In this aspect,
it is evident that modern generation are increasingly concerned regarding their look as well
advanced features in their mobile device (Frow et al., 2015, p.463). Therefore, it is not only a
matter of modern technology used in smart phones; rather it is the necessity to have similar
requirements in the product. Thus, Venus mobile’s management needs to make more stress
on all these aspects other than aiming towards marketing opportunity to address long term
sustainability of the products.
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Fulfil
Demands
Of
Customers
Increasing
The Sales
Enhance
The
Competiti
ve Benefits
Advanced
Features
In Mobile
Improvem
ent Of The
Mobile
Products

Concerns about increasing competitive benefits:
ssIn this context, it is necessary for Venus Mobiles to be concerned about new and innovative
opportunities in the market. The plan of production must seek to expand the cost of
production with a high usage of construction of plants 4. Additional plants needs to be
introduced as the growth of marker is increasing. On the contrary, outsourcing capacity
needs to be used by the company to puffer buffer in the evnet of growth. These will help the
company to expand the market share. The company needs to make additional stress on the
development of new generations smart phones equipped with advanced technology to target
all kids of consumers (Brook and Pagnanelli, 2014, p.47). Featured smart mobile phones
within an affordable range of price will be helpful for the company to enhance the
competitive benefits of the Venus Mobile company.
• Part 2
Stakeholder summary
An innovative strategy is just a matter of concerns that a leading organisation's manager
needs to prepare, but they also need to have the capability to accept all the groups of
stakeholders. On the contrary, all the groups of stakeholders are the major participants to
implement new strategies. Therefore, it is not only the duty of the employee to implement
new strategies. But it is also the requirements of the customers to bring down proper
measures of success. In this context, the group of stakeholders are necessary for the
management of strategic planning.
Staffs:
Internal stakeholders are those that are associated with the employees. These employees are
the most crucial participants in case of integrating new business strategies. The stakeholders
of the Venus Mobile are the managers and CEO of the company who are responsible for
providing accurate information about the investments that is to be made for the strategic
transformation of the company. It is noteworthy to say that, it is a necessity to collect
responses from the present scenario along with the collection of future opportunities.
Suppliers:
In case of mobile manufacture industry, suppliers are implied as manufacturers those who
are involved in discussing the new strategy. Therefore, if a specific company of mobile
16

manufacturing is offering stress on the quality and characteristics for targeting potential
customers, there will be similar stress on the suppliers as well. In that case, suppliers have a
necessary role to play in the development of the strategic planning. The suppliers will be
needed to respect the contracts and agreements that have been development for the strategic
improvement of the organisation. There is not much information given about the supplier of
the company. However, there is limited differentiation in terms of suppliers, specifically ion
case of operations systems that sellers need to focus on while maintaining the contracts and
agreements.
Consumers:
Consumers are the most valuable part of decision-making operations. Therefore, when a
business is not able to involve in the customer's groups, the company will never achieve any
substantial profit and productivity. The customers of the company are those are interested to
buy the products of the company. The target consumers are from USA and other overseas
location. All the consumers of the company will be provided with full information about the
products as well as services through the website portal and other advertising medium
provided by the company. The community members and the general public are also the part
of stakeholders who expects that the organisation will not violate the general expectations of
the society. The company is currently producing through the use of different networks such
as retailers whose information are not available. In this context, without any significant
productivity, the company cannot apply any strategic planning.
Investors:
An innovative strategy of consideration for the investors as equally necessary as without this
the implementation of the plan is not possible to be implemented, stakeholders, as well as
investors, are the major sources of capital investment and the flow of business cannot be
accepted by all the members without the involvement of the investors. This is because it is
the investors who are essentially valued in developing a strategy and they are the ones who
invest the amount for planning the development of the products.
Competitors:
The growing competitors of the company are those who emerging in USA and the
organisation that are developed attractive mobile with advanced features in USA and other
location. The competitors in this context, expects that Venus will comply with all the rules of
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competitive environment and will not violate the general principles of the antitrust regulation.
Competitors of the company have identical models with some difference in terms of region
and manufacturing capability and the approach towards R&D. However, the company
currently has 5 major competitors in their location and other location as well.
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Appendices
Appendix 1: Business life cycle of Mobile phone industry in UK
Appendix 2: Net demand for the product by locations
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