Comprehensive Strategic Analysis of BT using various Business Models

This report offers a comprehensive strategic analysis of British Telecom (BT), a major player in the mobile telecommunications sector. It employs several strategic management tools, including the PESTEL model to evaluate the macro-environmental factors impacting BT, the Ansoff Growth Matrix to explore growth strategies, Porter's Five Forces model to assess the competitive landscape, and Bowman's Strategy Clock to analyze strategic positioning options. The analysis covers BT's strengths and weaknesses using the VRIN model and discusses the implications of these factors on BT's business strategy and future direction. The report emphasizes the importance of strategic capabilities in ensuring BT's survival and competitive advantage in a rapidly evolving market.

BUSINESS STRATEGY

Table of Contents
INTRODUCTION...............................................................................................................2
TASK 1...............................................................................................................................3
P1 PESTEL MODEL FOR ENVIRONMENT ANALYSIS AND ANSOFF’S GROWTH
VECTOR MATRIX FOR ANALYSING ORGANISATIONS STRATEGIC
POSITIONING................................................................................................................3
TASK 2...............................................................................................................................8
P2 MEANING OF STRATEGIC CAPABILITY AND VRIN MODEL FOR
DETERMINING STRATEGIC CAPABILITY AND THE ORGANISATION
STRENGTHS AND WEAKNESSES..............................................................................8
TASK 3.............................................................................................................................12
P3 PORTER’S FIVE FORCES MODEL FOR BT........................................................12
TASK 4.............................................................................................................................15
P4 ANALYSING THE STRATEGIC DIRECTIONS AND OPTIONS USING
BOWMAN’S STRATEGY CLOCK MODEL.................................................................15
CONCLUSION.................................................................................................................18
REFERENCES................................................................................................................19
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INTRODUCTION
The mobile telecommunication is regarded as the rapidly growing sector across the
world. The survey of the Deloitte Company states that about 50% of the people of UK
are using the mobiles when they are walking. BT, Virgin, EE, Vodafone, Three are some
of the operators of the mobile in the UK. The survival of these companies seems in
danger as the competition is high in the market. This report deals with the overall study
of the BT by doing the analysis with the help of pestle as well as Porter's five forces
model in order to estimate the level of competition possessed by it so that an effective
business strategy is developed for the BT.
Figure 1 British Telecom Organisation
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TASK 1
P1 PESTEL MODEL FOR ENVIRONMENT ANALYSIS AND ANSOFF’S GROWTH
VECTOR MATRIX FOR ANALYSING ORGANISATIONS STRATEGIC POSITIONING
The services offered by the British Telecom organisation consists of the mobile, fibre as
well as the TV services across the United Kingdom and also serving the services in
more than 180 countries around the world. It is headquartered at London, in the United
Kingdom (Yüksel, 2012). The size of the organisation is about 102,000 numbers of
employees. About 50% share of the organisation are given to the public. The digital
products are being provided by the organisation. Also, the knowledge about the
technology is being given to the organisation so that the profits associated with the
organisation can be maximized. In addition to this, the services of the organisation need
the less monitoring by the organisation. The revenue generated by the British Telecom
organisation is £ 24,062 million. The BT vision, as well as the mission, is concerned with
the giving the superior quality services to the consumers of the organisation.
PESTEL MODEL FOR BT
The micro-environment impact is being described and evaluated with the help of Pestel
model. The description of the various challenges faced by the organisation socially,
politically, environmentally, technologically, and legally for the organisation is described
below:
Figure 2 Pestel Model
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Source: Administrator, 2016.
Political
The organization profit is affected by the political factors which in turn affects the market
share of the organisation. The various branches around the world are affected by this
factor (Florin, 2014). The risks associated with these factors can be mitigated by
analysing it. The elements of the political factors comprise of the level of the corruption,
government interference with the organisation, relocation of the property, working days
as well as the working hours regulated for the employees. In addition to this, this also
contributes to the product labelling, military risks, etc.
