Lloyds Bank: Macro and Internal Environment Analysis Report

This report provides a comprehensive analysis of Lloyds Bank's business strategy. It begins with an introduction to business strategy and its importance for organizational growth. The first task involves a PESTEL analysis to examine the macro-environment, including political, economic, social, technological, environmental, and legal factors impacting Lloyds Bank. The second task utilizes the VRIO framework to assess the internal environment and capabilities, focusing on value, rareness, imitability, and organizational aspects. The report then explores Porter's five forces model to evaluate the competitive landscape. Finally, it culminates in a strategic management plan, incorporating the application of theories, concepts, and models to develop strategic priorities for Lloyds Bank, ensuring its competitive edge and market position. The report emphasizes the importance of strategic planning for success.

Business Strategy

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Appropriate framework to analyse macro environment for organisation.............................1
M1 Analyse macro environment to determine and inform strategic management decisions.....3
TASK 2............................................................................................................................................3
P2 Appropriate framework to analyse internal environment and capabilities of organization...3
M2 Analysis of internal environment to asses strengths and weaknesses of organization.........5
TASK 3............................................................................................................................................6
P3 Porter’s five forces model to evaluate the competitive forces of a given market sector.......6
M3 Devise strategies to improve competitive edge and market position based on outcomes....8
TASK 4............................................................................................................................................8
P4 Application of theories, concepts and models to interpret and devise strategic planning....8
M4 Strategic management plan that has strategic priorities.....................................................10
CONCLUSION..............................................................................................................................10
REFERENCES .............................................................................................................................12

INTRODUCTION
Each and every organization that wants to grow and need to gain larger market share then
it is required from them that they should conduct all activities in most appropriate and systematic
manner then a strategy should be framed and followed. Business strategy is helpful in conducting
all future task in systematic way so that all targets should be fulfil in limited period of time. This
type of action is helpful in gaining greater profit and larger market share in industry (Aharoni,
2015). Present report is based on Lloyds Bank which is famous and popular enterprise
established in UK. Business strategy are useful in optimum utilisation of all resources like
natural, financial etc. and this could be done by placing all resources in very effective place
where all source could be used on maximum. When all activities and task are done with
maximised efficiency then it is a capability of person that he/she have sufficient capacity to
formulate and implement business strategy.
TASK 1
P1 Appropriate framework to analyse macro environment for organisation
Management of every corporation require to have accurate and complete information
about market conditions which help them to acknowledge needs and wants of public. This help
them to design system and conduct activities to provide items and services in respect to
consumers requirements. PESTEL analysis is appropriate tool which is used by administration to
execute market research and survey to anticipate position and image of Lloyds Bank in market.
Political factors: This concept define that government formulate laws and act to regulate
and manage functioning of organisations. Administration require to make policies and strategies
in according to authority of country in which business is conducting operations. In Lloyds Bank,
management have make policies and tactics in according to regulatory bodies. This help firm to
make system function adequately and according to market situations (Ghosal, 2015). Authorities
require to take care that business operations are executed effectively and legal procedure is
followed by seniors.
Economic factors: This element specifies that interest and exchange rate, inflation are
various components which vary from one nation to another. Lloyds Bank is having branches
established in different nations which help administration to have large customer base. For this,
companies require to conduct operations and activities adequately.
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Social factors: This component define that organisation require to deliver different
variety of items and services in respect to needs and wants of public. It is necessary that
administration execute operations which help them to produce quality things and provide option
to consumers to make them purchase products in according to their taste and preference.
Management require to utilise funds efficiently and organise business work which help them to
deliver appropriate items and services in market (Higgins, Omer and Phillips, 2015).
Technological factors: This element specifies that management require to implement
appropriate tools and techniques in system so that adequate items and services are delivered in
market. It is essential that adequate technologies are used by members which help seniors to
utilise material efficiently and make employees perform tasks effectively. In Lloyds Bank,
management keep updating technologies and use software which help firm to deliver quality
services to clients. Along this, members be able to give things in respect to needs and wants of
people which benefit enterprise to improve market image of Lloyds Bank and position it higher
than other rival firms.
