Analyzing Globalization's Impact on Vodafone and the UK Market

This report analyzes the impact of globalization on Vodafone UK, focusing on external environmental factors. It explores the influence of political, economic, social, technological, legal, and environmental elements on Vodafone's operations. The report discusses how these factors affect the company's performance, decision-making, and strategies in the global market. It examines the effects of globalization on the UK's business landscape, including competition, technological advancements, and cultural considerations. The report also considers the impact of economic factors like recession and inflation, as well as social factors like consumer preferences. It concludes by summarizing the key findings and emphasizing the importance of adapting to globalization's challenges and opportunities.

How globalization has
impacted on United
Kingdom

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
Assignment 1...............................................................................................................................1
CONCLUSION ...............................................................................................................................4
REFERENCES................................................................................................................................5

INTRODUCTION
External environment consists of all those factors which could influence business
operations. There are some elements which are involved in macro environment i.e. political,
economic, social, technological, legal and environmental. These components can influence its
performance in external market (Heo, Choudhary and Augenbroe, 2012). Vodafone group is the
chosen organisation is this present assignment that deals in networking and telecommunications.
The firm operates its own services in 26 countries over the globe. In addition, Vodafone group
also provides IT services to its customers in 150 nations. Its overall market capitalisation is £53.5
billion approximately. The present report will study the impact of all external environmental
factors upon globalisation.
TASK 1
Assignment 1
In every business organisation, external environment encompasses all entities which exist
in the outside boundary. But put a huge impact on its survival as well as growth. In addition,
company also has no control over these factors. Therefore, it is essential for Vodafone group to
measure or monitor all these external changes. It is well and good for the firm if it prepares plans
and policies in order to face all these factors. Along with this, external environment can be
classified into different parts , such as -
Below mentioned two major factors that put a huge impact on individuals as well as country or
region. Political factors involve tax policies, duties, labour law, trade restrictions, political
stability, etc. Main aim of Vodafone group is to value customer relationship but due to
some political issues, company is not able to deliver quality services to its customers. Due
to this, it may lose its potential buyers. In addition, changes in British government also
put a huge impact upon decision making process of a company. United Kingdom has its
own communication act and it is necessary for Vodafone to follow the same in order to
effectually perform business in the global market. The act has strict rules and regulations
otherwise, it would be tough for networking companies to stay in competition (Fleer,
Hedegaard and Tudge, 2012). Apart from this, it is also compulsory for these commercial
entities to grant permission of legal authorities if they want in extend their market area. .
I

For that, Vodafone has to show its brand image and assess benefits before entering in the
global market. It also follows many high restraint regulations which are related with
environment as well as customers’ demands. UK government has made a rule for
telecommunication companies in which all firms need to show their annual report and
their deliveries in front of legal bodies. It consists that whether the company is following
an ethical manufacturing process or not. After that, government measures the quality of
its products before launching in market (The Effects of Globalisation on Business, 2011).
For Vodafone Group, this is essential for it to manage healthy and cordial relationship
with other countries so as to perform their in effective and efficient manner.
 Economic factors – These factors also put a huge impact on the growth and development
of a company. It involves increase in gross domestic product, unemployment, level of
inflation, interest rates, exchanges rates, economic recession etc. All these elements
persuade the market in which a company operates. Due to recession in 2007-2008, it was
not possible for companies to pay high wages to their employees. This could increase
unemployment and diminish GDP rate of the country. In the British market, when 5G
technology is introduced, every telecom company needed to adopt it in order to cover
high market share (Zhou and et. al., 2011). Although, it generates competition among
local network providers and Vodafone Group; but new technology wants high
expenditure for acquiring new techniques. Inflation rate of the nation also impact upon
buying behaviour of customers. Current inflation rate of British market is 4.60% and so,
company needs to decrease its product prices in order to stay in the target market. Apart
from this, if the rate is going high then people starts saving their money and put a control
over their buying which directly affects UK's economy in the global market.
Some other external environment factors are stated as below: - Social factors – These factors involve demographic changes in fashion or market trends.
UK market is so vital, there are different kind of phones are traded. In this modern era,
people prefer Apple I Phone that is a big competitor of Vodafone in the international
market. Apart from this, Vodafone is totally European company but now it has changed
its preferences as per the local societies in which the firm is being operated. Technological factors – In UK’s telecommunication market, technology is developing
day by day. There people want to adopt new features and software in their smartphones.
II

