PM101 Business Strategy Assignment Level 4

Task 1

P1 analyse the impact of external environment on business activities.

External environment is the most influencing and effect full factor which helps to identify the external opportunity and threats (Armstrong, Kotler, Harker, 2015). Vodafone is the big telecom providing services. There are many factors which influence business activities which help to protect the best influencing outcomes. There are explaining the external environment of Vodafone on the basis of pestle analysis

Political: This is the first driving factor of business environment which gives adverse effects on the behaviour of company activities. Moreover, another major goals and organisation objectives must be considered while making the product and services. Telecom industry is highly affected by the changes in demographic rate etc. as per the changes in regulations by government in which mobile phones licences are force fully controlled and are highly costly (Cascio, 2018). Before making any business strategy company needs and wants.

Economic: it is another factor of macro environment which makes environment more complicated and complex for the business activity. It also makes the process more difficult for the companies. Vodafone is the multinational company which is highly affected by the changes in economic system due to changes in interest rates, which makes goals and objectives fulfilled and impactful (Hammond and et.al. 2007). Along with that, changes with external environment would give effect on the prices of company services it also makes the necessary changes in the organisation.

Social factor: this can be the major factor which might be impactful for the company services. It will be more effective and complex for the protection of services. Social factor is directly connected with the society and peoples who connect with the company profit. In terms of Europe it is the long term process to understand the long term process (Johnson, 2016). This is the impactful decision making approach which is required to make the long term process of making good task. It also helps to influence the positive activity goals and objectives.

Technological factors: it is another factor which impact on the technological factors. Technological factors are very much influencing and productive for company growth.  It makes productive method to enhance the growth of the company. Besides, it is the long term process of productiveness. With the help of development effects it must be according to the process of making good task and objectives. Such as with the advanced technology company gives 3G or 4G services for the customers (Leonidou and et.al., 2017).

Legal factor: it is another factor which affects company in the form of factor affecting goals. Along with that, legal implications and changes in the regulations will affect the company atmosphere. Rules and regulations will definitely affect the company atmosphere in term of task oriented goals.  It also helps to attract the more effective process. Company needs to acquire all changes and more impactful process of working. Besides, legal implication is must be required in for the development of company objectives and goals. This is the overall process of making good task oriented process (Leonidou and et.al. 2015).

Environmental factor: this is another factor which affects company or influence to Vodafone activity. But the firm and establishing a recycling session for gadgets in terms to assist the environment and recycle and reuse the raw material utilised in the handset.

Ansoff growth vector matrix to analyse the firm strategic positioning.

Market penetration: it is the technique or process to enhance the company market share with its current product line. Vodafone has a current strategy is the long term process of making good skills. Market penetration is the good market leader which helps to influence the activity. Along with that, moreover, another process is that to target the market plan. Moreover, in this market penetration it takes overall time which helps to influence the market growth or customer attraction.

Product development: Vodafone provides various kinds of services or products to their customer. In order to maintained good position in the target market it helps to motivate the best strategic planning and objectives (Scholes, 2015). In order to sustain in the long term Market Company requires adopting the best strategic market positioning. Along with that, Vodafone is also required to make more new product services in order to meet the business objectives.

Market development: it is another strategy or aspect of the development process which helps to influence the best strategic position in the market. In order to develop the market conditions company requires adopting new policies and strategies in order to meet the needs of market development.

Diversification: it is another process or policy to identify the different product and services to the market area (Woerner and Wixom, 2015). Diversification is the process to make different services or products to make the good appearance in the market condition.

M1

Business environment is the highly influencing and most effective target market goals under which there are many factors which affect company policies and procedures to make good impact on the overall behaviour. External environment would give negative and positive factors on the behaviour of company. Company needs to adopt all required goals and objectives in order to consider all objectives.

