Tes Motors is an upcoming American organisation which is manufacturing automobiles to the market with the various innovative feature (Denton, 2012). The organisation is focusing on manufacturing of green energy supporting automobiles with luxurious features. Also, the organisation is focusing on the reduction of the prices of their new upcoming products to encourage the consumers to purchase products from the organisation with a lesser cost with the highest levels of luxury (Denton, 2012).
Elon Musk is the current chairman of the organisation and Musk is famous for his innovative IT system solutions to the market such as PayPal. Musk is a visionary and he always dreams bigger. The focus of this innovative entrepreneur is not the profit (T, 2013). Musk is expecting to find new technologies which would improve the living conditions of the human and he encourage his organisation to share the new knowledge without obtaining patents for the betterment of the human race and the world (T, 2013).
1.2 The external environment of the organisation and strategies to overcome the challenges of PESTLE
For the external business environment analysis, it would be used the PESTLE model. The model has main six factors to be considered in the external environment and the theories are suggesting that the organisation should have strategies and plans to overcome the challenges of each factor of the model.
The politics are playing a major role in the external environment. The political conditions would define the business policies and the positive political support would ensure the long run of the business in the environment (Paley, 2005). The current political conditions are supportive to the organisation and this can be named as an opportunity to the organisation.
The country’s government has identified the organisation as an innovative one which is creating new jobs in the country while making the good economy and due to that, the positive support can be seen. The organisation should use this opportunity to improve its strengths to get ahead of other competitive brands in the market successfully (Jeannet, Hennessey and Jeannet, 2004). The organisation should improve its intimacy with the government by offering new knowledge and technology to the country for the development.
Economic environment would define the demand and the supply of the market. If the people have a high level of purchasing power the demand would increase and if the supply was low accordingly it would increase the prices affecting the inflation of the country. Economic conditions of the market are so sensitive and the organisation would require following various strategies to face the economic challenges of the environment.
The organisation is currently not making the profit. The organisation is increasing the revenue through higher levels of sales, but still, the organisation hasn’t made any profit. Tes is considering that their expenses are the investment for the future income. The best suggested way to increase the income to the organisation is improving the investments. By benchmarking in the stock market Tes would be able to improve the investments to the organisation and since the organisation has a good reputation and positive hope for the future the people would purchase their stocks without thinking twice (Paley, 2005). By doing that the organisation would be able to successfully face the economic conditions of the market.
The sociological environment would consider the social factors and the social quality of the environment. If the people would have healthy and happy lives they would tend to have various luxuries (Paley, 2005). The buying power would define the affordability of the people and they would go for better and high quality things if the living conditions are high in the environment.
Tes actually has a good opportunity in this environment. The Americans are highly concerning about the environmental protection and pollution free green environment the products of Tes would be appreciated in the market highly (Paley, 2005). Also, the products are offered for the affordable prices and because of that, the people would favour the enjoyment of luxuries for a lesser cost. The organisation should follow the strategy of focusing the enriching the lives of the Americans that would give the organisation a higher level of market share with positive consumer perceptions of the brand.
Since the organisation is highly focused on the innovative technology, the technological environment would have a higher level of impact to the organisation. The country has the world’s modern technology and the high level of applications of the technology can be seen in various industries of the country. The people are fond of the technology and they prefer using new technology to ease their day to day activities.
The organisation is actually responsible for introducing new technologies to the environment. Most of the new technologies of Tes was introduced through R&D activities of the organisation. Also, Tes is giving away the new technology without holding the knowledge with patent licences and that is an encouragement for the technological environment of the country. To tally with the technological environment, the organisation can improve the R&D activities for the purpose of finding the new knowledge and use that knowledge for the betterment and the improvement of the organisational product portfolio (Jeannet, Hennessey and Jeannet, 2004).
The legal environment would define the legal framework that the organisation should follow during its business processes. The organisation was registered as a public listed organisation and therefore the organisation is liable to share its financial information transparently with the shareholders (Paley, 2005). The stakeholders of the company should be given the information that they required.
Since the organisation is highly focusing on the new technology and innovation, the organisation would need to consider the intellectual property rights. The organisation should be able to protect the rights of the new thoughts. Since the organisation is sharing the knowledge for the betterment of the humans the legal impact from the organisation would be rare to see in the market. The organisation needs to improve the current processes and procedures while protecting the legal consideration of the environment.
