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Impact of External Environmental Factors and its Business Strategies - BT Group Plc

University: UKBC College London

  • Unit No: 4
  • Level: Diploma
  • Pages: 4 / Words 1066
  • Paper Type: Dissertation
  • Course Code: JNB519
  • Downloads: 873

Table of Content

  2. TASK 1
Question :

Mobile Telecommunication Sector is growing rapidly and to ensure the expansion market need to be analysed with the help of various task:

  • Analysis of the external environment is done along with the impact of various macro factors
  • Analysis of the internal environment is done along with the impact of various micro factors
  • Analysis of the communication industry with Porter’s five forces model
  • Analysis of strategic direction using Bowman’s strategy clock
Answer :
Organization Selected : BT Group plc


Business strategy refers as the process of formulation of policies which guides the different departments of organisation to accomplish their objectives within given framework of time. It is considered as long term action plan to perform their future activities through minimisation of risk. It is the duty of the management of organisation that oversee internal and external factors before formulation of their strategies to attain effectiveness in their operations. There are large number of advantages are associated with the formulation of effective business strategies like improvement of the performance of employees, competitive advantage, reduction in amount of risks, effectively satisfaction of the demands of customers etc. This will provides the opportunity to organisation to improve their internal strength and motivates the employees provides their full efforts towards the accomplishment of desired targets. BT Group plc is British multinational telecommunication organisation situated in UK. It provides their services in more than 180 countries (Ackermann and Audretsch, 2013).

In the present report explain about, PESTLE model to understand the impact of external environment factors upon business, analysis of the Ansoff's growth matrix to understand about strategic positioning of organisation, analysis of the internal environment present within the organisation, application of VRIO and VRIN model to determine strategic capabilities and identification of the strength and weakness of organisation. Also, identification of the competitiveness present in UK telecommunication sector through application of porters five forces and application of the Bowman's strategy clock model to analyse strategic direction and options available to organisation.


P1 Impact of external environmental factors and its business strategies

BT is multinational telecommunication organisation which provides their networking facilities in more than 180 countries. This organisation is known as British Telecom which is headquartered in UK. There are different kind of services are provided by this organisation which includes fixed-line mobile, broadband, subscription television and IT services. Large number of employees are working in organisation to effectively satisfy the different requirements of customers. It is observed that around 106400 employees are working worldwide till 2017. There are large number of subsidiaries are working under BT. This includes BT Global services division provides telecom services to corporate and government customers worldwide. Due to having their multinational operations there is huge impact of macro-environmental factors upon business operations which should be effectively understood with the application of PESTLE model.

1. PESTLE model for environmental analysis

There are large number of factors are present within business environment which impacts the business operations of organisation (Alsoboa and Aldehayyat, 2013). These factors have more worse for multinational organisation as they have to face different situation in various nations. These factors are named as Political, Economical, Social, Technological,Legal and Environmental. It is ascertained that this will have both positive and negative impact depends upon the capability of organisation. It is the duty of the management to build their future strategies in consideration with these factors. Here, PESTLE analysis is done of BT to analyse the impact and influence of macro-environmental factors which are mentioned below:

Political: It concerned about the political situations which are present within the country. Still there are many factors which influence the decision of management according to such situations. This will includes about tax policies, employment legislation, stability of government etc. All these factors plays an significant role to make the business operations successful. Presence of unfavourable conditions has negative impact upon the profitability and market share. BT at present working in 180 countries which makes the task more difficult to cope with the conditions present in various nations. There are different factors which are need to oversee by the management BT to attain effectiveness in their operations and reducing the negative impact different political situations such as:

  • Stability of government and importance of Telecommunication sector for economy of country
  • level of corruption
  • Intellectual property protection regulations
  • pricing regulations
  • Taxation related provisions
  • Wages legislations
  • Mandatory employee benefits

BT has major operation in UK which where all the above mentioned conditions are favourable through positive impact is attained on business. All the above mentioned conditions have favourable in UK which is helpful for BT to develop their business and attain desired results. The support of government and effective taxation policy provides opportunity to enhance their margin and brand image.

Economical: It is one the important factor which affects the growth capacity of organisation and have direct impact upon their profitability. The different factors which need to consider under this includes inflation rate, savings rate, interest rate, foreign exchange rate, flow of cash, level of income of individuals etc. To develop their growth strategies BT need to consider different aspects of telecommunication industry like quality of infrastructure, skill level of employees, economic growth rate etc. It helps to attain the positive impact upon business operations. For ex., level of income of individuals of society in UK is high which is positive sign for BT to improve their customer's through providence of new facilities as per their different requirements.

Social: The culture which is present within the society has huge impact upon the structure of organisation. There are different social factors like age, education, attitude and behaviour impacts the business functions. Consideration of all these factors provides opportunity to BT to understand the preferences of customers in market and designing of their future telecommunication strategies to gain their trust. At present the level of education is high in society which is positive sign for BT to improve their business activities like now every this should be done through application of telecommunication and broadband networks. But if these situation are not preferable then this will shows negative impact.

Technological: The different factors which influence business operations includes advancement of technology, methods and techniques etc. It is the duty of all organisation is to implement these changes in their organisation structure otherwise it has negative impact upon their functioning and image. The different steps which are taken by BT in this regard includes investment in high speed network and alliance.

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