Comprehensive Business Strategy Report: Ernst & Young Analysis

This report provides a comprehensive analysis of Ernst & Young's business strategy, utilizing various frameworks and models. It begins by examining the macro environment through PESTLE analysis, assessing the political, economic, social, technological, environmental, and legal factors impacting E&Y's business strategies. The report then conducts an organizational audit using SWOT analysis to identify E&Y's strengths, weaknesses, opportunities, and threats. Furthermore, it analyzes the strategic capabilities of Ernst & Young using VRIO analysis and evaluates the internal environment using the McKinsey 7-S Framework. The industry analysis is performed using Porter's Five Forces model, followed by the application of the Ansoff Matrix to devise appropriate product/market strategies. Finally, the report applies Porter's generic strategies and Bowman's Strategy Clock to develop strategic planning and directions for Ernst & Young, concluding with a strategic management plan to implement the recommended strategies. Desklib provides access to this and many other solved assignments for students.

Business
Strategy of Ernest
And Young.

Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY..................................................................................................................................2
Activity 1.........................................................................................................................................2
1.1. Discuss the Application framework to analyse influence of macro environment................2
Include a diagram of the PESTLE of Ernst & Young.................................................................2
Using PESTLE, critically analyse the impact and influence of the macro environment, on
Ernst & Young (E&Y) and its business strategies.......................................................................2
1.2. Organisation Audit................................................................................................................5
Explain briefly about what is Swot analysis................................................................................5
Using SWOT, critically analyse the impact and influence of the macro environment on Ernst
& Young (E&Y) and its business strategies................................................................................6
Activity 2.........................................................................................................................................9
What do you understand by strategic capabilities?......................................................................9
Identify the key components of strategic capabilities..................................................................9
Analysis the strategic capabilities of Ernest and Young by using VRIO Analysis...................10
Explain the McKinsey’s 7S framework.....................................................................................11
Include a Diagram......................................................................................................................12
Conduct a critical Evaluation of the internal environment using The McKinsey 7-S Framework
...................................................................................................................................................12
Activity 3.......................................................................................................................................13
Explain the Porter’s Five Forces Model....................................................................................13
Include a diagram......................................................................................................................14
Produce an industry analysis for Ernst & Young (E&Y) using Porter’s Five Forces model....14
Explain the Ansoff Matrix.........................................................................................................15
Include a diagram for Ernst & Young (E&Y)...........................................................................16
Apply the Ansoff Matrix to devise appropriate product/market strategy for Ernst & Young
(E&Y)........................................................................................................................................16
Activity 4.......................................................................................................................................17
Explain Porter’s generic strategies............................................................................................17

Apply the Porter’s strategy and Bowman’s Strategy Clock to devise strategic
planning/strategic directions for Ernst & Young (E&Y)...........................................................17
What is a strategic management plan?.......................................................................................19
Explain how this Strategic Plan will be used to implement the recommended strategies in
Activity......................................................................................................................................19
CONCLUSION..............................................................................................................................21
REFERENCES..............................................................................................................................22

