Comprehensive Analysis of DHL: Strategy, Impact, and Challenges

This report offers a comprehensive analysis of DHL, a leading global logistics company. It begins with a comparative analysis of DHL's strategic capabilities, including its global presence, customer-centric approach, and talent pool. The report then delves into DHL's operations using Porter's Value Chain, examining primary activities such as inbound and outbound logistics, operations, marketing, and service, as well as supporting activities like firm infrastructure, human resource management, technology development, and procurement. The VRIO framework is applied to assess DHL's competitive advantages, followed by a TOWS matrix to identify internal strengths and weaknesses, as well as external opportunities and threats, and develop corresponding strategies. A PESTLE-scenario analysis provides insights into external factors, and the report explores DHL's life cycle within the context of Porter's Five Forces, highlighting the bargaining power of consumers. Finally, the report addresses DHL's strategic group analysis and proposes strategies for creating a positive social impact through Corporate Social Responsibility (CSR) initiatives, emphasizing the importance of CSR in enhancing brand image and customer engagement.

Running head: ANALYSIS OF DHL
Analysis of DHL
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ANALYSIS OF DHL
Table of Contents
Question 1: Comparative analysis.......................................................................................2
Strategic capabilities........................................................................................................2
Porter value chain............................................................................................................2
VRIO framework.............................................................................................................3
TOWS matrix...................................................................................................................6
One part of PESTLE-Scenario Analysis..........................................................................8
Evolution of the life cycle of DHL in context of porter’s five forces.............................8
One factor from porter’s five force analysis....................................................................9
Strategic group analysis...................................................................................................9
Question 3: Creating a positive social impact.....................................................................9
Reference List....................................................................................................................14

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ANALYSIS OF DHL
Question 1: Comparative analysis
Strategic capabilities
At present DHL is operating in many countries around the world and have gathered a
number of loyal consumers. The headquarter of the company is in Bonn, Germany (DHL group,
2020). The company have created talent pool which consists of more than 350,000 employees in
order to stay ahead of its competitors (DHL group, 2020). At present the company is leading in
the department of postal and various logistics services. The company ardently makes use of
demographic as well as geographic process of segmentation in order to meet the various needs of
the consumers (DHL group, 2020). The company have been seen to be taking great care of the
consumers and it can be identified as customer centric company. By the process of
differentiating the targeting strategy it becomes very easy for the company to understand the
future steps and also strategize the various deliverables of the company. In the global scenario
the company have always placed itself as the company which leaves being global footprint.
Positioning strategy is used by the company which is user benefitted and also aids the company
in becoming a customer centric company and serve its customer in a better way.
Porter value chain
The primary activities are:
 Inbound logistics: The global shipments of the company are easily tracked by it by
automating process. DHL is an international delivery company which have different units
that provide a plethora of logistics products. Both domestic and international delivery of
parcel is done by the company via road, rail and air by the help of end-to-end
management of supply chain.

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ANALYSIS OF DHL
 Operations: The operations which are used by the company in its logistics department are
freight transportation and kitting. DHL is planning to expand its warehouses in 2020
(DHL group, 2020). The inventory management of the company is very efficient in
understanding the condition of the market and provides quick response to any kind of
changes.
 Outbound logistics: A proper network planning, consolidation of shipment and real-time
track of the products are done by the company.
 Marketing sales: In 2016, the company was raked at 228 in the brand list of companies
globally (Al-Salami, Saadi, Sawadi and Saleh 2019).
 Service: International shipping along with courier delivery services are provided by the
company.
The secondary activities are:
 Firm infrastructure: The quality management of the company is great along with
accounting and financing planning. The company have designed an app by the help of
which it is able to track its various shipment and coordinate in a proper way.
 Human resource management: In UAE the company have been ranked in the first as the
company with best Human resource management.
 Technology development: Innovations like LocusBots along with Sawyer collaborative
robots have been introduced in the workplace to make the work easier for the company.
 Procurement: The procurement volume of the company is divided into groups like IT,
telecommunications, Network supplies, production system and ground fleet.
VRIO framework
Valuabl Rarit Expensiv Used by Competitive Why

