Comprehensive Business Strategy Report: Virgin Mobile Network Analysis

This report provides a comprehensive analysis of Virgin Mobile's business strategy, focusing on the influence of the macro environment, internal capabilities, and the telecommunication sector. It employs various strategic models such as PESTLE, Ansoff's Growth Vector Matrix, VRIO, SWOT, and Porter's Five Forces to evaluate Virgin Mobile's competitive positioning and strategic decision-making. The report examines the impact of political, economic, socio-cultural, technological, legal, and environmental factors on Virgin Mobile's business strategy. It further assesses the organization's internal environment using the VRIO model to identify valuable, rare, inimitable, and organizationally supported resources. The analysis of the telecommunication sector through Porter's Five Forces highlights the competitive dynamics, including rivalry, bargaining power of buyers and suppliers, and threats of new entrants and substitutes. Finally, the report interprets Virgin Mobile's strategic direction using Bowman's Strategy Clock, offering insights into its competitive advantage and market positioning.

BUSINESS STRATEGY

TABLE OF CONTENTS
Introduction......................................................................................................................................1
Task 1...............................................................................................................................................2
P1, M1 Analyze the impact and influence the macro environment has on Virgin mobile
network and its business strategy................................................................................................2
Task 2...............................................................................................................................................6
P2, M2 Conduct and assessment for organization’s internal environment and its capabilities...6
Task 3.............................................................................................................................................10
P3, M3 Analyze the telecommunication sector.........................................................................10
Task 4.............................................................................................................................................13
P4, M4 Interpreting and understanding the strategic decision..................................................13
Conclusion.....................................................................................................................................16
References......................................................................................................................................17

LIST OF FIGURES
Figure 1: Virgin mobile network.....................................................................................................2
Figure 2: PESTLE analysis..............................................................................................................4
Figure 3: Ansoff's growth vector matrix..........................................................................................5
Figure 4: VRIO model analysis.......................................................................................................6
Figure 5: SWOT analysis.................................................................................................................9
Figure 6: Porter's five forces model...............................................................................................10
Figure 7: Bowman's strategy clock................................................................................................14

