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Business Strategy Organisation

University: Kensington College Of Business

  • Unit No: 19
  • Level: High school
  • Pages: 16 / Words 4002
  • Paper Type: Assignment
  • Course Code: N/A
  • Downloads: 436
Question :

This sample will let you know about:

  • Discuss about the P1 Impact of macro environment in a organisation strategies.
  • Discuss about the Strategic Management Plan.
  • Discuss about the SWOT Analysis of JP Morgan Chase.
Answer :
Organization Selected : JP Morgan

INTRODUCTION

Business strategy refers to an integration of all the decision taken and actions that is performed by a company to achieving the goal of the organisation and to secure the competitive position in the market (Business Strategy, 2020). It is the backbone of every business that leads to complete the specific goals in the business. JP Morgan is one of the leading global financial services company since 1968, which provide solutions in different fields like securities, treasury services, investment banking, markets, private banking, merchant services and commercial banking in more than 100 plus countries. This firm serves millions of customers, institutional, government clients etc. further this report through the light on impact of macro environment in the company external and internal conditions and revenues. After that using porter's model to evaluate the competitors that are present in the market. Thereafter the company use various model, theories and concepts to determine the strategic capability of the business and critically evaluate this to know the sustainability.

TASK 1

P1 Impact of macro environment in a organisation strategies.

Macro environment refers to the external environment which affect the business overall activities either positive or negative (Fritscher and Pigneur, 2020). This factor is uncertain and they have an impact in a overall performance of an employees and its working. It is the factor that is affected by the monetary policy, fiscal policy, GDP, employment rates and consumer spending. The impact of macro environment affects the decision making process such as spending, borrowing and investing. Here, J P Morgan use PESTLE analysis tool to better understand the organisation environment and its sustainability over time.

  • Political Analysis- It is the factor that affect the overall business unit by its profitability or survival. It plays a significant role in the profitability and sustainability of the JP Morgan because government continues to implement tough rules and regulations on the financial industry (Ojiako, 2020). To overcome this monetary issue company applied more strict restrictions to consumers account. Maximise the level of tax may demotivate the company to increase their profits.
  • Economic factors- This factor impacts the sustainability and profitability of the business. It involves various factors like interest rates, economic growth, exchange rates, disposable income of an individuals and business. This factors affect the purchasing power of the customers (Ghauri, Grønhaug and Strange, 2020). The GDP growth of the country affect the JP Morgan sustainability in the near future and the interest rate of the the nation also affect the person willingness to borrow or invest. Therefore, high rates result in greater investment and it would maximise the growth of the company. Financial market also affect the companies capital in a way that keep in mind the demand and supply. The stability in the nation currency creates a great impact on the longer survival of the firm.
  • Social Factors- This factor refers to the individual beliefs, costumes, values and attitudes who live in a particular society (Al-Surmi, Cao and Duan, 2020). This factor involve population growth, health consciousness, age distribution and so on. This factor directly point out the customers satisfaction and what derives them. It affects the JP Morgan company in a way that it is very essential to carefully understand the consumers, education level, lifestyle and values and beliefs in a society. There are various social factors which affect the firm popularity. Firstly, the population of the company, in their respective age and genders is greatly impact the product that would offer by the company. Here, the firm would unable to sell their premium class product to the general public where majority of people are belong to lower class rather they would focus on the niche marketing. Because of knowledge differentiation firm would be very careful to not to lose their connection to the potential customers priorities and interests.
  • Technological Factors - This factor involves the change in technological innovation and development that effect the merchandise and firm (Yu, Park and Hong, 2020). Elements in this analysis are automation, digitalisation, mobile technology etc. Technological analysis majorly focus on the developments that would taken place only in digital technology and this also offer the new channels of distribution, logistics and manufacturing. In context of JP Morgan, it distance itself from the free user banking firm and refocusing on their company plans onto the digital platforms. The essential reason of digitalisation is easily connect with their customers and financial firm. This type of change is important because it is the primary interaction between the individuals and the company. The very important change that the organisation adopts is the quick deposit features for cellphone device. This technique helps the customers to easily and quickly deposit their check and cash by using their personal phones. And where the further improvement is needed firm invested in the R& D departments where they analyse and identify more new ways to connect with the people and earns profits over a long period of time.
  • Legal Factors- This factor includes advertising standards, consumer's rights, health and safety, opportunities, product labelling and safety. In this each firms need to know about what is right and what is not legal on order to trade successful (Cardoni, Kiseleva and Lombardi,2020). If the organisation deals internationally than it is very difficult task to know each country legal laws. Discrimination laws are placed in the JP Morgan to protect the every employees right in a way that they equally treat and offers a same opportunities according to the skills and capabilities of the staff members regardless of age,religion gender etc. health and safety laws are also maintained by the company for their employees so they work effectively and efficiently. This will also increase the growth of the company.
  • Environmental factors- It refers to that factors which rely on the environmental aspects like climate, weather, farming, tourism, insurance and agriculture. This factor come into trend after CSR ( corporate social responsibility). In context of JP Morgan a finance company that extremely done paper works and waste large amount of paper. To become a healthy environment company move towards a online paper work to manage their environmental habits.