Task 2

P2 (I) Meaning of strategic capability

Strategic capabilities identified as the capability of business to successfully employ the competitive strategies which allow the organization survive and increase its value over time. Moreover, it does not consider the strategies which are used by organization; it concentrates on the assets, resources and marketing, determining how well the organization will be able to employ strategies in the future (Al-Atiqi and Mumen, 2014). Vodafone is the long term process of making good skills and wants. It also determines the abilities of organization towards development effective strategies that tends to raise its growth and profitability in market. This increase in business opportunities also enables the organization to gain support in telecom industry. Vodafone is identified as top most telecom sector company which possess major strategic capabilities which tend to raise the recognition of organization in market. Vodafone also has strong competitive position which is enabled by its ability to perform high level in differenced methods in short m strategic success is enabled by distinctive organizational capabilities. Implement of effective business strategies has increased the capabilities of Vodafone to sustain in market. Strategic capabilities developed by Vodafone in regard to its operations are providing telecommunication services at low cost with guaranteed quality. In regard to technological development, the company have become able to exploit technological opportunity and developing and applying technologies.

P2 (ii) VRIN model to strategic capabilities of Vodafone

It is important business model act as basis for the competitive advantage of firms that lies primarily in the application of group of valuable tangible or intangible resources at disposal of firm.  There are various effective models that can be used by managers to analyse strategic capabilities to achieve success in business operations. VRIN analysis is based on estimate that businesses differ depending on what these resources are and how they are combined with one another. This analysis is used to consider for the competitive advantage or weakness of organization in market as compared to competitors. In this context, this model is used to determine the strategic capabilities of Vodafone to achieve success in business operations and its competitive advantage on the basis of four elements which are mentioned above:

• Value: It implies to the resources that can bring value will be identified as source of competitive advantage. There are various effective resources have been available with organization which provided them abilities to develop competitive advantage over rivals.  As per given share, Vodafone is strong telecom sector company (SammutBonnici and Galea, 2015). However, it also has strong financial capabilities in market which enable them in expansion of business and adaptation of new product develops strategy for sustaining their business operations in market. Further, Vodafone also has qualified employees at workplace which provide them capabilities to generate ideas and plans for attracting customer towards their service. Its valuable resources are economies of scale because it has large infrastructure in telecom sector.
• Rareness: It implies to resources that are available to all competitors rarely provide any significant competitive advantage. In this context, Increase in use of telecommunication services among young customers is identified as major resources for organization along with development of new technology (Klauer, 2015). This resource is also available for organization in market. Moreover, increase in use of services also enables the organization to achieve competitive advantage. For this, company needs to analyse competitor’s strategies. Vodafone's aim is to keep its services simple yet innovative; therefore resources are focused on its R&D rather than extravagant marketing campaigns. Global business presence makes new comers to the UK recognised Vodafone brand instantly, high specialised stuff for unified mobile services.
• Imitability:  It implies that ideal resources cannot be achieved by competition businesses. In this context, Vodafone has strong financial resources and qualified professional in organization. These resources are identified as rare and cannot be easily imitable by other competitors of Vodafone in market (Anyen, 2015). Wide range of products and service are provided by Vodafone to its customers at low rate which has also provided them capability to sustain competitive advantage over rivals in market. Brand provides easy access to market segments. Vodafone has a culture of being a market leader however the culture does not promote ceasing opportunities as they rise.
• Non Sustainable:  This element of analysis is based on assumption that an ideal resource is not substituted by any other resource. There is no such valuable resource is available with Vodafone which cannot be substitutable by any other resource.

P2 (iii) Strengths and weaknesses of Vodafone

Vodafone has massive coverage in market because it had wide distribution and coverage of network. It mainly operates in 25 countries. Continuous increase financial strength of organization has also provided them major support in expansion of business operations.  Strong position in market often implies to financial leverage, larger capacity to absorb risks and greater capabilities to steer the market direction (Brown, 2013).  By providing fastest communication network and technologies it has achieved strong brand loyalty among its customers. It is also analysed that Vodafone has a strong presence in all kinds of mobile markets. Developed markets like Germany and UK have generated bulks of revenue for organization in market as compared to competitors. Moreover, aggressive business strategy, creative advertisement, decent customers service and employees friendly policies have supported Vodafone in cementing its place among the better brand across the world. It makes it easier for them to win new customers and retain the existing base.

