Business Strategy Report: Evaluating Strategic Plans for TNT Express

This report provides a comprehensive analysis of TNT Express's business strategy, beginning with an introduction to business strategy and its importance. It delves into how TNT's mission, vision, objectives, goals, and core competencies affect its strategic planning. The report analyzes internal and external factors influencing TNT's strategic plans, including competitor analysis and market dynamics. It evaluates the effectiveness of techniques like SPACE and BCG matrix in developing strategic business plans. The report includes organizational and environmental audits, stakeholder analysis, and the development of a new strategy for TNT, along with alternative strategies and justifications. It assesses the roles and responsibilities for strategy implementation, analyzes resource requirements, and outlines SMART objectives. Finally, the report provides recommendations and conclusions based on the analysis, referencing relevant sources throughout.

Business strategy

Table of Contents
INTRODUCTION ..........................................................................................................................2
TASK 1............................................................................................................................................2
1.1 How business mission, vision, objectives, goals and core competencies affect strategic
planning .................................................................................................................................2
1.2 Analyse the factors that have to be considered when formulating strategic plans for TNT. 3
1.3 Evaluate the effectiveness of techniques that are used when developing strategic business
plan.........................................................................................................................................5
TASK 2............................................................................................................................................7
Organisational audit................................................................................................................7
Environmental audit...............................................................................................................8
Stakeholder Analysis..............................................................................................................9
New strategy for TNT..........................................................................................................10
Alternative strategies............................................................................................................11
Justification...........................................................................................................................12
Assess the roles and responsibilities of personnel who are charged with strategy
implementation ....................................................................................................................12
Analyse the estimated resource requirements for implementing the new strategy for TNT14
SMART objectives...............................................................................................................15
RECOMMENDATIONS...............................................................................................................16
CONCLUSION..............................................................................................................................16
REFERENCES..............................................................................................................................18

