Strategic Management Assignment 1 _Bang & Olufsen (GC0440)

Table of Contents

1.0 Introduction.

2.0 Evaluate how the strategy adopted by Bang & Olufsen impacts the company’s decisions and activities

3.0 Analyse the external and internal factors of Bang & Olufsen and how the company responses to them

2.1 Analysis of Bang & Olufsen external analysis.

PESTLE Analysis (External Environment Analysis).

Porter’s Five Forces Analysis (Competitive Situation Analysis)

2.2 Internal Environment Analysis (Using Porter’s Value Chain Model)

Porter’s Value Chain.

4.0 Conclusion.

References.

1.0 Introduction

In Denmark; Bang & Olufsen is a well-known company that produces various types of luxury products including musical instruments, loudspeakers, multimedia instruments, and telephones with well-developed designs. B&O has operated its business activities around 100 countries by its 1000 dealers (Olufsen, 2019). Blythe (2016) claimed that the modern business world needs a strategic management system to hold market opportunities. The strategic condition of the firm can be measured in terms of strategic planning. In this paperwork; firstly the strategy adopted by Bang & Olufsen that affects the company’s decisions & activities is described. After then; this study contains an explanation of the business environment of Bang & Olufsen (B&O).

2.0 Evaluate how the strategy adopted by Bang & Olufsen impacts the company’s decisions and activities

Dolbow (2012) stated that Bang and Olufsen (B&O) is one of the best producers of electronic appliances. It produces various audio-video products that are continually improved. This company generally focuses on customers who are fashion-sensitive. The marketing team of Bang and Olufsen is continuously promoting the products like DVD players, speakers, high tech televisions, and digital music instruments amongst various products. Continuous innovation and development of design make Bang and Olufsen a leader of innovation within the industry.

Resources and power are the strengths of a firm in order to gain a competitive end (Vej, 2017) B&O has preserved its competencies through practice, experience, and continuous development. Through fighting to ensure the best experience of the products of the company, it has acquired strength over the years. A new strategy named ‘Pole Position Strategy’ is declared by B&O. This strategy is related to the name of Formula One racing. In order to focus on the range of the product and profitability, Pole Position Strategy enables B&O (Dolbow, 2012). The main point of this strategy of B&O are Profitability, Focus on the development of products; One general sales organization; Common digital platform building; Adjustment of cost; and New management team.

Dolbow (2012) claimed that the Performance of sound and the excellent picture of B&O products conquer the market. These two products satisfied the customers of Bang and Olufsen. Customers choose different challenging technology. Therefore, this company manufactures user-friendly and supportive products for the customers. It brings the customers close to the company and satisfies them. The design of the products of this company is unique which shows ideas of products themselves (Anthony, 2012). The most reputed designers are hired in the company and they design delightful products so that they can attract customers. The material quality of products is also stiff in nature. The materials are costly but it helps to defeat the competitors of the Bang and Olufsen. Generally, customers are willing to pay more for quality products than defective ones that sometimes even more costly to mend.

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Band and Olufsen have many success histories. However, for different challenges, it has been incompetent to reach its particular levels. Bang and Olufsen have led to the production of televisions of the ‘BeoVision 10-40’ plasma screen which offers an instant cinematic experience for viewers (Anthony, 2012). It is unlucky that customers propagate that the plasma technology used for TVs becomes moldy with time. This screen slowly weakens and the colors become faded after some time (Raun, 2017). It affected negatively the product of Bang and Olufsen. The price of the product of Bang and Olufsen is another challenging criterion. Many customers complain that although Band and Olufsen offer quality products for their customers, the prices are very high. Therefore, customers oblige to purchase products from other competitors of Bang and Olufsen who offer lesser prices.

Bang and Olufsen have a team of research and development to develop a strategy (Dolbow, 2012). New technology is innovated for the convenience of designers of products and manufacturers. The heavy demand for audio-video products helps the company to spread its wings in the market. The company has been pointing to franchise opportunities and advertising to distribute its products all over the world. The business strategies of Bang and Olufsen are fine but there are some threatening factors. Competition is one of them. The price difference from the competitors has pushed B&O to the edge. Anthony (2012) stated that most customers don’t buy a plasma screen for having a B&O stamp. They purchase the alternatives companies’ products at a lesser price. At last, it can be said that Bang and Olufsen should find out the strength and opportunities to expose its activities.

3.0 Analyse the external and internal factors of Bang & Olufsen and how the company responses to them

Blythe (2016) claimed that Effective strategic planning is needed to mitigate the complexity and ambiguous position of the business fields. Normally strategic planning is affected by various environmental factors that categorized under internal and external factors. At this stage; some strategic frameworks like PESTLE analysis, Porter’s five forces, and the Value Chain model are described below………..