Strategic Management in Global Business: A Facebook Case Study

This report provides a comprehensive analysis of global strategic management principles, using Facebook as a case study. It examines business and corporate strategies, applying models such as Porter's generic strategies, the BCG matrix, and vertical/horizontal integration to assess Facebook's market position. The report includes a PESTLE analysis to evaluate the external environment and a VRIO framework to analyze internal capabilities. Strategic tools like gap analysis and McKinsey's 7s model are discussed to enhance organizational performance. Furthermore, Porter's five forces model is used to identify competitive forces within the industry. The analysis aims to provide insights into Facebook's strategic planning and identify contemporary strategic issues, offering suggestions and recommendations for improved performance. Desklib is a valuable resource for students seeking similar solved assignments and study materials.

Global Strategic
Management

EXECUTIVE SUMMARY
The international business is a major type of company which is performing major
operations related to international marketplace. It is major role of a company to apply application
of BCG matrix and Porter's generic model to gain positive strategic outcomes in the international
marketplace. This project includes application of PESTLE analysis and drive different models
which are applied by a company in order to calculate effect of macro or external environment. In
this project, there is a brief description of McKinsey's 7s model and gap analysis in order to gain
effective knowledge of employee behaviour in order to lead the marketplace.

Contents
EXECUTIVE SUMMARY.............................................................................................................2
Contents...........................................................................................................................................3
INTRODUCTION...........................................................................................................................4
TASK A...........................................................................................................................................4
Examine the business and corporate strategies about the positive contribution to the company 4
TASK B...........................................................................................................................................6
External environment and internal analysis and understand how the complex problem at
Facebook were managed by CEO................................................................................................6
TASK C...........................................................................................................................................8
Describe the strategic tools to enhance the overall organisational performance.........................8
TASK D.........................................................................................................................................10
Examine the concept and model to develop and design the strategic planning.........................10
TASK E.........................................................................................................................................12
Evaluate the various contemporary strategic issues in strategy by using concepts and models12
Suggestions and recommendations............................................................................................12
CONCLUSION..............................................................................................................................13
REFERENCES................................................................................................................................1

INTRODUCTION
The international business is considered as a major global company which performs
economic activities in order to develop at the global marketplace. Operations which are
performed in international companies requires professional strategies and attention in order to
complete different tasks and functions (Agwu, 2018). In this project, example of Facebook
company is taken into consideration which is an international social media based company. The
Facebook company was established in the year 2004, February 4 and is founded by Mark
Zuckerberg. In this report, effective macro and external analysis is performed and internal
analysis is also performed. This project also includes a brief analysis of key factors and strategic
tools used by a company to facilitate strategic planning. This report will also cover corporate
strategic level to evaluate and develop strategic planning.
TASK A
Examine the business and corporate strategies about the positive contribution to the company
Business strategy
The business strategy is termed as a major approach which consists of planning and
strategic frameworks which are important for company development. Business strategy is a
future planning which is helpful in eliminating risk associated with different operations. In the
recent times (Bonsu, 2019). It is important for Facebook to take support of effective business
strategy and planning for achievement of desired market performance. The Facebook company
use the below mentioned models in context of international business environment:
Porter's generic strategies
The Porter's generic strategy is a major planning framework which is important for a
company to gain future growth. In this approach, there are three types of elements which are to
be followed by Facebook:

Illustration 1: Porter's Generic Growth strategies, 2022
 Cost leadership- The cost leadership is a major element in Porter's generic growth
strategy which helps a company to develop cost effective products and services (Busch
and Shrivastava, 2017). In this technique Facebook develop cost effective services for
different customers in order to increase their satisfaction.
 Differentiation- In this element, a company offers unique and innovative products to
customers. The unique selling preposition is developed by Facebook in order to create a
distinct value in international marketplace.
 Focus- Focus is a major element which a company needs to develop on its products and
services to capture the marketplace. It is also one of the major roles of a company to
deliver effective products and services with focus on after sales service.
The BCG matrix model
The BCG matrix-methodology stands for growth share model which is helpful in
development of graphical approach in order to bifurcate different segments (D’Cruz, 2018). The
application of BCG matrix is mentioned below in context of Facebook:

