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A business strategy is a series of actions or choices that aids in the achievement of a company's objectives and goals. Managers utilize it to obtain the upper hand in the marketplace by executing operations, satisfying customers, and meeting desired objectives (Rehman and Anwar, 2019). A business strategy is a long-term plan for achieving a certain objective.
This report will focus on Jaguar Land Rover Limited's internal and external environment for forming effective business strategy of the company. The purpose of this study is on the macroenvironment's effect and impact on organizational growth and improvement. It also covers the organization's internal environment, which should be accessible by a variety of ideas and theories because of its primary weaknesses and strengths in the market. In addition, theories and practices are discussed in detail to help readers grasp the organization's strategic orientation.
As a trainee Strategic Planning Manager at Jaguar Land Rover, I am responsible for conducting an environmental study and developing a draught strategic growth management plan based on recognized internal and external analytical methods, while also considering JLR's development and expansion goals.
P1 “Macro Environmental Impact and Influence on Organisation”
According to Braun, Latham, and Cannatelli, (2019), in order to determine a company's viability, researchers must look at a variety of aspects that provide useful insights and information for achieving desired outcomes. In order to construct a strategic plan, an organisation must identify its purpose, vision, and goals, which are crucial to its growth and development. A global automotive corporation, Jaguar Land Rover (JLR) is the biggest automobile manufacturer in the United Kingdom and one of the most prominent in the world. A subsidiary of Tata Motors, it is based in Coventry, England, and has its headquarters there (Sindi and Roe, 2017). Machines and equipment of the highest quality are used by Jaguar in the production of bespoke automobile bodywork.
As part of British Leyland following the Second World War, Jaguar started producing luxury saloons and sports cars, which eventually included Rover. Tata Motors acquired Jaguar Land Rover (JLR) in 2008, making it a subsidiary of the Indian firm.
P2: Analysis of JLR's Macro Environment
When an organization's performance is impacted by its internal and external environment, it includes all of the factors that not only shape possibilities, but also represent dangers to that organisation. Decisions, results, and strategy are all influenced by these variables. The external environment of JLR is analysed below using the PESTLE Framework.
Positive: In a positive light, Jaguar Land Rover is an international firm and has relationships with different nations. As a result, any political change may be quickly adopted by the corporation.
Negative: JLR's company has become more unstable in its current markets as a result of coping with various rules and worldwide pressure.
Positive: Jaguar Land Rover is financially strong and also contributes to the economies of other countries; as a result, JLR and other countries collaborate. On addition, the company's worldwide expansion is facilitated by its capacity to access financial markets and also the availability of liquidity in the stock market.
Negative: However, the economic volatility of existing nations and their varying tax rates have a detrimental effect on JLR's company.
Positive: The company's ability to craft products and services that cater to the tastes and preferences of individual customers contributes to its ability to stand out in the marketplace.
Negative: JLR might have to enhance public service investment in order to meet the needs of the local population. Health and safety concerns are becoming laxer as a result of increasing liberalisation. Avoiding these mindsets is critical for JLR. Failure to do so might have a devastating impact on the sector.
Positive: Jaguar works in a variety of countries, necessitating the use of a variety of methods and practises that aid in market competitiveness.
Negative: Adapting to changes in a dynamic environment may be very challenging for businesses. The world's growth in technology might pose a threat to a company's survival.
Positive: The legal component is critical to the success of any business everywhere in the globe. As a result, it promotes economic progress by protecting both consumers and companies against exploitation.
Negative: However, the company's investment increases as a result of complying with and implementing different rules and regulations. If the firm or its goods or services are severely regulated or illegal, laws and regulations may have a direct influence on Jaguar Land Rover.
Positive: Organizations that do environmental analyses strive to provide environmentally friendly goods and services as a means of enhancing their own company's brand equity.
Negative: Adhering to environmental rules and regulations, as well as offering eco-friendly goods and services to clients, may be very costly for businesses.
The SWOT analysis below reveals the internal elements that represent risks and opportunities for the firm.