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ANALYSIS OF DHL
e y e to
initiate
organizatio
n
measure
Service
Quality
Yes No Parity in
competitivenes
s
Logistics
company
have to
provide
better
service
quality in
order to stay
in the
market and
gather more
customers.
DHL, over
the years
have been
known to
provide
optimum
services to
its
customers.
Reputatio
n of the
brand
Yes Yes Yes No Competitive
advantage is
sustainable
The
company is
well reputed
in many
countries
however the
company
have failed
to use its
reputation.
In some
countries
like Namibia
the agents of
the company
are not
utilizing the
brand name
of the
company in
a proper
way.
Stability of Yes Yes Yes No Competitive With the aid

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ANALYSIS OF DHL
finance advantage is
sustainable
of Equity
and debt the
company
have been
covering the
various long
term
requirement
s to stay
ahead in the
market.
However it
have been
seen that the
company
invests more
in short term
problems
which leaves
the future
plans
vulnerable.
Innovation Yes Yes Yes Yes Competitive
advantage
Being a
logistics
company
there are
huge
competition
for DHL in
the market.
With the
presence of
tough
competition
it is
important
for DHL to
implement
innovation
in its
technology
in order to
stay ahead
of its
competitors.

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ANALYSIS OF DHL
TOWS matrix
Internal
factors
External
factors
Strengths (S)
S1. Customers of the
company are highly satisfied.
S2. The suppliers of the
company are very reliable so
they do not face any kind of
problem during supply chain
bottlenecks (Dujak,
Franjković and Šebalj 2014).
S3. There are presence of
product innovation in the
company which attracts a lot
of customers.
S4. The workforce of the
company is highly skilled and
they complete work on time.
S5. The company have
implemented a lot of its
profits on improving the
brand image.
Weakness (W)
W1. The financial planning
of the company have not
been done properly.
W2. There are presence of
gaps in between the
products which are sold by
the company.
W3. The company is not
very good in forecasting the
product demands which
causes huge pressure on the
inventory (Dujak,
Franjković and Šebalj
2014).
W4. The challenges which
are being faced by the
company from the new
entrants are not being
tackled by the company in a
better way.
W5. The company is
investing more on the
challenges which might be
bad for them in the longer
run (Malinowski 2018).
Opportunities
(O)
O1. The stable
cash flows of
the company
gives it the
opportunity to
invest in
different
product
segment.
O2. The
decrease in the
shipping costs
also brings
down the costs
S – O strategies
S1 – O1 With the
implementation of new
products customers will be
satisfied.
S2 – O2 Owing to stable
suppliers the shipping costs
have gone down.
S3 – O3 Product innovation
will be aided by market
improvement.
S4 – O4 The needs of the
consumers will be met by the
workforce.
S5 – O5 brand image will be
helpful in adapting to
W – O strategies
W1 – O1 the stable cash
flows will be aiding in
fixing finance.
W2 – O2 The gaps are
fulfilled by the decreased
shipping costs.
W3 – O3 market changes
will require better planning.
W4 – O4 to cope up with
customer behavior the
company needs better
strategy.
W5 – O5 Investment in
changing consumer needs
must be done.

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ANALYSIS OF DHL
of DHL (Baxter
and Srisaeng
2018).
O3. The
development of
the market is
very helpful for
DHL as it will
be able to easily
compete with
other
companies.
O4. The uptick
in the economy
as well as the
increasing
spending of the
consumers will
be giving the
company the
opportunity to
attract more
customers
(Stancu and
Drăguţ 2018).
O5. The new
trends in the
need and
behavior of the
consumer will
be opening up
new
possibilities for
the company
(Liu 2017).
consumer behavior.
Threats (T)
T1. There are
absence of
innovative
product supply
by the
company.
T2. There is an
increase in the
pay level.
S - T strategies
S1 – T1 satisfaction of
consumers will give the
company time to innovate.
S2 – T2 reliable suppliers will
not ask for more payment.
S3 – T3 product innovation
will help in fighting against
laws by increased revenue.
S4 – T4 The workforce will
W – T strategies
W1 – T1 financial plan
needs to be improved to
bring innovation.
W2 – T2 the gaps in product
needs to be filled up.
W3 – T3 market needs must
be correctly assessed to
cope up with laws.
W4 – T4 New entrants

