Business Analysis in Britain - Case Study Example

Save Britain Money (SBM) PEST Analysis Executive summary Save Britain Money (SMB) operates in the energy industry and aims at ensuring energy consumption is decreased through its five subsidiary companies in the United Kingdom. The external environment of SMB affects its ability on meeting its goals and these factors include political environment, which determines the laws and regulations as well as the policies that SMB has to abide to and follow in its operations. The economic environment entails the situation of the economy in relation to the pricing, the social environment deals with the situation and view of the people, while the technological environment determines the availability of new methods of carrying out activities and development of new products at SMB. To be successful, SMB has to make measures to adapt to this external environment in its operations. Introduction Save Britain Money (SBM) Save Britain Money is a Welsh company with headquarters in Swansea and large offices in Cardiff. SBM employs 950 staff members and a further 500 self-employed staff that work across the United Kingdom. The founder and CEO of SBM is Swansea businessperson, Neville Wilshire SBM has subsidiaries including Nationwide Energy Services, We Claim U Gain, Save Me My Money, Billscutter, HiS Energy, Debts Reduced, and FuelSwitch.com. The main business operations of the company include energy efficiency surveys, renewable energy advice, and installation, mis-sold payment claims, price comparison services, debt management plans, on-line fuel switching and much more. SBM was founded in 2005 in response to grants offered by the Welsh government; this was aimed for households to improve energy efficiency in their homes. This study aims at conducting an in-depth analysis of Save Britain Money using the PEST framework to understand each factors effect on the policies and competitiveness of the company in the market, strategies for the company to undertake and provide recommendations for the success of SBM. Main findings PEST FRAMEWORK PEST is a tool for the generation of an understanding on the relation of the firm to the external environment (Warner, 2010). The main reasons for PEST analysis is that it is relevant in decision making as it informs the management on the situation of the firm in relation to the external environment (Slownam, & Jones, 2011). Political– this deals with the relation of the firm to the rules and regulations, tax rates, legislation, and laws in different countries in which the company operates. Globalization has led to the importance of the political environment as an influence on the ability of the firm to meet its goals as firms set up shop in different regions, countries, and localities for the generation of new markets (Groznik, Krapez, & Skerlavaj, 2011). SBM plans to expand rapidly to new areas to sustain growth and expansion needs of the firm but this is affected by the political environment in this regions. Policies on energy use, energy saving, environmental conservation, and fuel switching has an impact on the ability of SBM to be successful in these new areas. The potential impact of the political environment is the use of funds and resources to ensure SBM complies with these laws and policies in the operating environment reducing the ability of the firm to expand at a high rate to the new market areas. However, SBM will gain a competitive advantage after compliance to these policies as they have a prior experience in the energy saving industry and this plies limits the ability of new firms to enter into the market. The policies of the firm have to be made in compliance to the set rules and regulations in the operating environment where SBM expands to as a means of ensuring compliance and operation within the law. The plan by the Government to launch Green Deal, their energy efficiency flagship in October, is another factor on the political environment of the firm. The fact that SBM has made plans to be the largest provider of Green Deal services to consumers is in line with the government’s vision making the firm have competitive advantage. This is due to the preparedness of the company and the availability of human resource and financial resource to meet this requirement. SBM should be in a position to align its development and growth needs as well as further expansion to the policies and goals of the government, both local and national, in its operating regions. Economical– entails the ability of the people to access the products offered by the company depending on the prices and their economic conditions (Cadle, Paul, & Yeates, 2010). The impact of economic downturn on the ability of consumers to spend has been negative, hence the need for them to make savings on their spending. The economic environment that SBM has to consider is the stability of the United Kingdom economy and the fact that standards of living is increasing owing to high unemployment rates, low access to credit, and the impacts of the global environment (Ryan, & Campell, 2012).. These factors make it necessary for the consumers to augment their savings in their utility bills affecting positively on SBM’s business. There is an industry flow towards saving energy owing to the need to protect the environment and save utility costs, hence the need for SBM to provide services at lower costs and that will provide the customer the highest levels of money saving compared to other companies. Ensuring employees are well trained, low cost measures, increased technology to meet the needs of the population of high energy bills savings at low cost gives SBM competitive advantage. Technology impacts negatively on the competitive advantage of SMB, when the competitors have highly advanced technology but being innovate, installing and ensuring SMB has better technology gives them a competitive advantage. Social – there is a shift in the attitude of consumers towards the protection of the environment and saving energy use and costs (IIBA, 2009). This has a positive impact on SMB as it aims at providing measures for consumers to reduce costs from energy use and limit environment degradation as demonstrated by its implementation of project green. SMB in the eyes of the public is viewed as conducting activities that promote redistribution of energy and translate to moral uplift, hence positively viewed by the public. This augments the ability of the company to increase customer base and gives the company a competitive advantage over other firms since it has a greater influence in the community. SMB actions minimize environmental degradation. Technological– availability of new technology on sing of energy costs will affect positively on SMB where there will be high saving for the consumers (Geels, Hekkert, & Jacobson, 2011). This allow SBM to meet saving needs of consumers on the energy they use augmenting the ability of the company to attract new client base. To adapt to the introduction of innovative technology, SBM has to augment research and development on new technology on energy saving and ensure latest technology is installed (Blais, 2012). Training of employees on use and application of new technology also ensures the firm adapts to changes in the technology in the energy industry as technology easily becomes obsolete if measures for improvement and update are not taken. Appropriate recommendations for SBM’s future success SBM should invest in current technology and invent new ideas that aid in the achievement of a high energy saving to increase their ability to provide more vale to the customers increasing their competitive advantage in the market (LAHDEN, & ErkAmo, 2013). The other recommendation is for SBM to expand its operations to areas that have low income and are in high need for energy saving to increase their ability to better use their disposable income (Elearn, 2012). This will aid the company in getting a high customer base owing to the high concentration of this king of households in the UK. Another recommendation is making policies and strategies that are in tandem to changes in legislation and government policies and arranging to comply with these legislations aids SBM to respond to the external market environment better. Conclusions The external environment has a very big impact on the ability of a company to meet its goals, objectives, gain competitive advantage, and make strategic decisions. The main reason for this assertion is that the changes political, economic, social, and technology affect the firm’s ability to maintain its operations in terms of increased costs, augmented opportunities, expanded market area, access to resources, efficiency, and effective price setting. 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