The organisations are expected to follow their business processes with the environmental friendly ways. The organisations should follow the policies and laws to protect the environment. Tes is actually focusing on becoming well in the green technology. All the products of the organisation are running using the electricity and the management of the organisation is expecting to the improvement of the usage of solar energy.
Using the solar energy the cars can be charged and that would save fossil energy of the world. That would also reduce the pollution of the world. The organisation should keep the focus on the betterment of the environment and encourage the green friendly technology usage. That would improve the positive perception towards the brand in the market as well.
The product life cycle or commonly known in the marketing with the abbreviation of PLC. The product life cycle would define the stage of the product’s life in the market and using the PLC the marketers can execute various strategies to the product in the market to stable the revenue generation to the organisation while the product is successfully performing in the market. Below figure 2.1 depicts the generic product life cycle with its stages.
figure 2. 1 Generic product life cycle with its stages
According to the theory the product would not make much of revenue during the introductory stage and the sales would be growing when transforming the growth stage in the market. During the maturity stage the product would be stabilised in the market and the organisation would not want to worry about the product since the consumers are highly familiar with it (Jeannet, Hennessey and Jeannet, 2004). After that the product would started to decline in the market and after some considerable time the product would be vanished from the market forever.
The selected product for the life cycle analysis is Magg two minutes noodles. The Magg brand is owned by Nestle India and also the product life cycle would be assessed by the actions of the product in the Indian market (Jeannet, Hennessey and Jeannet, 2004).
During the introductory stage of the cycle, it would be expected to improve the consumer awareness of the product (Milligan, 2012). To do that the organisation had done high level of marketing campaigns. .The product is coming to market with the specific mention of the convenience to the domestic nutrition and food needs (Jeannet, Hennessey and Jeannet, 2004). The product is much relative to the home made fast foods. The target consumers of the product were children, youngsters and the people who have the feeling of having convenience in their lives.
During the introduction stage, it can be seen a high level of market penetration strategies can be seen in the market. The market penetration activities would focus on the improvement of the consumer awareness of the product in the market. The selected product mainly targeted the school children when conducting the advertisements and promotional activities. The organisation was started giving the food for free during the introductory stage of the product and due to that, the consumers are experiencing the taste and the convenience of the product.
The growth stage of the product happened after the product introduction to the market. During this stage, the consumers are aware of the product and many of them are buying the products. The others are buying the products because of the recommendations of the existing consumers or the because of the advertising functions of the organisation. In the growth stage, the product has started to make profits due to an increase in sales. Also, the entrants of the competitors to the product could be seen in the market and many of the imitations could be seen in the market due to the successful market introduction of the original product. During this stage, high level of product differentiations and improvements were done to increase the captured market share of the organisation (Solomon, 2003). Magg was dealing with the race of the market by introducing the features that the other competitors are not able to introduce to their product. The organisation was highly focused on the market competition during this stage.
Currently, the product is in the maturity stage. During the maturity stage of the product, it can be seen that the sales of the product are declining after some time (Solomon, 2003). The product and the brand awareness is high in the market and the consumers are familiar with the brand and the taste of the foods issued under the brand. The organisation would not prefer to decline the product in the market. Because of this, the organisation is extending their strategies in the market to avoid the declining stage of the product. Mainly the organisation is differentiation the product in the categories of flavour, shape and the convenience (Jeannet, Hennessey and Jeannet, 2004). Also, the organisation is conducting the analysis and researches to find out the consumer perception towards the product and how to improve that while improving the market status of the product in the market.
Abay is a well known organisation that is conducting the business under market creator e-commerce model. The organisation is an American multinational organisation that is providing business to consumer (B to C) and consumer to consumer (C to C) the e-commerce services through the Internet. Pierre Omidyar was the founder of Abay and today the organisation is famous for one of the “best dot com” commerce site in the world.
Abay has more than 35,000 of employees serving worldwide and the organisation is listed as a public limited company. The headquarters of the organisation are situated in California, United States of America. The organisation was started as an auction company and until today the organisation is maintaining their auctioning function through their website. Abay.com website now has both the auction and buy it now function and using those functions the organisation is providing high quality services to its consumers worldwide. The organisation is expecting to expand its business model and market and they are focusing on improving their processes and performance through continuous quality enhancements and enrichment.