Economic
The organisation has done the acquisitions in the year of 2015 with the organisation of
the Orange which resulted in the enhancement in the working efficiency as well as the
cost efficiency of the organisation contributing towards increasing the productivity of the
British Telecom organisation (Löffler, et al. 2014). The 4G infrastructure is possessed by
the BT organisation so that the expansion of the market can be done globally as well as
increasing the opportunities for further growth in the future. An effective pricing strategy
of keeping the prices at the lower rates will bring the loyalty of the consumers. The
organisation is also thinking about the expansion of the services in the areas of big
data, cloud computing, as well as M2M.
Social
The social culture is being affected by the social factors which further include the
behaviour and the perception of the people towards the organisation as well as towards
the services of the organisation (Bouyssou, et al. 2010). The behaviour of the people is
being analysed within the industry as well as in the market. The social factors take into
account the numerous elements such as the varied cultures, varied interests, varied
roles, varied qualification possessed by the employees of the organisation.
Technological
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The technology is responsible for increasing the growth of the organisation. The speed
matters a lot in the organisation of the British Telecom. There is two type of the speeds
while talking about the organisation of the British Telecom. The growth of the
organisation is achieved with the help of slow speed whereas the decrement in the
growth of the organisation is noticeable by using the fast speed. The technology will
create an impact on the products, services, design structure, and the diffusion rate.
Environmental
The environment comprises of its various standards which must be followed by the
organisation in order to achieve the growth of the organisation in terms of the profit. The
laws, as well as the legislation, are being included in the standards of the environment
so that the organisation can recognise it for sustaining in the market as these standards
play a vital role in defining the survival capacity of the organisation. The pollution laws,
waste management, product recycling, changes in the climate are the factors which
affect the functioning of the organisation (Indiatsy, et al. 2014). The restoration of the
balance of the ecosystem must be maintained by the organisation.
Legal
The organisation set up is being affected by the framework as well as the standards
which are defined legally for the organisation. This is done for the purpose of protecting
the intellectual property rights of the BT organisation in order to secure the loss of
information (Van den Steen, et al. 2015). The employment laws, consumer rights laws,
data security laws, trust laws are associated within the organisation.
ANSOFF GROWTH MATRIX FOR BT ORGANISATION
The market growth of the organisation as well as products can be determined with the
help of an effective tool called Ansoff’s Growth Matrix. The existing products, as well as
the newly developed products, are being analysed with the help of this growth vector
matrix by taking into consideration the product life cycle so that the diversification,
development, and development of the product can be done.
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Figure 3 Ansoff Matrix
Source: Admin, 2013.
Market Penetration
The company sales, as well as the profits, can be enhanced by building an effective
strategy for the organisation so that risks can be minimized. The products rebranding is
done in the organisation of the British Telecom organisation for building the customer
base and also increasing the organisation efficiency (Djurica, 2010). The new contacts
are established by the organisation of the British telecom organisation. The pricing
strategy7 adopted by the organisation proves beneficial for the organisation. The
demands of the old, as well as the new consumers, are not avoided by the organisation.
Product Development
The risks associated with the product selling has not affected through the organisation
and also the merging process of the BT organisation with the other organisation helps
inefficient product delivery as well as management so that profits can be increased of
the organisation (Hussain, et al. 2013).
Market Development
The risk possessed by the organisation of the British Telecom is medium. Also, the
deals were given by the various organisations to the British Telecom organisation based
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on the various parameters associated with the organisation. It aims to provide the
numerous services for its customers with the view of increasing the share of the market.
Diversification
With respect to the diversification, the high risk is attained by the organisation of the
British telecom (Shaw, 2012). Along with this, the barriers associated with the
organisation are determined and analysed so that the survival of the organisation
becomes easy in the market.
