Domino's Pizza Organisational Strategy: UK and International Growth

This report provides an analysis of Domino's Pizza's organizational strategy, focusing on its operations in the UK and international markets. It identifies key challenges the company faces in the external environment of the UK, including government regulations, technological diffusion rate, economic decline, and consumer environment. The report further analyzes the internal business situation and resources of Domino's Pizza in the UK using SWOT and VRIO analyses, highlighting strengths, weaknesses, opportunities, threats, and valuable, rare, inimitable, and organized resources. It also examines the competitive environment in both the UK and international markets using Porter's five forces model. Finally, the report suggests strategic options, such as product expansion, that Domino's Pizza could pursue for future growth in both markets. Desklib provides access to similar solved assignments and resources for students.

Organisational Strategy

Contents
Contents...........................................................................................................................................2
INTRODUCTION...........................................................................................................................1
MAIN BODY..................................................................................................................................1
1) Analyse the key challenges facing the company in the external environment in the UK.......1
2) Analyse the internal business situation and resources of the company in the UK..................2
3) Analyse the competitive environments of the company in the UK and International market 5
4) What strategic options and directions could the company pursue for the future growth both
in the UK and international Market.............................................................................................6
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................8

INTRODUCTION
Organisational strategy could be delineated to sum of actions which a business intends to
employ for accomplishing long term objectives. Establishing strategy of a company reflects of
creating priorities and direction for all members of company (Carvalho and Madeira, 2020). It
assists to prioritise kinds of practices which will make a view of reality in future. For
understanding about organisational strategy, Domino’s Pizza is selected company. It is
multinational pizza restaurant chain established in 1960. It is leading pizza brand of UK and
major player in Republic of Ireland. Mission of the company is to redefine convenience through
devising inspired food that will be picked up in three minutes or safety delivered in 10 minutes.
The report highlights key challenges that are face by the company in external
environment of UK. It further analyses internal business situation along with resources of entity
in UK and competitive environment of the venture at domestic and international market. At last,
it includes strategic directions and options which could be pursued for the organisation for future
growth in UK and international market.
MAIN BODY
1) Analyse the key challenges facing the company in the external environment in the UK
External environment is said to composition of all outside factors which impacts business
operations. It is significant of a company to act and react as per changes in external environment
of a nation to keep flow of operations. In aspect to Domino’s Pizza, there are various challenges
faced while carrying out operations in external environment of UK. Mentioned below are some
of challenges facing Domino’s Pizza within external environment of United Kingdom:
Government regulations: In UK, frequent changes in regulations of government are key
challenges facing a business as it harms performance of the organisation through enhancing
environmental uncertainty. In context to Domino’s Pizza, managers while operating practices in
environment of UK faces challenge of changes in government regulation. For example,
following political uncertainty throughout 2019 and a new government, it is not clear to
professionals of Domino’s Pizza to work with same regulations or comply new regulations.
Changing government regulations due to Brexit and Covid-19 puts pressure on the company to
change strategies which impacts adversely on efficiency and performance in existing external
environment of a nation (Margherita, Sharifi and Caforio, 2021).
1

Technological diffusion rate: It is perceived that technology is fastly disrupting huge
businesses. Business environment of UK is most of technologically advanced in the world. It has
been identified that technological diffusion rate of UK is high that creates challenges for
Domino’s Pizza to upgrade existing technology as per trends to enhance services (Annual
Reports and Accounts of Domino’s Pizza, 2019). However, Domino’s Pizza has developed and
run technology ordering platforms that support website and app. It improves customer
experience together with drive repeat sales of the company.
Decline in economy: Economic environment includes factors such as labour market
conditions, foreign exchange rate, business cycle, interest rate and hence forth. In external
environment of UK, Domino’s Pizza faces challenge of ongoing macro-economic uncertainty
addition to decline in economy which impacts on its sales and profit making competence. At
same time, biggest challenge for franchisees of Domino’s Pizza remains cost along with
availability of labour, specifically, delivery drives. New stores opening of the company are
facing challenges through dynamic macro-economic environment.
Consumer environment: Within an environment, consumers make spending in the
products of company in which they are interested in and have huge income to meet their
satisfaction (Nwachukwu, Zufan and Chladkova, 2020). In context to UK, it is determined that
weaker consumer environment as well as greater competition enhances challenges for Domino’s
Pizza to carry out practices smoothly. Moreover, changing preferences of consumers challenges
managers of the food chain to make continual adjustments in menus and policies that impacts
negatively on operations of the entity in the external environment.
2) Analyse the internal business situation and resources of the company in the UK
Internal business situation refers to events and circumstances which organisation control.
These situation arises within boundaries of company are properly controlled by business
administrators (Katunina, 2017)
. In aspect to Domino’s Pizza, analysing internal business situation assist in framing
strategic planning goals in order to sustain together with grow company. To analyse internal
business situation of Domino’s Pizza, SWOT Analysis is used which is an effective framework
to look towards strengths, weaknesses, opportunities and threats of entity. SWOT Analysis of
Domino’s Pizza is as follows:
Strengths: Weaknesses:
2