From the above explained external factors of environment JP Morgan evaluate this to increase its profitably, revenue and growth in the market. Here, the political factor affects negatively in it. This factor enables to understand what are the customer preferences and needs and according to that company can make their products. They use digital marketing so they easily connect with their customers and other financial firms. They should follow the employment law to fairly treat their employees which in result in a good productivity for every employees. Because of CSR, company use environmental friendly product offerings so they earn higher profits and maximum growth.Take online assignment help in the UK from expert writers at the best price.

TASK 2

P2 Analysis of internal environment of JP Morgan.

Internal environment is an essential part of business. This climate refers to surroundings which are presently available within organization that can influence the functioning of organization (Ahamat and Chong, 2020). This particular environment contains physical, financial, human, technological resources as well as goodwill image and corporate culture of an organization. Business has control over such elements through which company can formulate and identify its strategies. There are two models SWOT and VRIO by which capabilities of JP Morgan can be understood.

SWOT Analysis of JP Morgan Chase

SWOT analysis is a study carried out by company in order to determining its strengths and weakness along with extrinsic opportunities and threats. It refers to a matrix of strategic planning which is intended for utilizing in beginning of decision making and use for evaluating the overall competitive position of an organization in industry or market (Lartey and et. al., 2020). In context with JP Morgan, the firm is one of the foremost ruling organisation in financial industry. JP Morgan uphold its well known position by thoroughly examine and analysing its SWOT matrix to understand the present scenario of challenging environment.

  1. Strengths: These are features which provide advantage over other rivals to business enterprise. In current time, JP Morgan has various strengths which enable them to prosper and grow in market. This helps in maintaining secures market share and explore new markets. Some of strengths are JPMC operates its business in more than 60 countries serves its services to different institutions, banking sector and government clients. Company has wide diversified and balanced revenue streams with distinct financial segments like corporate and consumer banking, asset management so on. It sustain fruitful returns on its capital expenditure because of its thriving accomplishment of exclusive projects.
  2. Weaknesses: These are characteristics which slow down the functioning of business and act as disadvantage for organisation (De Haes and et. al., 2020). There are some areas at which JP Morgan can enhance its weakness and convert them into positive possibilities. JP Morgan faces various fluctuation in market due to which it creates instability situation within organisation. There are number of competitors fighting for same market share with different or similar products which generate stiff competition condition for JPMC. Another major weakness of JPMC is raise in expense management because its non interest and operational expense is increasing year by year. Further, company revenue are majorly dependent on single market of US which makes firm position weak and slow down its business.
  3. Opportunities: These are elements which provide benefits to business or project. Low inflation rate of country brings opportunity for JP Morgan as it create stable market for company by which it enable the firm to provide lower interest rates to target consumers. Another opportunity for JPMC is government green drive through which company can offers its products to state and federal government contractors. New taxation policy impact positively which generates opportunities for JP Morgan to raise its profitability.
  4. Threats: these are components which creates hurdles for business enterprise. The major threats face by JPMC is regulatory challenges which means frequently changes in legal laws creates situation of increasing costs for JP Morgan which in turn influence its operating margins. Any financial crisis or recession situation will affect adversely over the working of JPMC. Take Examples of Assignments Now!!!

VRIO Analysis of JP Morgan

VRIO analysis is one of the popular mechanism to identify and evaluate the company resources and its competitive edge (Hasimu and Soegoto, 2020). This framework contains four elements valuable, rare, imitable and organization. This analysis can be understood by following matrix.

