Strategic Analysis and Options for Lloyds Banking Group PLC

This report provides a comprehensive strategic analysis of Lloyds Banking Group PLC, evaluating both internal and external factors that influence its strategic decision-making. The analysis includes a PESTLE assessment, examining the political, economic, socio-cultural, technological, legal, and environmental influences, as well as a SWOT analysis to identify the organization's strengths, weaknesses, opportunities, and threats. Bowman's Strategic Clock and Porter's Five Forces model are applied to assess the competitive landscape and strategic positioning. Based on these analyses, the report critically evaluates and justifies strategic options available to Lloyds Banking Group, focusing on strategies for growth and competitive advantage within the financial services industry. The report concludes by highlighting the most appropriate strategies for ensuring the organization's continued success and achievement of its objectives.

Business
strategy

Table of Contents
INTRODUCTION :..............................................................................................................................4
PART A - INTERNAL AND EXTERNAL ANALYSIS THAT PROVIDES A PLATFORM FOR
STRATEGIC DECISION MAKING : ................................................................................................4
FRAMEWORK TO ANALYSE THE IMPACT AND INFLUENCE OF THE MACRO
ENVIRONMENT :...............................................................................................................................5
PESTLE ANALYSATION :................................................................................................................6
SWOT ANALYSATION......................................................................................................................8
PART B – ON THE BASIS OF THE ANALYSIS CRITICALLY EVALUATE AND JUSTIFY
STRATEGIC OPTIONS FOR THE ORGANISATION....................................................................10
BOWMAN'S STRATEGIC CLOCK.................................................................................................10
LLOYDS BANKING PORTERS FIVE FORCES ANALYSATION................................................11
STRATEGIC OPTIONS AVAILABILE FOR THE ORGANISATION :..........................................12
CONCLUSION :................................................................................................................................14

INTRODUCTION :
This report will cover up the internal and external analysis which gives the platform for
strategic decision making including the PESTLE and SWOT organisation with an evaluation of the
resources and capabilities of the organisation along with this there will be a complete analysis of the
environment with the help of Porter's Five Forces model with the identification and justification of
the organisation of Lloyd Banking and it's potential of the competitive advantage which helps in the
valid and tactical strategies for achieving the objectives of the organisation. There will be a
distinctive strategies available for the organisations with the most appropriate strategies for the
platform of growth by which there will be strategies that will be ensuring success in the
organisation and all of these information in this report will be having the assurance in the outcomes
of the business of Lloyd Banking and meanwhile the growth of the organisation with the help of
different type of strategies which would be helpful for Lloyds Banks group plc. This report would
be divided into 2 parts , on the first part there would internal and external analysis for providing a
platform of strategic decision making using different methods in the report and the second part of
the report will be containing the basis of the analysis of the first part by justifying the strategic
options available for the organisation which is Lloyds Banks group plc.(Achinas, el. at.,2019)
PART A - INTERNAL AND EXTERNAL ANALYSIS THAT
PROVIDES A PLATFORM FOR STRATEGIC DECISION
MAKING :
INTERNAL ANALYSIS :
Internal analysis targets on the evaluation of the general aspects of the organisation as it can
be helpful to see through the strong weak points of the organisation which eventually helps into
evolving in the business and it's strategies about the resources has been getting used in the
organisation. This strategic management requires internal analysis as it is vital for valid reasons one
of which is it provides the in depth understanding of the management of the resources of the
organisation and getting the precise knowledge about the inefficiencies in the accounts of the
business and the only way of knowing about these sensitive things is though the internal analysis of
the organisation.
EXTERNAL ANALYSIS :

