Business Environment Analysis: Sony Mobile Corporation Report

This report provides a detailed analysis of Sony Mobile Corporation's business environment. It begins with an abstract and introduction, followed by a discussion of the key elements of the internal environment, including financial, physical, and human resources, mission and objectives, management structure, work environment, corporate image, labor management relationships, and technology capabilities. The report utilizes a TOWS matrix to analyze strengths, weaknesses, opportunities, and threats. It also examines the product life cycle of Sony's smartphone products. The external environment analysis includes a PESTLE analysis, market structure assessment, examination of the laws of supply and demand, elasticity of demand and supply, and Porter's five forces. The report concludes with a summary of findings and references.

BUSINESS

ABSTRACT
Sony is the great mobile firm that has adequate financial resources and firm is performing
well in the market. But there are many other competitors those who are doing very well in
mobile sector, as they are using advance technology to improve quality of product. That thing is
creating product for Sony and affecting its sales as well. Enterprise spend huge amount to raises
its sales so that it can remain in in competition for longer duration. If prices are high, then it
affects demand. Enterprise has to ensure availability of products and services so that it can create
equilibrium in demand and supply.

TABLE OF CONTENTS
ABSTRACT....................................................................................................................................2
INTRODUCTION...........................................................................................................................1
DISCUSSION..................................................................................................................................1
KEY ELEMENTS FOR INTERNAL ENVIRONMENT...............................................................1
Financial resource........................................................................................................................1
Physical and human resource.......................................................................................................1
Mission and objective of business...............................................................................................1
Management structure.................................................................................................................2
Work environment.......................................................................................................................2
Corporate image...........................................................................................................................3
Labour management relationship................................................................................................3
Technology capabilities...............................................................................................................3
Use TOWS matrix.......................................................................................................................3
Product life cycle.........................................................................................................................4
EXTERNAL BUSINESS ENVIRONMENT AND KEY ELEMENTS.........................................5
PESTLE analyses.........................................................................................................................5
Market structure and its impact on firm......................................................................................6
Laws of demand and supply, its impacts on business.................................................................7
Elasticity of demand and supply price and income.....................................................................9
Porters five forces......................................................................................................................11
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Internal and external are two major elements of business environment, in order to gain
success in the market companies are required to analyses its market positon and have to
implement effective strategies so that it can grow well in the market (Cho and Lee, 2017).
Present study is based on Sony mobile corporation. It is the firm that offers personal
consumption products to consumers across the world. Study will analyse internal and external
environment of Sony. It will explain supply demand graphs and will describe price and income
elasticity. SWOT, product life cycle in respect of Sony mobile corporation.
DISCUSSION
KEY ELEMENTS FOR INTERNAL ENVIRONMENT
Financial resource
Sony is operating globally; it has great financial capacity. Firm utilise its funds in
significant manner and its fund management strategy is good that helps the firm in running
operations successfully. Adequate financial resource helps the firm in implementing necessary
changes at workplace easily (Gallemore and Labro, E., 2015).
Physical and human resource
Sony has skilled workforce; these talented staff members are very positive towards the
brand. This human resource help Sony in serving consumers well and creating competition in the
market. This effective human resource is helpful for the company to grow well in market and
gaining competitive advantage as well (Wahab, bin Mohamad Shah and Faisalmein, 2019).
Sony also has adequate infrastructures, adequate equipment’s that helps in producing right
quality and quantity products. That is the reason that firm is able to meet the demand timely and
serving consumers well.
Mission and objective of business
 Mission of Sony mobile company is to connect with consumers emotionally and raise
curiosity among them to buy products of Sony.
 Objective of Sony is to raise profitability by entering into global market and enhance
satisfaction level of consumers by offering them satisfactory goods and services (Kraja
and Osmani, 2015).
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Management structure
Management structure plays significant role in business unit, companies always want to
retain talent for that there is need to build their relationship by building effective structure. Sony
mobile company has flat management structure, managers ensure to have smooth flow of
information between top management and all level of workers. Managers give rights to all
employees to share their views so that they feel happy and like to work in the firm for longer
duration. Employees of Sony always share their feeling and ideas that is implemented by the firm
to enhance operational efficiency of the organisation. This type of structure is helpful for
enterprise in order to build relationship with staff members and making them loyal. This
encourage workers and people work together to manage the demand. This is beneficial for the
Sony company in order to work better in the market and gain competitive advantage as well
(Sloberg and Nilsson, 2019).
There is limited layers and transparency is high. People are involved in decision making
process that assist business in making more accountable and sound decision for the growth of
Sony corporation.