Resource

Valuable

Rare

Imitable

Organisation

Financial resource

YES

NO

NO

NO

Human resource

YES

YES

NO

NO

Patents

YES

YES

YES

NO

Distribution Channel

YES

YES

YES

YES

  • Valuable: these resources are foremost resource which are valuable of organisation and enable them to implement best strategies in effective and efficient manner (Vidgen, 2020). In case of JP Morgan, financial resources are valuable for company as they enable they enable the firm to make investment in external opportunities such as various projects and business this helps the organisation to enhance its profitability and overcome from threats.
  • Rare: The rare resources are those which can be attain by few competitors. For JP Morgan chase, company's rare resources are its highly talented and skilled employees which cannot be acquire by other firms easily. To retain these potential workforce JPMC needs to provides better compensation packages and effective work environment.
  • Imitable: These are those resources which cannot be easily sustain by other firm irrespective of few rivals. In case of JP Morgan, its imitable resources are its patents and copyrights which are extremely difficult to imitate or copy by others because it is illegal to imitate patented product or service also it is an expensive process to develop or purchase copyrights.
  • Organization: The above resources required to be properly organized with purpose of creating value and sustain competitive advantage of organization. For JP Morgan, it has well organized distribution network which enables firm to offer its services and products to its target customers on time when need arises.

From above frameworks, it can be summarise that JP Morgan Chase has effective abilities and core competencies which helps firm to sustain immense success and growth in market. These mechanism enable the company to identify its strengths and opportunities so that it can effectively sustain its competitiveness among its competitors. Moreover, it helps organisation to cultivate adaptive climate so that they can modify and formulate strategy on basis of external changes.

TASK 3

P3 Evaluate porter's five forces model in context of the organisation

Porter's five forces model was proposed by Michael Porter. It is an analytical tool to identify the firm's revenue and profitability in its business industry. This model examines the rivals in the market and for this they considers four factors which affects the organisation growth and success (Coulson-Thomas, 2020). In context of JP Morgan, managers use porter's five force model to evaluate its sustainability and profitability in the industry .

  • Threats of new Entrants- Organisation's power was affected by the new entrants into its markets. To directly compete with the JP Morgan, new entrants brings with new innovation, new ways of doing things etc. and than they compete with the firm. If a new entrants come up with a creative ideas it puts the pressure on the firm (Legaspi, 2020). JP Morgan manage all the challenges and build effective barriers to overcome this threats. They introduce new and creative products and services that attracts more new customers and gives a reason to old ones to buy their products. By established economics of scale so that it lower the fixed cost per unit. Spending more money on the research and development departments to fear the new entrants.
  • Bargaining power of the suppliers- Many financial companies buy their raw materials from different suppliers. Dominance position of supplier's affect the profit margins of the JP Morgan in a way they they will not high their prices of offings. More powers in the hand of suppliers in the monetary sectors affect the cost and lowers the profitability of the industry (Tardieu and et. al., 2020). To overcome this problem JP Morgan build efficient supply chain with numerous of suppliers. They experiment different product designs using diverse materials so when the price of one producers high they shift to the another one.
  • Bargaining power of Buyers- Firms will greatly influenced by the bargaining power of buyers. In JP Morgan buyers power are relatively high because of intensity of the competition among rival firms in the banking service industry (Rolaskhi and Soegoto, 2020). The best example in this factors is when financial sectors provide payment for new targeted consumers. Another trend that follow in this that increasing fashion of internet where customers are more reliable on the technology and company use research team to analyse the buyer's demand. By constantly innovating new products and services firms attract more new users and this will reduce the bargaining power of buyers and it will positively impact the proficiency.
  • Threats of substitute products- When a offering products of the firm match with the competitors than it will create difficult situation for the firm. JP Morgan is majorly a service oriented company where they understand the customers preferences and perception and according to that they offer and invent the services. However, they also increasing the switching cost for the customers by analysing the core needs rather then what they buy.
  • Rivalry among the firms- If the competitor is present in a same industry this will cause to down the prices and decrease in overall profits (Lyneis, 2020). For this JP Morgan build a sustainable difference and build a image better than the competitors. Collaborating with rivalry to increase the market share so that they capture the whole market large as well as small.

