Nissan Strategy Report: Macro Environment and Internal Capabilities

This report provides a comprehensive analysis of Nissan's business strategy. It begins with an introduction to the company and its objectives, followed by an examination of the macro environment using PESTLE and stakeholder analysis, highlighting the impact of political, economic, social, technological, legal, and environmental factors. The report then delves into Nissan's internal environment and capabilities, utilizing the McKinsey 7S model and the VRIO framework to assess its strengths and weaknesses. Porter's Five Forces model is applied to evaluate the competitive landscape, followed by a discussion of strategic planning considerations. The analysis underscores the importance of adapting to external factors and leveraging internal capabilities to achieve a competitive advantage in the global automobile industry. The report concludes with a summary of key findings and recommendations for Nissan's future strategic direction.

NISSAN STRATEGY
REPORT

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
LO1..................................................................................................................................................4
P1 Impact of macro environment................................................................................................4
LO2..................................................................................................................................................7
P2 Internal environment and capabilities....................................................................................7
LO3..................................................................................................................................................9
P3 The Porter’s five forces..........................................................................................................9
LO4................................................................................................................................................11
P4 Strategic planning.................................................................................................................11
CONCLUSION..............................................................................................................................14
REFERENCES..............................................................................................................................15

INTRODUCTION
Business strategy plays an excellent role to a business and or company to achieve great
profit margins. In this dynamic and modern world, effective strategic management plan is the
only way to different organisations to gain highly competitive advantage in the market. Making a
plan for business strategy management is very necessary task to a company, because competition
within each industry or sector is continuously increasing. That’s why it is too important to a
company for properly managing its different business strategies to perfectly deal with high
market competition. A company always need to make a specific plan to deal with various factors
also which has involved in its business environment, because these all factors highly affects
company while managing business strategy. This report discusses business strategy of Nissan.
This is one of the leading Japanese automobile brands, headquartered in Nishiku, Yokohama,
Japan. Nowadays, Nissan has the large customer base in global automobile industry. Some
productive frameworks also have been used to systematically analyse strategic management of
the company.
MAIN BODY
Company background
Nissan is one of the most popular automobile companies, founded in 1993 and
headquartered in Nishiku, Yokohama, Japan. Nowadays this company is systematically
expanding its business activities in lots of new countries in across the world (Desyllas and et.al.,
2018). The mission of company is to increasing market share with 10% in the global automobile
industry. The vision of Nissan is to offering its products and services within each and every all
countries. Key objectives of this company are as follows; increasing brand image in market by
fulling corporate social responsibilities on time, make huge customer base through providing the
quality services etc. The upper management at Nissan believes in maintaining an ethical
workplace within its business environment, that’s why nowadays Nissan is operating its various
busines operations on its progressive path.

LO1
P1 Impact of macro environment
Factors which has involved in Nissan’s macro business environment are highly affecting
company’s various business operations in both manners positively and negatively. In this
situation, top-level management of company should use different innovative tools and
frameworks, like; PESTLE analysis and Stakeholder analysis for properly analysing impact of
different macro environment factors. It is very necessary task to this automobile company,
because by analysing impact of macro factors existing management can easily make productive
business strategies. There are PESTLE and Stakeholder analysis frameworks has been used
below;
PESTEL Analysis
PESTEL Analytical tool is very innovative tool in the terms of analysing major macro
environment. Currently most companies within market are taking lots of advantages through this
tool, in which upper management of Nissan also should highly consider this tool for
systematically analysing impact of external and macro environment factors (Pedron, 2018).
Basically, PESTEL term indicates six key macro environment factors called; political, economic,
social, technological, legal and environmental factors which has been discussed below;
Political factors: These factors are highly affecting Nissan, because the upper management of
company always responsible to fulfil different formalities which imposed by local government of
a country and nation. For example; the UK’s has imposed taxation on all businesses or ventures
which are operating under its authorised zone. That’s why existing management at Nissan need
to fulfil taxation formality. According to governments of many countries, a business always
responsible for not harming health of people by its operations, so that Nissan is required develop
appropriate strategy to avoid conducting those all business activities which can be harmed heath
aspect of people. These factors fully affected strategic environment of Nissan.
Economic factors: Economic factors also highly influences Nissan’s busines operations.
Basically, company can easily sale its products and services in those countries which has well-
developed economic conditions. Suppose the United Kingdom has very well economic
conditions, in which Nissan can generate huge profit margin in this country by using some

