Business Strategy Report: Nissan's Macro & Internal Environment

This report provides a comprehensive analysis of Nissan's business strategy. It begins by examining the impact of the macro environment on the company and its strategies, utilizing tools like PESTLE and stakeholder analysis to assess political, economic, social, technological, legal, and environmental factors. The report then delves into the internal environment, applying the VRIO framework to evaluate Nissan's resources and capabilities, and employing the McKinsey 7S model to analyze its structure, systems, style, staff, skills, and shared values. A SWOT analysis further highlights Nissan's strengths, weaknesses, opportunities, and threats. Finally, the report discusses Porter's Five Forces to assess the competitive landscape, providing a holistic understanding of Nissan's strategic position and challenges in the automobile industry.

Business Strategy

Table of Contents
INTRODUCTION ..........................................................................................................................3
Impact and influence of Macro environment on organization and it’s strategies .....................3
LO2..................................................................................................................................................6
P2 Analyze Internal environment and capabilities .....................................................................6
LO 3.................................................................................................................................................8
Porter’s five forces......................................................................................................................8
LO4..................................................................................................................................................9
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................14

INTRODUCTION
Business strategy refers as the set of actions and decisions that undertakes by
organization to achieve it’s goals in it’s industry. A ideal business strategy always supports
organization to be competitive in it’s sectors and leads high profitability in the business. In
addition, it guides decision-making process for recruitments and allocates adequate resources. A
successful business strategy always helps organization to stay competitive and builds good brand
image in the business market. To understand role of business strategy has an example of Nissan.
It is a Japanese automobile company which is headquartered in city, Nishiku, Yokohama. It has
wide brand portfolio and sells it’s product multiple countries. The vision statement of the Nissan
is to enrich people’s live. While mission statement is to offers unique and innovative automotive
car products and services that influences superior measurable valuable to all stakeholders either
internal and external (NISSAN MISSION AND VISION STATEMENTS: AN ANALYSIS,
2019). The main objective of the company is to zero emissions of carbon through automobiles.
It has taken corporate society responsibility to give values to the people and keep environment
pollution free. This report provides understanding about impact and influence of the macro
environment on company and it’s strategy through analytical models. In this report will discuss
about McKinsey 7s model for analyzing internal environment of the company.
Impact and influence of Macro environment on organization and it’s strategies
There have certain analytical tools i.e. pestle analysis and stakeholder analysis which undertakes
to analyze impact on influence of macro environment on organization’s performance,
productivity and operations.
Pestle Analysis
It is a analytical tool that is used to analyze and monitor organization’s performance and
it’s strategy in and devise a strategy which can effectively helps organization to stay competitive
and improves it’s chance of sustainability and productivity as well. Pestle analysis is used to
analyze external environment of the Nissan company as analytical tool. The model comprises six
factors that are described as follows:
Political factors

In recent years level of political stability is quite good that influences Nissan’s
performance and operation because it does not have to change their product policies to meet
governmental policies. Due to high political stability enables to trade it’s products to large
number of customer’s as well as it manufactures some customized auto-mobile products which
meets government policies (Achinas and et.al., 2019). Thus, Nissan enables to influence it’s
products development strategy effectively. But it gets negative impact on it’s trade expansion
strategy due to trade barrier. According trade policy a particular organization cannot trade it’s
product in multiple countries. So, Nissan motors company unable to build good relation with
potential trade partners that harms organization by preventing enable exports.
Economical factors:
High interest rate, GDP growth, financial performance, unemployment etc. are economic
factors which impacts on Nissan Group plc. In recent years automobile sectors has affected by
economic crisis negatively because it reduces selling of vehicles. Nissan Group has also
impacted negatively in term of selling revenue such as demand of luxury or high cost vehicles
has impacted poorly while poor economic condition. The reason behind was that taxation price
was also high which automatically has improved luxury products price (Simões, 2020). High
level of unemployment rate in country gives positive impact on it’s recruitment strategy for lead
strength in supply chain management. Nissan group recruits large number of people who are
willing to work on lower wage thus it enables to lower price on it’s products.
Socio-cultural factors
Nissan Group plc is operated into two sectors such as manufacturing and retailing so it
become easier for the organization to give value it’s customer in the business market.
Organization uses demographical segmentation strategy to target it’s main customers while
considering age and gender factors which impacts on their purchasing behavior (Vallati and
Grassi, 2019). Nissan targets male mostly who always looks for such kind vehicle which gives
them a attitude and differentiate them from others. As resultant social factors influence
demographic segmentation strategy of Nissan whereas it enables to improve customer’s buying
behavior and in return generate high revenue within business.
Technological factors