Environmental factors: This tactic defines that management require to take care and
design system and implement tools and techniques which help organisation to use natural
resources properly. Lloyds Bank consists latest technologies which help management to use
material adequately and deliver appropriate things in marketplace. With advancement in
technology, computer is best tool which helps organisation to keep record of clients and organise
activities propelry. Along this, seniors main responsibility is to deliver adequate things in
marketplace in according to needs and wants of people (Kalyani and Sahoo, 2011).
Legal factors: This component specifies that various laws are formulated by government
in respect to equality, discrimination, employment. Employer of Lloyds Bank have adequate
manpower so business operations are executed appropriately. Their main duty is to provide
duties to members on basis of their skills and abilities. Along this, workforce are given future
opportunities and compensation in respect to their performance and outcomes. This benefit
management to enhance market position and retain skilled and competent people for longer
period.
Thus, management of Lloyds Bank conducts PESTEL analysis to get information about
government legislations, technology, economic conditions, needs and wants of public,
environment tactics and legal procedure. Lloyds Bank is able to construct strong position in
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market as firm has latest tools and techniques implemented in system; so clients are give quality
services and quickly. This help administration to make system function effectively and deliver
appropriate items and services in according to demands of public. Thus, management is able to
attract large number of people; thereby enhance sales and profitability (Bucolo and Matthews,
2011).
M1 Analyse macro environment to determine and inform strategic management decisions
Seniors require to make system function effectively and utilise resources such as
material, machine and manpower efficiently. Business operations have direct or indirect impact
from elements which are present in macro environment, so it is essential that management design
system and implement tools and techniques which help firm to deliver appropriate items and
services in marketplace. Administration require to formulate policies and strategies in according
to rules and regulations of government. Along this, members require to get duties and targets on
basis of their skills and abilities which help superiors to make them perform tasks effectively and
complete objectives within specified time. Management involve members in deciosn masking
process which benefit firm to make appropriate judgements and select alternatives which are
advantage for functioning of organisation.
TASK 2
P2 Appropriate framework to analyse internal environment and capabilities of organization
Administration require to have complete information about system and it abilities in
respect to organise and conduct activities according to market conditions. It is essential that
management have adequate material and manpower so that appropriate things are manufactured
in respect to needs and wants of people. SWOT analysis is one of technique which is used by
seniors of Lloyds Bank to acknowledge strengths and weaknesses of system (Köseoglu and et.
al., 2013). Along this, market research help management to anticipate opportunities and threats;
thereby make system function effectively. Besides this, VRIO framework is another tactic that is
used by administration of Lloyds Bank to analyse intrinsic components and get true image of
capabilities of system.
VRIO framework: This concept includes four components which are Value, Rare,
Imitable and Organisation. This model was developed by Jay B. Barney which states that
administration require to have complete information about resources. Finance, material and
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manpower are various components which are computed by seniors to acknowledge capabilities
of system. This help company to execute operations and produce adequate products in respect to
demands of people. Management of Lloyds Bank uses this approach to have accurate
information about internal environment. By analysing conditions and situations that are
prevailing in market helps seniors to design system and conduct activities effectively. This help
enterprise to organise activities and deliver appropriate items and services in marketplace in
according to needs and wants of people. These are various aspects that are analysed by seniors to
design system and perform activities properly are stated beneath:
Value: This component defines that management require to anticipate that resource
includes appropriate value so that operations are executed properly. It is essential that
supervisors examine system capabilities by examining usefulness of material and their worth in
respect to market conditions. Lloyds Bank require to have adequate equipments which help
management to provide quality and appropriate services to clients. Seniors main responsibility is
to find if resources are being left unused, thereby add new activities and select alternatives where
material and workforce can be transferred. Employer have skilled and competent staff members
which perform activities effectively and have ability to take challenges and function
appropriately (Murano and et. al., 2011).
Rareness: This tactic specifies that organisation have various components which are in
limited number, so management require to use appropriate tools and techniques. It is essential
that business operations are executed effectively which help firm to provide items and services in
according to needs and wants of people. Management of Lloyds Bank prime duty is to utilise
funds efficiently and take care that enterprise have adequate material and manpower. This help
firm to provide quality services and timely deliver things in respect to demand of public.
