Bentley Motors: Business Strategy and Macro Environment Analysis

This report provides a detailed analysis of Bentley Motors' business strategy, encompassing various aspects of its operations and competitive environment. The report begins with an introduction to business strategy and its importance, followed by an evaluation of the macro environment using PESTLE analysis, considering political, economic, social, technological, legal, and environmental factors affecting the company. It then delves into the internal environment, utilizing the McKinsey 7-S model and SWOT analysis to assess the company's strengths, weaknesses, opportunities, and threats. The report further examines the competitive landscape through Porter's Five Forces model, identifying strategies to enhance Bentley Motors' competitive edge. Finally, it explores strategic planning and theories to achieve business goals, concluding with a summary of the key findings and recommendations. The report aims to provide a comprehensive understanding of Bentley Motors' strategic approach and its position in the automotive industry.

Business
Strategy

Table of Contents
Table of Contents.............................................................................................................................1
INTRODUCTION...........................................................................................................................2
TASK 1............................................................................................................................................2
P1) Evaluation of macro environment.........................................................................................2
M1 Analyse the macro environment that inform strategic decision making...............................4
TASK 2............................................................................................................................................4
P2) Internal environment and capabilities...................................................................................4
M2 Analyse the internal environment to assess strength and weakness.....................................7
TASK 3............................................................................................................................................7
P3. Porter's five Forces model.....................................................................................................7
M3 Appropriate strategies to improve the competitive edge......................................................8
TASK 4............................................................................................................................................9
P4) Strategies and theories to attain the business goals by strategic planning............................9
M4 Strategic management plans................................................................................................11
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................14
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INTRODUCTION
Business strategy is considered as action and set of tactics which are used by organisation to
increase their organisational productivity and profitability. Different businesses have different
objectives and goals which are important to accomplish in certain period of time. The
management of organisation should have plans and strategies which can help to maintain the
quality and productivity of their business and increase profitability (Madhushree, Kumar and
Aithal, 2018). There are different routes and ways to fulfil task and goals that is business
strategy, helps to face the problems and get them a better solution. To understand about business
strategy Bentley Motors has been selected that is larger size company accomplishing goals by
formulating effective strategies and implement them effectively. This report covers different
contents such as impacts of macro environment on business organisation, internal environment
and capabilities, porter’s five forces and models that assist strategic direction available on
organisations.
TASK 1
P1) Evaluation of macro environment
Macro environment is consider as condition or situation which are situated in economy as a
whole and impacting on business. This environment involves inflation, GDP, monetary policy,
fiscal policy and inflation which are important factor and affecting the business. To start any
business and running it continuously organisation should focus on such factors that states which
factor can impacts negatively. For instance, Bentley Motors is automobile company that is
running business by considering all such factors are as defined:
PESTLE analysis – This is a tool and framework which is used by marketers to analyse and
monitor the macro environment and identify which factor can impacts negatively. In Bentley
Motors, the PESTLE analysis is defined below:
Political – This factor is mainly related with political system which is formulated by
government which help to run and support the business on the other side it can bound a business
due to some strict legislations. Different factors are covers in political system such as stability,
taxation rate, government policies, fiscal policy, GDP etc. which are set by government. In UK,
Brexit situation has created an opportunity for Bentley Motors as taxation rates are reduced
which helped to increase the sale and productivity of such organisation. On the other side,
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changing fiscal policy continuously can challenge the productivity and profitability of company
so this can also impacts negatively (Zhu and Chertow, 2017).
Economical- This factor involves following determinants such as interest rates, exchange
rates, economic growth patterns, disposable income and buying behaviour which can affects the
business. UK’s economy and growth is developed in better ways where people are able to spend
their disposable income in good quantity which helps to increase the sale of Bentley cars that
states it impacts positively. On the other side, changing buying behaviour can switch customers
towards other brand there it is important for management to understand people then introduce
products accordingly (Patel and Chrisman, 2014).
Social – This factor of PESTL is related with society that involves demographics condition,
culture trends, population, changing needs and wants of society and age distribution. The
business of Bentley Motors affected negatively as needs and wants of people are changing day
by day where luxurious people are demanding more luxurious and standard cars that is creating
cost of organisation while manufacturing so it affects negatively because sellers are selling raw
material at high cost (Rogmans and Abaza, 2019).
Technological – This dimension of factor is related with technology which is used by
organisation to improve their business productivity and profitability. This is important for
companies to adopt the new technology in their selling, producing and distribution process which
improve business activities. The manager of Bentley Motors are using technological factor which
helps to run a business by improving distribution chain in different location. This is favourable
factor which affected business positively. On the other side, while adopting new technology and
introducing something lot of money and resources need to used which can reduce the
profitability of chosen company.