The time of the process in the evaluation of the goals and resources of the organisation one
need to look around and analyse the external factors of the business which provides the
management strategies as it is important to look after the external forces of the business as it could
effect the operations of the business. This analysis is more about the environment of the business as
there are many competitors in the industry so the organisation needs to see the solution to be ready
with the outsources which could be diverting for the business. It requires to keep an eye on the
regulatory changes in the frameworks of the of the government for the effective management of the
finance of the organisation.
Lloyd Banking group has been initiating to grow and expand it's products and it is already
enhancing the innovation of the strategies of their products and services to satisfy the consumers as
per their requirements and he growth of the banking services is promising as per the report of CBI.
Therefore it would help Lloyds to grow their investments and its securities in the business of
insurance. Lloyds Banks provides a lot of financial products including banking wholesale and
insurance products providing loans , mortgages and social banking products. (Ackermann, F., 2020)
FRAMEWORK TO ANALYSE THE IMPACT AND INFLUENCE
OF THE MACRO ENVIRONMENT :
The vision of the Lloyds Banks serves as a philosophy of the institution as the company is
one of the biggest financial influencer in the market all over the world and it operates it's business
through the potential opportunities and innovations of their products. Today , the bank has been able
to taje the initiatives which is giving the competitive market to their competitors. It may effect the
functioning of the business as it influence the working of the organisation so that they can grow
their brand image in the business.
TECHNIQUES AND STRATEGIES :
Business : This technique helps the business to get through the strength and weakness of the
organisation and Lloyd Banks is capable enough to understand the dynamics and work on the loop
holes of the company.
Benchmarking : This strategy initiates when the organisation make their brand image compete with
the other competitors of the market in the same business of the organisation and Llyod Banking has

been a initiator for doing the same which helps the organisation for the growth from their own
loopholes and manage the brand image as per the market requirements.
PESTLE AND SWOT OF THE ORGANISATION AND AN EVALUTION OF THE
ORGANISATION'S RESOURCES AND CAPABILITIES :
These both strategies have been used to analyse advantage and disadvantages of the
organisation and analysing the SWOT and PESTLE which are internal and external environment of
the company helps in creating the strategies which could be helpful for the business of the
organisation. (Bruijl, D. el. at. , 2018)
PESTLE ANALYSATION :
PESTLE stands for Political , Economical , Socio-cultural , Technical , Legal and
Environmental analysation of the organisation , this falls in the external environment of the
organisation referred as scanning the business environment.
POLITICAL :
One of the initial factor of the macro environment is Political which plays a vital role in the
profitability in a specific country. Lloyds Banking group has been operating the dynamic in
different countries to diverse the risk of the political environment. Lloyds Banking group can
analyse these factors by the political feature of PESTEL is that It can get through the information
about the stability in the politics and the importance of the economy of the country and analyse the
level of corruption in the financial sector as the interference in foreign Money centre banks is a vital
stage of understanding the taxation of the world.
ECONOMICAL :
Inflation rate , saving rate and foreign exchange rate has been aggregated by the economical
factor of the company while on the other hand the norms of the competition which have the
advantage for the organisation which uses the inflation and growth rate for keeping the record of the
depending of the consumers. The economical factors that Lloyd Bank group should consider by the
PESTLE analysis is the type of economic system is there in the country and its stability with the
government interference in the markets where exchange rates are required before investing as the
currency of that particular organisation is important. Economic and Unemployment rate of the
country also plays a vital role to know about before the investment.

SOCIAL :
The culture of the society has been playing a key role in impacting the culture of the society
and its environment. Collective beliefs of the population plays a important role in getting the
information about the marketers and consumers of the country for the foreign money centre banks
and Lloyds bank group should analyse for social culture is the demographic talents of the
population power and hierarchy of the society with the education standards has the vicious role in
impacting the investment of the organisation.
TECHNOLOGICAL :
Technological aspect is very important for analysation of the investment as it can boost the
interest of the people and it can establish organisations to cope with the changes in the market.
Organisation should analyse the industries with their speed in technologies which will give them
time for the profitability of the organisation and it should consider the impacts of the recent
technologies by the competitors of Lloyds Banking Group and their impact on the business and cost
structure in foreign money centre banks along with the chain of value structure in the financial
sector.
LEGAL :
As per the different aspects that have been explained above legal framework requires to be
the most effective way in the organisation which Lloyd bank should consider to protect the
intellectual property rights of the organisation and it should analyse the legal consequences in a
calculative form and the most important legal factors that Lloyds banks should consider while doing
a business is to know about the employment and healthy and safety law , to have the information
about the consumer protection and e commerce along with the anti trust law in the foreign money
centre industry and the data protection rule of the country as it can contributes to the organisation's
legal frameworks.
ENVIRONMENTAL :
The varieties in the market according the country have different environment which impact
the total profitability of the organisation as every country has their own environmental laws depends
on the exact environmental conditions of the country. Lloyd should look upon the environment
standards that are required to operate in the market which are the weather and climate of the country