Work environment
Employees like to work in the environment where they are being treated well and when
there is friendly atmosphere. Working environment of Sony is very friendly as people feel so
relaxed and encouraged when they work in organisation. Company gives them timely leaves and
also maintain workload of workers so that they can maintain balance between personal and
professional life (Pati and et.al., 2018). Furthermore, managers of the Sony always give
incentives, rewards, recognition to their staff members for raising their confidence and pushing
them to work more effectively. This kind of environment help the company in retaining skilled
workers in the firm for longer duration. Sony always ensures to have open communication
between all level of employees, so that transparency remain maintained. This kind of
environment always helps the organisation in minimising confusion and eliminating situations
like conflicts at workplace (Cho and Lee, 2017).
Sony always organises training sessions for its workers so that their potential can be raised
and they work more effectively and contribute well in improving the workplace efficiency.
Managers acknowledge presence of workers and always appreciate their hard work, that is the
reason why people like to work in Sony. There is strong team spirit, all the workers work in
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team, support each other and this helps business in performing well in market (Gallemore and
Labro, E., 2015).
Corporate image
Sony is the well-known mobile phone company that offers wide range of products to mass
audience. Sony has built strong brand image in the market that supports the business in gaining
attention of buyers. It fulfils its corporate responsibility which has supported enterprise in
improving its corporate image to great extent.
Labour management relationship
Relationship between employees and management is the most essential element in business
unit. Sony always tries to have or maintain strong relationship with its employees this creates a
harmonious environment. This kind of bonding is helpful for Sony in improving working
efficiency of workers and achieving goal of business unit to great extent (Wahab, bin Mohamad
Shah and Faisalmein, 2019).
Technology capabilities
Sony is using updated technology, it has high resolution audio sound facilities I it’s phone.
OLED display is used in its mobile phones. GSM system is used in its phones, till 1991 it was
using 2G standards but now it is using 3G standards and soon will move towards 4G. Wireless
services are used in its phones, VoLTE voice technology system used by Sony.
Use TOWS matrix
SWOT analyse is the model that is used by companies to understand the potential of firm
and its market position.
Strength
 Sony is offering user friendly personal consumption products to consumers that help the
organisation in gaining attention of mass audience.
 It has wide range of products of services that is the reason that entity is able to raise its
productivity and profitability to great extent (Kraja and Osmani, 2015).
 Advance technologies are used by Sony which make it unique from other competitors
such as Nokia, Samsung and also it ensures to offer products at affordable rate.
Weakness
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 Heavy sets is the major weakens of this company and also it has inadequate financial
resources to implement new technologies to enhance quality of products so that it can
competitor with leading brands such as Apple etc.
 Financial planning of business is not proper that is the reason that firm is unable to
generate return on its investments (Sloberg and Nilsson, 2019).
Opportunities
 New technologies can create opportunity for Sony as it would be able to make its
consumers loyal towards the brand.
 Economic upstick can create opportunity for Sony as it would help in enhancing purchase
capacity of consumers that would be better in generating more sales.
Threats
 Changes in laws can affect its productivity hence changes government regulations are
threat for Sony mobile company.
 Imitation of products and process can create threat to business.
Product life cycle
Sales of Sony’s smartphone products has longer life,
Figure 1product life cycle
(Source: Product life cycle, 2019)
 Introduction phase: This is the stage when Sony introduce the new product in the market.
Sony Ericsson is considered as top model of mobile phone, when it was introduced in the
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market then company has kept the price of this phone as at that time distribution was
limited (Pati and et.al., 2018).
 Growth phase: When product is introduced in the market successfully then demand of the
products gets increased because in the introduction phase firms makes investment in
promotion of that product. Hence people are well aware with the features of that item
hence they take interest in buying such products. In this stages, distribution gets increased
and entity has started reducing price and now it was available at affordable price.
 Maturity: This is the phase in which distribution reaches to the intense level and now
enterprise has to promote its brand so that it can gain attention of mass audience in order
to remain in the competition and gain competitive advantage (Sloberg and Nilsson,
2019).
 Decline: This is the last phase in which distribution becomes very sensitive hence
demand gets down. Promotion is done by Sony to enhance interest of potential buyers.
(Figure 2: Sony's total revenue from 2007 to 2018, 2019)
EXTERNAL BUSINESS ENVIRONMENT AND KEY ELEMENTS
PESTLE analyses
Pestle analyses is used by business to analyses its positon in the external market. This has
six major element
Political factor:
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Government of UK has made new regulation related to telecom and has given permission
to use 3G network, now it become essential for Sony to produce such products that can handle
3G networks. This has helped the Sony in improving quality of phones and attracting more
consumers towards the brand. But this has changed entire production process hence cost of the
firm has been increased (Gallemore and Labro, E., 2015).
Economical factor:
High employment rate creates positive impact on firms those which are operating in
mobile sector, as people have adequate income sources hence they can spend money in such kind
of personal consumption products (Cook, 2017). This increases demand and help Sony in raising
its sales.