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TASK 2
P2 MEANING OF STRATEGIC CAPABILITY AND VRIN MODEL FOR
DETERMINING STRATEGIC CAPABILITY AND THE ORGANISATION STRENGTHS
AND WEAKNESSES
The survival of the organisation is dependent on its strategic capability so that the
market value of the organisation can be enhanced thereby bringing the competitive
advantage for the organisation. The areas which the strategic capability draws attention
are the resources of the organisation, market share of the organisation, and the
financial fund needed by the organisation in order to provide the numerous opportunities
of employment in the forthcoming years (Johnson, 2016). The identification of the
competitors is effectively done with the help of the phenomena called the strategic
capability. This strategy plays a significant role in any organisation. The vendors of this
strategic capability are the business leaders, employees, government, as well as the
investors. The growth of the organisation can be achieved by following the strategic
capability of the organisation. The strategic capability further helps in evaluating as well
as monitoring the business with the help of government and the business analysts. The
strategic capability is carried out with the help of the strategic value analysis. The
strategic value analysis is based on acquiring the data from the various sources namely
the annual reports as well as the surveys (Hamel and Prahalad, 2013). The numerous
elements are considered in this strategic value analysis namely the structure possessed
by the organization, the organisation assets, human resources, the employee's qualities
and the potential possessed by them, and lastly the policies which determine the price
of the various products of an organisation.
VRIO MODEL FOR BRITISH TELECOM
The VRIO Model helps in determining the capabilities possessed by the British Telecom
so that the organization can gain the competitive advantage. This model tells that the
resources of the organisation which are internal to the organisation must possess the
value in the market so that the alternatives to these resources cannot be done in the
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market. The VRIO model comprises the four elements which include the organized,
Rare, inimitable, and the Valuable which are further described below:
Figure 4 VRIO Model
Source: Admin, 2016.
Valuable
The valuable resources are considered in it so that the opportunities can be identified
for the organisation as well as the threats associated with it. The resources which
possess the value to attracted a large number of customers by bringing loyalty of them
towards it. There are some factors which help in deciding the Valuability of the
resources associated with the organisation (Simão, 2010). The prices of the products
are also kept low on the valuable resources. Those resources which do not possess any
value in the market create a drawback for the organisation.
Rare
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The resources of the organisation must be rare so that other organisation in the market
does not develop its alternatives in the market for the consumers. This variety of the
resources helps in bringing the growth of the organisation thereby ensuring the
competitive advantage for the organisation (H. Netland, and Aspelund, 2013). The
benefits associated with the organisation by having the rare resources are large. Also,
the resources which are similar in the function or nature should be avoided through the
organisation.
Imitate Costly
Imitation is defined as the process in which the substitutes for the products as well as
the services are developed as well as created but the implementation of this is very
difficult as various issues are encountered in it which includes the level of the
complexity possessed socially, haziness occurred in the resources of the organisation,
and lastly the process of creating the resources are originally done by the organisation.
Organized
The organisation is composed of the several departments which work collaboratively
with each other by supporting the functions along with the management of all the
department so that each function of the organisation works in an effective way
(Hinterhuber, 2013). The organisation cultures, as well as the structures, are associated
with the organisation which needs to be organized effectively so that the competitive
advantage can be gained.
BT Valuability: Yes
BT Rarity: No
BT Imitable: No
BT Competition: Yes
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STRENGTHS OF BT
The healthy, as well as the strong balance sheet, is being maintained by the
organisation of the British Telecom. The BT organisation has gained the loyalty of the
customers towards the organisation thereby attracting numerous people. The attractive
products, as well as the services, are being provided by the organisation of the British
Telecom in serving the consumers (Crewther, et al. 2012). According to an estimate, the
review collected by the organisation helps in determining the good experience
developed by using the products of British Telecom organisation. Globally, the
organisation has expanded in the 170 countries throughout the world. The highest area
is being covered by the British Telecom organisation in the industry of
telecommunication. The operation of the British Telecom is being possessed by the
telephone lines of the population greater than the 28 million.
WEAKNESS OF BT
The dependency of the organisation of the British Telecom is high in the market
according to the growth of the organisation. The isolation of the existing partners by the
British organisation has brought the prices of the product high with providing the lower
quality products. The name of the organisation has also occurred in the account
scandals associated with the organisation which is one of the weaknesses of the
organisation named British Telecom (Vasilevskis, et al. 2010). The finance sector of the
organisation has been drastically affected by this. This organisation also lacks the
advertising as well as the promotion strategies with respect to the products of the
organisation. The various complaints were also fired by the consumers against the
services of the organisation which are also not looked into. These were the weakness of
the BT organisation.
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