Strategic management refers to the formulation and the implementation of the main goals and the key initiatives that have undertaken by the concerned management of the organization on the behalf of the owners of the concerned business organization (Rothaermel 2015). The strategic management of the organization is generally dependent on the consideration of the resources that the concerned company might have been utilizing as well as the assessment that is made on the basis of both the internal and the external environment that are observed in the operational environment of the concerned business organization (Lasserre 2017). The strategic management of the organization generally relies on the setting of the objectives of the concerned organization, the analysis of the competitive environment wherein the company had been operating. The strategic management of the company should also take into the consideration the analysis of the internal environment of the concerned organization, the evaluation of the strategies that are taken into consideration and ensures that the concerned management of the company implements the strategies in the concerned departments of the organization. Rolls Royce is a British automobile company that has been active since the year 1998. The company deals in the manufacture of various automobile vehicles as well as has its holding in the aerospace industry as well. The various business ventures of the company are inclusive of the civil and the defense aerospace, the marine and the other energy markets (Rolls-royce.com 2018.). The following report deals with the strategic management processes that are implemented in the British automobile company of Rolls Royce. The report opens with an overview of the automobile company and proceeds to put forth an analysis of the competitive environment of the company. The report proceeds further to put forth an analysis of the internal affairs of the company.
PESTEL analysis is a tool that is used to look into the various environmental factors that might affect the concerned companies that have been operating in the given market. These environmental factors that has been affecting the concerned businesses include the political, the economic, the social, the technological, the environmental and the legal factors that have been in operation in the concerned market. The various environmental factors that have been affecting the famous automobile manufacturer are the political factors, the economic factors, the social factors, the technological factors, the environmental factors and the legal factors.
The political factors that have been affecting the Rolls Royce are those that pertain to the various factors like the political risks that pertained to the Gulf Wars and the other terrorist activities that seem to be affecting the confidence of the passengers, especially among those that belong to the United States. The company is also affected by the matters that are related to the carbon emissions of the vehicles that are manufactured by the concerned company (Huxtable and Schaefer 2016). The other political factors that have been affecting the company relate to the factors pertaining to the political lobbying that is generally found in the concerned countries wherein the company has been operating. The political factors that have been affecting the company might also include the various policies that might majorly affect the aerospace departments of the concerned company in discussion, Rolls Royce (Sharma 2015). The economic factors that have been affecting the company deal with the factors of the supply and the demand of the various products and services that the concerned company has been extending to the esteemed clients of the organization. The company is observed to have been facing an economic crisis due to the unpredictable rise of the demands on the part of the clients of the company. The other economic issues that have been affecting the company deal with the unavailability in the matters pertaining to the cost for the major investment on the part of the company (Gwiazda 2013). The social factors that have been affecting the company changes in the global demand of the products and the services that are offered by the company. The aerospace department of the company have been facing various issues that pertain to the social factors that are operative in the concerned market (Gupta 2013). There has been a rise in the population in the urban areas of the country thereby leading to the increased management of the traffic as well as the increase in the demand for the airbuses that are capable of holding more passengers at the same time thereby attempting to cope up with the pressure that is exerted by the concerned clients of the organization (Y?lmaz and Ustao?lu 2013). The technological factors that seem to be affecting the automobile manufacturer pertain to the factors dealing with the integration of the technology in the various products and the services that are offered by the company. The aerospace department of the company has demonstrated the fact that the products that are offered by the company as well as the services that are offered might incorporate the use of technology. The inclusion of the technological matters in the company might lead to the conditions wherein the company might have to face a risk in the matters of the obsolescence of the technology that has been implemented in the products of the company after long tenures of having the same product in the market (Moritz et al. 2015). The environmental factors that need to be abided by the concerned automobile company pertain to the matters that are various weather conditions that might impact the activity of the airlines, the reduction of the demand of the consumers due to the changes in the weather or the climate and the scarcity of the non-renewable fuels and the other materials that are needed for the production (Hill, Jones and Schilling 2014). The legal factors that might affect the company are those that deal with the health and safety of the concerned employees of the concern as well as that of the clients of the concern. The company must also abide by the various legislations that are related to the environmental standards like the control of the pollution, reduction of the emissions and the abatement of the noise that is created by the vehicles that are manufactured by the company.
The Porter’s Five Forces Analysis is undertaken by the concerned company in order to make a judgement on the competitive environment of the concerned company in discussion (Porter and Heppelmann 2014). The concerned company in discussion, Rolls Royce is known to be one of the leading companies in the automobile industry. The company uses the technology of the gas turbine engine that is quite mature and thus might lead to the difference advantage among the various competitors of the concern (Eden and Ackermann 2013). The five factors that are analyzed in the aforementioned model are the industry rivalry, the bargaining power of the suppliers as well as the clients and the threats that are faced by the company in the matters that pertain to the new entrants in the market as well as the substitutes that are active within the concerned market.
