Virgin Mobile: Evaluating the Contemporary Business Environment

This report provides a comprehensive analysis of Virgin Mobile's business environment, examining both internal and external factors that influence its operations. The internal environment is assessed using SWOT analysis, identifying strengths such as a strong brand image, global presence, and robust IT infrastructure, as well as weaknesses like poor marketing and operational issues. The external environment is evaluated through PESTLE analysis, covering political, economic, social, technological, legal, and environmental factors. Key opportunities include expanding in the cellular market and adopting new technologies, while threats involve high market competition and potential joint venture failures. The report highlights the importance of adapting to changes in the business environment to maintain competitiveness and ensure sustainable growth. Desklib offers this report to students along with a wide array of study tools and solved assignments.

Contemporary Business
environment

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Describing the internal environment of the company............................................................1
Examining the external impact on company:.........................................................................3
Micro economic and insights into mobile industry................................................................5
COCNLUSION................................................................................................................................7

INTRODUCTION
Business environment is the sum of internal and external factor which affect the business
in both ways. Therefore, changing at a fast pace are that changes which needs to be evaluated
and develop a strategy that In order to cope up with the changes. That is why, the company has
to develop logical and reliable business strategies that further supports the planning and helps to
take better decision as well. The chosen mobile company for this project is Virgin mobile which
is the wireless communication brand which offered the services at worldwide level. Further, the
entire report also highlights contemporary business environment and also helps to gain
knowledge related to same. Further, the present study describes different models used to
determine the internal and external environment of the company. Further, it also examines how
and why the selected firm needs to audit their external and internal business environment.
MAIN BODY
Describing the internal environment of the company
As the foundation of the organization's internal environment, which plays an important
role to shape the managerial behavior. It is quite important for the Virgin mobile to keep analyze
the internal business environment (which include culture, members, strength and weakness) that
directly influence the decision of the organization (Leiber, Stensaker and Harvey, 2018). That is
why, SWOT analysis is used that helps the business to determine the internal environment of the
company in order to identify its strength, weaknesses, opportunities and threats, these are as
mention below:
Strength: Virgin Mobile is one of the leading global mobile service providers and it
reflect that the company has a brand image at internal level. Further, the company operates at
different countries such that Australia, UK, Colombia, Ireland, Saudi Arabia, United Arab
Emirates, Poland, South Africa etc. Therefore it clearly shows that the company has a brand
image in the international level and serve its operations at world level (Nash, Manning and
Heiser, 2019). Another strength is, Virgin Mobile provide good service center and website which
has its own advance features that includes paying bills, recharge etc that ease the work of
customers which saves time as well. Moreover, the quoted firm also provide cheap call and data
rates that directly helps to attract wide range of customers towards it.
Virgin Mobile has a strong backing of Virgin group which increases the financial
performance of the company and also raise the brand image at internal market as well. On the
1

other side, Virgin Mobile also has a partnership with the leading telecom companies at
worldwide such as Sprint (USA) and Tata Teleservices (India) etc. Moreover, the company also
have a strong IT professionals who work with a great commitment in order to give the best
quality of services to their customers so that they will also provide the services or products which
actually customers needs (Menga and et.al., 2015).
Weaknesses: The company's marketing technique is so poor and that is why, it has a
limited brand visibility and awareness as compared to other leading global telecom brands. This
is consider as a weakness because it affect the brand image of the company in negative way as
well as its financial performance as well. Moreover, company also faces operational issue in
many countries such that India, Singapore that affect the brand image in adverse way. Moreover,
the company also have a lot of communication gap between every stakeholders and as a result,
the organization's operational performance got affected (McDONALD, 2016). On the other side,
the company have a bad transportation facilities which means that the products are not delivered
on time and as a result, it affect the overall market in opposite way. Thus, due to not having
effective promotional strategy, and operational issue affect the business In adverse way.
Therefore, it creates negative impression upon its customers as well.
Opportunities: The Virgin mobile is consider the fast expanding cellular market along
with tie- ups which further boost the brand image of a Virgin Mobile at international level.
Further, another opportunity or the company is to comply with the latest and low cost
technologies because it helps to boost the services and also run the business at further level of
success (Gürel and Tat, 2017). As per the modern trend or era, every company has to adopt the
advance technique so that it will helps to save the time and also assist for the smooth functioning
of a business. In the same way, quoted company has a brand image and good financial
performance, so adopting new and advance technique will also boost the services and raise the
brand image as well. In addition to this, another opportunity is more branding and visibility by
using joint venture in order to enter into new market so that it also grab further opportunities for
the future as well (Puyt, Lie. and de Graaf, 2017). Therefore, these shows the better future
opportunities which will leads the business towards further level o success.
Threats: The company faces biggest threat with high competition in the market such that
UK occupies the highest market share in the telecom industry, in which every company sell its
products and services at reasonable price in order to keep attracting wide range of customers. In
2