Company require to construct things and manufacture items which help seniors to grab attention
of large number of people by provide them unique products. Along this, Lloyds Bank even
require to use resources efficiently which help firm to compete with rival brands and position
higher than competitors (Jocovic and et. al., 2014).
Imitable: This aspect define that management main responsibility is to use resource
efficiently and produce appropriate items and services in according to needs and wants of people.
It is necessary that seniors design products in such manner that other firm are not able to copy
and produce identical things. For this, administration have option to take license from
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government and register techniques, products and services. This help Lloyds Bank to secure
software and organise activities effectively. Superior are able to provide adequate services to
clients, thereby retain them for longer period. Along this, as bank system consists information
about personal information about people and other data. For this, management require to secure
data and other important things from being used by other firms.
Organisation: This tactic specifies that firms require to have adequate resources in
according to make system function effectively. Management main responsibility is to have
appropriate funds, material and manpower so that business operations are executed properly.
Lloyds Bank provide quality items and services to clients to retain them for longer period by
giving them good experience. Employer duty is to have skilled and competent members which
help firm to provide things in respect to demands of people. This help superiors to grab attention
of large number of people; thereby enhance sales and profitability (Lueg, Pedersen and
Clemmensen, 2015).
Thus, VRIO model defines that Lloyds Bank will be able to establish competitive
advantage over rival firms only if they use resources adequately. Management main
responsibility is to utilise material and have skilled employees which help firm to deliver
appropriate items and services in marketplace. For grabbing attention of large number of people
and position higher than competitors, management require to organise activities effectively and
prove unique things and items to clients (Oestreicher-Singer and Zalmanson, 2012). Lloyds Bank
have valuable and rare resources which are designed and used in such manner that other
organisations are not able to copy their things. This help management to enhance market position
and reputation by delivering adequate items and services in market in according to needs and
wants of people. With use of effective resources, seniors of Bank is able to make system function
effectively and handle situations appropriately; thereby deliver appropriate things in market.
M2 Analysis of internal environment to asses strengths and weaknesses of organization
Management require to have accurate information about capabilities of system. This help
administration to acknowledge potentialities in respect to organise business operations to utilise
market opportunities and deliver items and services in according to needs and wants of people.
Along this, superiors even require to have information about weaknesses of system which help
them to make modifications in system and implement modern tools and techniques to handle
market situations and deliver things in respect to demands of public. VRIO framework is
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appropriate technique that is used by seniors to have complete information about importance of
resources in business. This also informs management about material and manpower which are
rare and have ability to get imitated by rival firms. Thus, superiors require to organise activities
and use resources effectively; thereby deliver adequate things to people and generate sufficient
revenue from business.
TASK 3
P3 Porter’s five forces model to evaluate the competitive forces of a given market sector
This can be refer as the strategic tool of management to evaluate and understand various
industry element. Lloyds Bank Group manager can utilise this method for developing a proper
strategy and reviewing the profitability for emphasising the competitive edge of enterprise for
longer period. Here are mentioned some of its basic aspects briefed under:
PORTER'S FIVE FORCES
Threat of New Entrance: In comparison to the new entrance, the market has medium
new entrance threat in business and Lloyds Bank Group successful in achieving the consumer's
potentiality. It is required to understand and analyse the weakness of organisation, this is
essential for new enterprise to achieve their success in contrast of existing banks. This is
essential for new entrance of market to carry out proper economies of scale and lower their fixed
cost of services and products effectively. Also this is required for them to properly investigate
their market through the assistance of research and development procedure (Smink, Hekkert and
Negro, 2015).
Bargaining Power of Supplier: Approximate entire Foreign Money Bank Centre
purchase raw resources from various suppliers. Hence, it can claim that supplier has dominant
place that can decrease the Lloyds Bank Group margin which can help in earning more in
market. This is essential for organisation to handle the supplier issues which can help in
achieving their business objectives. Hence, it can be claimed that supplier has high power of
bargain in UK which poses Lloyds Bank a threat as well as other main financial operator
(Leonidou and etl al., 2015).