INTRODUCTION
Business Strategy is a set of effective competitive moves and actions that business could
generates could use in better format to attract customers, enhancing performance, implement
tactics to attain better competitive advantages to organisational goals. This mainly outlines about
how business should be carried out for effective desired ends. It further explain about master
plan which is implemented through an individual so that high competitive positions can be
accomplished within marketplace (Kumar Mangla. and Goyal, 2021). This also creates more
better vision and direction for the whole organisation. It is important that all people within
company where it has clear about goals and objectives. In this report, the company has selected
Ernst and Young which is global and multinational business which provide service network
within network through headquarter in London, England. Ernst and Young is also one of largest
professional services network within world along with Deloitte, KPMG and PWC. As the topics
are highlight in following report different critical frameworks to acknowledge macro
environment is discussed. Internal capabilities and environment of organisation is acknowledged
along with evaluation through Porter's five forces. At last, different models, concepts and
theories to understand strategic directions are stated.
MAIN BODY.
Activity 1
1.1. Discuss the Application framework to analyse influence of macro environment.
Macro Environment: It is form of an organisation that is related within external and internal
factors which creates high influence through better working to decision making of company.
Furthermore, these elements within have impact on better strategies where firm have competency
to undertake risk and opportunities driven flow.
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Include a diagram of the PESTLE of Ernst & Young
Figure 1: Pestle Analysis, 2020.
Source: https://www.istockphoto.com/vector/pestel-analysis-gm1264040171-370105318.
Pestle analysis: It is critical framework to better analyse about effective key factors such as
Political, Economic, Technology, Social, Environment and legal. These factor would better
influence through an organisation from outside (https://www.case48.com/pestel-analysis/13683-
EY., 2020). In following there is detailed pestle analysis regarding with Ernest and Young
company.
Using PESTLE, critically analyse the impact and influence of the macro environment, on Ernst
& Young (E&Y) and its business strategies
 Political: According to this factor it better reflect about political environment about
specific country, it influences about strategies and tactics that is adopted by the company.
As the UK political condition is quite stable in terms foreign exchange policy (Yuan., Lu
and Yu., 2020). Thye conducting pestle analysis the political impact to Ernest and Young
exert a strong better influence and long term sustainability and profitability of Ernest and
Young. As the major influence which EY need to consider about political chaos where it
derives about investors and harms effective stakeholder trust in economic and effective
conquest to mapping organisational culture. Currently, Ernest and Young is having its
existence in different countries where each branch of company having its own political
challenges. Through growing tensions and instabilities within global political
environment can affect the better gold industry growth limit growth opportunities
available through EY (Farrukh and Nawaz., 2020). The basic challenges which can face
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through Ernest and Young that is frequently changing of Policies by government by
increasing environmental uncernity.
 Economical: These factors reflects the overall performance of nation that is related
towards economic grounds in broader sense. The overall growth is context towards better
electric vehicle market is expected to reach more $1.5 millions dollars. The impact of
important for EY to understand economic factors such as forgien exchange interest rate,
labour market conditions, inflation, recession or saving rates. All these factors of
economic is enhance more development of country. It is detailed understanding of the
economic environment can help Ernest and Young. It estimate the growth of industry
and organisation. Growing economics offer wide range of growth opportunities to Ernest
and Young company. Similarly, it is important about better understand towards industry
life cycle to enhance better growth. Entering the mature industries can be more mature
industries that creates more challenging as per market situation aspect. As the well
developed infrastructure facilitates about the business environment which better increases
the effective growth.
 Social: This factor consists about effective in analysing the impact which the social
aspects imply upon an organisation. As the company can their product and services to
approach by follow Demographic and Geographic factors such as Age, Gender, Income
basis and other factors. In perspective of Ernest and Young company the impact of social
factor as positive factor through using demographic trend, this would flexible way to
approach people based on aging population, migration of trend and socio economic
variables have parameters. It enhances importance of international business organisation.
For more customer interaction and product and services EY need to choose right and
potential market. Further, it is also important for EY to understand people’s attitude and
behaviour towards migration and this can be influence firm ability (Liu and Kong, 2021).
There can be negative impact of social factor towards EY if their products are not
productive enough people can change their preferences time to time. Through gender
roles Ernest And Young must study traditionally which better assigned gender roles to
align its marketing and communication practises accordingly. Marketing and human
resources strategies are addressed as on traditionally which easily distinguish the society
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on the basis of gender roles with different stereotypes. For this, EY need to make strategy
to promote their product through online platform.
 Technological: In this overall technology advancement and innovation factors are plays
an important role in this. The scope of technology is quite effective or productive in UK
when it comes to Smart and advanced resources. As the technology environment can help
EY to better capture the technology trends to accomplish business advantages. EY needs
to follow technology advancement as it changes on time to time. Artificial intelligence
has creates positive impact on environment where it changes the standards of resources
into another level. The impact of Technology is different online platforms where EY can
easily commence their business to target people for their product and services. Social
media marketing can be good business strategy, as it allows different social media
platforms such as Instagram, Facebook, YouTube on which Company can easily trade
and interact as many audience. EY can also take leverage the opportunities that offered
by the social media marketing to effective channelize business performance within better
competitive market.
 Environment: According to this factor, the elements which are associated with
environment of the market which the firm usually deals. The environment factor that
major influence to EY recycling and waste management. In this, growing of environment
pollution which is better coupled with the technology advancement which has been
compelled through business organisation to better adopt innovative recycling and waste
management practises. The EY is adopting the effective waste management practises
organisational units is located within the near urban areas highly crucial for EY. Through
Renewable changes of technologies EY can get a benefit by investing certain capital in
renewable technologies that ensure long term sustainability. Through this practice, the
investment will also increase stakeholder satisfaction and expand the better customer
base to better brand image in competitive advantages.
 Legal: This factor is determine the legal aspects which involves rules and regulations that
govern by policies and procedures of an organisation. In terms of EY, there are some
legal laws that can impact on its business. Employee Protection laws must follows by EY
as because it indicates about the health and safety laws as some of the countries enhance
strict regulation to better ensure about the labor safety (Ali. and Anwar., 2021). The
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management team of EY assure to provide positive working environment for the
workforce could increase ethical and moral obligation for EY. Similarly, Anti-
discrimination laws also need to be carefully situated when developing human practises.
Another important law for EY that can impact positive behaviour is Intellectual Property
laws are designed to protect the company assets and patents which consist valuable ideas.
The inability to protect the intellectual property right can result of loosing effective
competitive advantages.
Evaluation
The above Pestle analysis for EY is summarises about six different factors that create
positive and negative influence while conducting business into another region. As many
challenges and opportunities driven where company can easily reduce risk by implement
strategies effectively. For EY company, the positive factor of Pestle determines the
Technological factor. In the UK, there are different types of technology advancement through
which EY business can optimise their business outcomes. The negative factor can be Economic
factor because inflation and recession fluctuate the market through it decrease the sustainability
the company and increase the high competition level in competitive marketplace.
1.2. Organisation Audit.
Explain briefly about what is Swot analysis.
According to this framework of Swot analysis creates strength, weakness and opportunities
and threats. It is terms as techniques for assessing about these four impact of business Swot
Analysis where it driven simple tools that can helps to effectively analyse about how company
does best right job effectively. Through conducting SWOT analysis also help to better
understand about internal and external competitive abilities of specific company effectively.
Thus, SWOT is a one of powerful tool that mobilise and develop the business strategies for
better start up firm as well as toward existing company
(https://www.case48.com/swot-analysis/13683-EY).
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Figure 2: Swot Analysis, 2020.
Source: https://medium.com/thrive-global/how-to-complete-a-personal-swot-analysis-
2f8769aebd5e.
.
Using SWOT, critically analyse the impact and influence of the macro environment on Ernst &
Young (E&Y) and its business strategies
Strength Weakness
 The geographical existence in different
regions that can act to one of major
strength of the organisation. This
determines the EY business where they
can reach to the target market and
ensures about easy accessibility.
 EY has a wide range of product
portfolios that allow the organization to
effectively expand business to offset
the losses from one product category
with better benefits from others.
 Strong online presence on different
 In this administration can draw the
criticism from the environment for its
poor waste management practises. It is
inability to integrate sustainability in
effective business operation.
 EY can loose efficiency due to poor and
unbalanced inventory management. As
the shortage or excessive inventory can
either result into.
 Through insufficient budget for
marketing promotion activities, the firm
can expand towards customer base and
6