, the laws of the environment along with the financial sector of the waste management contribution
towards the renewable energy and endangered species.(Bruijl, D. el. at., 2018)
SWOT ANALYSATION
It is a strategy tool to analyse the situation of the organisation and it has been very useful for
getting the information about the Strengths , Weakness , Opportunities and Threats of any company
according to the ongoing environment of the business. These point will be covered by the
analysation of Lloyds Banking group plc and the strategies of the organisation.
STRENGTH :
Lloyds Banking group plc is one of the leading organisation in the industry and it have numerous
strengths which help it to enhance in the market as strengths are not only to protect the share of the
market but to conquer other new markets as well. The strengths of Lloyds banking are :
 It has successful track record on producing the new product which has been refer as product
innovation.
 The distribution network is very strong as the organisation has built their distribution
network very reliable on the majority of the market.
 Lloyds Banking group has been successful in making good return on the capital expenditure
through building the new streams for revenue.(Sutrisna el. at.,2020)
WEAKNESS :
The areas of weakness can get improved by the SWOT analysis by building the advantage strategic
positioning and planning of the organisation.
 The strategies of the market has been left a lot to be desired even though the product has
been successful in making the profits because of the limited success outside core business as
Lloyds banking have been facing challenges in shifting to the other product and moving
along with the ongoing culture.

 Product functioning is and the structure of the organisation is compatible with present
business scenario only which has been limiting the expansion and enhancement in the
market.
 Contribution and the ratio of profitability of the Lloyds Banking group has been going
below the average of the industry.(Cox, el. at.., 2018)
OPPORTUNITIES :
External strategic factors has been playing a key role in the industry and opportunities is surely one
of them which helps the organisation to grow the business on a higher level.(steiss, 2019)
 Lloyds banking has been investing in the online channels which has been generating great
profit for the organisation and it can now leverage this opportunity by knowing the customer
better and serving their needs.
 Lloyds banking can enhance their profits though the new taxation policy which can surely
impact the business and could open up the doors for the new opportunities.
 New technologies has been turning around and providing new opportunities to the pricing
strategies in the market as it will manage to bring the new customers as well
THREATS :
External and internal threats can be disadvantage for any organisation and it could be leaving the
profits in the depth loss as Lloyds banking has been operating in the different countries it should be
conscious about the business.
 The overall sales has been going downwards as the competition is increasing in the market
which has been resulted the increased number of players in the industry.
 In the medium long term new technologies developed by the competitor could be a threat for
Lloyds banking group in future.
 In the specific markets globally there is threat of profit growth for Lloyds Banking plc
because of the shortage of skilled workflow. (Cutolo,, 2021)

PART B – ON THE BASIS OF THE ANALYSIS CRITICALLY
EVALUATE AND JUSTIFY STRATEGIC OPTIONS FOR THE
ORGANISATION
BOWMAN'S STRATEGIC CLOCK
The framework emphasising the different strategic position which clarifies the role and
responsibilities of the leaders to position the product towards the targeted market to have the lead in
the business. There are few strategies :
 LOW PRICE AND LOW VALUE : It is a strategy through the company keeps the price of
their product low as possible to attract the large number of customers and to set up its
customer base in larger market.
 LOW PRICE : The factors in which company tends to focus on the products of which the
prices are low because of which they could enhance their productivity and innovation along
with that it focuses on the low profit margin resulting customer in bulk buying which
generates the higher sales.(Slack,, 2019)
 HYBRID : The strategy which has been the combination of both the strategies mentioned
above because they offer the product which has average quality but end up in the low price
range to meet up the requirements of the competition in the market.
 DIFFERENTIATION : Strategies through which an organisation focuses on offering the
product which is different and unique that builds up the focus oriented customers for being
the leader of the market.
 FOCUSED DIFFERENTIATION : This initiatives are supported and applied by the
companies who are focused on the quality product which are luxurious and premium selling
in high price.
 RISK HIGH MARGINS : The strategy in which companies offer the high price of the
product in the initial stages which sometimes work for the business and sometimes it don't.

