Virgin Media Company Growth - Case Study Example

Table of Contents Introduction 2 Reasons for Company Growth 2 PESTLE Analysis 3 Conclusion 7 References 8 Introduction Organizations continuously look towards devising ways through which they are able to understand the external factors and the influence this factors have on the working culture. This helps businesses to develop strategies according to the market requirements and helps to keep ahead of competition. This report looks into the strategies and methods adopted by Virgin Media Inc for its growth and the manner the external factors have an influence on the working of the organization. This thereby helps to understand the manner in which Virgin Media Inc which deals in mobile phones, fixed telephone lines, internet and television is able to deal with it so that the business flourishes. Reasons for Company Growth Virgin Media Inc has ensured that they diversify their risk by having different products in their portfolio which has aided in the growth of their business. The company along with the development of new products and services has developed new ideas, and strategies based on the external environment and has looked towards including those in their planning process has ensured that they have a slight edge when compared to their competitors. The company has also looked towards huge investments in emerging markets which will further help Virgin Media Inc to ensure better strategies for the future and develop markets which will help to diversify risk and ensure an opportunity to grow their business. Virgin Media Inc has also looked towards developing their team where there are people who are both problem solver and critical thinker. This has helped Virgin Media Inc to make new transitions and confront the changes so that new possibilities and opportunities can be identified. This has helped Virgin Media Inc to develop strategies where they are able to understand the customer wants and based on it develop their products and services so that customer satisfaction maximizes. The company has relied on using its experiences and brand name at newer destinations and has looked towards having economies of scope in their operations This has helped Virgin Media Inc to ensure that they are able to save on cost which has immensely helped them to improve their business. The company has also looked towards the merger of NTL and Telewest which has helped Virgin Media Inc to gain an advantage in relation to infrastructure, experience and size of operations (Virgin Media, 2012). The company through this policy identified the needs of the customers and worked on four domain digital television, broadband, landline and mobile phones which ensured a first mover advantage and helped Virgin Media Inc to gain a large market share and develop its strategies of growth accordingly. Virgin Media Inc looked towards making alliances with partners like Sky, Setanta and others which helped Virgin Media Inc to get a ready market and was able to develop strategies that matched with the market requirements and helped the business to grow and ensured that they had a strategy which led towards their growth. PESTLE Analysis Business in this world continuously look towards using different tools to indentify the organizational change that the business is undergoing and PESTLE is one in that direction (Johnson & Scholes, 2002). This part of the report thereby presents the manner in which the external environment is having an impact of Virgin Media Inc. Political The rate of decline in fixed telephony due to change in government regulations and development in mobile phone network is an area that will affect the business of Virgin Media Inc. The rate of decline of fixed telephony is twice compared to the rate of decline of residential fixed telephony which has increased the usage of voice over internet protocol making it difficult for the fixed line business to sustain an advantage (PEST, 2012). This will have an adverse effect on Virgin Media Inc as all fixed telephony users of Virgin Media won’t transfer to their mobile services and will look towards some other players which will have an effect on the financial and operational condition. This is being added by a decline of over 5% in the business of fixed telephony business and will adversely have an impact of the company’s revenues. Virgin Media Inc has grown as a brand and with a presence of over 30 countries has ensured that the company is able to deal with some of the finest world economies which has helped to deal with difficult situations in a better way but has also increased the political interventions that the business faces due to business being present at different places has increased the role of politics and their decision making is being affected due to the political situation prevalent across all countries. Economic The global economy since the meltdown of 2008-09 has started to recover which ensures an opportunity to diverse the business so that the risk mitigates and similar situations in the future are dealt in a better way by Virgin Media Inc. The matter gets complicated due to intensifying competition and other players offering similar products and services at similar prices provide a threat. The complexity multiplies when we consider the fact that the recovering economy provides an opportunity for every player in the market to grow. Virgin Media Inc has thereby looked towards diversification and is looking towards differentiating their TV products by having a facility of video on demand by using popular applications like You Tube. The increase in the viewers