Strength | Weaknesses |
· Jaguar Land Rover is one of the world's most popular luxury automobile brands. its long-term legacy is its cutting-edge technology and highly-skilled staff (Agnihotri and Bhattacharya, 2018). · New opportunities for JLR have opened up with the company's merger with Tata Motors, the world's biggest carmaker in India. · As a result of this investment, the company's goods and services are always being improved. | · Due to a lack of demand for diesel vehicles in the United Kingdom and other nations, Jaguar Land Rover is experiencing trade issues. · There is a lot of competition out there, and it has to fight to keep its market share when it enters new markets. |
Opportunities | Threats |
· Many new markets are available for JLR's expansion. Countries in the South Asian region. · The firm needs to concentrate on hybrid, electric, and low-emission vehicles. | · JLR's rivals include BMW, Porsche, Mercedes, and Audi, as well as a number of other high-end vehicles (Braun, Latham, and Cannatelli, 2019). · In addition, the company's sales and profitability may be directly impacted by financial instability, government and environmental legislation, and a rise in raw material costs. |
M1 Analysis of the macro environment to determine and inform strategic decisions
The PESTLE Framework is used to examine JLR's external environment. To be seen in a favourable way, Jaguar Land Rover is a global company with connections to several countries. Consequently, any political reform may be accepted by the company very fast. JLR and other nations work together because of Jaguar Land Rover's financial strength and contribution to the economy of other countries. It is also assisted by the company's ability to access financial markets and the availability of liquidity in stock markets, which aids in its global growth. Product and service customization is an important part of a company's capacity to differentiate itself from competitors in the marketplace. In order to fulfil the demands of the local people, JLR may have to increase public service spending (Braun, Latham, and Cannatelli, 2019). A wide range of processes and practises are needed by Jaguar since the company operates in so many different nations. Any company's success depends on its ability to successfully navigate the legal system, no matter where it is located. As a consequence, it aids in the development of the economy by safeguarding both customers and businesses from being exploited. For companies, complying with environmental legislation and providing environmentally friendly products and services may be very expensive (Agnihotri and Bhattacharya, 2018). A study of the company's internal environment indicates that Jaguar Land Rover is one of the most well-known luxury car manufacturers in the world today. Cutting-edge technology and a knowledgeable workforce are the foundations upon which it will build its future. The combination of Jaguar Land Rover with India's largest automaker, Tata Motors, has opened new doors for JLR. Due to a shortage of demand for diesel automobiles, Jaguar Land Rover is having difficulties in the trade market. Hybrid, electric, and low-emission cars must be the company's primary focus.
P2 “Internal Environment and Capabilities of an Organisation”
The internal business environment comprises of a wide range of aspects and components that determine the atmosphere inside the firm's structure and are under the control of the organisation.
The McKinsey 7s Framework for Jaguar Cars:
VRIO Framework
When evaluating a company's long-term competitive advantage, the VRIO framework looks at both its internal and external resources. The VRIO framework, as described by Sindi and Roe (2017), is composed of four components that together form the acronym VRIO and aid in the discovery of long-term competitive advantage. It is important to clearly establish the corporation's resources, whether they are material or intangible, before moving into the VRIO framework. Resources must be classified into one of the following groups:
FINANCIAL RESOURCES | HUMAN RESOURCES | MATERIAL RESOURCES | NON-MATERIAL RESOURCES | ||||
? | Money | ? ? | People Skills People Knowledge | ? | “Raw Materials” | ? ? ? | “Patents Brand Name” “Intellectual Property” |
? ? | Shares Bonds | ? ? | Facilities Machinery | ||||
? | Debentures | ? | Equipment |
VRIO Analysis Resources Value Rare Imitation Organisation Competitive advantage Alignment of Yes No Every firm The organisation Needs lot of various builds its own can extract efforts to activities with strategy. maximum get JLR potential out pleasant corporate of it. outcomes. strategy Pricing Yes No Pricing JLR have its “That kind of strategies strategy own pricing competitive constantly analytics advantage imitated by engine. temporary for another Organisation”. industry. “Keeping In an It applies in In that Organisation It is helpful in track of industry in segment in scenario successfully gaining project and “Which “Which competitors grab competitive their frequent consumers are not able to opportunities. advantage. Implementation” overrun of of JLR imitate it. cost exist”. Operates”.
M2 Critical evaluation of the organisation’s skill set, structure and capabilities
Human Resources
A company's human resource (also known as "human capital") may be a source of competitive edge or a cause of vulnerability (Rehman and Anwar, 2019). Productivity increases and economic development for Jaguar Land Rover may be attributed to its human resources (“individuals with knowledge, skills, and capabilities”)." When it comes to hiring and training new employees, JLR has a well-oiled recruiting machine in place that ensures they get the right individuals in the right positions at the right time. In order to realise their full potential, they build an internal team that enables them to be recognised for their outstanding performance.