Recent advanced automated technology has proved blessing for automobile industry
because it has improved working performance of the organization as well as productivity of
products. Organization has strategy to use new technology effectively within workplace so that it
helps to take competitive advantage by offering high quality automobile product as their needs.
This advanced automated technology influences organization’s performance because it enables
to offers customized product in minimum time and without human errors which leads
satisfaction in customer for the product and services as well (Vallati and Grassi, 2019). With this
new technology organization enables to take competitive advantage from it’s competitors in the
business market.
Legal factors
Organization has business strategy to sell it’s product on lower cost so it has decided to
buy raw material in larger quantity which automatically reduces production cost then it enable to
sell it’s car product on competitive edge over the competitors. This strategy influences by
government because they have imposed law to offer high quality product on lower cost so that
each customer can spend better life like potential customers in the society.
Environmental factors
Nissan has strategy to introduce new car products which is carbon free and does not raise
any type of harmful radiation which becomes reason of climate change. This strategy is highly
influenced by government policies because they are basically associated with climate change.
Thus, company comply all governmental policies and puts pressure on it’s competitors for the
environmentally friendly products. In addition, with this policy it enables to builds good brand
image in the customer’s mind for the brand and it’s products (Phadermrod, Crowder and Wills,
2019).
From above discussion has analyzed that organization gets positive impact on it’s performance
and strategy. To overcome economical crisis issues can designed low-cost products with the
support of suppliers that improve customer’s buying behavior as result generate high profit
margin on it’s products. Organization has take CSR practice within workplace that helps
company to overcome all external environment issues and improves profitability ratio within
company.

Stakeholder Analysis Matrix
It is a procedure of determining those people who plays huge role in the organization to
meet it’s objective. The stakeholder is identified within business based on their level of
involvement, interest and their influences in the project. It is a best technique to analyze needs
and expectation of people either they are employee or customers so that make them satisfied by
offering desirable product and services on time. Nissan Group uses this stakeholder analysis
matrix to determine it’s valuable stakeholders. There are four elements of stakeholder matrix
such as:
Meet their needs
Customers, government and it’s policy and others are external stakeholders of Nissan group
which helps to each it’s objectives and generate high revenue within business on it’s products. It
mainly focuses on it’s customer’s choices and expectation through constant deep market research
strategy so that can meet each objectives and improves satisfaction level in them for the product
and it’s services (Sharma and Aggarwal, 2019). It uses different advertising strategy to aware it’s
customer about new products which attracts existing and new customers for buying car products.
Key players
Employees, investors, local communities and suppliers and dealers etc. are main stakeholder
which gives huge contribution to make each project successful in the business (Simões, 2020).
So, Nissan group plc keeps close relationship with them and organizes conference meetings,
corporate guiders etc. who supports to understand needs of individuals from the job or company.
Least important
Physical evidence of the organization is least important for the Nissan automobile company as
compared others.
Show consideration
CSR strategy Nissan influences it’s stakeholder to give better performance by performing each
role proficiency. CSR shows high consideration in the organization’s performance, profitability
and operations.