using online applications and especially online videos will help Virgin Media Inc to differentiate their services and will provide with a wide opportunity to capture the recovering market. Social Virgin Media Inc has looked towards understanding the social market and their requirements and based on it has looked towards using their infrastructure so that they are able to provide better services. Virgin Media Inc has been able to used their fixed telephony network and ensure that they are able to provide the residential customers with different facilities like internet, television and fixed telephony through their same optic fibers. This has helped them to ensure that the customer demands are easilly met even during peak hours as using them has ensured that their reliability on other network reduces. This has helped Virgin Media Inc to match with the social requirements and has ensured wide scale services. Virgin Media Inc has also looked towards obtaining economies of scale through their understanding of social requirements and Virgin Media Inc by using the same infrastructure are able to provide the required services to the business community. This is due to the fact that when the peak demand for household is low than the business demand is high which has enabled them to ensure better services and look towards understanding the social requirements of each community and provide services based on it. Technological Internet, television and telephony services have witnessed widespread growth and technological advancement which has made different businesses look towards making different tools which helps them to provide better services. The development of different services like VoIP, 3D mobile instant messaging, WiFi, WiMax, LTE, and internet protocol television (PEST, 2012) has intensified the competition level as it has provided the users with different tools that can be used while delivering services. Virgin Media Inc has looked towards inculcating some of these applications and has further developed their offerings so that customers looking towards the brand find something which can be used by them. Virgin Media Inc needs to further understand the pace at which technological advancement is being noticed in this arena and needs to develop the required tools and have to invest in research and development so that an appropriate tool which will help the business to develop is made. This sector looks towards rapid transformation and multiplying the pleasure for the viewers which make it imperative that Virgin Media Inc looks towards matching it with the market requirements. Legal The sector has witnessed development in rules and regulations which has made it important that the players look towards matching the legal requirements. The government with the opening of economies has allowed the increased usage of mobile business which has affected the fixed telephony business and has made it mandatory that Virgin Media Inc looks towards obtaining the required licences from the government so that they are able to operate freely. The importance of this magnifies in case of business being conducted over different countries as different rules and regulations prevalent over different countries has made it important for Virgin Media Inc to obtain the required permission Environment Increased awareness and campaign to save the environment and reduction in carbon emission by ensuring that the appliances are switched when not in use has increased the burden and load on Virgin Media Inc as they have to ensure that they are able to develop policies and strategies to prevent the environment. Virgin Media Inc on this front has ensured that they use their own infrastructure and provide the different services like internet, television and fixed telephony through their same infrastructure. This has ensured that the company doesn’t has to further cause harm to the environment and develop new processes which has ensured the required steps to deal with the rising environmental concern. Conclusion The report thereby presents the manner in which the external environment has an influence on the working of Virgin Media Inc and the manner the company understood its external factors and used it for the development of the business. Understanding the external factors and working on the changing environment resulted in the success of Virgin Media Inc and helped them to diversify the risk. This will ensure that Virgin Media Inc is able to grow in the future and keep themselves ahead of competition at all levels. References Johnson, G. & Scholes, K. 2002. Exploring Corporate Strategy: Text and Cases 6th edition, FT Prentice Hall, UK Macher, J.T. & Richman, B.D. 2004. Organisational Response to Discontinuous Innovation: a Case Study Approach, International Journal of Innovation Management, 8 (1), pp. 38-46 Macher, J.T. & Richman, B.D. 2004. Organisational Response to Discontinuous Innovation: a Case Study Approach, International Journal of Innovation Management, 8 (1), pp. 87-123 PEST. 2012. PEST Analysis of Virgin Media. Retrieved on July 10, 2012 from http://swotanalysisexamples.org/pest-analysis-of-virgin-media/ Taylor, H. & Cooper, C.L. 2008. Organisational Change: Threat or Challenge? The Role of Individual Differences in the Managing of Stress, Journal of Organizational Change Management, 1 (1), pp. 1-19 Virgin. 2012. Strategic Analysis of Virgin. The art of strategic planning for information technology Virgin Media. 2012. Virgin Media Case Study. Retrieved on July 10, 2012 from http://www.businessteacher.org.uk/business-resources/case-study-database/virgin-media-case-study/ Read More