productive competitive strategies. Company can sale its products and services in such countries
also which are in their developing stage. Basically, people within developed and developing
countries always able to buy products and services of Nissan (Lai, Melloni and Stacchezzini,
2016). That’s why Nissan always able to generate huge in these countries, because these
countries have favourable economic conditions.
Social factors: Social factors are very appropriate for Nissan in most places. Mainly people
within most countries always like to by quality products and services, in which this social factor
can positively affect to Nissan, because this automobile company mostly provides only quality
vehicles within various market segments and places. Company should use TQM (total quality
management) in proper manner for always developing quality products. On the other side, people
within most countries like to products and services from those brands which always be fulfilled
their CSR (Corporate Social Responsibility) on time, so that upper management at Nissan
responsible to take an appropriate step towards fulfilling CSR on time.
Technological factors: Nowadays technological factors are positively affecting business
operations of Nissan, because with support of technology company can easily improve its
existing performance and productivity in the international automobile industry (Lartey and et.al.,
2020). Currently each automobile company is taking huge advantages through technology, in
which existing management of Nissan also need to take a proper plan for using effective
technological machineries, tools and gadgets in its daily operations. Recently, Nissan’s
marketing team has boosted marketing functions by using digital marketing tool, in which there
is digital marketing tool is also a small aspect of technology. That’s why technological factors
are too good to this company within market.
Legal factors: Legal factors also positively affects to Nissan’s daily operations, because by
adhering various legislations within its operations, it can be able to maintain an ethical
workplace within its business environment. That’s why upper management of Nissan always
responsible to adhere each and every legislation, standard and rule & regulation.
Environmental factors: These factors affect Nissan’s upper management for never conducting
such activities in its business operations which can negatively affect natural environment. For

example; company should never develop and produce those vehicles which can generate very
harmful smoke and gases, because it is necessary to protect to natural environment.
These all macro environment factors are highly effecting business strategies of Nissan,
because this company always need to make strategies which supports in properly dealing with
impact of these factors.
Stakeholder Analysis
Stakeholder analytical tool is another useful tool in the term of analysing impact of macro
environment (Lee and Kim, 2019). Basically, this tool can help to Nissan for identifying and
analysing their major stakeholder, in which top-level management at Nissan is also highly
required to consider this analytical tool within its daily operations. This tool is also something
similar as PESTLE analysis, because this also shows different factors which can affect Nissan’s
business strategies. There are mainly three stages has included in this tool which every business
should be considered.
Stage1: Determine the stakeholders
Determination of stakeholders is the first stage within the Stakeholder analysis tool. In
this stage, the management of Nissan need to systemically determine its various stakeholders.
For example; currently customers, employees, suppliers, shareholders etc are key stakeholders of
this company, in which the management should be included these all stakeholders into a list.
Stage2: Prioritize stakeholders
Prioritize stakeholders, in this stage the management of Nissan need to prioritize its various
stakeholders according to their levels of interest and power. The company need to make power &
interest grid that can give facility for knowing the actual power & interest of different
stakeholders. There are power & interest grid mainly supports in dividing various stakeholders in
four main categories, these four categories have been discussed below;
 High power & high interest: There are mainly shareholders comes under this category,
because they provide huge fund to Nissan, so that they have high power (Habib and

