Business Strategy of Giffgaff: A Comprehensive Analysis

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UNIT 32
BUSINESS STRATEGY

Table of Contents
INTRODUCTION............................................................................................................................. 3
LO1 IMPACT AND INFLUENCE OF MACRO ENVIRONMENT OVER AN ORGANIZATION..................4
P1............................................................................................................................................... 4
M1............................................................................................................................................. 6
LO2 ASSESS AN ORGANIZATION’S INTERNAL ENVIRONMENT AND CAPABILITIES.......................10
P2 & M2................................................................................................................................... 10
LO3 EVALUATE AND APPLY THE OUTCOMES OF AN ANALYSIS USING PORTER’S FIVE FORCE
MODEL TO GIVEN MARKET SECTOR............................................................................................ 16
P3 & M3................................................................................................................................... 16
LO4 APPLY MODELS, THEORIES AND CONCEPTS TO ASSIST WITH THE UNDERSTANDING AND
INTERPRETATION OF STRATEGIC DIRECTIONS AVAILABLE TO AN ORGANISATION.....................19
P4 &M4.................................................................................................................................... 19
CONCLUSION............................................................................................................................... 24
REFERENCES.................................................................................................................................25

INTRODUCTION
In the changing world there are many companies which are defined as the larger scale
companies, the success and the growth of the companies have been defined on the basis of
business strategies which are being applied within the business environment in order to
increase the development and profit within the organization, which contributes towards the
increase in the productivity of the company according to the people’s demands. The company
such as Giff-Gaff has been classified as the company belonging to the telecommunication
background within the UK. The company has been running as an operator of a virtual network
with the use of the O2’s network of British (Belton, 2017). The company is owned by the
Telefonica’s owners, which was introduced on 24 November 2009, with the headquarters of the
company established in Uxbridge, Greater London, UK. The first product introduced by the
company was the prepaid SIM card with the standards such as 2G AND 3G. The company has
won many types of rewards and prices in the field of providing the best communication
facilities to its customers, wherein 2010, the company won the Forrester Groundswell Award, in
2012 the company won the best MVNO Award, in 2014 the company won the best telecom
provider award, in 2016 the company won the uSwitch Network of the year award, which has
been made possible only by the critical analysis of the environmental factors which affect the
overall growth and development of the company (Holloway, 2017).
Figure1: giff gaff
Source: (Holloway, 2017)

LO1 IMPACT AND INFLUENCE OF MACRO ENVIRONMENT OVER AN
ORGANIZATION
P1
Since Giff gaff has been defined as one of the best company all over the UK, which deals in
determining the manufacturing of the new product and services according to the demands of
the customers. The marketing strategy of Giff gaff defines to be different from the other
telephonic companies, as the company is owned by Telefonica, the company uses the
collaborative approach along with its members which contribute towards the expansion of the
business in all over the country along with its operations spreader through the online facilities
(Bryson, 2018). The team of the company consists of the group of multi-talented members
which includes the different types of stakeholders such as investors communities creditors
trade unions employees partners, customers, as giff gaff is the private company rather than
PLC, therefore it has no trade shares. There is the minimum allowance of the giff gaff's share
value at €1.000, which has been owned by O2.
The communities defined within the company is the group of the members itself, where the
members get rewarded for the introduction of the new set for services and the technologies
which help the company to deal effectively with the changing trends and technology over the
world (Barney, 2014).
The trade union of the company depends upon the set of laws and the rules imposed by the
European government over the exchange of goods and services in accordance with the taxes
imposed by the government. As the company has been owned by the owner of the Telefonica,
which also serves as the partner for defining the development of the company, there find the
need to provide the employment to the candidates having the high level of skills. The marketing
strategy of the gift gaff deals with the combination of the various factors such as the
demographical, geographical and psychographic. The aim of the company is to supply the best
and the fastest way of communication to its customers by introducing the new set of services
and the technologies needed for enhancing the performance of the company (Barney, 2014).

The company also serves its best to provide the value-added services within the business
environment. The company deals with the motive to generate the cost-effectiveness in the
company by defining the set of services and strategies which define the growth and
development of the company by evaluating the performance of the procedures within the
company.
Figure 2: Stakeholders in giff gaff
Source: (Barney, J.B., 2014)

M1
The company also includes the effect of various external and the internal factors which helps in
maintaining and regulating the growth of the company over the implementation of the various
factors, which can be defined on the basis of PESTEL Analysis of the giff gaff:
PESTLE Analysis of Vodafone-
POLITICAL ECONOMICAL SOCIAL
 As the company is the
telecommunication
company, there are a
certain set of laws
imposed by the UK
government in
relation to the
wireless and the
networking issues.
 The achievement in
terms of providing the
stability within the
rate of inflation and
the fast recovery for
the gross domestic
product has led to the
positive impact on the
expenditures of the
customers and the
corporates in the field
of communication
technology.
 This type of factor
deals with the
determination of the
best and the
appropriate set of
services which helps in
recognizing the
demand of the
customers and
implementing the set
of services according
to the demand
(Kharub and Sharma,
2017).
• The company deals with
the political issues dealing
with the problems
associated with the tariff
plans and the services
provided by the company.
 The decrease in the
rate of unemployment
by 7.2% in the year
2013, resulted in the
limited demand for
communication in
terms of mobile
limiting the services
and the productions
 The addition of the
mobile and internet
within the customers
have also lead to the
change in the way of
communication
demand.
In order to build the new set  The demand of the  The introduction of