the same way, the market share of Virgin Mobile also declines due to competitor's low-price
offering. Therefore, quoted firm offer the product at high rates with the best quality and as a
result, it is quite essential for the firm to stay ahead in the competition by providing the low and
reasonable products rate (Phadermrod, Crowder and Wills, 2019). In addition to this, sometimes,
failure of Joint venture and then tie- up with other firm also affect the business profitability in
opposite way. That is why, it is not good for the Virgin Mobile to keep offering the best variety
of products in order to increases profitability. Beside this, company also faces the issue related to
reducing the customer base such that as quoted firm offer high rates services to their customers
and that is why, most of the user also port their numbers and as a result, it reduce the customer
base which is consider threat for Virgin mobile.
Examining the external impact on company:
In relation to undertaking the matter related to external factors, the issues which arise is
resulting to conducting the PESTLE Analysis. In these aspects, it is conducted to examined the
negative and positive impact on virgin mobile company through macro environment factors. It
includes the following such as:
 Political: In these aspects, the issues of the company are raised through lot of
involvement of government norms. As virgin mobile is one of the leading mobile
company in British and also carries accurate management by government. Thus, in this
perspective, the negative impact which is arises is resulting to not carrying the clear
financial report of the company management. As they are undertaking the business with
many other companies in form of partnership (Prajogo, 2016). Thus, in such aspects the
issue is raised regarding not clear of any of the records which is updated by company.
The positive aspects of external factors are resulting to carrying all such norms and
following regulation which is imposed by government. It also examined that they pay
taxes within stipulated time and thus managing the polices in effective way. The major
importance which is examined is relating to retaining the interest of the customer towards
the services which is offered by the virgin mobile. As they mainly deal in pre-paid
customer services.
 Economic: In respect of managing the economy in country, the major impact arises is
relating to fluctuation in rates in local and international market which resulting in
changes in company strategy. Another impact which arises through this perspective is
3

relating to facing the period of global recession. As in these aspects it carries the losses in
jobs which resulting in reducing the employment in business which affects the working
criteria and also resulting in cutting off the company crucial employees. The positive
impact of changes in exchanges rate is resulting in gaining more customer towards their
pre-paid customer services (Kozubíková, Homolka and Kristalas, 2017). As it is easily
affordable to the customer and also the tariff charges are less in respect of availing the
services of virgin mobile company.
 Social: Thee impact in context of social factors arises is relating to undertaking social
norms, culture or also the briefs regarding availing the services of virgin mobile. The
negative impact relating to social factors arises is in respect of carrying poor punctuality
services. As customer are not satisfy the services which is offered by them as the
complains raised in respect of not getting timely delivery of decision if any queries are
raised (Erasmus, Strydom and Rudansky-Kloppers, 2016). The positive impact which
results in growing the integrity of the virgin mobile is resulting to attracting the youth
interest towards designing the exteriors of the stores in trendy colors. As it is also
examined that they are focusing on building the high satisfaction level of employees at
work place which results in less discrimination between the employees in company.
 Technological: In recent times, due to changes in technology, virgin mobile is also
adapting the changes in frequent ways. Thus, the positive impact which raises is relating
to using the fastest network technology to reach to global level and build the strong
connectivity with the customer. As virgin mobile ifs the first company which offers free
voice mail services to the customer. Through the advancement in technology, they mainly
resulting to carrying the effective customer care services to resolve the issues of the
customer in better way (Leal, Avarello and Garcia-Perez, 2018). It is necessary that
customer queries are resolved and this can be undertaken by appointing the skilled and
trained person to handle the matter relating to technology in right manner.
 Legal: In these factors the impact which arises in business is relating to undertaking the
consumer laws, competition laws, health and safety laws and also data protection laws. In
this manner the negative impact which arises is relating to facing disputes between the
virgin mobile and T- mobile is relating to buying stakes in its joint ventures. Thus, it
resulting to affecting the reputation of the virgin mobile in respect of gaining advantages
4

