Global Elements Affecting Business growth
There are various kinds of external factors that greatly influence several management practices of business. These factors include nature of industry, growth of nation, economy system, technology, competitors, demand etc. Organization should have to evaluate impact of various elements on business at the time development of various business plan (Business environment, 2013). This report presents that aims and objectives of organization are playing very important role in development of various organizational strategies. It also evaluates impact of inspirations of different stakeholders of American Express on business operations. Report also reflects various impact on oligopolistic and monopoly market conditions on the business decisions in hotel industry. Research analyses various global factors that influence management practices of mobile companies.
Purpose of an organization acts a basis of various business operations. It determines mission and vision of company that assists management in development of long term goals and business strategies (Yu and Ramanathan, 2012). The purpose of American Express and Wateraid with reference to mission, vision and objectives are explained below:
The purpose of American Express is to facilitate best financial services with proper ethics.
Mission: The primary mission of American Express is help different kinds of customers by offering different types of financial services. This thing creates huge impact of management practices of firm in order to enhance service quality.
Vision: The main vision of management of American Express is to become world's most respected service brand (Webster and Hamiton, 2012). On the basis of organization's vision, business entity makes efforts for offering best in class services to enhance satisfaction level of consumers.
Objectives or Value: American Express develops various objectives on the basis of vision and mission of company. It includes meeting of customer commitments, best in class services, promotion of teamwork within organization, development of good citizenship and creation of proper personal accountability.
The primary purpose of Wateraid is to facilitate pure water and proper sanitation for people which are living in remote areas of world.
Mission: The mission of Wateraid is transform lives of poorest community by providing access of safe and pure water, facilitation of hygienic food and sanitation in remote areas of world (Tuominen and et. al. 2008). For this, management develops various plans and programs in order to enhance relationship with various partners.
Vision: Organization wants to develop a world where everyone can easily get safe water and proper sanitation. This vision influences every activity of organization and helps managers in development of goals of firm.
Objectives or Value: With reference to mission and vision of organization, management has developed different kinds of aims and objectives. In this, manager determines objectives which includes promotion and safety of rights of poor people, proper access to water and sanitation (Wetherly, 2014). Organization develops various plans with partners to reach 1.24 million people with safe water and 1.77 million with proper sanitation.
In various business operations, consumers, employees and share holders are playing key role in order to different kinds of business objectives and goals. In this process, management of American Express makes efforts to maintain proper balance between needs and aspirations of stakeholders and goals of company (Szidarovszky and et. al. 2009). American Express meets the aspirations of customers, employees and shareholders with various strategies. Some tactics are explained below:
For shareholders: The major aspirations of shareholders are timely payment of dividend, safety of investments etc. So, business entity has earned record earnings in economic slow down. In this situation, management provides substantial part of profit of company to shareholders as dividend that increases market position of firm. Shareholder can take advantage of strong capital position of firm (Wang and Wang, 2008). In order to facilitate capital growth to company, managers have made huge investment in core business operations and opening new business avenues for assessment of future benefits.
For consumers: In order to meet financial needs and aspirations of consumers, American Express provides world class services to consumers. In this, organization is facilitating 24-hours customer care services, 45-day interest free credit cards, travel benefits, peace of mind through travel insurance and protect retail purchase in situation of theft or accidental damage cards and listening quarries through social networking websites (Roukis, 2006). All these services play very important role in achievement of aspirations of consumers.
For employees: American Express organizes various activities and follows various management operations in order to meet aspirations of workers. In this process, management promotes employee,s engagement in business operations by taking reviews, suggestion on various management decisions. Business entity facilitates highly flexible work environment in which employees can easily maintain balance between personal and professional life such as pick up children from school by managing work (Poser, 2008). Company also arranges social activities for development of good relations among workers and fairness in remunerations.
Responsibilities of American Express includes several factors such as quality of services, customer handling process and other management operations to meet satisfaction level of buyers. In order to meet responsibilities towards consumer, American Express has maintained high standards for training of employees, security of financial transactions as well as development opf long term relations with various other business partners (Szidarovszky and et. al. 2009).
Using internet based channel: The management of American Express have significantly enhanced its internet based services. In the process of delivering online services, management has adopted various safety measures and policies in order to protect consumers while facilitating online services. Various firewalls and security specialists are used by company for safety and security of consumer's personal confidential information (Recognizing Responsibilities, 2008). With the help of internet safety tools, business entity can protect business as well as consumers form online frauds.
By providing consumer education and financial literacy: To increase financial knowledge of consumers, American express has developed different kinds of financial literacy programs by developing partnership with various world's most respected consumer support firm. This thing improves skills and knowledge of first time credit card user (Sohal and Perry, 2006). For example: Organization is managing “My Money Business Program”.
By protecting travelers and promoting responsible tourism: In order to meet responsibilities related to safety of travel customer from different kind of disaster, business entity develops Customer Crisis Preparedness Programs which provide appropriate and well-coordinated response to consumer during situation of disaster (Recognizing Responsibilities, 2008). In order to manage this thing, business entity has increased coordination among travel managers.