P2 Analyze Internal environment and capabilities
VRIO Analysis
This framework use to determine internal resources that can provide sustain competitive
advantage in the business market. Nissan uses this framework to identify it’s internal capabilities
and resources. This framework comprises four factors
Valuable resources
Financial resources, local car products, employees, patents and distribution network is
highly strong and more valuable resources which can help organization to achieve high
competitive advantage over it’s competitors (Eskerod and Larsen2018). While cost structure and
R&D department are also important resources for the company but they are not considered
valuable resource because they are highly available in all firms.
Rare resources
Financial resources, patents, distribution networks etc. are rare resources which are not
easily available in other firm because posses’ high cost. With these resources Nissan Group can
stay as competitive for long time in it’s sector (Harper, 2017).
Imitable resources
Employees and products are imitable resources of Nissan because it does not posses’ high cost so
anyone can imitate them by offering investing high funds on R&D and T&D department to
improve efficiency level of these resources (Baernholdt and et.al., 2018). But patents,
distribution network, financial resources are non-imitable resources because they posses’ high
cost which is not easy for others to imitate.
Organization resources
Financial resources and distribution networks are well-organized resources of Nissan
which can support to achieve sustainable competitive advantage and improves it’s performance.
While patents are not well-organized that causes organization unable to maintain sustainability in
the competitive advantage.
McKinsey’s 7s model

Strategy: To promote electric cars across the world is major business strategy of the Nissan
company.
Structure: Organization follows corporate hierarchy structure that helps to control over all
functional units effectively.
System: managers and leaders are works together within workplace to take effective decision by
keeping hope that they receive best outcomes within company.
Style: Management of the Nissan follows transformational leadership style while leaders follows
charismatic leadership styles to motivate staff within workplace (Hristov, 2020).
Staff: Management of Nissan company perform various roles within company such as recruiting,
trained, motivated and rewarded staff so that enables to lead high profitability within company.
Skills: Nissan is an automobile manufacturing company which needs such kind staff who has
creative mind and highly dedicated for their job receptibilities within workplace.
Shared values: Nissan follows 360-degree feedback strategy to gather feedbacks from customers
about it’s car products and their experience as well as asks them for suggestion (Dvir and Emet,
2016). thus, company gives values to the customer and builds good relationship. On the other
hand, it also gathers feedbacks from staff about strategy and encourages them to create creativity.
Thus, it gives values to the staff as well within company.
SWOT Analysis
It is a strategic analytical tool that is designed to determine strengths, weaknesses, threats
and opportunities of individuals or organization in the business market (Vargas-Hernandez and
Medrano, 2020). The model is used for Nissan motor’s group to examine it’s internal
environment.
Strengths
It has strong R&D spending so it has best selling of electrical vehicle across the world. It
has strong presence in the emerging and leading market which is also a major strength of the
business.

Weaknesses
It has poor marketing and advertising capabilities that causes has poor brand awareness in
people for the brand and it’s products in automobile industry.
Opportunities
There are various governments across the world are tried to reduce the greenhouse gas
emission and promotes fuel efficiency initiatives. Such kind environmental initiatives may help
organization to improve selling of it’s car electric product which comply all government
regulation associated with green gas emission.
Threats
Low fuel prices can become threat for the organization because people like to prefer
petrol car instead of electric cars. From past few years automobile industry becomes major hub
to generating high revenue so competition is raised by and by which can create threat for the
Nissan motors group plc.
LO 3
Porter’s five forces
The competition in the market is increasing for Nissan which is why the company is using this
framework so that they can get a competitive advantage over the factors. This is going to make
the company have the right measures and direction in the organization is going to be strong. The
organization has aimed for higher profit margins so that they can invest it in further functioning
and get a larger market share.
Bargaining power of suppliers (Medium)
There are a lot of suppliers which Nissan has captured over time so that they can shift from one
to the other. There are times when the suppliers price their raw materials high but the
organization can shift for an alternative supplier in this case. The organization is using batteries
which are currently having limited suppliers which is why there is no alternative for that and the
company will have to use that factor.
Threat of new entrants (Low)