to the company working (Shalhoub, Marshall and Ippolito, 2017). The positive impact
which arises is resulting to securing the right of the employees working under the virgin
mobile company. As the laws are imposed in respect of protecting the rights and interest
of employees and thus in such case their rights are protected under the consumer laws.
 Environmental: The impact arises in relation to changes in climatic condition or weather
changes. The negative impact which arises is resulting to carrying the various offers or
scheme in respect of changes in environment. As due to changes in environment, the
issues arise in relating to not getting proper network or services which resulting in
distracting the mind of the customer towards the virgin mobile company (Zaldivar and
et.al., 2018). Thus, in such manner the native impact of the environment changes occurs
which affect the integrity of the business to sustaining their company at global level. The
positive impact arises due to changes in weather condition is that they can organize or
deal in events or any other programs in which they make familiar to customer regarding
saving paper. As the minute things which is examined once the incident happens and thus
due to occurring changes in environment, they came to know about the importance of the
resources and its necessity to maintain growth in country for longer way.
In relation to linking up the matter with the internal matter it is examined that in context
of strength, it is mainly adapted through undertaking the political factors as Virgin mobile is
carrying all the polices and norms which is imposed by government. Thus, they are paying taxes
within the stipulated time period and also following the national and international rules in right
manner (Sadgrove, 2016). The weakness which is examined is relating to social factors as they
are lack punctual in following the values and brief in effective way. In context of opportunities, it
raised in respect of grabbing the advanced technology through promoting the free voice mail
services at global level. The threats which is raised is relating to legal factors as due to carrying
the strict norms and regulation resulting in distracting the intertest of the employees at work
place. Employees can easily distract the interest towards the business and switch to different
company at same post.
Micro economic and insights into mobile industry
The concept of Micro economics can be defined as that aspect o economics that takes into
purview the factors that are related to an individual unit in a market rather than the entire market
(Gardere, Sharir and Maman, 2018). It is therefore, a study of economics at a micro or small
5

level where the choices and decisions taken by individuals in the market are evaluated and the
reason for such behavior is established in a rational and logical manner. Market here refers to the
place where products and services are sold and purchased and under micro economics there are
many factors and concepts that can be used to analyze the choices that are being made by the
consumers in the market place:
Demand and Supply: Demand here signifies how much is the demand for a particular product in
the market and supply signifies the quantity of goods that is currently supplied in the market.
Both of these are main driving forces behind price determination because when demand for a
good increases, its supply decreases and price increases (Iossa and Martimort, 2015). Similarly,
if the demand for a good decreases, then automatically, its supply in the market increases and
price of that good falls in the market. These two forces demand and supply are dependent on
each other and therefore the movement of these two is the key factor behind determining at what
price the product should be plced i.e. the amount which customers are willing to pay. When both
of these reach a common point, then consumer is known to be at equilibrium i.e. when the
demand of a product becomes similar to the supply, then they both intersect each other and the
price which is charged at that moment is referred to as equilibrium pricing.
In the mobile industry of UK, the demand for the mobile has continuously been on rise
and there are more and more customers who have been trying to own a mobile phone so that they
can depend on a more reliable method for connectivity (Khan, Alam and Alam, 2015). The
Virgin Mobile, which are one of the highly reputed brand in UK is also a major trader in this
market and both the prices of mobiles and its demand has been increasing in UK’s market.
However, in the recent years, with the advent of more modern technology, it can be seen that
there are other consumer electronic devices that are fulfilling the requirements of a phone but are
also giving additional features which has ultimately impacted the goods demanded in the mobile
industry of UK. Therefore, these factors of demand and supply are an important part of
microeconomics on which whole micro economics is based.
Oligopoly: Oligopoly can be termed as market situation under which there are a limited number
of firms who form a cartel or a group together thus making it difficult forms to enter the industry
in which they are operating and also they are able to control the market or the industry in the
manner of price control and regulation and therefore this kind of control over the market makes it
very difficult for the new entrants (Prajogo, 2016). Usually in this type of market there are a
6

limited number of firms but these are operating at larger level and this is the reason they have
adequate power to regulate the entire industry by forming a cartel (Deasy and et.al, 2016).
Oligopoly constitutes a major part of micro economics and details the control over prices and
competitive market in which the industry is operating. Similarly, in mobile industry as well,
there exists an oligopoly market because the industry satisfies all three conditions that are
necessary to term a market as oligopoly i.e. the entire industry is dominated by a few firms i.e.
Apple, Samsung, Xiaomi, Oppo etc.; all of these firms are selling the mobile phones and lastly,
there are a significant amount of barriers to enter the mobile industry as well. Therefore, it can be
adequately said that in UK as well there exists an oligopoly market in the mobile industry since
these are the top sellers of mobile phones that fall within similar price range and have similar
features (Provencher and Ramnarain, 2019). Virgin mobile is able to garner profit from this
situation as it helps the company in selling their mobile phones without compromising o the
price and hence be able to utilise larger profits. Thus oligopoly helped in analyzing another
aspect of microeconomics in the mobile industry of UK.
COCNLUSION
The entire research conducted above helps in concluding that business environment plays a
significant role in determining how an industry is operating in a particular market. Initially in this
report, a SWOT analysis was performed that helped in determining what are the strengths and
weaknesses of the internal environment in which the selected firm Virgin Mobiles was operating
and why it was important to gain insight into this aspect of the business environment. This report
also evaluated the eternal business environment by analyzing the mobile industry of UK by
conducting a PESTLE analysis which helped in determining and analyzing different factors that
are associated in the external environment and their impact on the mobile industry of UK. Lastly,
in this report, analysis was also done on the microeconomic factors and components such as
Demand, Supply, Oligopoly market where the relevance fo these terms was identified and then
its importance in the mobile industry of UK was detailed.
7