Illustration Index
Illustration 1: SPACE Analysis.......................................................................................................6
Illustration 2: BCG Matrix...............................................................................................................7
Illustration 3: Stakeholder Analysis...............................................................................................10
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INTRODUCTION
Business strategy refers to the various ways by which an organisation can effectively
achieve its objectives and goals. It also called as long term planning of the companies for
accomplishing their objectives in efficient manner. In this strategy is game plan of the firm's
management which is used for strengthening its performance and work efficiency. These
strategies include SWOT and PESTEL analysis. Business strategies are generally developed by
organizations for attaining different objectives in effective manner. These strategies play
important role in growth, development and success of an organization. The current research
project is based on Business strategy. Regarding this, it focuses on TNT express which is
operating its business in courier industry of UK. It is an international company which is engaged
in express and freight delivery service (TNT Express launches PharmaSafe, 2016). It includes
internal and external environment of the organization which are required for developing new
strategies of an organization (Åkerman, 2014). Along with this, it also shed lights on current and
future strategy of the company. Further, it includes different models and theories for developing
appropriate tactics for an organization. Including this, stake holder's analysis will also be
completed by this investigation. In addition, appropriate process of future strategic
implementation plan is also describing in the following paragraphs of the report.
TASK 1
1.1 How business mission, vision, objectives, goals and core competencies affect strategic
planning
Strategies have to be planned by keeping in mind the objectives of company. TNT has
kept their customers at the core of their strategies. Company makes sure that all the stakeholders
have been involved in the decision making. TNT follows a strategy map which aligns the entire
organisation together (Al-Ansaari and et.al., 2014). This makes sure that aims, objectives,
mission and vision are according to the strategies of entire organisation. Further, it is using
balance scorecard method and has been awarded for its exceptional performance in the industry.
Operational activities are linked with the strategy and it has shown remarkable growth for them
(Aversa and et.al., 2015). Their vision is to become the most admired company and increase their
sales. For this, they have made sure that proper plans are followed by all the departments in the
organisation to achieve desired goals. They have realised the importance of customers and
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various services which are provided to them (Baddache and Nicolai, 2013). So, they have
incorporated all these in their objectives and planned to accomplish it.
Identification of TNT’s mission, vision,
goals, objectives and core competencies
Explanation
Mission  Exceed customer’s expectation
 Deliver value to customers by
providing efficient and reliable
services
 Lead the industry by creating
values and taking responsibility
Mission of TNT is to provide
excellent services to its
customers. It has planned to
maintain the same level of
services across the globe.
Vision  To become the most admired
company in the industry
TNT has clear vision and it has
formulated strategies and plans
to ensure quality services.
Goal  Achieve 2% sales growth annually TNT has planned to expand
and attract more customers
constantly.
Objective  To achieve profitable growth
 To reduce carbon emission by 45%
till 2020
 Answer customer calls within ten
seconds
To maintain healthy
relationship with various
stakeholders and grow
business with sustainable
development.
Core competencies  Efficient transportation of goods or
documents
 Providing quality services
 Enhancing customer satisfaction
 Responsible behavior
 High caliber workforce
Strength of TNT lies in
attracting customers and
building high level of
workforce which meets
expectations of the customers.
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1.2 Analyse the factors that have to be considered when formulating strategic plans for TNT
High standard of services that TNT has been able to achieve is a result of its business
strategy. Strategic planning begins with the formulation of Mission and Vision statements. After
that, goals, objectives and aim of the organisation are decided (Dameron and Durand, 2013).
Further, current situation is accessed by considering the internal and external environment of
business. Important factors that have to be considered while formulating strategies are:
Internal factors: Such factors include employees, management, physical and financial
resources etc. These are very important and a strategy cannot be formulated without considering
these factors.
Support activities: These activities include infrastructure of the firm, skills needed in the
workforce, technology, assets and inventory (Doole and Lowe, 2008). A firm cannot develop a
strategy without taking all these factors into consideration.
Primary business activities: Primary activity of TNT is to transmit goods and provide
quality services to the employees. They have to ensure that customers are satisfied with the
services that are given to them.
External factors: Such factors which affect business are competition, preferences of
customers, economy, tariffs, rules, recession and inflation. Plans have to be altered by keeping in
mind the changes in business environment.
Strategic challenges and facilitators for TNT are:
 Fierce competition: TNT has been facing tough competition from DHL and Fed Ex
(Ferreira, 2013). As a result, they change continuously their strategies and plans to
remain competitive in the market.
 Growth of B2C: TNT is a B2B company and there has been a significant rise in direct
customer service. It is a major challenge for them because they have to include such thing
in their portfolio to remain competitive (Few and Few, 2013). Plans have to be altered
and this perspective of business has to be included.
 Slow growth in Europe: Growth rate has been slow in Europe and they have to look for
other opportunities for business. For that, TNT is planning to expand their business in
China and Brazil.
These factors have affected the business but there are some positive effects for the company
which facilities in the formation of strategies and plans. These are as follows:
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 Worldwide presence
 Cost efficiency
 Exceptional customer service
 Balance scorecard development
 Good relationship with customers
 Efficient technology
 Strong product portfolio
 Huge network
 Large market share
1.3 Evaluate the effectiveness of techniques that are used when developing strategic business
plan
Business strategies provide a direction and helps the business to achieve its goals. These
are generally long term in nature. TNT has been successfully performed their strategies in the
recent past and has been able to maintain its distinctive position in the industry. Techniques
which can be adopted for the development of strategic business plan are:
SPACE Analysis: This technique helps the organisation to formulate its future strategy
(SPACE Analysis, 2011). SPACE matrix in context of TNT Company depicts that it has to adopt
aggressive strategy in the business. It has strong position in the market and company has been
growing at a rapid pace. It has been providing its services in more than 200 countries of the
world. It has been performing excellent in terms of providing services and customers have been
loyal to it (Lin and et.al., 2013). Though it has some competitors and it is affected by the nagging
business environment but still an aggressive policy will be better for them. They should include
this while formulating their business strategies. In past years as well, they have been carrying out
the operation to gain competitive edge in the industry.
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BCG Matrix: Such matrix determines the position of company on the basis of its market
share and growth rate (Longoni and Cagliano, 2015). If TNT incorporates this technique in their
strategic plan then such will help in making it more effective. There are four categories in this
matrix:
 Cash Cows: These produce more revenues and consume less. They are ones which are
leader in the the mature market (Nuntamanop and et.al., 2013). Their value can also be
determined using the present value method as they generate a stable cash flow for a
company.
 Dogs: The dogs have low market share and low growth rate. They don't even consume
large amount of cash.
 Question Mark: They are those which grow rapidly in the market and they consume large
amount of cash. They have relatively low share in the market and generate low revenues
as well.
 Stars: They are very strong in the market and also generate large returns. Their growth
rate of very high as such they consume large amount of funds (Okereke and Küng, 2013).
A company's portfolio should have stars which will become cash cows in near future and
keep generating revenues for the company.
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Illustration 1: SPACE Analysis
(Source: SPACE technique, 2013)

At present, company is in stars stage which indicates that they are moving forward in
their business. Market share of the company is high and their overall growth rate is also high.
They have lot of investments in the market and more investment is also needed (Panicker and
Manimala, 2015). The BCG matrix can be a useful technique for TNT to develop its future
strategy. They are in a stage where they have to continuously remain competitive in the industry
otherwise their rival will take over. It is for the same reason that TNT has been expanding its
business and increasing their existing product portfolio.
TASK 2
Organisational audit
Organizational audit is a technique used by the management of a company to find out the
strengths, weaknesses and challenges associated with the business. It is very beneficial as it helps
an organisation to evaluate various factors that can affect it (Priego and et.al, 2014). All the
elements of micro and macro environment are taken into consideration. The best technique to
analyse the strategic position of TNT is SWOT analysis. The strength of the company lies in its
quality services which are provided to customers. TNT is a market leader in Europe and it
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Illustration 2: BCG Matrix
(Source: BCG Matrix, 2015)