The introduction of 5G network is assistive for Vodafone as it can provide fast data
services to its customers (Wang, Chenand Chen, 2012). In addition, this company also
offers attractive prices plans to its potential buyers in order to attract or retain them for a
long period of time. Legal factors – According to the Sale of Goods Act 1974, it is necessary for every
organisation to follow all legal laws and legislation before selling its products in market.
In terms of networking company, the process of mobile production should also be legal.
In addition, Vodafone has several rivals as it is performed globally. Sometimes the
company faces many legal issues i.e. copy and patent issues, tax issues etc. Environmental factors – Every business organisation has to implement a recycling plan
in which it can re-use its wastage in order to make a new hand set. This will also help the
environment to a high extent. Due to globalisation, multinational companies are become
more ethics oriented. Vodafone Group plc should always consider the aforementioned
facts and analysis.
Impact of globalisation: -
Globalisation consists with freely movement of people, technology, services, goods,
capital etc. in international market. It refers to the procedure that is driven by international trade
and investment. In other words, the term of globalisation means to promote products and services
of a business at international level. This can affect cultural, environmental and economic
development of country. It helps in extending global trade and operating systems of a company.
By adopting the concept of globalisation, a firm is also liable for economic growth and
development of a country. Apart from this, it is also assistive in creating wealth for British
economy.
Globalisation put a huge impact upon goals individuals as well as a country. For example
– if there is changes in global environment, then it also bear upon individuals needs and wants.
Apart from this, sometimes it also affected overal country or a religion. For Vodafone group,
globalisation bring it fierce rivals . Hence, a company requires to evolve its strategies so that it
can raise compliance by prevailing market trends (Swayne, Duncan and Ginter, 2012). For
example –company makes efforts to mitigate the impact of global warming. To the same, it is
focusing on the way to preserve environmental friendly practices of firm. Globalisation also
increases competition among various business entities at international level, this is occurred by
III

foreign investment is flowing in United Kingdom. In these days, multinational companies are
aware and instantly reacts towards needs and wants of their users . In other words, customers are
very selective while purchasing anything.
Technological advancement in the global market also affect a firm's growth and
development. Vodafone group has strongly used information technology in order to enhance
communication with its clients in all sectors. In addition, business entities are wisely taking
benefits of market platforms through internet i.e. social apps and emails. Referred firm has a
great market position as it has expanded too much amount for attaining and retaining numerous
customers. Along with this, changes in political factors also put a huge impact on globalisation.
For example- if there is any variation in the political policy of UK, it affects the relationship of
company with other countries. For example- if British government has increased tax rates and
duties upon data packs and call costs then Vodafone also needs to extend its prices across the
world. This could reduce customers and market growth of the business at international market
place.
Religious and cultural ideologies also impact upon various affairs of a business. It seems
with how to accomplish peoples' attention and maintain their interests towards a particular
brand or product. Now Vodafone is dealing with various types of people who have different
religion, culture, race, etc. Thus, it is essential for this company to produce products which are
able to fulfil the needs and demands of international customers. Along with this, company also
has corporate social responsibility that it treats employees in a better way by giving them dignity
and respect of their work (Wang, Chen and Chen, 2012).
CONCLUSION
From the above mentioned report, it has been concluded that there are many external
factors which put a huge impact on the organisational performance and its survival as well. The
present report has included macro environmental factors of Vodafone UK. In addition, it has also
discussed the impact of globalisation on all these elements. There is a brief description of
political and economic factors of company and their impact on UK's economic condition.
IV

REFERENCES
Books and Journal
Baffour Awuah, G. and Amal, M., 2011. Impact of globalization: The ability of less developed
countries'(LDCs') firms to cope with opportunities and challenges. European Business
Review. 23(1). pp.120-132.
Chatterjee, K., Sherwin, H. and Jain, J., 2013. Triggers for changes in cycling: the role of life
events and modifications to the external environment. Journal of Transport Geography.
30. pp.183-193.
Fleer, M., Hedegaard, M. and Tudge, J. eds., 2012. World yearbook of education 2009:
Childhood studies and the impact of globalization: Policies and practices at global and
local levels. Routledge.
Heo, Y., Choudhary, R. and Augenbroe, G. A., 2012. Calibration of building energy models for
retrofit analysis under uncertainty. Energy and Buildings. 47. pp.550-560.
Spence, M., 2011. The impact of globalization on income and employment: The downside of
integrating markets. Foreign Affairs. pp.28-41.
Swayne, L. E., Duncan, W. J. and Ginter, P. M., 2012. Strategic management of health care
organizations. John Wiley & Sons.
Wang, C. H., Chen, K. Y. and Chen, S. C., 2012. Total quality management, market orientation
and hotel performance: The moderating effects of external environmental factors.
International Journal of Hospitality Management. 31(1). pp.119-129.
Zhou, L. and et. al., 2011. Impact of globalization on Income Distribution Inequality in 60
countries. Global Economy Journal. 11(1).
Online
The Effects of Globalisation on Business. 2011. [Online]. Available through:
<https://www.mtdtraining.com/blog/the-effects-of-globalisation-on-business.htm>.
[Accessed on 26th August 2017].
V