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ANALYSIS OF DHL
T3. Different
liability laws of
different
countries can be
major problem
for the
company.
T4. Changes in
the buying
behaviors of the
consumers
(Rozario 2017).
T5. The
company faces
the challenges
of currency
fluctuations in
different
countries.
meet the changing behaviors
of consumers.
S5 – T5 Brand image will aid
in getting more customers to
fight with currency
fluctuations.
might take customers from
DHL.
W5 – T5 Proper planned
investing on challenges
needs to be done.
One part of PESTLE-Scenario Analysis
Economic factors – if there is occurrence of any kind of global financial crisis then it will
be having an adverse effect on DHL (Exel 2015). DHL is situated in many parts of the company
and the nature of the business of the country will be very much affected in any kind of global
economic crises. During inflation, DHL will be facing certain problems like the buying power of
the consumers will decrease which will be affecting the profit of the company.
Evolution of the life cycle of DHL in context of porter’s five forces
Maturity – As DHL entered its maturity stage, the power of the buyers increased owing to
the exceeding demand of the services of the company. In contrast to this the power of the
suppliers of the company decreased as the volumes of the products purchased by the company
have increased by a significant amount. At this stage the threat from substitute was increasing
from the company but the threat from competitors was decreasing.

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ANALYSIS OF DHL
One factor from porter’s five force analysis
Bargaining power of the consumers (high): There are presence of a lot of logistic
companies in the market which gives the customer a lot of options to avail services from. The
customer switching costs have increased in the present market scenario (Ma, Lee and Goh 2014).
It is very important for companies like DHL to take care of the customer loyalty as it is very
important for their survival in the market.
Strategic group analysis
The company aims in increasing its focus towards its customers. The company is looking
forward to attract talented employees and retain them by providing them a better workplace. The
company also drives efficiency in its management relentlessly to achieve its goals and vision.
Socially reactiveness is also one of the major goals of the company (Al-Salami, Saadi, Sawadi
and Saleh 2019).
Question 3: Creating a positive social impact
DHL can implement a proper Corporate Social Responsibility (CSR) so that it can easily
create a positive social impact. In the present time of business conduction CSR have been seen to
have a new meaning and a more significant impact on business. With the help of CSR,
companies around the world have been seen to create a better environment for business (Chang,
Kim and Li 2014). With the help of CSR, a company can implement sustainable development of
economy, better employee relations, and also contribute to the local communities in which the
companies are operating (Farooq, Payaud, Merunka and Valette-Florence 2014). With the help
of implementing CSR, DHL will be able to contribute a lot to the social community. With the
help of implementation of proper CSR techniques, DHL will be able to connect with the
customers in a better way and will also be able to increase their brand image. With the help of

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ANALYSIS OF DHL
CSR, it becomes easier to keep the consumer engaged with the brand and gather more customers
(Farooq, Payaud, Merunka and Valette-Florence 2014). Both customer retention and customer
attraction are possible by the aid of CSR techniques. By the aid of the various CSR campaigns,
DHL will be able to present some initiatives which will be better for the community. Campaigns
like this will be keeping the customers of the company busy and also help them in understanding
the various initiatives which are being taken by the company to help the local community. CSR
is the techniques by the aid of which DHL will be able to show the Human face of their business.
Contributing some good deeds for the community not only keeps the consumers happy but also
the stakeholders associated with the community. With the aid of the implementation of better
CSR techniques, it becomes easier to ascertain the fact that the employees of the company are
also happy with the company. If the employees of DHL have the feeling that they are working in
a company which is taking care of the environment around it, then they will be working hard to
reach the missions and visions of the company.
With the emergence of globalization in the business sector, it has become more critical to
implement CSR techniques in a company. Business in the present world has become very
powerful and present in all parts of the world. There have been seen to have a significant
decrease in the scope of the governments as well which brings up to the fact that CSR is essential
for companies to work in a well-disciplined manner (Duarte, Gomes and Neves 2014).
Stakeholders are one of the significant components of DHL who needs to be taken care of by the
company in a proper way. The stakeholder theory can be followed by the company for the better
implementation of CSR in the company. The stakeholder theory suggests that the essential aspect
of performing business is to build a proper relationship with the stakeholders of the company and
listen to the various needs of the stakeholders (Boulouta and Pitelis 2014). CSR has taken its