Bargaining Power of Buyer: Buyers are generally demanding in nature for whom
organisation provide numerous service at lower cost. Lloyds Group of Bank have higher
bargaining power of their consumer and higher ability to persuade their discounts and increasing
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offer in more efficient and effective manner. This is required for organisation to create more
large consumer group in order to reduce the bargaining power of consumer and deliver more
opportunities of organisation to their production process and sales. Also new services can assist
in decreasing the defection of existing Lloyds Group of Bank customer to their competitors.
Substitution Threat: When service or product meet an equivalent consumer demand in
distinct manner, profitability of industry suffer. In context of Lloyds Group of Bank, the
substitution threat is higher if this deliver a proposition of value which is distinct uniquely from
other present industry offering. Company can manage their substitution threat through being
more service oriented beside being more product oriented. Through increasing more switching
consumer cost, organisation can achieve their business objectives and dominate the market
among substitutions (Klettner and Boersma, 2014).
Rivalry among Competitor: In case of intense existing rivalry in industry, the cost will
drive adverse and decrease in overall industry profitability can be observed within the market.
Hence, this can be noticeable that Lloyds Group of Bank function in more Foreign Money Bank
Centre in industry. Hence, this can be claimed that competition does undertaken value on entire
long term performance and profitability of organisation. Through creating a sustainable
differentiation, organisation can achieve their business objectives and compete the rivalry in
better manner (Johnson, 2016).
Therefore, management of Lloyds Bank have adequate funds, material and manpower
which help them to organise business activities in according to market conditions. It is essential
that superiors have accurate and complete information about needs and wants of public. Along
this, seniors even require to have knowledge about rival firms offerings. This help enterprise to
organise activities accordingly and provide things in according to requirements of people.
Management have healthy relations with suppliers which help Lloyds Bank to have
adequate resources available in respect to needs and wants of people. Administration even
require to formulate adequate strategies and tactics to make system function in according to
market situations. Along this, they even require to implement latest tools and techniques in
system which help firm to deliver quality items and services to clients. This help company to
enhance market position and goodwill by providing quality things to people and at appropriate
rates. Thus, seniors are able to compete with rival firms by establishing branches in different
nations which helps them to increase customer base; thereby enhance sales and profitability.
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M3 Devise strategies to improve competitive edge and market position based on outcomes
In every organisation, management require to make system function effectively and
organise activities such that appropriate items and services are delivered in marketplace.
Administration require to have adequate resources such as material, machine, funds and
manpower in respect to market situations. Along this, they even require to formulate appropriate
tactics, policies and strategies in respect to conduct business activities effectively. This helps
management to give adequate guidance and instruction to members in respect to duties and
targets assigned to them by seniors. Skilled and competent members perform tasks effectively
and provide appropriate items to people. Superiors establish competitive advantage over rival
firms by designing appropriate tactic and strategy for firm. Along this, management require to
produce unique and innovative things which help firm to grab attention of large number of
people. Administration is able to enhance market position and reputation by providing quality
items and services to clients. Thus, company is able to compete with rival firm easily by making
system function effectively.
TASK 4
P4 Application of theories, concepts and models to interpret and devise strategic planning
Strategic direction are the processes and methods through which firm an achieve the
objectives and goals. It is responsibility of manager to give proper directions to firm so that they
can take perform effectively and efficiently (Brewster, 2017). Thus as a result they can easily
accomplish their targets. Hence firm uses a strategic model so that they can investigate various
elements. Strategic model used by Lloyds Bank:
Bowman's strategic clock model: It is an effective and useful model used by the
organization. It is crucial so that all employees can perform in a better manner and thus they can
easily accomplish their objectives and targets. It was created by David Faulkner and Bowman so
that they can attract many customers in firm. It includes various steps which are described below:
Position 1: Adverse added value and cost: This is the step that is not be taken as part
of competitive advantage so that in all activities and task in businesses. According to client
thinking and opinion there is low prices of all items. Through this it negatively affects the
activities and task of the business (Budayan, Dikmen and Birgonul, 2015). If there is case of
Lloyds Bank position is stronger and there is high reputation of this bank so hence it can give
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strong competition to other companies. Through this it is a strong condition for bank and thus it
can earn more revenues. Thus it can give strong position over other firms.