Having a well-trained workforce is one of the most significant parts of the company's internal business environment, which has a favourable influence on its development.
However, workers who lack the necessary skills and expertise, as well as those who have a bad attitude toward their work, will be a major hindrance to the organization's success.
Capital Resources and skill set
Money, tools, technology, structures, machinery, and so on make up capital resources. In order for a business to carry out its strategy, enough financial resources are unquestionably necessary. By having enough budgets and financial resources, a company may simply execute its strategies and grow (Braun, Latham, and Cannatelli, 2019). When it comes to Jaguar Land Rover's financial stability, they make sure to put their money where their mouths are by using the most effective tactics, utilising the greatest goods, and giving investment possibilities for others.
Organizational Structure
The CEO (Dr Ralf Speth) sits at the top of the pyramid, at Level 1, with his immediate reports at Level 2 of the hierarchy. Executive Directors, the CFO, and the “Chief Commercial Officer” (CCO) make up the 15-person team (CCO). JLR's executive director of manufacturing (Grant McPherson) sits at the top of the company's hierarchy, and the next level down is the middle manager area (Rehman and Anwar, 2019). The vertical functional structure of Levels 1 and 2 is maintained in Level 3, but the divisional structure of Levels 4 and 5 is introduced. When you go down from Grant McPherson, “Executive Director of Manufacturing” at JLR, through Levels 3, 4, and 5, you arrive at the Middle Manager area. The vertical functional structure of Levels 1 and 2 is maintained in Level 3, but the divisional structure of Levels 4 and 5 is introduced.
LO 3: “Porter’s Five Forces Model and Competitive Forces Analysis”
There are five forces of competition that form the Jaguar Land Rover industry, and Porter's five force model is used here to describe JLR's strengths and position in the UK.
To prepare a strategy plan, JLR must follow the following frameworks:
Bowman's Extended Model
It was established by Bowman and Faulkner (1992) to indicate the strategic positioning of a product in order to acquire a competitive edge in the market. According to the Bowman's Strategy Clock, a business may use the two dimensions to better position its goods and services in the market (Reley, 2018). Price and perceived value are two different things, yet they are intertwined in this case.
Jaguar Land Rover is among the most forward-thinking companies in the automotive industry. There are just two product lines available, as opposed to the six that were formerly available (Sindi and Roe, 2017). In the evaluation of this product line, it is evident that the company's goal is to differentiate its product from its rivals by technical advancement and the adoption of a new product line. It spends a lot of money on research and development, but then has a low investment in R&D compared to its rivals. Consequently, it has resulted in a limited amount of cost reductions in their products and services. Low market share in developing markets compared to their rivals provides an excellent chance for them to attract high-priced goods. Land Rover, on the other hand, has a greater presence in the market than Jaguar. Products like the Freelander and Discovery are available to those in the middle-class.
Strategic Management Planning
Strategic Management Plan for Jaguar Land Rover was created to acquire a competitive edge over its rivals.
SMART Objective |
Actions to achieve objective |
Resource implications |
Success criteria |
Who is responsible |
Deliver product design and engineering excellence by 2022. |
Adjusting production schedules and conducting frequent evaluations are two ways to improve quality. |
Increase the number of engineers with advanced degrees and make a larger investment in innovative goods and technology. |
Global demand is met and the market is always ahead of the curve. |
Both the Human Resource Management team as well as the production team work together on this project. |
From 2022 forward, new product development and commercial expansion are planned. |
Automotive research and development. Introduce new electrified cars, including all-electric, plug-in hybrid, and mild hybrid models. Expand manufacturing operations in China, Brazil, Austria, and Slovakia. |
Invest on research and development. Make a £4 billion investment in new product development and capital spending. Increase your skill pool to meet increased demand. |
Consistency across all consumer touchpoints with a premium brand experience. The business extended internationally. |
Human Resources Management Chief Commercial Office |
Conclusion
On Each Order!
As a result of the preceding analysis, it has been established that business strategies are critical for an organisation to address numerous challenges and provide a clear route toward achieving desired goals and objectives. To achieve market success, organisations must consider a variety of elements, including strengths, skills, and competitors, all of which contribute to an organization's viability and potential to develop in the future. Developing an unique brand image and customer loyalty is critical for an organization's long-term success and viability.
References
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