PESTLE Analysis of Vodafone

This document provides a detailed PESTLE analysis of Vodafone, a multinational telecommunications company. It discusses the importance of PESTLE analysis for business organizations and evaluates the external environment of Vodafone using the PESTLE framework. The analysis covers political, economic, social, technological, environmental, and legal factors. It also provides recommendations for Vodafone to overcome challenges and make effective decisions.

PESTLE on Vodafone

Executive Summary
Business Environment is one of the key area as it explains about internal and external
factor which may affect business organisation. The information about Vodafone in detail helps to
identify where does company performs their business for attaining the targets. PESTLE analysis
has allowed the management of Vodafone to take some of the effective decision through which
their goals and target can be accomplished. The recommendation can certainly allows the
business to overcome the problem which can occur due to different factors.

INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
(A) An overview of your chosen company including its history and the organisational
structure. How is the company managed nationally, and/or internationally?..............................1
(B) Brief discussions of how the company is governed..............................................................2
TASK 2............................................................................................................................................3
Evaluate the importance of PESTEL analysis for a business organisation. Why is it important
for organisations to carry out PESTEL analysis..........................................................................3
TASK 3............................................................................................................................................4
Use the PESTEL framework to analyse the external environment of your chosen company.....4
Recommendation.........................................................................................................................6
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
Business environment can be defined as the process which simply explains about internal
and external factor which can play crucial role within the business at the time of accomplishing
the goals. It is mandatory for any of the entity to analyse about internal and external factor
because it is the only source through which organisation can get effective opportunity to take
better decision (Avramenko, 2012). In context of file, the chosen organisation is Vodafone which
is one of the multinational company dealing in communication sector. Different topics will be
discussed in the file which will be related with detail information of company including its
market and Board of Directors. Importance of Pestle analysis will be explained along with it
PESTLE analysis will be done on the business organisation.
TASK 1
(A) An overview of your chosen company including its history and the organisational structure.
How is the company managed nationally, and/or internationally?
Vodafone Plc is the business organisation which is currently dealing in
telecommunication sector for the purpose of earning profit. It's registered office is in Newbury,
Berkshire, England whereas its global headquarter is in London England. Company was founded
in the year 1982 by Gerry Whent, Ernest Harrison. It is among top 5 organisation globally which
is dealing for mobile operation. As per the data available, it was found that company operates its
network in 25 different nation where it is networking partner with 45 different nation which is
the main reason behind the accomplishment of their goals and target on specific time period.
The history says that organisation has evolved themselves at a great speed where they have
worked in the field of latest market for radio technology in the field of military. The history of
the company shows that they have worked in different area for the purpose of improving overall
technological sector of the organisation. Whenever any of the organisation needs to perform
effectively, they must ensure that how they can perform effectively so that organisational goals
can be accomplished. Here, Vodafone follows matrix structure where report of every single work
is done to different organisational heads. This types of work simply allows the business
organisation to take effective decision and recover any of the problem which is being faced by
organisation. Managing the business is very much important in current scenario because it is the
only source through which any of the organisation can accomplish their goals and target. For
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managing the activity within the premises of UK, company tries to work on the area that how
they can meet out the requirement of customers and for that they continuously takes feedback
from the customers. In international platform, management likes to hire local staff which is well
familiar with culture and trends so that effective result can be obtained.
(B) Brief discussions of how the company is governed.
In present scenario, company law is very much important because it simply guides that
how any of the organisation needs to work in any of the situation so that goals can be
accomplished. In order to govern each of the action within the organisation, role of Board of
Directors increases because they are the one who actively takes part in any of the decision
making process so that suitable decision can be obtained (Ballard and et.al., 2012). Here,
Hierarchy structure is followed by organisation where each of the action is taken by the Board of
directors of company and it becomes essential that all of its breaches and subordinates to follow
those laws. This is is one of the reason that organisation is able to perform effectively within the
market.
In present scenario, there are 11 directors are there within the premisses of Vodafone Plc
who needs to take part in any of the decision making process of the organisation. Further,
number of directors are classified into two groups i.e., executive and non executive. Talking
about executive directors, this are those directors who plays the crucial role within the
organisation as they are the one who has the responsibility to manage every single work within
the organisation. At the same time, non-executive directors are the one who is not responsible for
managing day to day affairs which simply explains that they do not actively participate within
the organisation. Currently, there are two executive directors working within Vodafone and at
the same time there are nine non-executive directors who has been delegated the role to perform
any of the specific task within the organisation.
