Strategic Analysis of Vodafone's Business Environment and Planning

This report provides a comprehensive analysis of Vodafone's business strategy, exploring the impact of the macro environment, the company's internal capabilities, and the competitive forces it faces. The report begins with an introduction to business strategy and its importance, then moves on to analyze the macro-environmental factors affecting Vodafone using a PESTLE analysis. It then examines Vodafone's internal environment and capabilities using the VRIO framework and SWOT analysis. The report also applies Porter's Five Forces model to assess the competitive forces within Vodafone's industry. Finally, the report interprets and devises strategic planning for Vodafone by applying various theories, concepts, and models, concluding with recommendations for future strategic direction. The report covers key aspects of Vodafone's operations, including market coverage, revenue generation, marketing strategies, and premium pricing, while also addressing weaknesses such as subscriber base decline and market share losses. This report is a valuable resource for students and professionals seeking to understand Vodafone's strategic position and the factors influencing its success in the telecommunications industry.

BUSINESS STRATEGY

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 The impact and influence of the macro environment on Vodafone.......................................1
TASK 2............................................................................................................................................4
P2 Analysis of the internal environment and capabilities of Vodafone by using appropriate
frameworks..................................................................................................................................4
TASK 3............................................................................................................................................7
P3 Porter’s Five Forces model to evaluate the competitive forces of Vodafone.......................7
TASK 4............................................................................................................................................8
P4 Applying a range of theories, concepts and models, interpret and devise strategic planning
for Vodafone...............................................................................................................................8
CONCLUSION..............................................................................................................................10
REFERENCES .............................................................................................................................11

INTRODUCTION
Business strategy is a crucial concept that uses to define organisation's target, goals and
objectives in order to getting desired growth easily. In this process, management of firm play a
most important role to create a specific plan and policy for workforce to prepare them to go out
toward target objectives for better accomplishment (Ackermann and Audretsch, 2013). Strategic
plan succeed when they lead to create a strong competitive position, effective financial
performance and business growth. The project report is based on Vodafone which is a British
multinational telecommunication firm. The organisation was founded in the year of 1991 and
now they operate networks in around 25 countries with the partner networks in approx. 47
countries. Vodafone is a global business organisation which provide telecommunication as well
as IT services in around 150 countries. This report represent impact of macro environmental
factors on the business strategies of Vodafone and internal environmental analysis or business
capabilities. At last it represent, impact of competitive forces analysis and strategic direction by
considering Porter's generic model.
TASK 1
P1 The impact and influence of the macro environment on Vodafone
For a business organisation, it is required to create a effective strategic framework that
assist to represent a quality value of firm in target market. Most of the industry players create a
ascendency by coming up with impactful strategies that helps them to getting higher competitive
advantages over the existing rivalries. These business planning normally ensure that firm is able
to operate their business operations between competitors and grab maximum profitability easily.
Vodafone is a large scale telecommunication and IT firm that provide business services in
several countries. For this, they requires to create a impactful strategic framework that assist
them compete with tough rivalries easily (Annabi and McGann, 2013).
Business strategies of Vodafone
Vodafone is a large scale firm which has a current strategy to maximise their
geographical area by acquiring different business and customers through implementation of
innovation in operational technology. Main objective of Vodafone is to emerging creative ideas
in order to meeting society's need and requirement effectively on the basis of their quality
products and services. Vodafone also provide their impactful contribution in environmental
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sustainability by enabling Low-Carbon through bespoke production in their networking
operations. Aim of Vodafone is to face several challenges effectively as focusing on major
interventions sustainability that helps to offering attractive commercial returns to business as
well as shareholders.
PESTLE analysis
Vodafone is one of the leading telecommunication company. Its business is expanding in
other locations such as Europe, India and many other locations. It is the international company so
there are various external factors which require to be determined to evaluate the organisation
success and growth. Such PESTLE analysis are described as follows:
 Political factors – It is the political factor which influential in the way of progress of the
organisation such as Vodafone and it will make infrastructure for the company functional
in specific region. This is necessary for Vodafone firm is to follow all rules and
regulation which are develop by government bodies in proper manner. In current time
period, there are certain things such as political imbalance and harmony of the regime
that are directly impact on company functions (Auzair, 2011).
 Economical factor – It is one of the crucial conception for an organisation such as
Vodafone. Economic aspects provide high opportunities for expanding business and also
open new areas for development and growth. This factors also impact on Vodafone
growth and level of inflation rate in the market in which company regulated or operated.
Vodafone uses economic factors in their business industry as economic indicator, growth
rate and inflation to emerged with them. For this, they provide wireless communication
services for industry growth and effectiveness. Vodafone enhance their labour cost and
productivity to provide effectiveness in economy development process.