 Stars- The star products are in category of products which are getting high amount of
growth and share of market. Star product of Facebook is Instagram which is having
highest share in market related to social media. The Instagram is having over 650 million
users all over the world.
Question mark- The question mark products are related to less market share at the marketplace.
The Oculus company, which is part of Facebook and is having good market share (Dyer,
Godfrey and Bryce, 2017). Company is putting emphasis on areas of research and development
in order to create a good amount of growth rate related to question mark products.
 Cash cows- In the slow growing marketplace, the cash cows have high market share. In
the cash cow products of Facebook, What’s App is counted as a major product which is
in high demand all over the world.
 Dogs- The dogs are considered as failed products of company which has low-rate share in
low growing marketplace. The messenger by Facebook comes in this category which
helps in overall success of company.
Vertical and Horizontal Integration Model
The vertical integration strategy is considered as key approach that supports a company
to take direct ownership of various stages of output instead of focusing on the suppliers (Hansen,
2020). In this approach, Facebook company operates in current competitive environment by
relying on functions and operations developed by self. The forward integration is helpful in
expanding business operations by development of control of whole distribution process related to
final products.
TASK B
External environment and internal analysis and understand how the complex problem at
Facebook were managed by CEO
PESTLE analysis
The PESTLE analysis is an universally adopted approach by different companies which
helps in analysing the external environment associated with business operations. The PESTLE
analysis of Facebook is mentioned below:

 Political factors- The political factors are related to rules and regulations formulated by
government of USA in order to control business operations of Facebook. This helps the
company to perform all major operations in a smooth and specified manner.
 Economic factors- Economic factors are related to monetary policy developed by
government of USA in order to gain focused growth at the marketplace (Hill, 2017). In
the recent times, it is important for Facebook to follow economic factors in order to gain
growth related to GDP and National income.
 Social factors- The social factors play an important role in development of culture for the
company. Facebook analyse all social factors in a precise manner to lead the marketplace
within a set period of time and develop internal environment.
 Technology factors- The information and technology are two major pillars which are
utilised by Facebook in order to gain competitive advantage. Technology based factors
are related to use of advance software and computer systems used by a company to
perform quick and accurate operations.
 Legal factors- In the functioning of Facebook company, legal factors play an important
role in development of legal operations (Hitt, Ireland and Hoskisson, 2016). The legal
factors include key employment based legislations which are to be followed by a business
entity to survive at the marketplace.
 Environment factors- Environment based factors include, environmental policy
developed by government to promote sustainability. It is essential for Facebook company
to take into consideration application of environmental policy to protect surroundings.
Less paper work is also promoted by Facebook company to develop ethical and
sustainability based business operations.
VRIO framework
VRIO framework: VRIO framework stands for the valuable, rarity, immutability and the
organization that are closely related with the organization. Organization using the framework
with the objective of identifying organizational internal capabilities as well as available resources
to develop effective policies and strategies (Hitt, Ireland and Hoskisson, 2019). Factors of VRIO
framework in the context of Facebook are mentioned below:
Valuable: It is the most important aspect that differentiate organisation from others such
as Facebook have strong and effective global market reach that is most valuable aspect for the

organization. It helps business to generate higher revenue as well as gain competitive advantages
over other rivals. It enable business to take the brand to global level and reach higher number of
customers.
Rareness: Facebook is the multinational organization that operated its operation at large
platform and enable the organization to gain large audience (Lasserre, 2017). It helps business to
improve its financial strength that enhances organizational rare aspect that maintains business
differentiated image in market than other competitors.
Imitable: Technological innovation and advancement is the aspect of Facebook that is imitable
and enable organization to gain higher revenue in existing market place. Facebook brand image
and position in extremely high that is not imitable by other organization.
Organisation: Organisation is the most important aspect to have in business that help to
organise all resources in systematic and optimum manner. Facebook has efficient business
culture and implement efficient human resource management technique that enable organization
to organize its resources in efficient manner so they are available at the time of work.
TASK C
Describe the strategic tools to enhance the overall organisational performance
Gap analysis model- The gap analysis model is a major technique used by various companies
like facebook to achieve desired success at the marketplace. This model is related to comparison
of desired outcomes with actual performance (Lazareva, Anopchenko and Lozovitskaya, 2016).
The application of this model helps Facebook to develop effective marketing capabilities at the
marketplace.
McKinsey's 7s model
The application of Mckinsey's 7s model is helpful in providing effective competitive
edge to Facebook company in a short span of time. The below mentioned points cover major
elements of this model:
 Strategy- The strategy is considered as key planning frameworks which are developed by
a business entity to develop future based perspectives. Facebook company develops and
takes assistance of its top level and strategic management at the marketplace.