IN an entity, performing any of the activity is not so easy because there are number of
aspects and responsibility which needs to be fulfilled because that is the only way through which
organisation can perform effectively (Berg and Kilambi, 2014). In context of Vodafone Plc, there
Chairperson plays the huge role in performing any of the work because he is the one who decides
that when any of the work is to be done and how those work is needed to be done. All of those
activities can only become the way through which organisation can attain their goals. Gerard
Kleisterlee is the current Chairperson of Vodafone Plc who plays the vital role in decision
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making process of the entity. He has been the chairperson of the organisation since 26th July,
2011. On the other side, Chief Executive Officer also plays the necessary role because it
certainly boost the performance of the organisation. Even their role within the decision making
process is huge and give their guidance to any of the department if they face any of the problem
while working within the organisation. Currently, Nick Read is the CEO of Vodafone who has
taken the responsibility since 1st October, 2018.
TASK 2
Evaluate the importance of PESTEL analysis for a business organisation. Why is it important for
organisations to carry out PESTEL analysis
PESTLE analysis can be defined as the business model which allows the entity to identify
about the external factors which can have huge impact on organisation. The impact of external
factors might be positive and even it can be negative as well. All of this effective can be easily
identify with the help of PESTLE analysis (Bharadwaj and et. al., 2013). There are number of
importance of PESTLE analysis which can be used by any of the organisation for example: it can
certainly allow the organisation to boost their performance through which their goals and target
can be accomplished easily.
In current scenario, if PESTLE analysis needs to be evaluated then in that respective
condition, it can be easily said that there are number of benefits which can be obtained from it.
The first benefit will be for the company is that they can become able to identify whether any of
the decision needs to be taken or not because identifying the outcomes will be easier in it. At the
same time while talking about other benefits, it will provide the detail knowledge about the
business which is very much important for conducting any of the business activity. Even
company will be able to analyse able the alternate ways to perform any of the work. In context of
the Vodafone Plc, they can easily identify that what are the decision which they should take and
what should be ignored so that effective result can be obtained. Although, there are number of
drawbacks as well such as any of the data which are collected in it are based on assumption
which sometimes may create issue for the organisation. Data collecting process might be lengthy
due to which company may have to suffer from different types of issues. Overall there are
positive as well as negative side of PESTLE analysis and it is necessary that how any of the
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company uses it because that is the only key way through which entity can accomplish their
goals and target.
Talking about the organisation like Vodafone Plc, they are required to conduct PESTLE
analysis because of the support it provides to the organisation. It is said that any of the entity
which is performing within the market will be able to identify that how they needs to take any of
the decision. The another importance for Vodafone Plc is that they are among one of
multinational company where they always tries to expand their business and in this respective
circumstances company must take the help of PESTLE analyse. It is because management will
be able to identify that how they are needed to perform in new market and what are those
decision which can allow the organisation to give tough competition to the rivalry firm. Even
management of Vodafone can use PESTLE analysis for reducing any of the unnecessary
expenses because it certainly helps the business enhance their overall profitability in the market.
TASK 3
Use the PESTEL framework to analyse the external environment of your chosen company
PESTEL analysis is considered as analytical tool which stands for Political, Economical,
Social, Technological, environmental and Legal. This is applied for identifying, analysing,
organising and monitoring a key external factor which has an affects upon entity (Hilton and
Platt, 2013). Moreover, there are various factors which impact the business that are discussed
underneath:
Political factors: Political plays important role into firm and it includes tax policies, political
stability, trade regulations and many more. It is all about government intervenes within economy.
For example: As Vodafone faced specific pressure into South Africa. Instead of issues, it
maintained its organic development with revenues enhancement. Moreover, as new data
regulation is implemented by the government so this impact business positively and negatively. Positive impact: Due to new regulation, they can enhance their product line and business
as well. This is helpful to expand their business opportunities internationally.
 Negative impact: Also, new data regulation outcomes into slower growth within the
market of South Africa.
Economical factors: These are metrics which measures health of any economic region. Also,
it has a substantial affects on how entity conduct their enterprises as well as gainful they are. It
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consists interest rates, unemployment rates, disposable income of customers and many more
(Janita and Miranda, 2013). For example: As Vodafone is operating into telecommunication
sector and growth depends upon the market development. Businesses are utilising mobile
phones, internet for marketing. So, it affect positively and negatively. Positive impact: Due to this business enhances so they can provide various job
opportunities to UK people which will helpful in reducing the unemployment rates of
respective company. This shows the contribution in economical development.