provides services in more than 200 countries. The objectives and vision of the company is clearly
defined (Ritter and Gemünden, 2004). They use latest technologies and the has highly trained
workforce. The biggest weakness for them is the environmental aspect in which they work.
There are safety issues, transportation problems, punctuality and other environmental factors
which causes problems in their operations. Threats are also prevalent in the industry. The
competition level is very high and companies like DHL, FedEx etc are trying to capture the
market (Santos and Baptista, 2015). Furthermore transportation problems, security of the goods,
climate, transportation all have their influence in the quality of the service. Even though TNT has
to face lot of threats from the external sources but there is ample of opportunities for them. It is a
global company as such its has more opportunities to grow (Schrager and Madansky, 2013).
They can also expand to other countries like China and Brazil. The development of
communication system and transportation has allowed them to improve their service and make it
more quicker then before. The customers have been loyal to allow as a result they have huge
customer base (How to do SWOT, 2016). The customer services that are provided is one of the
best in the industry and this gives them the competitive edge that they want.
Environmental audit
An environmental audit helps an organisation to gather all the useful information about
the environment in which it is operating. TNT has its presence around the globe as a result it is
affected by all the global changes that are happening. PESTEL Analysis is an effective technique
to study all such factors (PESTLE Analysis, 2016). The political factors are of utmost importance
to them. Many nations does not support foreign identities in their countries and for a global
company this could be a problematic situation. Apart from this, economical factors such as
interest rates, exchange rates, inflation, demand and supply also affect the business. All these
factors play a vital role for a global company (Wagner and Svensson, 2014). TNT also takes into
consideration all the social factors during communicating, promotional and at the time of
delivery. Each country has its own culture, preferences and lifestyle and all of these have to be
included in PESTLE analysis. Technology can be also useful for improving the customer service.
The improvement in transportation, communication and innovative methods of delivery can
improve the quality of the overall services (Winnard and et. al., 2014). It is essential for the
company to adopt to new technologies and introduce innovation in its business activities
otherwise they will lag behind in the industry. The environment factors and the social
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responsibility of the company have to be considered in environmental audit. The world is
moving towards sustainable development and it is expected from all the organisations to
implement in their mission strategies as well (Robbins, 2016). The macro factors would be
incomplete if the legal element is ignored from it. Each country has its own legal framework.
They have different regulations and guidelines which have to be complied. TNT has to consider
all such legal necessities that has been laid down by the country in which it is operating
(Mozaffarian, 2016). The macro environment has major influence in the business of a company.
Therefore a proper understanding is required so as to ensure that the business is not affected by
it.
Stakeholder Analysis
Stakeholders includes all those people who are affected by the decisions of the company.
These include employees, customers, creditors, community, government and suppliers. When a
company is about to introduce a new strategy for its business, all the stakeholders have to be
considered at that time. For this a technique known as stakeholder analysis is used (Koda-Kimble
and Young, 2016). It is helpful in identification of key stakeholders and the effect on it during
the decision making. TNT Company is planning to adopt Growth Strategy in their business. It
will not only help them to expand but it will also ensure profitability in the company. In order to
incorporate this strategy in the business TNT has to identify its major stakeholder. For them
employees, customers and the community are the key groups (Longoni and Cagliano, 2015). The
next step is anticipate the influence on them if the company adopts to growth strategy. The
influence could be positive or negative. Finally, they have to develop plans for successful
implementation of the strategy (Ferreira, 2013). The biggest advantage of stakeholder analysis is
that the management gets the opinion of all the key stakeholders for a particular plan. This will
ensure quality as well as increased support for the decision. Furthermore, gaining support from
the most important stakeholder allows an organisation to gain more resources. This technique
would help TNT to implement the new strategy in the organisation (Ritter and Gemünden, 2004).
They would understand the benefits of the project and the reason behind adopting it is also
communicated to them. The company would also be able to anticipate the reaction of different
people towards the project. These stakeholders can be compelled to support the growth strategy.
Some of the people in the organisation has the power to block a particular project and if such
situation arises for TNT then the whole business would fail (Al-Ansaari and et.al., 2014). A
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company cannot continue its operations without he support of different people associated with it.
There has to be sustainable development in the organisation. They cannot afford to lose the
growth opportunity of the business just to keep the stakeholders happy. There has to be a proper
balance between the objectives of the company and the stakeholders (Mozaffarian, 2016). The
growth strategy is essential for them and it is not adopted then the competitors would take the
advantage of it.
New strategy for TNT
There are many strategies which are can be adopted by TNT to ensure its growth in the
long run. Their business has been growing at a rapid pace at the present moment but to ensure
that the same pace continues in the future they have to bring changes in the company. To resolve
this issue Ansoff matrix can be used (Okereke and Küng, 2013). This technique provides
alternative growth strategies keeping in mind the present and potential growth opportunities of
the company. There are four possible strategies that TNT can choose from. The best strategy for
them would be Market Development. This would allow them to grow and expand their business
in different parts of the world (Wagner and Svensson, 2014). It is already a global company as
such this strategy would be suitable for them. It will also help them in gaining the competitive
edge that is longing for. The low revenues in one region can be compensated by high revenue
from the other area. Furthermore, the quality and price would also become competitive because
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Illustration 3: Stakeholder Analysis
(Stakeholder Analysis, 2015)