Social factor:
In the recent time people are paying more attention on Education. People understand
advance feature hence they like to buy such modern smartphones. Sony takes care of this need
that helps the organisation in attracting more consumers.
Technological factor:
Sony is using updated system in existing phones that enhances its facilities. This helps
the organisation in gaining attention of mass audience. But Apple and rest big firms are using
android system which is very costly that creates pressure ion Sony and affect its revenues as well
(Larondelle and Lauf, 2016).
Legal factor:
Government has many laws related to phone manufacturing because use of high phones
is creating problems for environment. Hence Sony had to make changes in its production process
so that it can take care of atmosphere and produce phones as per provided guidelines.
Environmental factors:
Concern towards environment has increased operational cost of Sony. Now firm has
started using lithium for its batteries that has enhanced cost of firm.
Market structure and its impact on firm
Oligopoly is the market structure of UK where big firm’s dominant other small
organisations. As number of seller in this industry are limited hence these big firms control over
entire sector. Companies advertise their products and services frequently so that they can attract
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more consumers and can gain competitive advantage. Small companies have to set prices of their
products by considering market price of big firms (Bas, Mayer and Thoenig, 2017).
Apple is the leading brand in mobile industry of UK, it has great control over the market.
As mobile industry of United Kingdom has oligopoly market structure hence few big brands
control over entire sector and take pricing decisions. Small companies have to set their prices as
per the price range of these big brands. Small mobile companies have to face barriers to entry
into this market because of brand loyalty and financial condition of these firms. One of the most
important element is quality, as quality of Apple products are amazing that has made the brand
unique and popular globally.
Sony corporation had come into market in the year 1946, it offers financial, electronic,
games, mobile etc. services across the world. This is considered as oligopoly firm because output
or production generated by this enterprise is higher than others (Davidoff, 2016). It focuses on
producing such kinds of goods that can be used for personal consumption. This market structure
has affected the business in positive manner because company gets exclusive resource ownership
which make it unique from other brands. But there are other big brands such as Apple, Samsung
that offers high quality mobile or smartphones to consumers. Apple being an oligopoly firm
creates pressure on Sony in term of mobile products and this affect the sales of Sony mobile to
great extent (Tanger and Parajuli, 2018).
Laws of demand and supply, its impacts on business
This is the theory that states that there is close connection between demand and supply. If
availability of particular products is high or desire is also high, then it impacts on price range of
particular product. If supply is low and demand is high, then it increases prices whereas if supply
is high and demand is low then price of particular products gets down (Zhao, Zhang and Xie,
2016).
Law of demand
This law states that if there is high price of products then demand of quantity will get
down. People do not like to spend money in such products that have high prices because they fail
to spend more money on such products that create value for them by spending large amount on
such costly items (Cook, 2017).
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Figure 3: Law of Demand
(Source: ECONOMIC SUPPLY & DEMAND, 1996)
Law of supply
This law states that goods prices get increases if quantity supply is higher. That means if
products are available and firms are supplying the products timely then prices get fluctuated or
increase (Bas, Mayer and Thoenig, 2017).
Figure 4demand supply relationship
(Source: ECONOMIC SUPPLY & DEMAND, 1996)
There is great impact of supply and demand on prices of products and services. As demand
of mobile phones is very high in the UK market. UK is the nation where demand of mobile
phones has been reached to saturation point. But to meet this demand companies are managing
supply as well, this helps in keeping prices of products low. Due to high demand Sony mobile
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company enjoys more sells of its mobile phones that impacts on business in positive manner as it
supports in increasing revenue of business unit to great extent and help the firm in gaining
competitive advantage (Davidoff, 2016). Sony always ensures that it has adequate materials to
supply on time so that consumers interest can be raised and entity can make them satisfied
towards the organisation. In the year 2015 revenue of mobile industry reached to 1.9 trillion.
Increasing demand of products has raised opportunity for Sony also and firm has become able to
meet its profit maximisation objectives successfully.
Elasticity of demand and supply price and income
Price elasticity of demand and supply
Price elasticity of demand can be described as % of quantity demand changes / price
changes whereas price elasticity of supply is % of quantity supplied changes / price changes
Sony mobile company uses this element to determine is progress. Firm gathers all the
information related to changes in prices, after that this information is being used to calibrate
prices and to ensure profit maximisation. If there is changes in price, then company makes
changes in production because it defiantly affects the demand (Tanger and Parajuli, 2018).
Figure 5linear demand curve
(Source: Price elasticity of demand and price elasticity of supply, 2019)
Price elasticity depends more on prices of products and quantity is demanded. If there is
constant slop that shows linear demand curve. This reflects that price is high that means
qualitative is low.
But if prices get changed in tinny manner than it will raise demand hence it is called
infinitely elastic demand. If prices are nominal then demand is high but if there is high prices
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