Hasan, 2017). Then they have high interest as well, because they always expect to gain
positive return.
 High power & low interest: Customers has been involved in this category of gird,
because a customer is always a king of market, so that they have high power. On the
other side, they have low interest, because they have many other companies as well for
purchase vehicles.
 Low power & high interest: Generally, employees come within this category of grid,
because they always need to follow orders of Nissan, so that they have low power. On the
other side, employees have high interest in Nissan, because these are always working for
gaining effective earnings.
 Low power & low interest: This is the last category within the grid, in which mainly
suppliers comes under this category, because they have no any right to take any decisions
within company, so that they have low power. Then they have lots of other brands also
for supplying their items and goods, so that they have low interest in company.
Stage3: Communicate with the stakeholders
This is the third and most important stage within the stakeholder analysis tool. In this
stage, upper management at Nissan should properly communicate and interact with their
stakeholder, because by communicating Nissan will be able maintain effective relations within
its different stakeholder. Effective communication within organisation always positively affects
to the all over growth of that organisation.
There are factors of stakeholder analysis and PESTEL analyses influencing busines
strategies of Nissan in both ways positively and negatively. So, that the management of company
should take some appropriate steps towards properly managing impact of these all factors.
LO2
P2 Internal environment and capabilities
There are internal environment factors and capabilities of Nissan also highly affects its
daily operations, in which upper management of Nissan need to analyse its different internal
environment factors and capabilities. There are various innovative tools and frameworks

available to company which can support in identifying and analysing various internal
environment factors and capabilities (Khan and et.al., 2019). For example; McKinsey’s 7S model
and VRIO framework are two very appropriate frameworks, in which these both frameworks
have been used below;
McKinseys 7S Model
McKinseys 7S model is one of the major frameworks for analysing this company’s seven
key internal environment and capability. This McKinsey’s 7S model mainly includes seven
internal factors, in which these factors discusses below;
Strategy: The management at Nissan always choose such business strategies within its
workplace which can provide it the best return. For example; Nissan should modern and latest
business strategies, because these strategies are providing very excellent results to different
businesses in the market.
Structure: Nissan has expanded is brand in across the world, so that it has very large business
structure. This structure is increasing day by day as well.
Systems: Upper management at company is always trying to run its various business operations
systematically, in which this step of management can positively affect to Nissan.
Shared values: The company has properly managed equality and diversity within workplace, so
that this factor of management provides equal growth opportunity to all employees. Basically,
equality and diversity management promote ethics also in the workplace.
Style: Existing leaders and managers within Nissan always tries to use various appropriate
leading and managing styles, in which these styles helps to managers and leaders for taking
effective work from their employees. Styles of leaders and manager represents internal
environment and capability of this company.
Staff: Staff within Nissan is very favourable to the growth of this company. For example; staff
and employees of Nissan always puts their huge efforts in the workplace.
Skills: Most employees of Nissan have well-developed employability skills and competencies, in
which this attribute of all employees can positively affect to this company. The management of

company have to make its internal business environment more effective for improving individual
capability of all employees.
VRIO Framework
VRIO Framework is another productive framework in the terms of knowing internal
environment factors and capabilities of Nissan (Sivakumar, Sahasranamam and Rose, 2017).
This framework mainly involves four elements which highly needs to be considered in company.
Valuable: This company has great reputation in the market, because it mostly provides quality
products and services in the market. For example; Nissan focuses on producing an exclusive
range of vehicles, so this factors always maintains high reputation of company in the market.
Rarity: The company provides various electric cars in various market segments. On the other
side, this automobile company produces such vehicles which releases very less smoke, that’s
why this thing makes it a rare brand. This company is fully able to produce rare and exclusive
products and services, so this a key capability of this organisation.
Imitability: When customers visit with the showrooms of this company, then existing employees
or staff of showroom has communicated with different customers in fully a proper manner. For
example; employees give each information of products and services of Nissan to customers
within showrooms, so that many of customers like for visiting Nissan’s showrooms.
Organised: The management at Nissan has an effective feature, that it can systematically
organise its various business operations in different market segments (Liao, 2018). For example;
Nissan’s most showrooms can’t face issues and problems relating to shortage of products,
because management has effectively organised its supply chain. Its employees also always be
organised for achieving different targets on time just because of an effective internal business
environment.