 Social factors – This is that factor which are based on local values and culture of people
where Vodafone has operated its business. For gaining higher success, the company need
to display adaptability in their strategies and policies which are related with general
culture. On the other hand, Vodafone is one of the strictly European firm according to
their local social factors where organisation has been regulated or operated. Major social
factors of the firm are culture and working environment for their employees that helps to
maximise number of services provide for each customer (Azar, 2011).
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 Technological factors – In current time period, Vodafone is very famous for their
innovative activities and functions in all over the world. The organisation emerging
bionomic, automation and digitalization factors in their business process that assist to
represent creative ideas and services in front of target customers. Advancement of
technology enable the Vodafone to create a positive and strong relation with services
users. The organisation implement advance technology and features in their strategic
process in order to compete with target organisations in rivalry market. In
telecommunication industry, implementation of advance technology is required to make
positive changes on the basis of current era (Bharadwaj and et. al., 2013).
 Environmental factors – For increment in globalization, most of the people become
more ethical and social oriented. In this, consumers except ecofriendly services from
telecommunication industry in order to reduce negative impacts of direct radiations on
human body. Vodafone consider such factors in their business approaches and reduce
negative impacts by reducing Low-Carbon activities through bespoke production in
networking process. Major focus of Vodafone is toward recycling of their hard ware
services properly for environmental safety activities.
 Legal factors – for a business organisation, it is required to implement legal terms in
their business process in order to working properly under a legal framework. Vodafone
implement anti trust law in their wireless communication process in each and every
country. Some other legislation that Vodafone implement in their business services are
data protection act, consumer protection activities, e-commerce act, intellectual property
act and so on. All these activities assist to provide them legality to working under
government properly (Bucolo and Matthews, 2011).
Stakeholder analysis of Vodafone
Stakeholder analysis is a most important factor in an organisation that uses to create a
positive relation between firm and its stakeholders. For management of firm, it is require to
identify interest and requirement of them in order to represent their quality services effectively.
There is a significant of stakeholder analysis of Vodafone is determine below as -
 Vodafone always anticipate their stakeholders reaction towards their business future
plans and strategies. These activities assist to suggest some better ways to make positive
changes.
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 For effective utilization of resources, Vodafone take help of their stakeholders for
betterment of their services.
 Vodafone always work to identify conflicts that can affect business activities and terms
between their stakeholder in order to reduce them effectively.
 Employees of Vodafone are working in their stores with proper collaboration in order to
create positive relation with their customers on the basis of quality products and services.
 Stakeholder are the one who understand firm's needs and necessary that helps to provide
them exact support for long term benefits (Grover and Kohli, 2013).
Stakeholder analysis of Vodafone is used to identify effectiveness of their key people
who belongs to their services. These kind of people are totally connected with firm on the basis
of their quality relation to emerging business benefits positively. Stakeholder of Vodafone are
helping them to create a betterment in their performance in the competitive market for gaining
maximum advantages easily.
TASK 2
P2 Analysis of the internal environment and capabilities of Vodafone by using appropriate
frameworks
Vodafone is a large scale telecommunication and It firm that provide its quality services
in several countries. In order to enhance organisational approaches, firm implement several
strategies which re working as their strength in order to grab several opportunities.
VRIO framework
 Valuable – Vodafone is a world level telecommunication firm that provide their quality
services to customers on the basis of their requirement and need. Premium cost and Huge
market coverage area of Vodafone are known as their strength that provide them
desirable profitability in effective manner (Jocovic and et. al., 2014).
 Rare – For a business organisation, It is required to utilize rare resources which are hard
to obtain by others. These things can be known as organisation's strength that helps to
provide maximum opportunities to a Vodafone. The firm implement effective and rare
networking approaches in their business which are hard for others to obtain easily. These
resources help them to implement wireless, networking, hardware and several services.
This situation is hold the rarity in market in order to attain competitive advantages easily.
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 Inimitable – For a business organisation, its products are known as their key strength.
These kind of this consist originality in an organisation's own services. In a target market,
several organisation are willing to create their own image in telecommunication industry
but Vodafone imitate their resources and networking ideas properly, so it is hard for
others to compete with them. For promotions, Vodafone uses unique ideas that helps to
capture customer's eyes toward them and hard for rivalries to implement in their business
due to intellectual rights (Kalyani and Sahoo, 2011).
 Organised – These kind of activities assist to manage Vodafone's business strategies in
order to generate Revenue, getting Marketing effectiveness and Premium cost process
with Huge market coverage activities. All these activities assist to enhance business
profitability in global market.