Position 2: Adverse price: It is second position in which bank sets prices for all policies
and plans which it can give it to customers. Through this it can set effective prices for all their
plans and polices. Bank can evaluate the demand and requirements of all users and thus it can
create stronger position in the firm. Through this it can set prices according to their demand and
their needs which is very suitable and convenient to all users. For example costs of all policies
and plans are low which is according to customer' suitability and through this bank can earn
more profits. Hence they can maintain distinct identity in the market (Grover and Kohli, 2013).
Position 3: Hybrid: In this situation there is maximum costs and products are also
different. But the bank mainly focuses on thinking and opinions of all users and then it can give
their policies and plans at suitable rate. They tries to give more interest on their plans and
policies. Through this it can increase the level of customer satisfaction and this they can enhance
their revenues. Thus through this effective and efficient approach firm can easily maintain strong
position in the market. Hence as a result there is good image in market a week as in minds of all
users.
Position 4: Differentiation: Under this step banks can differentiate plans and policies
with the competitor. They can provide all plans and policies which gives higher returns to all
customers as compared to all rivals. Thus as a result they can attract many users towards this
bank. Hence it can result in increases the customer satisfaction. Thus it also helps the bank in
increasing the image of bank in various nations. Hence they can create strong brand loyalty. So
thus it is easy to maintain brand equity in market. Through these steps it can maintain
competitive edge on other companies (Aharoni, 2015).
Position 5: Focused differentiation: Bank can provide differentiated plans and policies
which give best returns as compared to other firms. It is mainly targetted to age group between
21 – 40 years of age. For example bank has introduced a mutual fund policy which helps in
giving higher return to al customers. Through this it can earn more revenues. Hence it can
maintain good image in front of all users. Hence they can increase their reputation and thus it can
maintain brand loyalty in different nations. Existing users can give reference all new customers.
Through this it can increase the reputation among all users.
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Position 6: Dangerous high margins: It is very risky situation for firm. In this step bank
can give policies which can give higher interest rates and they do not provide extra
differentiated plans and policies as compared to other rivals in the market. Thus as a result they
do not give returns of mutual find policies. For example they has told a scheme of mutual fund
and give low returns which is not suitable and appropriate for the firm. Thus as a result they
cannot satisfy customers. Though this it is tough competition to other companies. Hence as a
result they cannot maintain competitive advantage over other firms (Ghosal, 2015).
Position 7: Monopoly pricing: In this situation bank has a monopoly and thus it can set
prices according to wants and needs of all users. Hence as a result they cannot give added value
in their plans and policies. According to this they cannot maintain strong position in minds of all
users. Through this it leads to reduction in profits. Hence as a result it canst maintain good
image among all users and in market.
Position 8:Loss of market share: In this stage bank has given higher or lower returns on
all policies and plans to all customers. They had not evaluated the customer perception so thus
they has proved policies with low customer perceived value. Through this they cannot maintain
good position in minds of all users. Hence as a result they cannot attract many users as compared
to various competitors (Higgins, Omer and Phillips, 2015).
M4 Strategic management plan that has strategic priorities
It is a plan that interacts with different objectives and goals to employees . It consists of
various components which are used by Lloyds Bank. First step is Mission and plan in which
Bank has told employees that its main vision is to increase the customers satisfaction and to
maintain strong position in market. Second is overarching strategic results. Third is strategic
theme is created by bank. Fourth is bank can evaluate it own performance. Fifth is it can create
core values and guide to all employees regarding different principle and leader can take various
decision to motivate all employees.
CONCLUSION
This report is summarised as a company should analyse all macro environmental factors
so that appropriate market situations could get analysed and for this PESTLE analysis is suitable.
VRIO framework is best suitable in making analysis of internal atmosphere that an association
have on which task conduction depends. This help management to organise activities effectively
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and deliver items and services in respect to needs and wants of people. It is essential that
organisation have adequate resources i.e. material, funds and manpower which help superior to
produce appropriate items in according to requirements of consumers. As, every industry have
numerous firms which are providing similar nature items; so it is necessary that appropriate
things are delivered in market. In order to gain knowledge about business position and rivalry
then association can use Porter's Five Forces Model. This approach helps management to
establish competitive advantage over rival firms; thereby enhance market image and reputation.
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