 MONOPOLY PRICING : The monopoly leader is the companies who offer the product
which has not been offered by any other brands and there is no competition of their product
in the entire market which raises monopoly leader.
 LOSS IN THE MARKET SHARE : The strategy involving the high price of the product
which is not being valued by the customers.(Henry, I.P., 2022)
LLOYDS BANKING PORTERS FIVE FORCES ANALYSATION
These five forces helps to analyse the industry and gives the understanding of the profitability. The
managers of Lloyds Banking group plc can use these useful forces for the developing a strategies
and enhancing the competitive advantage of the long term profitability.(Newman, el. at.2020)
1) THREATS OF NEW ENTRANTS : The entrants of the innovations in the foreign money
centre banks has lower the strategies of the price and enhanced the pressure on Lloyds
banking group though it has managed all the challenges to built effective barriers.
2) BARGAINING POWER OF SUPPLIER : There are a lot of suppliers in the industry of
foreign money centre banks who supply their raw material products to most of the
companies. Powerful suppliers use their negotiating skills for extracting the higher prices of
the organisation.
3) BARGAINING POWER OF BUYER : The smaller and powerful the customer base
would be of Lloyds Banking group the higher will be the bargaining power of the customers
and buyers are do often puts pressure on the organisation because of their demanding nature.
4) THREATS OF SUBSTITUTE PRODUCTS : When there is a similar product consumer
needs in different ways , it affects the profits of the organisation and that substitute product
as per the similarity between each other.
5) RIVALRY AMONG THE EXISTING COMPETITORS : Lloyds banking group plc do
operates and runs its business in a very competitive industry and this competition do affects
the overall profitability of the organisation.(Ilmudeen, el. at., 2019)

STRATEGIC OPTIONS AVAILABILE FOR THE
ORGANISATION :
Lloyds Banks group plc has been offering its service and support in almost all the
communities which are more focused on the retail and financial services operating though insurance
, retail and consumer finance etc. The key point and the usp of the Lloyds Banks Group is knowing
and understanding the needs of it;s customers and evaluating the different offer for fulfilling the
needs.
PRICING STRATEGY :
The strategies that have been used for these services is based on the value and Lloyds Bank
practice the same. It make the price based on the benefits of the customers. Apart from product and
services , Lloyds banks provide the diversity in the price range from both higher and lower rate
depending upon the types of services and products the customer needs which needs to be addressed.
PLACE AND DISTRIBUTION STRATEGY :
Lloyds Banks group plc had been providing its services in an international level for the
financing strategic financing as it has the ground locations in Paris , Frankfurt and Amsterdam. This
creates a vast pathway of the investments and market expenditure. It provides the support of client
oriented approach to the customers of UK who have the operations in the countries of Asia.(Juliana,
el. at., 2019)
BANK AND ADVERTISING STRATEGY :
It is one of the most trusted brands in the United Kingdom as it holds it publicity by making
the different type of advertisement for the promotion of its products and services through out the
country and it reflects in their bankings services. Lloyds bank started the campaign for new free
online money tracking service through Money Manager apart from this the bank has been part of
the various events as sponsors and it has boosted its investments through the advertising strategy.
PEOPLE :

Every organisation in the whole world depends and rely on its workforce for the betterment
and success and the total workforce of the Lloyds banks is about 45 thousand with the trained
professionals with great knowledge working in the different sectors around the globe in the
division of the work as per the qualification of the worker.
PROCESS :
There is smooth transitions between the bank Lloyds bank and its customers as per the
services it is more easily available through the online mobile application as the internet banking
which helps the customer to trust the bank and for understanding the services available for the
customers along with this online services the bank also provides the telephonic services as customer
care support to help the customer with any type of issue which they are facing from the bank.(Li, F.,
el. at., 2019)
PHYSICAL AVAILABILITY :
There are many people who doesn't know how to use the online applications so bank has to
provide the offline services as well for the smooth functioning of the organisation as the offline
mode is more accessible for the people and it can surely help the customers by acknowledging their
needs and problems and resolve it as per the customer comfortability.