 Domino’s Pizza provides great tasting
pizza, good value for money as well as
excellent services that drives its store
sales together with profitability.
 With huge franchise along with
organisational owned outlets, Domino’s
Pizza has extensive network spread
over multiple countries including
Iceland, Sweden, Norway and hence
forth.
 The company handles large number of
franchised outlets that creates difficulty
in controlling quality. Because of it,
some outlets of the company got closed
that affects its brand image.
 Rising health conscious population
decreases revenues of Domino’s Pizza
that affects the business as whole.
 The entity has weaker performance in
some of its stores which restrict
improvement in future cash flows.
Opportunities:
 Digital capabilities of Domino’s Pizza
continue to fuel its growth which is
essential opportunity for the venture to
go forward (Annual Reports and
Accounts of Domino’s Pizza, 2019).
 Resolving franchise disputes is
opportunity for the organisation to open
new stores and improving future cash
flows.
Threats:
 There are various risks faced by
Domino’s Pizza which creates threats
for compromising with future
performance and managing business
models.
 Fierce competition from major
international pizza brands addition to
local independent operators is threat for
the company.
Resources are said to materials available with company to carryout practices and achieve
desired goals (Maylor and Turkulainen, 2019). To analyse available resources of Domino’s
Pizza, use of VRIO Analysis provides insights about existing resources and capabilities of the
company. VRIO Analysis of Domino’s Pizza is underneath:
Resources Valuable Rare Inimitable Organised
Human resources ✓ X X X
Intellectual Property
resources
✓ ✓ ✓ X
3

Financial resources ✓ ✓ ✓ ✓
Valuable: Resources of company that enable in implementing strategies for improvising
efficiency through exploiting opportunities or mitigating threats are valuable resources. In
context to Domino’s Pizza, its available valuable resources are as follows:
 Financial resources: Within Domino’s Pizza. Financial resources are part of valuable
resources as they assist to make effective investment in arising external opportunities.
 Human resources: Employees are human resources of company. In Domino’s Pizza,
human resources are valuable as significant portion of employees are highly developed
and trained that results in creating more output for the venture (Annual Reports and
Accounts of Domino’s Pizza, 2019).
 Intellectual property resources: As per VRIO Analysis, it is determined that intellectual
property resource such as patent is valuable resource because it permit the business to sell
out commodities and services without competitive interference.
Rare: Resources which are uncommon addition to not possessed by multiple businesses
are categorised as rare resources. Mentioned below are rare resources of Domino’s Pizza:
 Financial resources: According to VRIO Analysis, it is assessed that existing financial
resources of Domino’s Pizza are rare as strong financial capabilities are possessed by few
entities within the industry.
Intellectual resources: Intellectual resources in form of trade secret is rare as these are not
easily available as well as possessed by rivals. It permits carryout out practices of the company
without any interference of competitor (Suferi and Rahman, 2018).
Inimitable: Organisational resources which are costly to substitute by other firms are
inimitable resources. Available inimitable resources of Domino’s Pizza are underneath:
 Intellectual property resources: Within Domino’s Pizza, intellectual property resources
available are not legally allowed to imitate trade secret. The resource required
development and attaining a intellectual property resource is costly process.
 Financial resources: In aspect to Domino’s Pizza, its financial resources are costly to
imitate because the venture has acquired them through prolonged profits over years.
4

Organised: Resources which captures value when supported by structure, culture and
processes of a business are organised resources. Organised resource available with Domino’s
Pizza is defined below:
 Financial resource: In aspect to financial resource, it is observed that financial resources
available with the company are organised as these are strategically employed for making
investment in right places, combating threats along with making use of opportunities.
3) Analyse the competitive environments of the company in the UK and International market
Competitive environment is a description about the ways in which businesses compete
within defined market place (Ho, Mustamil and Jayasingam, 2021). In association to Domino’s
Pizza, analysing competitive environment is useful to understand strengths and weaknesses of
competitors in comparison to own and finding a gap in market. It is a system to look towards
standing of business in marketplace as compared with rival. Competitive environment of
Domino’s Pizza in UK and global market is analysed through Porter’s five force model as it
assists in determining competition level and attractiveness of industry. Mentioned below are five
forces of the analysis to took towards competitive environment for Domino’s Pizza in UK and
International market:
Threat of new entrant: Entering into local fast food industry and global fast food sector
needs huge capital investment. In context to Domino’s Pizza, it is analysed that threat of new
entrant within UK is low as business is able to gain various advantages because of economies of
scale together with buying bulk quantity. However, in international market, threat of new entrant
is high due to huge trade barriers and investment amounts in fast food industry.
Threat of substitute: In UK and international context, it has been analysed that
Domino’s Pizza faces high threat of substitution as substitute products for the company entails
similar fast food items that are available at outlets of other businesses at less prices. It is
determined that customers of Domino’s Pizza incur low switching cost that enhances risk of
decision making of customers from the organisation to competitor offering similar food items at
less prices.
Competitive rivalry: In International and UK environment, there are multiple players
that perform in fast food sector that creates high competitive rivalry for Domino’s Pizza. Some
leading ventures at global and domestic market of fast food industry includes Pizza Hut, KFC,
Taco Bell, burger King and hence forth.
5

