Icon College: Business Strategy Report on British Telecom Analysis

This report examines the business strategy of British Telecom (BT), a major telecommunications company. It begins with an introduction to BT, outlining its services, vision, mission, and objectives. The report then analyzes the macro environment using PESTLE analysis, considering political, economic, social, technological, legal, and environmental factors affecting BT. Following this, the internal environment is assessed using SWOT and VRIO analyses to evaluate BT's strengths, weaknesses, opportunities, threats, and its valuable, rare, inimitable, and organizationally supported resources. The report applies Porter's Five Forces model to understand the competitive landscape and concludes with strategic planning recommendations for BT's future success. The report is a comprehensive analysis of BT's strategic positioning and potential for sustainable competitive advantage.

Business Strategy

Table of Contents
INTRODUCTION.......................................................................................................................................3
LO1.............................................................................................................................................................3
P1 Appropriate framework to analyze the macro environment of a given organization..........................3
LO2.............................................................................................................................................................5
P2 Analyze the internal environment and capabilities of a given organization........................................5
LO3.............................................................................................................................................................8
P3 Apply porter’s five forcs model and to evaluate the forces of given market sector............................8
LO4.............................................................................................................................................................9
P4 Apply a range of theories, concepts and models interpret and devise strategic planning for a given
organization.............................................................................................................................................9
CONCLUSION.........................................................................................................................................17
REFERENCES..........................................................................................................................................18

INTRODUCTION
Business strategy refers to an action and moves of a business that considers attracting customers,
compete with rival firms, accomplishing organizational goal and strengthening the performance of an
individual and the company with longer sustainability in the market. This report is based on British
telecom that is one of the British multinational telecommunication holders in the UK. It operates their
business outlet in around 180 countries that provides the various services like fixed-line, broadband and
mobile service to their users. This project report includes examine the external and internal environment
to know the ability and capability of completing the task and earns maximum profits. After that it can use
the model related to the porter’s five forces model that is helpful to know the competition and gain the
competitive advantage for a long term. At last it uses model and concepts and makes a strategic plan that
helps in earning profits and longer survival of the business (Akter and et. al., 2016).
LO1
P1 Appropriate framework to analyze the macro environment of a given organization
Overview of organization
British telecom is one of the largest British telecommunication companies in the UK
headquartered in London. It is founded in 1969 and opens their outlets in approximatley180 countries till
now. It provides the various services to the people like broadband service, fixed-line and also mobile
services, home security, supply chain management and the telecommunication equipments. It also gives
the subscription on the Television and IT services. In the company around 106700 employees are
working.
Vision
The core vision of the British telecom is to provide the world class products and services related
to telecommunication and the information and to develop and exploit their network in al over the world.
They work for customer satisfaction and earn a high amount of growth and services. they show their
professionalism and accept the change as per the demand of the business environment to properly
engaged with the stakeholders (VISION & VALUES. 2020).
Mission
The main mission of the British Telecom is the product the firm serves to its customers,
communities, and shareholders is a qualitative in nature. It is a benchmark of the business to work for

hopes to achieve. It works for earning efficient profits with effective strategies (Higgins, Omer and
Phillips, 2015)..
Objectives
The main objective of the British Telecom is that sustains in the market by earning high amount
of profits and satisfied the customer’s demands. They work for make the world better. it makes the fitting
contribution to the society in that where the business is operates. Here, employees work for increasing the
demands and value for the network. There objectives is to accountable, responsible and consistent in their
work by following proper code of conduct they can fulfils all the demands of the customers so that they
can satisfy with the company and become loyal towards the business organisation(VISION &
VALUES. 2020).
Macro environment
It defines as a remote environment for every company in which they exist. It is a set of activities
that consider economy as a whole. It is not controllable by the business firm. It includes GDP, spending,
employment, inflation rate, monetary and fiscal policy. In British Telecom, manager need to examine the
external environment as it is very dynamic in nature. To increase the efficiency, profits and making the
opportunities manager of firm analyze the macro environment by using PESTLE analysis that can be
shown below (Thompson, Strickland and Gamble, 2015).
PESTLE Analyses
It refers to an analytical framework that is used by the British Telecom to understand the
unpredictable environment in which it operates is business this helps in improves the performance and
operation. It can be explained below.
 Political factor - This factor involves political stability, tax rates, economic condition,
employment rate etc. of the countries in which a business s established. In British Telecom,
import duty on products affects the profits because of some raw material are imported from
outside the country like East Asia and china. And because of Brexit it will create the problem and
risk for the investors who invest money in the British Telecom and this will affect the growth of
the business. But at the same time it can increase its sales in UK (Woerner and Wixom, 2015).
 Economical factor - It can includes cost, price and profits of the company and its nation. In this
every firm should focus on change in policies, tax rates and accessibility of finance. It is very
important to grow their business on international level that helps in supporting the country