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ANALYSIS OF DHL
place in the core components of business in the modern world, and DHL needs to include better
CSR steps in the company to ensure that better social responsibility is being taken by the
company. For achieving a better social impact, a company needs to implement CSR in its
system. The target of DHL must be to create a positive impact on the social environment and
also help the community in which it is operating.
Along with taking care of the local communities, the company also take care of the
shareholders, and this will be possible by the implementation of CSR in the system (Wu and
Wang 2014). In the present context of business, it can be said that DHL will not only be
profitable with the implementation of CSR techniques but also be very helpful in engaging the
customers as well as the stakeholders of the company. The profit margin and the overall revenue
of DHL will be improved with the implementation of CSR techniques in the business of the
company. There will be an improvement in the shareholders, stakeholders, and employee, along
with the business of the company (Ghauri et al. 2015). DHL needs to understand the fact that
CSR techniques will be helping the company in meeting the various needs of the associated
stakeholders and keep them satisfied.
Keeping in mind the ethical responsibilities of the company, the stockholders, managers,
employees, suppliers, community, nation, distributors, customers and society must be a major
concern for DHL. All these factors re significant for the functioning of a company. The company
needs to contribute to the environment and the society around it so that it can quickly implement
specific values among the employees and the associated stakeholders. A company is desired to
be a part of an excellent corporate sector by a nation and its community, be ethical and also
follow the law. Although it is an essential component to include CSR techniques in a company, it
becomes hard for a company to implement because of the various shortcomings and hard to

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ANALYSIS OF DHL
implement techniques. With the implementation of CSR techniques in the company, DHL will
be staying ahead of its competitors and will also be able to establish itself more appropriately in
the business world. Carroll’s four-part CSR states that the many legal, ethical and discretionary
expectations of a company needs to be addressed to implement CSR in a perfect way (Carroll
2016). With the implementation of CSR, DHL will not only be able to take care of the society
but also implement better philanthropic as well as ethical responsibility (Carroll 2016).
According to Nalband and Kelabi (2014), it is required by a company to become profitable
before it can contribute to society and also obey the various laws which are put forward by the
government. It is expected by a company to become a better company by taking care of the
society and also follow ethical structures so that it does not come under any kind of
controversies.
The company can follow the triple bottom line theory so that it can implement CSR
techniques in the functioning of the company. The triple bottom line theory suggests that a
company must look after the various concerns regarding the social as well as environment along
with its business (Alhaddi 2015). Similarly, a company looks after its profits in the same way a
company must look after the environment and society do that it can have an impact on the
environment it is working on. The triple bottom line theory can be divided into three parts which
are planet, people and profit. All three factors are interlinked with each other, and all of them are
dependent on each other (Sarkis and Dhavale 2015). By following the triple bottom line theory,
DHL can quickly implement better CSR techniques in the company. The company will be
actively looking into the various needs of the society along with its profits. This will be very
helpful in assessing the fact that CSR techniques require a company to make use of its resources
in taking care of the environment and society as well. Various labour practices which will be

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ANALYSIS OF DHL
carried out by the company along with community impacts, will be contributing towards the
society. DHL needs to function following the human rights as well as product responsibility.
With the help of these steps, the country will be contributing towards the environment of the
society as well bring an impact on the people of the social community. Along with the
implementation of these steps, the company will also increase its profits and will be able to
provide better services to the community surrounding it and have a positive impact on society.

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ANALYSIS OF DHL
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