Legal – This is important for all organisations to focus on laws and legislations which are
used to run a business and maintain it continuously. Many dimensions are involves such as
advertising, consumer protection laws, product labelling and safety and etc. Bentley Motors is
working under all legal factors such as consumer protection law, advertising a standard and
health and safety law which helps to maintain the business. This helps to continue and run a
business by following all legislations that increases profits (Yuan, Cheng and Ye, 2016).
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Environmental – This factor is related to environment that is important to be clean. This is
responsibility of every organisation to take steps and follow the environmental regulations which
has impacted on business positively. Various determinants are covered in this factor such as
pollution, reduce wastages, agriculture, climate, weather etc. that has affects the business.
Bentley Motors is impacted on business in positive manner by maintaining proper care of
environment that support to run business by increasing production and selling activity (Lee and
Klassen, 2016).
M1 Analyse the macro environment that inform strategic decision making
Macro environment consider various factors such as political, economical, social,
technological, legal and environmental which can affects the business organisation and strategy.
For instance, changes in government regulations and inflation rate can create challenge for
organisation where management need to follow new regulation and high inflation that can reduce
productivity and profitability so this can effect negatively. On the same tie, reduction in inflation
and stability of political stability is a strength for Bentley Motors to run and continue business
effectively. The managers is required to follow all laws and regulation so productivity can be
maintain and right decision helps to attain the business goals (Hsu, Moore and Neubaum, 2018).
TASK 2
P2) Internal environment and capabilities
The internal environment consisting of elements within an company that involve staff,
managers, society, leaders, activities, etc. that influence their human resource behaviour. Each
company is capable of carrying out its strategic strategy in order to maintain itself in a
competitive market. With performance accomplishment this improves product and consumer
growth. The management of Bentley Motors are increasing their organisational capability by
implementing Mckinsey model which is related with internal factors that have affected the
business that is defined below:
McKinsey Model - In 1980, the Robert H. Waterman Jr. and Tom Peters developed this
system. It consists of a 7 'S structure that enhances productivity and the ability to achieve
organizational objectives. Bentley managers adopt this model to evaluate organizational
architecture that focuses on positive accomplishment. This model is listed more below:-
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Structure - A strategic decision-making strategy with a revolutionary concept is built to
improve the capacity for optimal decision taking. Bentley managers may use this to develop their
organizational structure for their growth opportunities in various departments.
Strategy - Every company relies on strategic strategies to deal with rivalries and keep the global
market stable. The Bentley Motor’s managers will use this to extend customers and boost their
confidence and enthusiasm to a high level of satisfaction (Fletcher, De Massis and Nordqvist,
2016).
System – This means organisation should use a appropriate system to which can help to
connect the all activities and complete task in effective time period. The Managers of Bentley
Motors are using product services system such as fuel, electrical, lubricants, cooling, exhaust a
and transmission which helps to produce cars accordingly and maintaining business
appropriately.
Skills – To accept any challenges and changes in organisation skills are important which
gives ideas what steps need to be taken further and how technology should be adopted. In
Bentley Motors, management need to adopt professional skills and talents which help to control
direction and manage activities effectively.
Styles – This means organisation must adopt effective and proper leadership style which can
helps to motivate employees and increase their profitability. Bentley motors is manufacturing
cars by following participative leadership style that interact customers and increase
organisational profitability.
Staff –The management of Bentley Motors are increasing their production and profitability
by recruiting employees with good skills and qualities which helps to improve the organisational
productivity by increasing sales (Shuen, 2018).
Shared values – This is another strategy which states that each and every action of business
organisation should be ethical, manner and proper interaction with employees that can helps to
build a good relationship between employer and employees and increases business effectiveness.
SWOT analysis – This is another framework which is abbreviated from strength, weakness,
opportunities and threats helps to run a business and increase efficiency. This frameworks states
that organisation should focus on risk and weakness which arises in business and maintaining
profitability. In Bentley Motors, management are analysing this factor to know the benefits and
risk such as:
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Strength Weakness
 Bentley motors is popular organisatio
because of its unique mix of luxury and
nature in cars.
 Brand uniqueness which is not require
promotions and extra activities.
 It adopt technology and R&D in order
to increase speed, durability and
performance which helps to increase
number of customers.
 It make wonderful and most beautiful
cars designs which attracts customers
encourages them to buy it.
 Bentley Motors has limited reach that
means it is not available at all places.
 It produce limited number of cars so
there is customers face long waiting.
 They serve niche segment to provide
the products and services which can
reduce the productivity.
 Environment is not friendly due to this
it is increasing pollution.