economy. British Telecom, is highly influenced by the cost, price and the profits. In this
unemployment level of the country is affects more the company sales and profits. Because of
international growing market it can helps in earning sales and profits with their effective pricing
policy.
 Social factor - This factor affects the most as it includes the society , customs, values, beliefs of
an individual in the society. In this a person trend plays an important role in the market growth. In
this British Telecom is based on the UK customers because of this they design the message for
the consumers as per their perceptions needs and desires. Because of this firm need to focus on
the people leisure interest, attitudes towards the use of telecommunication in their life so that firm
will increase their profits and sustainability.(Leonidou and et. al., 2015).
 Technological factor – In today’s environment using advanced technology is in trend where all
the people using digital technology. For companies it will make new opportunities for profits and
market growth. In British Telecom using advanced technology helps in capturing new
opportunities from this they will gain their customer trust. In this they can invest more on
research so that they know the customers demand and the technology so that they can make the
profits and sales and stay in the market for longer terms(Soltanizadeh and et. al., 2016).
 Legal factor- It includes the government regulation and the policies that effect the performance
of the company. In this legal environment British Telecom focus on their employment laws for
their workers and they also adopts the safety laws for their workforce. It is very essential to focus
on the employees welfare so that they will effectively and efficiently and complete the task in an
timely manner. Because of this organization use the quality products according to the consumers
demand so that they will earn more and more profits.
 Environmental factor- With the increase on environmental issue many company can face
problems regarding the use of offering for saving the environment. In context of British Telecom,
there main objective is to satisfy the consumers with their services that does not harm the society
and environment. in this they make focus on the law related to environment hazardous so that
they will make the loyal customers and earn more and more profits with high market
growth(Amran and et. al., 2016).
LO2
P2 Analyze the internal environment and capabilities of a given organization
Internal analysis

It refers to an analytical framework that is helpful to explore the company’s competencies, Cost
position and the competitive viability in the current market. In British Telecom, manager can analyze the
internal factor to know the efficiency and effectiveness of an employees and its performance that will
contribute in making the firm’s profit.
SWOT Analysis
To analyze the internal factor SWOT analysis is the best way to know the strength, Weakness,
opportunities and threats that is very beneficial for knowing the ability and capability of the organization.
Strength Weakness
 The main strength of the British Telecom is
that it contains the healthy balance sheet
and having a strong cash flow with more
financial resources from the operations. It
FY19-20 revenues measures at 22,905
million Euros. Because of having high
financial resource that can adequately
meets all its working capital
requirements.
 It inculcates the strength that it is the
largest company which provides the
services related to consumer broadband
and fixed voice telephony and around 560
communication providers use the network
of the British Telecom (Yuliansyah,
Rammal and Rose, 2016).
 The major weakness of the British Telecom
is that lack of making the business strategy
towards the promotion of cheap and low
amount voice calls. This will affect the
revenues of the firm.
 Another weakness that a British Telecom
contains is that it holds the high attrition
rate and spend more amount on providing
the training to their employees as compare
to other competitors.
 Because of Brexit occur in the UK affects
the company’s profit and market share.
Because of this they wouldn’t attract new
investors.
Opportunities Threats
 Strong cash flow helps in providing the
opportunity to make investments in the
adjacent products segments and because of
high cash availability they can spend more
on adopting the new technology. This help
in earning high amount of profits.
 Expanding their business in the emerging
 Due to Brexit, UK is separate from the
European Union because of which their
investors cost of production and trade deals
effect and it is the major threat of the
British Telecom.
 Major threat of Tesco is placed due to
government regulation that puts pressure