The competitive rivalry that is existent for the concerned company might be considered to be low and might be predicted to remain so in the future. The global aerospace industry is observed to be dominated by the three major companies that include Pratt and Whitney, General Electric and Rolls Royce. The market wherein the company operates is observed to be highly oriented to the budget plans of the concerned companies and might require the investment of the huge amount of capital in the field. Thus, the concerned company might have a high advantage in the fields wherein the industry rivalry is concerned (Moutinho and Vargas-Sanchez 2018). The bargaining power of the suppliers of the company might be considered to be low and is predicted to remain low. The company is observed to have a huge number of suppliers thereby providing the concerned company with the various parts and the other items that are needed for the production and the assembling of the parts that are procured by the company (Kozlowska 2017). The bargaining power displayed by the buyers and the other clients of the company is also considered to remain low since there are less buyers for the automobile company. The company treats the consumers as the authority for the price that is set by the company as the company is observed to have been one of the leading companies in the global automobile industry. The company is known to have been facing a low threat in the matters that pertain to the entry of the new organization in the market. The aerospace department of the industry faces a comparatively low threat in the matters that pertain to the new entries due to the huge costs that are involved in acquiring the achievements that are needed in the fields of the technology and the technological researches in the field (Diakaki et al. 2015). The threats that are faced by the company in the matters of the substitutes of the concern might also considered to be low due to the fact that the company might procure the parts that they need from the concerned company that had supplied the concerned parts in the first place. This is due to the fact that the company procures that parts that are best suited to the products that they have been offering to the concerned clientele of the company.
The internal analysis of any business organization might be conducted with the help of the SWOT Analysis. The SWOT Analysis of the organization helps in the analysis of the micro-environmental factors that might affect the company. The major factors that are identified in the analysis pertain to the various strengths, weaknesses, opportunities and the threats that might be faced by the company while operating in the concerned market.
The strengths of the company in discussion, Rolls Royce lie in the fact that the company has been one of the best in the market and is known to have been providing the clients with the best quality of the products. The company is known for manufacturing one of the best engines in the market. The aerospace department of the industry is known to best manufacturer of the aircraft engines. The company is known for the huge worldwide base that it has all over the world and receives a high amount of remuneration from the countries wherein the company operates. The company is known to have been operating in almost 130 countries and employ a huge workforce in the concerned countries (Rolls-royce.com 2018.). The reaches that the company has all over the world helps in the earning of the fair revenues from all the various markets and thereby avoids the risks that the company might face from the various volatile industries in the concerned market.
The weaknesses of the company lie in the spheres that pertain to the dealings of the legal matters that might arise within the society. The company might face the various legal matters in cases wherein the company might face the conditions wherein there might be the impositions of the damages and fines on the various products and he services that are provided by the company (Vitasek 2016). These impositions might lead to damaging the image as well as the goodwill of the company and the business of the company, the position that it holds in the market and the operations that the company might be involved in. The damage to the image and the goodwill of the company might also be reflected on the reputation of the company in the global market and the position held by the company at the share market price lists. The company, in discussion, Rolls Royce has faced a huge decrease in the operations budget that the concerned management of the company has been following since the year 2009. This decline is attributed to the lack of the cost-effective measures that have been implemented by the concerned management and the worse abilities that were demonstrated by the authorities responsible for making and the planning of the financial decisions that are to be implemented within the concerned business organization.
The opportunities that might present themselves to the company are the matters that deal with the increase in the demand of the automobile engines that are used in the various automobiles manufactured by the concerned company. The aerospace department of the company is known for being in high demand due to the fact that there has always been a high demand for the new models of the aircrafts all over the world in order to deal with the increase in the population of the country. The other opportunity that might be availed by the organization refers to the acquisitions that have been planned by the concerned management of the organization (Parthiban, Zubar and Katakar 2013). The aerospace department of the organization also faces a huge opportunity due to the massive growth in the demand of the turbine helicopters. The replacement of the old engines of the helicopter with the new engines might lead to a massive growth in the market division of the company (Jarillo 2013). The threats that are faced by the company are majorly found in the matters that pertain to the high levels of competition that is faced by the company in the markets wherein they might operate. The high-end technology that the company uses is rarely found in the competitors of the company. This leads to a very high competition in the market and industry wherein the company has been operating (Frishammar, Dasselaar and Parida 2015). The other factors that pose to be a threat to the organization refer to the compatibility of the policies of the organization to the various policies that are implemented by the governmental body of the country wherein the company has been operating and the risks that are involved in the supply chain of the company in discussion, Rolls Royce.
Conclusion
Thus, from the above discussion, it might be pointed out that the above analysis helps in the determination of the competitive advantages of the company that has been analyzed by using the various models. The PESTEL analysis of the company helps in the determination of the external environment of the company while the Porter’s Five Forces model of the company helps in the determination of the competitive advantage of the company. The internal environment of the company is analyzed by implementing the SWOT Analysis of the company. The analyses point out the fact that the company is one of the best performing automobile companies that has been operating in the global market.
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