social networking sites and the
marketing team of EY constantly keeps
themselves updated on the online
platform to interact with customers and
map product score (Verbeke and Yuan,
2021). EY digital marketing practises is
quite effective.
 EY has strong and effective financial
position and health can allows the firm
to make easy further investment for
long term sustainability aspects.
 There is well developed and efficiency
integrated IT infrastructure can improve
about effective operational efficiency
and increase better knowledge of the
latest market trends.
 EY implement different intellectual
property right which helps to authorised
to protect their ideas and product
patents which they offers uniquely
within competitive market.
encourage repeat purchase.
 There is high job stress and constant
low workers moral makes the
workforce less productive.
Opportunities Threats.
 The exponential growth within the
population and EY can approach the
potential customer for their great
growth opportunity of business
organisation.
 Through changing of customer needs,
tastes and preferences that can act
opportunity within business
organisation.
 By changing a regulatory framework
and introduction, a ne sticker regulation
imposes a major threat to EY. It makes
compliance with legal standards within
more complex and having to challenge
for the business organisation.
 The increasing number of direct
competitors affect the organisation
7

 There is a online platform opportunity
where EY can easily promote and
advertise their products to different
demographic audiences.
 The emergence of E-commerce and
social media marketing as a trend
which can easily raise the great
opportunity for EY. If this is EY that
can ensure strong online platform
through different social networking
sites.
 The new market segments and new
social media marketing trend are great
opportunity for EY where it ensures
strong online presence on different
social networking sites.
 Customer are fluctuates their
preferences according to the changing
of market trend. This can be advantage
for EY company to generate more
profitability.
ability to sustain and expand the
customer base. For example: Deloitte,
 The rise of inflation and recession
could raise more challenges for EY
business in competitive market to
sustain.
 The growing environmental
sustainability trends highlight major
threats when offered products and
services are not very environmentally
friendly (Wardana, Giantari and
Rahyuda., 2020). It draws negatively
publicity and criticism from the
environmental also affect brand image
of competitive market.
 The globalisation drives within the
organisation to cross national
boundaries and deal within better
cultural diversity which may have
determental if the organisation lack the
culture intelligence.
On the basis of above Swot Analysation, it mainly explains about strength, weakness,
opportunities and threats for EY company. As the overall evaluation is concluded that weakness
and threats are highly influence that can decrease the company's productivity level in the
competitive market. Some strategies recommend to EY, where they can overcome and increase
their productivity level in the market. Effective training and development practises can increase
the efficiency of employees. They need to improve their online business that would help to better
sustain in competitive marketplace. EY marketing team need productive and pricing related
strategy that helps to easily mitigate the risk factor from competitors.
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