market British Telecom has open stores in
much other country where they find and
get the profitable opportunity for the
business entity.
 the another biggest opportunity is the
trending people in the UK that helps in
purchasing the company products and due
to this firm may spend more on adopting
and move towards the technology to earns
a high amount of profit.(Chen, Eshleman
and Soileau, 20170.
on the company to adopt the current laws
and regulations that is require for them and
this make a additional expense on the
operating cost.
VRIO Analysis
To know the capability and ability of using the resources and its value to the organization manager of the
British Telecom use to make the VRIO analysis that can be shown below.
Factors Valuable Rare Imitate Organization Competitive
implication
Brand image Yes - - - Partial
competitive
advantage
Product and
service
portfolio
Yes Yes - - Temporary
competitive
advantage
Technological
capabilities
Yes Yes Yes - Temporary
competitive
advantage
Financial
capabilities
Yes Yes Yes Yes Sustainable
competitive
advantage
 Valuable – It is very significant for the manager of British Telecom to properly utilize the
resources that are highly valuable and give the tough competition in the market. In this brand
image is the most valuable resource for the firm because of its valuable product and service

portfolio, technological capabilities and financial capabilities. Therefore, these resources helps in
earning more profits, improve the employees performance and distribution of supply
management.
 Rare – It refers to the benefits of the company in understanding the goods offerings that is
prepared are rare or not. British Telecom rare products helps in gaining the competitive
advantage and the customer loyalty because of this business earn high revenues in a considerable
manner. Here British Telecom product portfolio is very rare in the local market as no
competitors beat the product range and use of technology are also rare as they use the RFDI
system to count the products which is unique one. And main its financial capability it contains
more amount to spend(Torrent-Sellens, 2015).
 Imitable – This refers to that when the products and resources are used by the British Telecom
cannot be copied by other firms. Its technological and financial resources are very unique and
strong that no one can copy it easily because of this they will attract more and more customers. In
this product portfolio can be copy by the rival firm that will affect the sales of the enterprise.
 Organization - It is a core for the organization like British Telecom to manage their current
resources in a effective and optimal manner. If the materials and the cost are not efficiently used
by the firm that it will increased the expenses. To reduce this financial resources are strong of the
company. it is the core resource of the sustainability in the marketplace.
LO3
P3 Apply porter’s five forcs model and to evaluate the forces of given market sector
Porter’s five forces model helps in analyzing the competition of a business. It is proposed by
Micheal E Porter since 1979. It helps in maximize profitability by understanding the forces related to the
rival firms. there are five frameworks that is used to analyzed the British Telecom profitability that can be
described below(Linder and Williander, 2017).
 Bargaining power of the suppliers – There are many suppliers present in the telecom industry.
Because of this power of suppliers are low in British Telecom. Because of this firm has the power
to negotiate in purchase of the raw material. This helps in increasing the profit margins because
of low cost of production.
 Bargaining power of the customers - This is an important framework for every organization. in
British Telecom they offers a variety of products and different services on its online and physical
outlets to the millions of consumers. in this buyers contains high power because of other

competitors present in the market place. Competitors like Talk talk, TPG, Deutsche Telecom AG
etc. To reduce the bargaining power of the customers company can innovates and offers new
products and services to their customers.
 Threat of new entrants - The new entrants in the Telecom organization is low as British
Telecom is an renowned organization and establish on a global level. The financial resources are
also very strong because of this it is not possible to easily enter in a new market. Because of this
no new business in market is capable to compete with the organisation in terms of the customer’s
loyalty, market shares. In this firm regularly research on the customer demands and focusing on
the innovating and developing new goods and services.
 Threat of substitute products- In this when one products or services meets the requirement for
the customers need in a different ways because of this industry profit suffers. In British Telecom
the threat of using customer other alternative services is more that also fulfills the demands of the
users. If the substitute product or services is offers in a low price with good quality than the
people are attracted towards it and it will reduces the sales of the company.
 Rivalry of the firm - There are many competitors present in the market in which British Telecom
has operates its business. In this some of them are large in size that have large market share. In
this to reduce the competition and gain the competitive advantage company can make produce
innovation products that help in sustainability. Sometimes they make collaborating with their
competitors that helps in increase the market size and the market share (Evans and et. al.,
2017).
LO4
P4 Apply a range of theories, concepts and models interpret and devise strategic planning
for a given organization
Executive summary
It refers to a set goal, focuses energy, strengthens operations that are used to communicate within
the firms and ensures that workers and stakeholders are working with very effectively to achieve the
common goals. The strategic management plan of British Telecom can be shown below. In case of
British Telecom, this plan includes the organisational structure, mission, vision, internal and external
environmental analysis competitor’s analysis, SMART objectives and SAF that helps in monitoring and
evaluating the performance that is based on the strategic plan.