Opportunities Threats
 Bentley need to become more
environment friendly that can make
more economic and better thermal fuel
alternative vehicles.
 Bentley has ability and power to
acquire other brand which is small in
size that can help to increase the sale
and profitability.
 It need to focus on emerging market
which can help to increase the selling
activity of cars.
 By using promotional channel it
become more capable and compatible
company which can help to increase
organisational sale.
 Changing government laws and norm
are becoming more stringent which can
reduce the organisational effectiveness.
 Increasing fuel prices can reduce the
number of customers because they
switch to other brand such as diesel and
electric.
 Visible competition due to marketing
campaign by other companies.
 Changing economy
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M2 Analyse the internal environment to assess strength and weakness
Internal environment is analysis by management in order to know what are the strength,
weakness, opportunity and threats. Threats and weakness should be reduced of organisation so it
can increase the productivity. McKinsey model is used to make the plans by involving stretegies,
structure, system, staff, skills, shared values etc. that helps to complete the goals in certain period
of time. On the other side, SWOT analysis is related to internal capacity of organisation where
managers need to focus on plans and introduce products and services accordingly (Gupta and
Narain, 2015).
TASK 3
P3. Porter's five Forces model.
Every organisation wants to increase their productivity and profitability by running their
business and increasing activities. This is important for organisation to build strategy and plans
so competitive advantages can be take effectively. Bentley Motors is automobile company that
manufacture luxury cars for customers by understanding their demand which help to get
competitive benefits. For this purpose, Michael porters model is used by chosen organisation that
is defined below:
Rivalry among existing competitors – This is prime element of forces model that states
competition between organisation. In UK, there are many competitors who are producing cars
such as Aston Martin, Rolls Royce, Mercedees etc. This can be threat for Bentley motors to sell
its cars at less prices with better quality then only it can increase sales and get competitive
advantages (O'brien, 2019).
Bargaining power of customers – Products and services which are produced by
organisation needed to sold to customers. In UK, there are many automobile organisation so it is
important for management to set the prices of products according to customers income level so
they can buy cars. The bargaining power of customers is high which is a threat for Bentley
Motors to sale its cars that can reduce the productivity and profitability (Roll, 2015).
Bargaining power of suppliers – All the automobile companies buys raw material from
suppliers which helps to produce the cars. In UK, numerous number of suppliers available who
are selling better quality of raw material to organisation at higher prices. The bargaining power
of suppliers is low because in case of charging high prices by suppliers there is an option to
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choose other suppliers. Therefore, Bentley Motors is taking advantages by getting raw material
from suppliers at low cost which helps to produce cars and increase profitability (Foss and Saebi,
2018).
Threat of new entrant: UK is larger market where organisations are allowed to establish
their own business and increase productivity. But to enter in to automobile sector there is need to
have high capital and human resources to enter in to new market. Bentley is taking competitive
advantages as there is difficult to enter in new market because there is need to spend more
money and technology which is difficult for new entrants (Alstete and Beutell, 2016).
Threat of substitutes – This means organisation bring new product or same products which
can use by customers and consume it effectively then it become a challenge for organisation.
This forces also can impacts on business of Bentley Motors negatively such as bus, bicycle,
rickshaw, auto etc. are substitution of Bentley who can challenge the business and reduce the
activities. Therefore it can be threat for company to sale its products and services (O'brien,
2019).
This has been established from the above discussion that corporation is needed to formulate
successful strategies to effectively tackle competition. Bentley motors managers need to be
knowledgeable of their rivalry's strategic tactics to mitigate their risks by taking precautionary
measures to reduce their unrestrained risk and succeed.
M3 Appropriate strategies to improve the competitive edge
Competition is increasing in business market where proper planning and strategy helps to
increase the customers base and product range so business growth can be maintain effectively. In
Bentley Motors, managers are applying porter’s five forces which helps to select best strategy
that uses to attain the business goals and make higher profits. For instance, there is threat of
bargaining power of customers and substitution that can reduce the productivity and profitability
of organisation. To improve this, managers need to produce better quality of products and sale
them at low cost which can help to improve the business and take competitive advantages. With
the help of this managers can increase their sale and productivity.
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TASK 4
P4) Strategies and theories to attain the business goals by strategic planning
An organization makes a strategic plan to better manage and organize its activities and ensure
that attempts are made by workers and other staff and meet the common goal. It is important for
organisation to have strategic plans goals which is decided by management can attain on time.
An company creates a strategic plan to achieve its sales target and other targets on cerain time.