SWOT analysis
SWOT analysis refers to the strength, weaknesses, opportunities and threats for a
company which impacts on the company's profit while the expansion. These are internal factors
of the Vodafone that affects on the sales. SWOT can be define as -
Strength
 Huge market coverage – According to the Forbes magazine Vodafone positioned at
395th among the 2000 brands. It is offering its services in more than 25 countries and
known as the second largest telecom brand in India (Klettner, Clarke and Boersma,
2014).
 Revenue generated – It is generating a high revenue every year and in the year 2016 it
has generated a whopping revenue around 87.3 billion dollars. This boosting revenue is
increasing the expectations of the industry and therefore it is ranked on 104th position in
sales and 84th in market value on the global level (Köseoglu and et. al., 2013).
 Marketing – Vodafone has a great marketing techniques that was notice in the beginning
when Vodafone takes over Hutch at that time the little pug captures the attention of
people. As it proved the its zingle right in terms of the active network across the globe.
The zingle says that a customer can be anywhere and the network will be available to
them for 24X7. After that the Vodafone Zoozoo's are also playing an important role in
marketing which converted a large number of fans into being its user. The company
timely introduces the new marketing campaigns with zoozoo at the right time.
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 Premium cost – While the various telecom companies are penetrating to the market
without improving the services. Vodafone is differentiating its services regularly and that
is valuable to its users and in order to get the extensive services the customers are paying
the premium prices.
Weaknesses
 Trimming subscriber base – Vodafone faced the drop in the subscriber for the last four
years that creates a hurdle to look at the global market. Thus, to raise the customers it
needed to strengthen its core values and implement strategies to attain more customers.
 Losing market share in USA – In the USA Verizon wireless and AT &T both are
performing far beyond the Vodafone. To sustain in the USA market it needs to plan to
float and attain its goals (Murano and et. al., 2011).
Opportunities
 Emerging market – Along with Africa rural market in developing countries are also has
potential market for Vodafone. These emerging and new markets has increase in the
disposable income that is beneficial to establish a communication network. If Vodafone
explores to these markets then it can gain the profit with the growing countries.
 Amendments in network coverage – One of the major problem of consumers is with the
network coverage. In the beginning it was providing the strong network but in recent time
it can be seen that it has a poor network coverage. The company can provide strong
network through its establishing new spectrum that can improve the coverage range and
this will be a good opportunity to increase the customers.
Threats
 Competition – Vodafone has an extreme competition everywhere and this is the one of
major threat for it. As USA has Verizon Wireless and AT&T, China has its domestic
product China mobile, India has Airtel and Reliance Jio. These are giving a tough
competition in the telecom sector and increasing the hurdles which is affecting the brand.
 Low margins – Competition is good for companies but extreme competition is bad for
the telecom companies (Oestreicher-Singer and Zalmanson, 2012). As differentiation was
good for Vodafone but in the past four years this has become a fierce competition and
that encourage the whole telecom market to adopt the penetration. Thus, it leads to drop
the margins for the entire telecom brands.
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TASK 3
P3 Porter’s Five Forces model to evaluate the competitive forces of Vodafone
For a business organisation, it is required to identify their major competitors in target
market who can influence in an organisation's decision making procedure. Vodafone is large
scale telecommunication firm who provide quality services in several countries. For them, its I
required to analyse their tough competitors and needs to understand their strategies in order to
compete with them easily. All these activities provide effectiveness in business profitability and
growth. In order to analyse effectiveness of the competitors, Vodafone requires to use Porter's
five forces model that assist to analysing strategic competitiveness and returns in target market.
The brief information of this model is given below as -
Industry rivalries – Vodafone is telecommunication organisation that establish their
business services in UK (Schaltegger and Wagner, 2011). In this country, various networking
firms provide their effective services to target users. For example these organisations are British
telecommunication, EE Limited, Virgin and so on. All these business firms are deals in similar
sector services that create a tough benchmark for new organisations as well as Vodafone. For this
management of firms requires to create some impactful strategies that assist to gain competitive
advantages from target market. In order to compete with them, Vodafone uses Cost leadership
strategy with the help of logistics or operations inferiors in organisational activities.
Bargaining power of Buyers – In the telecommunication sector power of buyers are
very strong who helps to maximise organisation's profitability easily. Through this Vodafone can
easily earn maximum growth because they build proper collaboration with their Stakeholders in
order to analyse their requirement in order to serve exact services to them easily. Powerfulness of
Buyers assist to implement organisational cost leader strategy effectively because this planning
can affect diversely on business ideas if firm not have loyal customers. For this, Vodafone
always focusing on building positive relation with customers that helps to getting long terms
benefits easily. These are the most beneficial business approach that affect positively on business
strategies. By creating positive relation with target users, firms can easily fluctuate their prices
on high margin because customers can accept them with proper loyalty (Scholes, 2015).