Introduction
Business strategy refers to the process of knowing the organization summary, which includes the
business objectives, sustainability in meeting the competitive benefits and customer expectations.
To understand the objective of Virgin mobile network business strategy the report has been
made. The report will discuss about the external environment of knowing the business strategies
of the Virgin mobile. This will show the various model to gather the business strategies of the
organization. The report will also study about the internal environment of the organization and
its capabilities. The report will also show the analyses on the telecommunication sector using the
Porter’s five forces model and applying strategies to bring improvement in competitive edge and
better positioning of the organization into the market. At last the report will interpret the strategic
direction using Bowman’s strategy clock model to calculate the strategic direction of the
organization.
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Task 1
P1, M1 Analyze the impact and influence the macro environment has on Virgin mobile network
and its business strategy
Business strategy is organization’s operational plan for achieving its objectives, optimising the
financial performance and vision using its business model. There are many factors including
external factors which influence the financial position of the organization. For analyzing the
impact various matrix and model should be managed by the Virgin Network Operator. The
Virgin Network is the first mobile operator launched in 1999. It does not have its own network
but have the contract of using the network of EE (De Castro, et.al, 2014).
Figure 1: Virgin mobile network
(Source: Daniel Tyson, 2017)
Before using different models it is very essential to understand the proper meaning of macro and
micro environment which are regularly operating into the environment. Micro environment are
those factors which affect the position of the organization internally and can be controlled by
themselves. On other hand, macro environment are the factors which affect the firm externally
and cannot be controlled and managed by organization at full extent. For better functioning and
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performance, environmental analyze of each and every strategy must be done using PESTLE
model and Ansoff’s growth vector matrix.
PESTLE Model for Virgin Mobile Network
Political Factors – The political factors includes infrastructure and regulations elements. The
rules and regulations are very tight in case of developing mobile networks everywhere as it may
harm humans and children which cause direct impact on their health. For making proper
infrastructure for its organization the authorities have to take prior permission from the ruling
government to conduct their mobile network business (Hughes, et.al, 2016).
Economic Factors – The recession phase has reduced the cost of calls and messages for the
people so that large number of customers can be attracted toward the deals. The price war is on
as the purchasing of 3G network had incurred large amount of cost for purchasing the services.
This causes the economic factor of the organization at risk.
Social-Cultural Factors – Change in fashion and market trends has affected the Virgin mobile
network services. It is seen that The UK is using many kind of mobile phones but recently the
interest of the customers is leading to purchase them iPhones which is known as best seller in the
UK. The apple company is leading in UK country. The young generation have more interest in
the phones but the people of different age groups sometimes do not use these technology which
puts direct impact on the selling of Virgin mobile network.
Technological Factors – The launching of 4G networks has also attracted the customers because
the using of internet has become easy directly by the phone which is the positive part for
attracting the customers. This technology also make easier for the people to handle all tasks from
using the phone and internet services (Ho, 2014). The Virgin Group has also provided the GPS
facility which has given the customers basic facilities of knowing the location of themselves and
others too.
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Figure 2: PESTLE analysis
(Source: Abdul Amin, 2017)
Legal Factors – The starting up of any business is majorly depends on some laws like the Sale of
Goods Act 1974 which states the whatever the product made by organization must be used in
correct form and should have some specific use. Certain laws also states that using of mobile
phones are strictly prohibited at the time of driving.
Environmental Factors – It relates to the factors of climate and weather changes. Virgin Group
has organized many events which are taking steps the reviewing the usage of paper, inks and
various resources to adopt environment friendly approach.
Ansoff’s Growth Vector Matrix
For Virgin mobile networks, various methods can be used for growth opportunities and they are
as follows:
Market Penetration Strategy – It is the strategy which is used to launch its own version of the
existing product. Virgin media has utilized this strategy to take market share from the BT when
the broadband services are been launched by him. It majorly puts all emphasize on cheap
packages and advertisement campaigns (Kiani, 2017).
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Development of Product Strategy – It states the launching of the new product. Virgin media has
planned to launch 100mbps service of broadband as an updated product.
Figure 3: Ansoff's growth vector matrix
(Source: Alan Kalpan, 2018)
Diversification Strategy – It states launching of new product into new market. There is no
strategy or product which is currently used by Virgin Group to give justification to this approach.
Development of Marketing Strategy – It helps in targeting the new market. Virgin media has
launched its broadband products for home customers which is the basic strategy to reach the
growth (Wuebker and Klein, 2017).
Various factors mentioned above have major impact on decision making process. The factors
which creates barrier in decision making are change in the rates of inflation, political factors
which affect the business, the change in terms and conditions of external environment will create
barrier in decision making strategy.
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Task 2
P2, M2 Conduct and assessment for organization’s internal environment and its capabilities
Strategic capability refers to the ability of employing the competitive strategies into the business
which allows increasing its value and makes its survival easy. In this context the Virgin mobile
network should apply the VRIO model to identify the organizations capabilities which are listed
below:
VRIO Model
This model helps in analysing the organization’s resources and the competitive advantage. It is
an acronym which indicates – Value, Rareness, Imitability and Organization. The Virgin mobile
network can use this model to achieve environment analysis, strategic choices and execution.
Using this framework the Virgin mobile network will able to meet its competitive advantage in
the industry of telecommunication (Nguyen, et.al, 2015).
Figure 4: VRIO model analysis
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(Source: Marlena Zakrzewska, 2017)
Value – This question states about the resource valuable to the organization or not. Valuable
capabilities will support the Virgin network to gain more opportunities and minimize all the
threats. All the values of business can complete by getting the chances of technological change,
demographic change and legal and political conditions.
Rarity – If the Virgin contains rarity than it can get more competitive advantages. It has all the
resources and various capabilities which are unique from all the resources (Sackett, et.al, 2016).
By this the Virgin Group will be able to give high quality services and uniqueness in their
products which will be much better from other competitors.
Imitability – In this the Virgin network can increase the chances which are present externally or
can minimize the threats present externally by using precious and rare resources. Sustainable
competitive benefit can only be achieved when it has culture to be the market leader and should
take every opportunity whenever it comes.
Organization – After identifying all of the above three sources the next step to be followed is the
need to exploit and manage all the resources available with the organization. As the Virgin
network is following all the steps properly and successfully it has enjoyed the phase of
sustainable competitive environment (Chatzoglou, et.al, 2017).
SWOT Analysis of Virgin Mobile Network
The study of SWOT is undertaken to identify the strengths and weaknesses of the Virgin mobile
network. The analysis is as follows:
Strengths of Virgin Mobile Network
 Virgin mobile is the leading mobile service provider.
 It has its various operations which are spread all over the world like India, UK, USA,
France, UAE etc.
 Rates of calls and internet services which attracts customers.
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 Best service centres, and websites which help customers in payment of bills, recharges
etc (Grant, 2016).
 It has strong backing of the Virgin Group of the Richard Branson.
 It has best partnerships with the leading telecom organizations like Tata Teleservices
(India), Sprint (USA) etc.
Weaknesses of Virgin Mobile Network
 Limited awareness and visibility of brand which are very less in comparison of leading
telecom brands.
 The brand is affected by the operational issues in some segments like Qatar, India
Singapore etc.
Opportunities of Virgin Mobile Network
 Latest and lower costing technologies to increasing the services.
 The branding and visibility is high in market with the JVs for entering into new markets.
 Fastest expansion of cellular market with collaboration will increase the image of brand
of Virgin mobile
Threats of Virgin Mobile Network
 The market share of Virgin mobile can be affected by the competitor’s low pricing
services for the customers.
 Portability of mobile number can weak the market base of organization.
 The business profitability can be affected by tie-ups and JVs.
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Figure 5: SWOT analysis
(Source: Marcus Miller, 2017)
The strength and weaknesses are two factors which need to be considered for working
capabilities for Virgin (Bohari, et.al 2017). The skills of employees and capabilities can be used
to support the business. On other side weaknesses bring setbacks and hurdles in achieving the
objectives of the business.
For example – the Virgin Group have highly qualified and skilful workers which bring many
opportunities to the organization by declining all the threats. Another internal capability is the
use hierarchy structure so that collaboration with other business partners makes easy operations
of activities. Therefore the strengths and weaknesses will also identify the competitive advantage
so that the problems which are coming internally can be easily resolved and the activities of the
business should be expanded.
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