LO3
P3 The Porter’s five forces
Porter’s five forces is another very helpful tool or framework that can provide facility to
different businesses and companies for analysing competitiveness of the selected market
segment. With support of this framework any company easily gain huge competitive advantage
in the market, so that upper management at Nissan should highly needs to be considered Porter’s
five forces in its workplace. This framework mainly includes five factors which has been
discussed below;
Bargaining power of buyers (High)
Bargaining power of buyers or customers is very high to Nissan within the international
automobile industry, because buyers always many companies to buy different vehicles in the
market. In this situation, upper management of company is highly required to innovate or
develop that type of vehicle range that attracts lots of customers or buyers towards its brand
(Ritter and Lettl, 2018). Basically, bargaining power of buyer is high for Nissan’s competitors as
well, because its competitors also has required to put their he efforts for attracting lots of
customers towards their respective brand. On the other side, if Nissan maintain an exclusiveness
within its products and services, then Nissan can easily gain huge competitive advantage in the
market.
Bargaining power of suppliers (Low)
Bargaining power of suppliers is low to Nissan, because there are large number of
suppliers exists within market for Nissan. In this situation, this automobile company can easily
negotiate with its various suppliers on the basis of its own terms and conditions. Basically, there
are suppliers need to put their high efforts for maintaining an effective relationship with Nissan,
because currently Nissan has opportunity to buy raw-materials from supplier of its own choice.
That’s why bargaining power of supplier is very low within automobile industry.
Threat of new entrants (Low)
Threat of new entrants is low to the company, because there are already lots of
automobile companies exists in global automobile industry. In this situation, if any new company

enter in this in industry, then it will be required to put its huge efforts for easily surviving in the
market (Kotusev and et.al., 2020). Basically, currently those new entrants are able to generate
huge profit in their initial stage which provide exclusive products and services in the market. But
currently threat of new entrants is low to Nissan.
Degree of Rivalry (High)
Currently there are very competition within the international automobile industry. There
are Toyota, Land Rover, BMW, Audi, Mercedes-Benz, Tesla etc. other automobile or vehicle
manufacturing companies are giving very tough competition to Nissan. In this situation, upper
management of Nissan should use competitive pricing strategy for providing its products and
services on very favourable price, because by using this strategy Nissan can gain huge
competitive advantage.
Threat of Substitutes (High)
Threat of substitute product is also high to Nissan, because currently customers has many
options in the market to fulfil their vehicle needs (Taherdangkoo, Mona and Ghasemi, 2019). In
this situation, company should boost its marketing functions for positively influencing customers
in the market for buying its products and services. It is necessary step to Nissan for gain
excellent profit within market.
Evaluation
On the basis of porter’s five forces analysis, only forces are low to the Nissan; bargaining
power of suppliers and threat of new entrants. Rest all three forces are high to the company. In
this situation, upper management of company should develop some effective business strategies
for making these all forces too much favourable. The Nissan should use competitive pricing
strategy for systematically dealing with highly competitive market. Proper analysis of these all
forces will give opportunity to company for making different effective techniques or tactics to
make own brand value very high in the selected market places. According to porters five forces,
currently bargaining power of buyers is very high, bargaining power of suppliers is low, threat of
new entrants is also low, then degree of rivalry is high and lastly threat of substitutes is also very
high, so that upper management at Nissan should make its business strategies accordingly.

LO4
P4 Strategic planning
Strategic planning can be defined as the strategic direction that offers through plan to
company. Management of the Nissan automobile company applies different strategic tool to
introduce its strategic planning.
Porter’s generic strategies
This model highly emphasizes on the following strategies. Nissan company has various strategic
options such as cost leadership, differentiation and focus strategy under the strategic choices.
Cost leadership: It involves in taking competitive advantage by offering products and services at
lower cost. This strategy allows organization to influence it’s growth potential in manufacturing
and retail industry (Omsa, Abdullah and Jamali, 2017). With this strategic choice option
organization can build strong it’s exiting customers base by offering value-based products and
services to them.
Differentiation strategy: It is another strategic option that available in Porter’s generic strategies.
this strategy allows organization to build a unique image in it’s market with the support of
innovation and branding campaigns. This strategy requires high investment on R&D department
because it helps company to introduce new product to services which fulfil individuals needs and
expectation.
Both differentiation and cost leadership strategy are applicable for the large capital instead of
small-scale businesses because they do not have strong financial source like large corporations
i.e. Nissan.
Focus strategy: It is another and effective strategic option in which combines two above
strategies cost leadership and differentiation strategy. this strategic option is highly effective for
small scale business. This strategic option allows organization to build strong customer base by
offering affordable price products and services. With this strategy organization enables to
differentiate it’s brand and products from others in the business market.