 Structure- The structure of a company is helpful in providing a systematic hierarchy
based structure in order to facilitate flow of decision-making. It is helpful in decision-
making approach which leads to market success.
 Systems- The process is system followed by a company to gain effectiveness in different
operations. All major companies at the marketplace focus on development of effective
and major strategic frameworks related to structure (McMillan and Overall, 2016).
 Skills- The skills are abilities of employees which helps in performing different types of
business activities in a systematic manner.
 Style- It is referred to the way different tasks are performed by management of a
company. In the recent times, it is important for a company to focus on appropriate style
in order to lead the marketplace.
 Staff- Employees are to be managed with effectiveness in different tasks like training and
development to achieve various measures. The companies also use core value
development system for approaching correct target market area with the help of
employees.
 Shared values- Standards and norms are two major elements of shared values which are
helpful in increasing market share of a company.
Porter's five forces
Porters five forces model: It is a tool that allow business to identify competitive forces
present in business that provide shape to industry and also allow them to identify weakness that
create threat for company (Miller, Beechler and Nath, 2017). There are different factors,
consider by Facebook while analysing industry and explanation of these factors are mentioned
below:
 Threat of new entry: Face boo does not have threat of this factor as it is difficult for new
company to enter in this firm and competitors with strong marketing platers in industry. It
requires huge investment in business, therefore Facebook has less threat of this factor.
 Bargaining power of suppliers: There are various suppliers of Facebook like data
constancy companies, BPO and others. But it is one of leading company that does not
trust all other suppliers therefore, it creates impact over business. So, Facebook has
moderate threat of this factors in their business.

 Bargaining power of buyers: Marketing share of Facebook is large as it has number of
customers in all over world. There is no much platform available in market that will
reduce bargaining power of customers. Therefore, there is less threat of this factor for
business.
 Threat of substitute: There are substitute social media platform are available in market
that can create impact over business of Facebook. Therefore, firm is having moderate
threat from this factor in business.
 Competition in existing competitors: There are various competitors available in market
which are competing against Facebook. These competitors include Snapchat, Twitter,
Pinterest and others. These competitors are making strategies in order to occupy
marketing share of Facebook. It is important for business to overcome of these factors in
business. Therefore, Facebook is facing high threat from this factor in business.
TASK D
Examine the concept and model to develop and design the strategic planning
SWOT analysis:
Strength Weakness
Facebook is a strong brand and also diversified
portfolio.
It has marketing dominance and also has loyal
customers.
User is facing concern related to privacy.
It is completely depended on advertising.
Opportunity Threat
 It can get marketing opportunity by
diversifying its portfolio.
 It can also expand its service on
existing platforms.
 There is increasing competition in
market.
 There are various regulation impose by
government on business.

Ansoff matrix: It is one of tool which can be adopted by firm for purpose of expansion of
business and develop strategy for sustainable growth. There are various strategies can be adopted
by Facebook for purpose of expansion of business.
Product development: It is a strategy in which organisation launch in new products in existing
marketing place in order to attract customers in existing market. It will assist business for
purpose of increasing to increase customer based and also revenue of company (Rugman and
Douglas, 2018).
Market development: it is another strategy that can be adopted by Facebook in which they can
introduce existing products in new market.
Market penetration: It is a strategy in which business makes efforts for enhancement of market
share in existing market with existing products. It can be done by business by adopting
complementary services.
Diversification: In this strategy, Facebook can introduce new products in new market that
provide opportunity to business.
From above mentioned discussion, it can be analyse that CEO Facebook should adopt
diversification in market in order to differentiate its service from competitor and also to increase
marketing share of business.
Performance indicator: Business is operating in market in order to get profit and for which it
needs to carry out its operation in effective manner. For this business needs to review its
performance that indicate them success and failure of business (Westney, 2021). Facebook is
also adopting performance indicator tools and explanation of it is mentioned below:
KPI: It is a tool in which business can evaluate actual and desired performance of business that
allow them to identify problem and also make modification. It allows business to attain desired
results in business.
Benchmarking: It is another tool that allow business to compare its performance with another
company within same industry. Dimension used by business to compare measures includes cost,
time as well as quality.

TASK E
Evaluate the various contemporary strategic issues in strategy by using concepts and models
Suggestions and recommendations
Review based strategy: It is one of strategic model that provide ways to view firm and allow
business to develop strategy. It is a strategy that allow business to collect different resources and
combined in a way which helps business to differentiate it from another organisation. CEO of
Facebook can adopt this strategy as it allows them to get advantage of differentiation on basis of
resources.
Figure 1: Resource Based View
Source: Resource Based View - The VRIN Characteristics
Corporate level strategy: It is another strategy which can be adopted by business in company
needs to define, target and attain goals of company. CEO of Facebook can attain these strategies
in business for purpose of expansion of business in international market. These strategies can be