Increase in competition in telecom sector has also reduced the capabilities of organization to sustain its business without implementation of change in strategies. Increase in rate of inflation has also provided impact on cost of operations of organization. Therefore organization has increased prices for its products and services in market. Further, increase in technical issues has also decreased the image among organization among customers. Further, it also has effective resources but lack of effective technologies to provide effective service to customers. Low financial growth in market is also identified as weakness of organization.

Task 3

P3 Evaluating the competitiveness of Vodafone

Although there are various factors that can be used for analysing the competitiveness of an organisation but here, Porter's five force model can be used to analyse the same for Vodafone. The analysis using the Porter's five forces has been discussed as under:

Bargaining power of buyers

It is obvious enough that there is a huge competition in the mobile industry. Also, there is also a lack of differentiated items as well. So, because of such reasons, the bargaining power of the buyers is high enough. A strong bargaining power of buyers means much reduction in the average rate. This actually means how much an individual can cut down the prices of the specific product (Dälken, 2014). Therefore, Vodafone can ensure the fact that they can select affordable price rates to the products so that the customers don't have to make a huge decrement. Also, if there is some product in the market that is highly required but in a less quantity, so the customers buy it, whatever the price is. So, Vodafone can ensure developing the products and services that are very least available by the other mobile network brands. This will help the company in a decreased rate of bargaining rate by customers because it is obvious that when people will need it, they will buy it if it is least available in the other markets.

Bargaining power of suppliers

Bargaining power of suppliers is considered as the fact that how much the suppliers can bargain in the rates of supplying the products etc. to the retailers, customers etc. If there will be a decrease in the overall rate of the suppliers, then there is a possibility that the bargaining power of them will increase. It is obvious because the suppliers also know that if the overall rate of the suppliers is low enough, then the manufacturers may have to compromise with the rate as well. So, this can increase the bargaining power of suppliers. So, the whole phenomenon depends upon the number of suppliers available in the market. As in case of Vodafone, as the company when compared to its various competitors, operates at better margins, it means that the suppliers of Vodafone have higher bargaining rates. If the overall market share is high enough, then it can easily include increments etc. in their pricing strategies. Vodafone is one of the leading mobile operators, so the suppliers even with a lower budget can also get involved with them. So, Vodafone can easily manage to deal with the suppliers and that too at a lower cost. Also, it can further help the mobile network operator in making the profits at higher rates as well. 

Threat of new entrants

It is obvious that when new mobile operators will enter in the market, it can act as a threat to the ones that are already dealing with the same processes. New entrants with their processing and operations can actually act as a threat to the ones that exist and dealing with the same and are already in the market. Vodafone can also get affected by some organisation that comes in the market. Although Vodafone is one of the leading companies, so there is a less possibility that it can get affected by the new extant but their entry can affect their productivity to an extent. Vodafone can focus on making their strategies and processing faster enough so that they can become able to deal with the new entrants and their strategies.

Threat of substitutes

Also, it is important to consider the fact that the competitors of Vodafone can also involve the substitute products of Vodafone in the market. The actual forte of these substitutes is to decrease the overall productivity of the actual organisation (Dobbs, 2014). So, as it is obvious that there are various rivals of Vodafone because of the large gain in popularity and productivity. So they can make involvement of the substitute products so that Vodafone can get down in the market place. Involving substitute products means making the involvement of products in market that can complete the requirement of the people that is get satisfied by the Vodafone. Also, the rivals might involve low pricing strategies for introducing the substitutes. So, people can go for the substitutes as they are also completing their requirement and that too at a lower price. So, it might affect the productivity rate of Vodafone. The strong buyer power of Vodafone and trusted customers can help Vodafone to stay protected from such type of issues.

Rivalry within the market

It is obvious enough that there is a huge competition in the mobile network operators, so every mobile operator company is trying to include various ways by which they can be able enough to satisfy the customers. As Vodafone has involved lower rate structure for customers, so this has increased the rivalry for Vodafone. The involvement of lower rate structure by Vodafone has satisfied enormous number of customers. The rivals in the market place also are trying to involve the same to decrease the value of Vodafone in the market place. Therefore, Vodafone has to focus on their existing strategy so that they can continue satisfying their customers. Trusted and satisfied customers can help Vodafone to stay away from any effect of rivalry or threat. 