Bargaining power of supplier: In International and UK level, suppliers of a venture
comprises of people and businesses which deliver raw materials along with other production
factors (Lin and Sanders, 2017). In context to Domino’s Pizza, it maintains its relationship and
formulate contract with suppliers on the basis of competitive pricing. Presence in domestic and
international market favour organisation as suppliers prefers to maintain long term relationship
with Domino’s Pizza that gives low bargaining power to suppliers.
Bargaining power of buyer: In fast food industry of UK and worldwide, buyers seek
quality, innovation in menu items as well as prices that gives them high bargaining power. In
aspect to Domino’s Pizza, it is analysed that buyers seek quality of fast food items. For
maintaining interest of buyers, the company make essential changes in its menu so that they
continue purchasing.
4) What strategic options and directions could the company pursue for the future growth both in
the UK and international Market
For future growth in UK market, managers of Domino’s Pizza could pursue product
expansion strategy as strategic option and direction. Through this strategy, managers of
Domino’s Pizza could add new attributes or expand product line for increasing sales volume and
profit. At the time of employing product expansion strategy, the organisation will continue
selling in current market of UK and will attain growth aspects by adding new products when
older ones become outmoded.
In international market aspect, diversification strategy is suitable for Domino’s Pizza to
achieve future growth. With the help of this strategy, the entity would sell new fast food products
and provide customers services to new markets. It is perceived that it is riskier so carefully
planning and market research is significant to achieve growth prospects in future (Ligonie,
2018). The direction will expose the venture to more opportunities for greater returns and
safeguards the business against adverse cycles of market.
CONCLUSION
From the report, it is concluded that organisational strategy is direction that is undertaken by
a business concern for achieving desired success. Major challenges facing the company in the
external environment of a nation includes government regulations, technological diffusion rate,
decline in economy and consumer environment. Resources that are available with a business are
6

human resources, intellectual property resources and financial resources. Strategic options that
could be pursued by a company for the future growth in the UK and international Market
includes product expansion strategy and diversification strategy.
7

REFERENCES
Books and Journals:
Carvalho, J. C. D. A. and Madeira, M. J., 2020. Innovation as a driver for organisational
strategy. International Journal of Innovation and Learning. 27(2). pp.159-174.
Ho, B.C., Mustamil, N. M. and Jayasingam, S., 2021. Building a conducive, engaged, and
learning working environment through sustainable and impactful organisational
culture. International Journal of Innovation and Sustainable Development. 15(3).
pp.280-304.
Katunina, I., 2017. Managing knowledge in the process of organisational competence
development. Cognitive Science–New Media–Education. 2(1). pp.11-22.
Ligonie, M., 2018. The “forced performativity” of a strategy concept: Exploring how shared
value shaped a gambling company's strategy. Long Range Planning, 51(3), pp.463-479.
Lin, C. H. and Sanders, K., 2017. HRM and innovation: a multi‐level organisational learning
perspective. Human Resource Management Journal, 27(2), pp.300-317.
Margherita, A., Sharifi, H. and Caforio, A., 2021. A conceptual framework of strategy, action
and performance dimensions of organisational agility development. Technology
Analysis & Strategic Management. 33(7). pp.829-842.
Maylor, H. and Turkulainen, V., 2019. The concept of organisational projectification: past,
present and beyond?. International Journal of Managing Projects in Business.
Nwachukwu, C., Zufan, P. and Chladkova, H., 2020. Employee commitment to strategy
implementation and strategic performance: organisational policy as
moderator. International Journal of Business Excellence. 20(3).pp.398-418.
Suferi, N. S. M. and Rahman, M. M., 2018. The role of strategic management & project
management to organisational success.
Online:
Annual Reports and Accounts of Domino’s Pizza. 2019. [Online]. Available through:
<https://investors.dominos.co.uk/system/files/uploads/financialdocs/dominos-ar19.pdf>
8