Bargaining power of suppliers - Power of suppliers in the telecom industry is high or
strong due to few number. Vodafone is the organisation which is cost leaders because they
operate with greater margin compare to their competitors this in return allow respective company
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to absorb increasing price from their supplier is easy manner compare to the competitors. For
example When its come to large scale Vodafone can barging with their suppliers and reduce cost.
This will result in high profit at the same time when their competitors are generating only
average return on their investment.
Potential Entrance – For a business organisation, it is required to create a strong
goodwill in competitive market in order to stand with major rivalries easily (Slack, 2015).
Telecommunication market of UK is very wide in which several organisations provide their
quality services to customers. For them, Vodafone always create strong strategy to reduce their
effectiveness in market for example they majorly cut down cost of their products and services
below the rivalries which is helps to capture customer's attention toward them. Some major new
entrence whoc wants to compete with Vodafone are TalkTalk, AT&T, Colt and so on who are
known as potential entrance who are directly affected with the strategy of Vodafone.
Produce substitute – Vodafone faces low threat of substitute because they are majorly
deals its services among loyal customers. One other aspect of this is Vodafone's cost leadership
strategy which is difficult for others to rate in their products. These kind of approaches assist to
create a positive image of firm in target market. Vodafone create their business structure at
maximum level by acquiring small firms in their organisation. These activities assist to enhance
organisation's resources in order to utilize them in business operations (Svee, Giannoulis and
Zdravkovic, 2011).
Vodafone is a unique service providing organisation that manage their activities on a
maximum level which is difficult for rivalry and substitutes to grab easily. In this process,
business strategy of firms as cost leadership approach assist to emerge their level at a specific
level. By analysing Porter's five force model it has been identified that Vodafone can easily
compete with competitions in target market.
TASK 4
P4 Applying a range of theories, concepts and models, interpret and devise strategic planning for
Vodafone
For a business organisation, it is required to analyse effectiveness of their strategic
planning in business growth and development process. Vodafone implemented several creative
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ideas and thoughts in their business process that assist to enhance their market image in
competitive market. There are some models determine effectiveness of business strategies in the
respect of Vodafone as -
Porter's generic model
Cost leadership – For a business organisation, it is required to implement unique ideas in
their business that assist to create their unique image in market. Cost leadership strategy helps to
determine a proper approach in which a organisation reduce prices of their services in order to
leading in target market easily. For example Vodafone implemented cost leadership strategy in
their business operations in which they provide low cost quality products to customers that assist
to gain competitive advantages easily(Svee, Giannoulis and Zdravkovic, 2011).
Differentiation – In this strategy, an organisation implement creative ideas and thoughts
for differentiate their services easily to others. For this, they majorly implement uniqueness in
produce in order to distinguish them to others similar sector firms. These ideas assist to create a
impactful image of firm in target market. For example Harrods is retail sector organisation in UK
which is basically known for its unique and luxuries products which are difficult to compare with
others.
Focus – In this process, an organisation requires to focus on a specific business idea that
helps to create their own image in market. These effectiveness can be between cost focus and
differentiation focus which helps to maximise profitability of firm in effective manner. On the
basis of this, organisation can create their goodwill in market.
Bowman's Clocks strategy
 Low Price and low add value – This is not very competitive position because at this
stage organisation sale products without adding any margin.
 Low Price – At this position, organisation add a minimum amount of margin while they
selling their products at low cost.
 Hybrid – At this position, organisation deals with two different strategies as low cost as
well as differentiate products that helps them to earn a minimal number of profit.
 Differentiation – This strategy is totally focusing on products quality in order to serve
unique products in market effectively (Svee, Giannoulis and Zdravkovic, 2011).
 Focused differentiation – In order to gaining a specific position, organisation make their
focus toward unique services that are never uses before.
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 Risk high margin – At this position, some organisations set high prices of their products
without adding any volume in them.
 Monopoly pricing – At this stage, a single business organisation offering products in
market without any rivalry in quality and cost.
 Loss of market share – This is the low stage of product in which organisation sale their
services at low cost but customers find more better options in market (Svee, Giannoulis
and Zdravkovic, 2011).
In between the above options Vodafone majorly focusing on Hybrid in which they earning
higher profit by considering low cost products and maximise uniqueness in their services.
CONCLUSION
From the above report it has been identified that for a business organisation, it is required
to create a impactful strategic plan that assist to enhance its profitability and growth in target
market. These planning are uses to build a positive image of firm in target market in order to
create a positive image in front of users. This research represent impact of macro environmental
factors on a business firm. In order to analyse organisational strength firm requires to implement
internal analysis approach that assist to determine firm's effectiveness. Competitive advantages
of business firm is determine on the basis of Porter's five force model. At last, for strategic
planning approach it represent
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