M3 Appropriate strategies for improving market position in Vodafone

Although there are various ways and strategies that can be involved in order to make improvements in the competitive edge along with the market position of Vodafone but some common strategies include involving positioning strategy by Vodafone as it can help Vodafone in analysing their actual position in the market and in understanding the basic requirements of the customers so that they can continue their processing on that basis (Johnson, 2016). Also, it helps them to analyse the strategies and ways their competitors are using so that they can become able to make any modifications if they want.

P4

P4 Analyse the strategic direction and option available for the company

Bowman’s Strategic Clock is a well-known model used to explore various alternatives to position oneself in the market in the most strategic way. This is basically used to analyse ways in which organisations like Vodafone can effectively position its products and services in the market to attain a contending position. This model is effective in terms of demonstrating its 8 vital elements as explained below-

Low price as well as low value added- This is referred to be a less contending strategy in which the company’s product is not distinguished with a very low value perceived by the customers despite of having a very low cost (Woerner and Wixom, 2015). It is thereby specified to be a strategy that enforces bargaining as a way to stay competitive in the market.      

 Low pricing- In order to adopt this particular strategy, Vodafone will require adopting the tactic of cost minimization to position themselves as the low cost leaders in the market. For this, their profit margins must be very low on each of their products and services with a high capacity of outputs to produce high profits.        

Hybrid- It is in accordance to the implied term hybrid that it means the combination of 2 or more strategies (Woerner and Wixom, 2015). Herein, it is meant to be a combined form of product differentiation with some portion of low pricing strategy. It is to encourage the consumers to buy value added services of Vodafone that is being offered in an affordable pricing as well as a standard differentiation.       

Differentiation- This is with an aim of providing high level of perceived value to the customers with a foremost role of branding that is known to play a principle role. This type of strategy is apparent to result in a high quality product that in turn creates a strong brand awareness and loyalty in the customers.     

Focussed differentiation- In this strategy, Vodafone will be required to position some of their services at highest cost levels to target such consumers who will be purchasing it due to a high perceived value. It is however meant for the luxury brands to attain premium pricing policies by together adopting the STP concept of marketing. Hence, Vodafone can use it for its most high priced service (Woerner and Wixom, 2015).

Risk high margin: this is the strategy which helps company to setting up the cost without offering anything to additional to the customer. If the customer is used to purchase services at the same price they get better services or goal oriented objectives and target market plans. Along with that company also needs to acquire some productive task in order to get the best possible action plans and goals and objectives.

Monopoly Pricing: This is the process of setting the prices. This is the strategy which has been adopted by the company in order to take monopoly market. This strategy is not that much effective for the company adopt. 

Loss of market share: this will create adverse effects in the competition market. Setting up common areas or benchmark (Woerner and Wixom, 2015). Cost for goods and services. It has been very much productive and effective. Moreover, it will be the great and impactful factor which helps to grow the business activities. 

M4

Strategic management plan is the most essential requirement in the organization in order to full fills the overall strategy and business plan. It must be proper planned and executed in order to get the best results. Due to ineffectiveness or low productivity. It gives negative impact on the behaviour of business.

Conclusion

From the basis of above section it can be concluded that, business strategy is the required and most productive part in the organisation in order to full fill the business objectives and target market goals. Overall, study based on business strategy of Vodafone. Furthermore, in the present report it has been discussed about the Pestle analysis of macro environment with the help of different strategies. Further apart it will also accomplish the overall business strategies and target market goals. 

You may also like to read: 

• Assignment on Business Future UKCBC

References

• Al-Atiqi, A. and Mumen, F., 2014. The Strategic Alternatives of Vodafone UK in 2009.
• Anyen, D., 2015. Customer centric approach as a strategic tool in the telecommunication industry: Case Vodafone Ghana.
• Armstrong, G., Kotler, P., Harker, M. and Brennan, R., 2015. Marketing: an introduction. Pearson Education.
• Brown, R.S., 2013. Capabilities, strategic intent and firm performance: An empirical investigation. Temple University.

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