From the above information it has been analysing that five force model of porter can gain the complete knowledge of the revenue, its profits, sustainability of the organisation in the financial sectors and banking industry. To understand the porter model managers can give the shape of those factors in a positive way by using various methods and strategies. For this they innovate the new services, products to stay in the competitive market. This will also restrict the new entry in the same industry. Worried for Management assignment help ? Get our experts Help Now!

TASK 4

P4 Formulating and Implementing strategic models and theories.

Organizations required to develop and implement different strategic plan in order to expand its brand name and growth in different other areas or beyond the boundaries of country. There are numerous models of strategic planning which helps a company to be a first mover to attain different opportunities and possibilities to convert the disadvantage into advantage. These models are useful for firm in accomplishment of organisational mission goals effectively and efficiently (Kasemsap, 2020). JP Morgan can make use of Ansoff matrix strategy for purpose of expanding its business units in different market. This helps them to gain information regarding present scenario and conditions prevailing in other areas. Ansoff matrix is a growth and product development strategy by which firm can assess its potentiality and core abilities that helps them to decide which strategy can be adopt by organisation. This approach contains four different strategies.

  1. Market Penetration: this particular strategy emphasise on raising its current sales volume of products within its existing market (Ansoff Matrix, 2018). Market Penetration is a method to penetrate the market share of the company by reducing existing rates in order to stimulate large number of customers through giving attractive offers. Company can expand its promotional activities so that it can communicate with huge range of consumers. This particular strategy is adopt by firm when it want growth expansion within known market.
  2. Product Development: this strategy concern with introducing new brand product in current market. This method of expansion involves research regarding development of product range which means a proper examination of external environment for purpose of gaining knowledge about customer's taste and preferences so that firm can produce its product accordingly. This particular strategy is applicable by when it has absolute knowledge of existing market and able to offer better solutions to satisfy the emerging requirements.
  3. Market Development: this strategy focus on tapping new market with existing products or services by organisation. With the help of this approach company can explore new markets by means of new geographies or regions, different customer base(Alkan, 2020). This particular strategy is affluent when company has updated version of technology that brings lucrative opportunities in new markets, when consumers value firm's product. Organisation have various options to tap new market it can enter in new domestic market and expand its business regionally otherwise internationally by tapping foreign markets.
  4. Diversification: this one is last strategy on matrix as it is most riskiest method to choose. This strategy mainly focus on entering new market with new developed products. Diversification means to develop different featured products which has no previous existence in market. There are two types of product diversification one is concentric diversification in which company produce products which related to existing product portfolio whereas second is conglomerate diversification which specify new product is completely different from its current products.

From above analysis of strategy, JP Morgan can consider Market Development strategy to expand its business products in different locations. As it is discussed above that JP Morgan's major part of revenue is highly dependent on US which becomes the reason of slow down in its productivity. By adopting this strategy company can serve its products in different geographical areas so that it can create strong customer base and enhance its total earnings.

Strategic Management Plan

Company overview: JP Morgan Chase is one the leading financial institution which deals in variety of financial services like asset management, investment management, stock trading, wholesale funding, wire transfers and many more. It is world's most valuable bank by market capitalization. Company has its operations in more than 60 countries and now entity wants to expand its commercial activities in Haiti.

Vision: The vision statement of JP Morgan is to aspire to be the best and cultivate finest team and healthy as well as winning culture.

Mission: To be the best financial institution across globe.

Smart Objectives: Main aim of company behind expand its business activities in new market is as follows:

  • To increase the number of its profits by 10% in coming one year.
  • To enhance its market, share by 15% in 1.5 year.

Strategies and tactics: Market development is the strategy adopted by Tesla to achieve its objective of increase profits and market share.

Monitoring and evaluation: JP Morgan can evaluate the effectiveness of its implemented strategy by measure the number of its profits and by examine the sale of its offerings.

CONCLUSION

From the above given information, it can be summarised that every business organisation operates in a flexible and dynamic environment that affect the commercial operations of entity. It is very essential for every company to identify and study those factors for which various tools are there that could be use by organisations. PESTLE and SWOT analysis are the tools that could be use by enterprise to examine the external forces and to measure its internal capabilities. Further, porter five force analysis could also employ by firms in order to examine the competitive forces of industry. Further, with help of strategic management plan company can attain its set organisational objectives and can sustain in market for long run.

Related Sample :- Planning for Business Growth

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