REFERENCES
Books and Journals
Leiber, T., Stensaker, B. and Harvey, L. C., 2018. Bridging theory and practice of impact
evaluation of quality management in higher education institutions: a SWOT
analysis. European Journal of Higher Education. 8(3). pp.351-365.
Nash, M. M., Manning, M. R. and Heiser, E. J., 2019. Applying Lewin’s Force Field Theory to
facilitate SWOT analysis: an effective and efficient approach. In Preparing for High
Impact Organizational Change. Edward Elgar Publishing.
Menga, E. and et.al., 2015. Ranking alternative strategies by SWOT analysis in the framework
of the axiomatic fuzzy set theory and the ER approach. Journal of Intelligent & Fuzzy
Systems.28(4). pp.1775-1784.
McDONALD, M. A. L. C. O. L. M., 2016. Strategic marketing planning: theory and practice.
In The marketing book (pp. 108-142). Routledge.
Gürel, E. and Tat, M., 2017. SWOT analysis: A theoretical review. Journal of International
Social Research.10(51).
Puyt, R. W., Lie, F. B. and de Graaf, F. J., 2017. Contagious ideas and cognitive artefacts: the
SWOT Analysis evolution in business.
Phadermrod, B., Crowder, R. M. and Wills, G. B., 2019. Importance-performance analysis based
SWOT analysis. International Journal of Information Management. 44. pp.194-203.
Deasy, S. and et.al, 2016. Controlling use of a business environment on a mobile device. U.S.
Patent 9,247,042.
Gardere, J., Sharir, D. and Maman, Y., 2018. Consulting and Executive Coaching on Future
Trends: The Need for a Long Term Vision with Apple and Samsung. International Journal
of Business and Social Science, 9(3).
Iossa, E. and Martimort, D., 2015. The simple microeconomics of public‐private
partnerships. Journal of Public Economic Theory. 17(1). pp.4-48.
Khan, U.A., Alam, M.N. and Alam, S., 2015. A critical analysis of internal and external
environment of Apple Inc. International Journal of Economics, Commerce and
Management, 3(6). pp.955-961.
8

Prajogo, D.I., 2016. The strategic fit between innovation strategies and business environment in
delivering business performance. International Journal of Production Economics, 171.
pp.241-249.
Provencher, A. J. and Ramnarain, S., 2019, October. Class Debates in Intermediate
Microeconomics: Social Economics and Pluralist Perspectives. In Forum for Social
Economics (Vol. 48, No. 4, pp. 354-372). Routledge.
Prajogo, D. I., 2016. The strategic fit between innovation strategies and business environment in
delivering business performance. International Journal of Production Economics, 171,
pp.241-249.
Kozubíková, L., Homolka, L. and Kristalas, D., 2017. The effect of business environment and
entrepreneurs’ gender on perception of financial risk in the smes sector. Journal of
Competitiveness.
Erasmus, B., Strydom, J. W. and Rudansky-Kloppers, S. eds., 2016. Introduction to business
management. Oxford University Press Southern Africa.
Leal, X., Avarello, A. and Garcia-Perez, A., 2018, December. Unveiling the Potential of ITS:
Market Research Analysis. In Data Analytics: Paving the Way to Sustainable Urban
Mobility: Proceedings of 4th Conference on Sustainable Urban Mobility (CSUM2018),
24-25 May, Skiathos Island, Greece (Vol. 879, p. 233). Springer.
Shalhoub, J., Marshall, D. C. and Ippolito, K., 2017. Perspectives on procedure-based
assessments: a thematic analysis of semistructured interviews with 10 UK surgical
trainees. BMJ open, 7(3), p.e013417.
Zaldivar, I. and et.al., 2018, May. Unveiling the Potential of ITS: Market Research Analysis. In
The 4th Conference on Sustainable Urban Mobility (pp. 233-240). Springer, Cham.
Sadgrove, K., 2016. The complete guide to business risk management. Routledge.
9