of services within the
existing services, there needs
to be the approval of the
services by the government
in order to define that in
violation of acts has been
done during the service
implementation.
customers in terms of
mobile communication
has been increased
due to the rise in
disposable income,
resulting in an increase
of mobile
communication in the
country.
the set of
communication
devices such as iPod’s,
tablets in the various
schools and
universities has
increased the value of
the communication
sector (Lewis, 2019).
The company must satisfy
the needs of the government
in terms of the safety and
security for the entire
customer and employees
 The ratio of the
employment and
unemployment rate
also affected the
stability within the
company.
 The increase in the
rate of the population
within the country has
boosted the use of
mobiles and
communications over
a long period of time.
TECHNOLOGICAL LEGAL ENVIRONMENTAL
 With the increase in
the demands of the
people for
communication, the
constant evolution of
in relation to the new
technology must be
done.
The Giff gaff company has
been maintained by the office
of communication in the UK,
which serves as the4
independent way of
regulating the communication
sector.
 As the company deals
with the set of
operations related to
the wireless way of
communication, it
harms the
environment by
emitting harmful
radiations (Lewis,
2019).
 The rate of achieving
the maximum profit
 In order to deal with
the marketing
 The use of substances
such as the cadmium

generation within the
company must be
achieved by
implementing the
latest set of
technology being
used.
demands of the
customers, the leaders
of the giff gaff
company incorporate
with the OFCM in
order to generate the
effective set of
required measures.
and plastic makes the
soil contaminated
resulting in the loss of
soil nutrients.
 There has been a
decrease in the
number of messages
and the mobile calls
due to the Over the
Top providers which
provides the best and
the fastest way of
communication to
the users.
 The OFCM also helps
to determine the
protection of customer
rights within the
working sector of the
company.
 The company has been
looking for an
alternative way to deal
with the generation of
the harmful elements
within the
environment by
considering the
effective set of
strategies and
methods required
(Manning, 2017).

Figure 3: PESTEL ANALYSIS
Source: (Manning, 2017)

LO2 ASSESS AN ORGANIZATION’S INTERNAL ENVIRONMENT AND
CAPABILITIES
P2 & M2
There have been many types and the methods used for the development and growth of an
organization, in order to achieve this aim various different methods defining the strategies to
generate the maximum profit within the organization has been implemented within an
organization which contributes towards the growth of an organization, the company named Giff
gaff also uses the different business strategies for the successful growth of the company in the
field of providing the telecommunication to the customers with the best set of services (Lewis,
2019). The SWOT analysis helps in determining the various factors which help in making a
strong and reliable business platform for the organization of the tasks and the methods
associated with it. The SWOT Analysis of Giff gaff can be elaborated by including the weakness,
strengths, threats and the opportunities defined with respect to the company, which can be
described in detail in the following table:
Strengths Weakness Opportunities Threats
The way of dealing
with the problems of
the customers within
the giff gaff generates
the strength for the
giff gaff.
As the UK is a popular
country, hence there
is an increase in the
number of
competitors in the
telecommunication
field.
With the increase in
the field of
telecommunication,
the increase in the
demands for the best
company in the
telecommunication
also increases.
Due to an increase in
demand in the field of
telecommunication
the companies
offering better rates
of the tariff plans can
lead as the threat to
the company.
The parent company
of Telefonica has
been defined as the
second largest
company of the world
The establishment of
the various set of
infrastructure within
the country by the
company can serve to
The set of the new
alliances in terms of
the strategy has been
made in order to
make the network
The diversification of
the company in the
various fields needs
to create
opportunities in

in the field of
telecommunication,
which serves as the
strength for the giff
gaff.
be harmful to the
company.
more secure and
reliable.
every single sector of
the market
(Manning, 2017).
As the parent
company named
Telefonica has been
recognized as the
largest company
within Europe in
terms of the
communication,
which serves
advantageous for the
giff gaff.
The total revenue of
the Telefonica due to
the economic
recession affects the
growth of the giff gaff
company.
The demand for the
employees within the
company has been
increasing affecting
the overall
employment rate of
the country resulting
in an increase in the
economic growth of
the country.
The aim of the
company is to
generate a better set
for the facilities for
the customers,
preventing the loss of
the revenues.
The company
achieves its strength
by providing the best
quality of the services
and the mobile
signals in the UK.
Another weakness of
the company is the
market of the UK has
been getting mature
in terms of the taxes
and other factors.
The high amount of
investment has been
done in the fie4ld of
the mobile
application
development by giff
gaff.
The timely use of the
new technologies
must be made in the
services generated by
the company for the
people to make the
people attracted
towards the company
(Manning, 2017).
The implementation
of the latest set of
technology within the
organization makes
Within the mobile
market of the UK,
mobile packages fail
to define the demand
The high rate of profit
can be made by the
successful
implementation of
The threat of loss of
customer’s faith over
the company serves
as the major cause of