Organisational structure
British Telecom follows an effective organizational structure that includes the six lines i.e.
consumers, EE, global services, ventures, wholesales, public sectors and other type businesses. It can
serves varieties of services with broadband, TV, mobile and telephony services.
Vision
The main vision of the British Telecom is to satisfy the customers by offering the world class
products and services to the users. it also develops and maintains their presence in all over the world also
gain the competitive advantage to sustain in the marketplace.
Mission
The main mission of the British Telecom is to focus on their tagline that is making the world
better and according to this they provide the training to their employees so that they will achieves
the task in a timely manner. The mission is related to provide the qualitative products on the best
price that customers can afford. (Kitsios and Kamariotou, 2016).
Values
The value of British telecom is that it acts as an accountable, responsible and consistent in doing
their work and always follows code of conduct that is major values they hold.
Macro- environment
Political- It can be affected by Brexit in UK because it affects the investors from other countries
who can invest in British telecom this is a threat but it can enhance the sales within UK is an opportunity.
Social- In this people in UK are enjoys their leisure time by using telephone or broadband
services this will helps in increasing the profits is the opportunity.
Economical- In this condition of unemployment due to Brexit affects the British telecom sales
and profits in the international market that is major threat but it will enhance the sales in UK.
Technological- Investing in new technology helps in attracting the large base of customers in
British telecom it shows the opportunity to a firm. As they already focus on using advanced technology to
increase their market share.

Legal- In this British telecom can follows the proper legal regulations related to their employees
like employee equality; safety etc. so that they can work potentially that gives effective results. This is the
major opportunity(Evans and et. al., 2017).
Environmental- To make the loyal customers British telecom does not use those products and
services which can harm the environment in which business operates. This earns maximum profits and
helps in capturing more new opportunities.
SWOT
Strength Weakness
The main strength is that it is one of the largest
companies having strong financial resources and
also provides effective customer services related to
broadband and telephony.
The major weakness is occurring due to Brexit
because they cannot effectively sales their products
due to unemployment present in the country.
Opportunities Threats
The best opportunity is the trending people who
can enjoy their leisure time by using broadband and
telephonic services this will helps in earning higher
profits.
Because of Brexit deals in international market is
much affects and investors cannot invest their
money effectively.
Internal analysis
VRIO
Valuable- The most valuable resource of British Telecom is their brand image and financial
resources that is properly utilize because it gives the tough competition to the rival firms.and helps in
gaining more profits.
Rare- The rare resources of British telecom is their product portfolio and distribution
management that helps in gaining the customers trust and increase the profits in an considerable way.
Imitable- In this British Telecom required to offers those goods and services that are not copied
by others. In this use of advanced technology is imitable that is offers to the customers and they enjoy the
maximum revenues(Evans and et. al., 2017).

Organize- It is very essential to organize and maintain all the resources in the British Telecom
because it helps in earning more profits. In these employees, financial, distribution and technological
resources all are to be effectively organized.
McKinsey’s 7S Model
Strategy- It refers to a plan that is helpful in maki8ng the strategy to gain the competitive
advantage If British Telecom cannot have a robust strategy than it will not achieves the targets and faces
many issues like decreasing customers and sales.
Structure- It suggests the structure in which British Telecom, different divisions can share and
organized information in an appropriate way so that it helps in gaining the competitive advantages in the
market.
System- It is related to that strategy which shows the daily activities that perform in an effective
way in British telecom so that there employees are encouraged to adapt changes effectively(Evans and
et. al., 2017).
Skills- It shows the abilities and capabilities of an employee in the British telecom so that
manager can allocate the task as per their knowledge and skills so that goals can be achieved effectively.
Style- It shows the style that was used within the organisation to manage the relations between
the employees and top level managers. In British telecom they use supportive style that will encourages
employees to give productive results.
Staff- It shows the number of employees who are working within the British telecom to gain the
profits and beat the rival firms in the markets.
Shared values- It shows the set rules and standards that guides the British telecom employees to
effectively behave in the working environment.
Competitor’s analysis
Porter’s generic strategies
This model can be used to determine the strategy of the organization. it includes 4 strategies
where a firm can choose according to their need that helps in earning more profits with maximize sales. In
context of the British Telecom, these strategies can be explained below(Sanden, 2016).