 Negative impact: In UK, the labour cost is considered as vital aspect in context of
telecommunication business. By the year 2018 and 2019, minimum wages rate get
increased which will shift firm cost in millions.
Social factors: It assesses the customer’s behaviours, belief and others into a competitive
marketplace. It is also called the demographical factors. It includes educational level, distribution
of wealth, population demographics. For example: As Vodafone is serving several services and
products within telecommunication industry as its horizontal growth is limited. Moreover,
change into lifestyle and preference of customer directly affects business financial health. Positive impact: this enhances the demand of internet across the world as more people
prefer to use internet for various purpose such as entertainment, study and many more.
So, this will enhance the respective company profitability.
 Negative impact: The changing demand of customer will also incur more cost for the
company.
Technological factors: Technological advancement may optimise internal effectiveness
as well as assists product or services to become technologically old-fashioned (Prins and
Cybercrim, 2017). At present, organisation delegate substantial resources towards research &
development in order to go ahead in potential market area. This aids them in boosting new
communicating, interacting and engaging ways with targeted clients. For example: In case
Vodafone opt few advanced technology in its enterprises practices so this can affects its business
positively and negatively. Positive impact: With the help of this, Vodafone obtain an opportunities to adapt new
technologies into their services. They introduce its own mobile phone application ad 5G
network for maximising the customer experiences. It assists respective firm to enhance
their business performance and consumer base.
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 Negative impact: The advancement of technology also enhances the competition level
within competitive marketplace.
Environmental factors: It is vital to ascertain PESTEL as this may helpful in obtaining few
enhancing concern regarding surroundings into masses. Now a day, people like to buy
environmental friendly products. For example: As Vodafone has decided to concentrate upon
switching towards renewable resource of energy for effective supply. Positive impact: Due to this, they also target to minimise the network wastage that would
assists them in accelerating business development as well as enhance customers demand.
This will enhance the organisational profitability.
 Negative impact: The decision of switching towards renewable resources will result into
more cost to company. It will also impact the financial resource of the respective firm.
Legal factors: It is the factor which concentrates upon issues like consumer rights, safety of
goods and so on. In order to operate the business in effective way, they should not only know
about this but also stand for by regulation of country in which they are performing (Vitale,
2017). For example: as various regulations are imposed by the government so it is important for
the Vodafone to follow all that while operating into various countries. Positive impact: If the comply all the regulation so this will enhance their brand
reputation in front of customers and government of particular country. It also enhances
the opportunities for new business in effective and efficient way.
 Negative impact: The telecommunication sector is often affected through legislation
issues which will affects its performance and create problem into business performance
appropriately. Also, this develops few types of barriers for its business practices.
Thus, it is determined that, all the factors of PESTEL impact the Vodafone in both manners
positively and negatively.
Recommendation
Based upon the above analysis it has been determined that the organisation have to be
structured as well as governed in effective and efficient way as it helps them to take effective
decision and recover any of the problem which is being faced by organisation. Also, it is
suggested to respective organisation that they have to utilise PESTEL analysis as this is only key
way through which entity can accomplish their goals and target. Also helpful for them to
understand the external environment and deal with the negative one in efficient way.
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CONCLUSION
As per the above report, it has been concluded that it is vital for all company to analyse
about internal and external factor because it is the only source through which organisation can
get effective opportunity to take better decision. Moreover, organisation is structured in
hierarchy way and it is governed as per company laws. Along with this, PESTEL Analysis is
important for firm as it assists them to identify whether any of the decision needs to be taken or
not because identifying the outcomes will be easier in it. Apart from this, there are various
factors such as political, economical, social, technological, and environmental and legal as well
as this impact the company positively and negatively.
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REFERENCES
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development of a customer-specific business process model. U.S. Patent 8,639,542.
Bharadwaj, A. and et. al., 2013. Digital business strategy: toward a next generation of insights.
Hilton, R.W. and Platt, D.E., 2013. Managerial accounting: creating value in a dynamic
business environment. McGraw-Hill Education.
Janita, M.S. and Miranda, F.J., 2013. The antecedents of client loyalty in business-to-business
(B2B) electronic marketplaces. Industrial Marketing Management. 42(5). Pp,814-823.
Prins, J.R. and Cybercrime, B.U., 2017. Diginotar certificate authority breach’operation black
tulip’. Fox-IT, November
Vitale, R.P., 2017. Business to business marketing. Pearson Education India.
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