The organisation is facing various ethical issue and consumer privacy protection issues time to time. Since the organisation is ruining its services through the Internet various harmful actions would happen and that would tarnish the organisational image in the environment. Recently the organisation was hacked. This happened during the time period of 2014 to 2015 and that has tarnished the organisational name in the market. This hacking has violated the organisational responsibilities to the external environment.
After the message of the site being hacked the users started to lose trust with the organisation and some consumers were feared about their Internet money transactions happened through Abay and PayPal. The new was spread fast when the organisation asked the consumers to change their passwords to protect the information (Maclaran, 2010). This made the drops of the organisational revenue and the organisation needed to improve its consumer base with new strategies (Maclaran, 2010). The organisation has followed much responsible framework which assures the protection of ethical considerations of the organisation (Ryan and Jones, 2009). Since the organisation is having various consideration it is required to identify what sort of consideration that the organisation should take into the consideration and mainly those considerations can be categorised according to the responsibility level to the external environment.
The business has to concern about the social, legal, ethical and professional issues when conducting the business in the environment. When an organisation is going beyond those factors and conducting the business according to its own agenda, that organisation would not survive in the market for the longer run. The business should be done with good faith and the consumer perception towards the business should be positive (Ryan and Jones, 2009). When considering a business like Abay or any other business in the field of e-commerce it is essential to protect the social, legal, ethical and professional concerns, in the long run, to give the best services to the consumers (Matthews and Cronan, 2004).
Abay is an e-commerce site which is running using the Internet (Matthews and Cronan, 2004). The site allows the users to sell and buy almost anything (Matthews and Cronan, 2004). Because of that, the users would be able to search what they want on Abay. The user has the ability to refine the search according to his demands. Sometimes the site would contain age inappropriate items and it would be a social issue if the children would be able to see those items (Maclaran, 2010). Abay is using a policy that the user needs to login to the system and confirms his age by giving his birthday (when the time of account creation) and continue the activities of the purchasing and searching. Due to that, the age inappropriate materials would not be found by the youngsters (Milligan, 2012).
Due to the new improved protection technologies and ethical way of conducting business in the environment, the consumers started trusting the organisation once again. Now the organisation gaining its previous market share in the market and conducting the business successfully once again. Abay has learnt its lesson due to the unfortunate incident happened to their system and they are doing everything that they can to prevent such incidents in the future.
Abay should improve their data and process protection activities more. Since the technologies are increasingly developing in the world, the organisation can implement various biotechnical authentication methods to prevent unauthorised activities in the system. Two-step verification, high level of encryption, password protection policies and many other data protection technologies should be implemented to the web application to ensure its protection (Milligan, 2012).
Also, the organisation should improve the awareness of the consumer about the newly enhance features of the site. That would improve the faith towards the web application and the consumers would tend to forget the unfortunate chaos happened in past.
During the report, it was identified the importance of three major areas to the organisation. All the major areas were assessed using the real companies and real scenarios in the market. First, it was analysed the external environmental impact to an organisation. The organisations should be able to identify the external environmental impact to the organisation when conducting the business and it is essential to address the external environmental challenges accordingly when conducting the business in the environment. Tes is a well known brand for innovation and the organisation is expecting to gain future profits to the organisation. The organisation is taking a higher level of risk in the market and because of that, they should assess the impact of external environmental factors to the organisation accordingly to make profits in the future.
Secondly, the product life cycle was assessed. The selected product was Magg two minutes noodles and the product is well known in many international markets. It was identified that the organisations should maintain various marketing strategies to gain favours in each stage of the product lifecycle and mainly the organisation should focus on the mature stage of the product because the product would have the tendency of declining during the mature stage. The organisation should extend their product and marketing strategies to keep the product in the market and that should be assessed using the product life cycle.
Thirdly it was discussed an organisation which was recovered from a business strategy. Abay was hacked but now they are following the strategy of improving the consumer intimacy to improve the organisational perception of the consumers. The business processes should be done using an ethical background and that would improve the consumer perception accordingly in the market.
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