Bentley's key product includes a very fast and powerful Roadstar Vehicle. It uses the Ansoff’s
matrix to evaluate different growth strategies that will help companies improve their target
audience and profitability. This organisation is applying Ansoff’s Matrix in order to increase
their capabilities and attaining business goals that are discussed below:
Ansoff matrix – This is a strategic planning which is mostly used by organisation to
grow their business and developed it continuously by making plans and strategies effectively.
This is important for organisation to focus on needs of company and make plans accordingly so
goals can be attain in certain period of time. This involves various strategies which are used
Be/ntley Motors to achieve growth and targets such as:
Market Penetration – Selling emerging goods into emerging markets is a tactic. This
approach seeks to boost the market share of the existing product and can be accomplished by
altering pricing policies, advertisement and promotion of sales. Bentley Motors should follow
this strategy to raise the target demand for its existing products by making use of more
aggressive marketing and reducing the price of its product. The management should provide cars
in existing market by reducing the cost and increasing promotional channel that can help to
aware people and increase sale.
Market development - Through this strategy of growth the company aims to offer its
current product to a new audience. This can be achieved by releasing an established product in a
new geographic region and also by using new distribution networks to reach new customers.
Bentley will use this tactic to boost its market share by introducing its electric car at some of the
world's latest sites, such as those around the world. Herein, organisations need to sale its cars by
entering in to new market by attracting new and old audience (Akindayomi and Amin, 2019).
Product development - According to this approach company aims to bring new product
into the exiting market. This approach includes the production and modification of the product
which can draw exiting business customers. Bentley Motors can use this approach to gain more
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competitive advantage by deep insight into consumer preferences and delivering the most
relevant product to satisfy the demand (Sousa-Zomer and Miguel, 2018).
Diversification - It's the marketing strategy in which businesses sell a new product in a new
market which helps to take the competitive strategy. This is a risky approach that needs a fair
combination of risk and organisational productivity (Tunn, and et. al., 2019). Bentley can use
this strategy to deliver new model of cars in a new market at relatively low price to grow its
market share and income.
Bentley is a successful and larger brand that having a strong market profile helps to
increase the sale. Diversification is the most suitable strategy for increasing its business
operations. Bentley has a very powerful production and development team to introduce fresh
technologies and more advanced technology to produce an electric vehicle with the highest
quality that can draw new consumer customers. Bentley admits that it is more focused on raising
the cost of its vehicles to make it more affordable for potential buyers, thereby providing an
incentive for such organisation to sell the product at a cheaper price on the current target market
to draw more customers (Baraibar‐Diez, Odriozola and Fernández Sánchez, 2017).
Bentley Motors is also using Horizontal and vertical integration for better growth and
development of business that is discussed as below:
Horizontal integration - It represents as a process of acquiring a company which
operates in a similar or different industry at the same level of value chain. Via horizontal
integration Bentley Motors will extend its business operations as it raises customer base and also
reduces competition.
Vertical integration- In this method, the company primarily extends its business by
purchasing products from the supply chain upstream or downstream. Bentley Motors will also
allow use of vertical integration as a result of enhancing supply chain communication and also
reducing freight costs (Dubey, 2018).
Therefore, Ansoff’s matrix, horizontal and vertical integration strategies are used by Bentley
Motors which helps to take the right steps and action by selecting best. Such as Diversification
strategy is used by chosen organisation where it produce a new model of cars and will launch in
new market will helps to increase the number of customers and increase organisational
profitability.
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M4 Strategic management plans
Strategic management plan refers as activity which is developed by companies to
accomplish their goals and objectives effectively. This plan covers mission, vision, objectives,
financial information ans tactics which can help to attain the business goals. Managers are
responsible to understand which type of plan is required to run a business and increase
profitability. In Bentley, manager are prepared a strategic plan in order to introduce new model
that is Bentley Bentayga GX in new market. So plan to complete the goals and attaining profits
in competitive market that is defined below-
Business Purposes Explanation
Mission The mission of Bentley motors to produce high performance
and best quality of cars.
Vision The vision of Bentley is to become world’s best fascinating,
successful and sustainable organisation in UK and get profits.
Value The company focuses on customer-first core principles,
honesty, teamwork, appreciation, etc.
Objectives  The objectives of Bentley are:
 To manufacture best quality of cars at reasonable cost
and customers get influenced effectively.
 To increase the profitability up to 40% in 2021.
 Introduced new technology and productivity in 2021.
 Attract customers by providing better quality of cars by
involving new technology.
 Increase product and market range by producing new
products.
Strategies The management of Bentley Motors are adopting various
strategies to implement the plans that are as defined:
Marketing Mix:
Product – Bentley Motors is planning to introduce new model
of car that is Bentley Bentayga GX will help to attract
customers more.
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