For any company to start a venture needs a large amount of investment which Nissan has already
put and has established themselves in the market which is why there are no entrants in this
industry. The skills and knowledge of the workforce has to be strong so that there is a better
functioning (Johnson and et.al., 2017). Innovation and inventions have to be higher which is
going to help the company to have a competitive advantage so that there is going to be a great
advantage.
Degree of Rivalry (High)
Experience in this industry is very important which Nissan is having and that is a great factor for
the company. There is creativity and innovation which is taking place affectively in the
organization and that is helping the organization to have a better reputation and higher market
share for a long run. There has to be a successful functioning of the organization which is being
taken care of by Nissan all the time so that they can maintain their brand image in the market and
the loyalty of the customers.
Bargaining power of buyers (Medium)
The trends are changing for the customers as well and the customers are shifting from fuel to
electrical cars which are why Nissan will have to find ways to get in this change affectively.
There are discounts and special offers which are being given out to the customers so that there is
a better functioning. There is a sense of transparency as well in the organization so that the
company can function properly.
Threat of Substitutes (High)
The competition for Nissan in the market is increasing on a large scale which is why the
company will have to get the trust of the customers by getting in innovation and unique ideas in
the company. There is training and development which is taking place in the organization so that
the company can reach out to the customers effectively which is a great factor for the company.
There have to be right patents which the company will have to take for the vehicles and other
innovations so that there is lesser substitute.
LO4
P4. Strategic planning

Strategic planning is defined as providing strategic direction to the organisation.
Management of Nissan Company use the following strategic tool to conduct its strategic
planning.
Porter's generic strategies
Porter generic strategies focus on the following strategies. Company has the strategic
options like cost leadership, differentiation, cost focus and differentiation focus under this
strategic choice.
Cost leadership: Cost leadership involve taking competitive advantages with the support of
cost. This is among the key strategic options this model serves which allow company to enhance
its growth potential in market. In this strategic option company can offer its products at the
average cost offer by industry (Grigorova, 2019). This strategic option will allow company to
gain the competitive advantages in market. This strategic choice will allow company to enhance
its existing customer base by attracting new potential customers for company's products and
services.
Differentiation: Differentiation is another strategic choice available under Porter generic
strategies. In this strategic choice company has the option to channelize a unique image in
market with the support of marketing and branding campaign (Wan, 2016). In this strategic
choice company has an option to invest in research and development operation. With the support
of research company can improve its quality of all existing products and it will also support in
launching new products. This strategy also drives company in gaining an effective success in
market.
Cost focus: Cost focus is an strategic choice available in Porter Generic strategic tool. In this
strategic choice company target a specific niche group and based on such group company decide
cost for different products. This strategic choice covers a limited scope for enhancing sales of
company as it covers only a specific niche group.
Differentiation focus: Differentiation focus is another strategic option available for company. In
this option company select a specific niche group and based on the needs and requirements
attached to that niche group company conducts its differentiation strategies.

Management of Nissan Company can channelize strategic option call as diversification.
Company is among the leading automobile company in market. This strategic choice will allow
company to entertain competitive advantages in market.
Hybrid strategy
Hybrid strategies channelize to take competitive advantages in market. This strategic
option allows company to take an edge over other competitors available in market. This strategic
option suggest that company needs to channelises only one strategic choice either it can focus on
cost leadership or differentiation strategies (Rinawiyanti, Lianto and Melsalina, 2016). Company
do not need to follow both strategic options in order to gain competitive advantages in market.
Nissan Company can go for either cost leadership in which it can low its product prices or can go
for diversification which allows company to channelize research and development for improving
the quality of products. It can be suggested that company's profile allows company to channelize
diversification strategy to take competitive advantages in market.
Bowman strategy clock
This model suggests different strategic choices that can be projected in following points.
Low price: In this strategy company offers its product at low prices. All such products of Nissan
Company carry low demands can sale over low prices.
Hybrid: Hybrid is the strategic choice which allows company to drive either low cost or
differentiation strategy.
Differentiation: Differentiation is a strategic option that allows company to improve the quality
of products with the support of research and development activities.
Focused differentiation: In this strategic option on the basis of the needs and demands of
specific niche group company conducts its differentiation strategies.
Risky high margins: This is a very aggressive strategic option company can implement. In this
strategic choice company can increase the price of its products (Vellas, 2016). This is a risky
choice as it might affect the sales of company negatively due to price hike.
Monopoly pricing: This is a strategic option is implemented where the product is offered by
only one company. The organisation offers the product carry the monopoly over market.