There are different kinds of economy system followed by various nation in the world. Some most important kinds of economy system as well as allocation of resource in various systems are explained under this statements:
Mixed economy: This kind of economy system is followed by government of UK. Mixed economy system can be defined as a system in which public considers several good elements such as public and private ownership of industry, market- based allocation with proper economic and planning as well as free market with proper control of state (Ditlev-Simonsen and Wenstøp, 2013). On the basis of characteristics of this mixed economy, resources are allocated by government and private player. Government facilitates basic resources such as coal and electricity. An organization can acquire other resources from various private firms.
Command economy: It is one of the important kinds of economy system. It defined that government manages production planning of different things as well as price are also determined by government (Services, 2009). China follows command economy system in which all major resources are controlled and allocated by government with reference to national interests.
Free market economy: This type of economy system can be defined as system which is generally based on supply and demand concept. Public authority have little or no control on various operations of business (Dettwiler, Lindelöf and Löfsten, 2006). On the basis of this principle, public authority of US acts as supporter. In this, all kinds of resources allocated by private business organizations.
Impact of the Bank of England’s low interest rate: If Bank of England's reduces interest rates then several benefits could be found by management of American Express and Microsoft. It includes expansion of business within less cost and companies can speed up business operations with the help of new projects (Chen and Mohamed, 2008). By lowering interest rates, government can promote demand of different goods and services that will increase sales and revenue of both companies.
Impact of an increase in VAT and corporate tax: In order to increase revenue of government, public authority increases different types of taxes. This thing enhances expenditures of American Express and Microsoft in acquisition of different services and materials for different objectives of business (Rendtorff, 2011). It increases overall cost and price of services that will create negative impact on sales and revenue of companies. So, business entity should have to take various actions that will reduce expenditures and could maintains profitability of company.
There are many kinds of legal legislation influencing business operations of American Express. Some important legislation are explained below:
UK Competition Act 1998:The main aim of UK competition Act 1998 is to identify and put restriction on business operations and dealing in order to get dominant market position.
On the basis of regulations of this act, the management of American Express cannot carry out such kind of business operations through which business entity can restrict competition (Ditlev-Simonsen and Wenstøp, 2013). So, American Express makes efforts to provide best services to consumers. In this process, company should have to organize various kinds of promotional activities for presenting a unique image of firm.
Consumer Credit Regulations 2010: This legal legislation controls various finance and credit related activities of different financial service providers. It controls advertisement, documentation, determination of Pre-contractual information and agreements and various other key factor for protection of interest of consumers (Poser, 2008). On the basis of these rules, American express disclose all kinds of information about different financial services at the time of developing purchase agreements. Company ensures consumer about safety of confidential information.
In oligopolistic market, only few but big business players offer hospitality services in UK market. In this market situation, price and market growth rate are greatly influenced by price and management of operations of other companies. In this, every company develops an action plan in order to manage each decision related to price and market growth of competitor. Pricing of services in UK hotel industry is controlled by competitors of particular organization (Elements of Business Environment, 2013). In this business aspect, market share growth is influenced by price of services because all companies are offering similar services. By facilitating unique services in great price, an organization can increase market share growth.
If Hilton Hotels is operating business in monopoly market then organization will manage different behavior as compared to prefect competitive market. In situation of monopoly, business entity could set high prices of several facilities offered by firm in order to increase profitability. On the other hand, Hilton Hotels will make efforts for improving of service quality as well as innovating new services that will play very important role in order to make strong position and monopoly in market (Wang and Wang, 2008). In this, company can easily maintain growth in market share with the help of distinct services.
In situation of weak market demand in hotel industry and market saturation, the management of Hilton Hotels should have to take several measures in order to generate demand of services. In this. Company takes several actions in the form of reduction in price of services,providing some value added service within same price, active marketing campaign and selection of creative advertising tools (Szidarovszky and et. al. 2009). With the help of all these action, hotel organization could increase demand of hospitality services. Company can facilitate different type of low cost holiday packages that will motivate consumer in order to acquire services of firm.
Several kinds of step could be taken by managers of Hilton Hotels in order to react new entrant such as international hoteliers InterContinental and Four Seasons in UK. In this situation, management of Hilton Hotels needs to match price and quality of services according to standards of new market entrants (Ragas and Laskin, 2014). In order to manage competition, Hilton Hotels should have to develop different kinds of proactive marketing plan with the help of innovative advertisement. Business entity needs to implement changes in business structure and consumer handling process that will increase service quality and satisfaction level of consumers.
Due to growth in internet based services, online booking culture is becoming very popular in hotel industry. On the basis of current market trends, the management of Hilton hotels should adopt this online culture related to room reservation (Wetherly, 2014). By adopting this system, company can offer room booking services to consumer from any part of world through internet. In this process, management should consider both positive and negative aspect of internet based services. Business entity has to evaluate organizational capabilities and expenditures of company in order to adopt new system.
To ensure about advantages of new online booking process, company has to develop an efficient infrastructure with the help of computer hardware and software that could manage all kinds of online operations with out any difficulty (Szidarovszky and et. al. 2009). Business entity should have to use different promotional medium like TV and newspapers to increase awareness among consumer about website of company. By offering special discounts on online website, Hilton Hotels can ensure success of new alternation in the form of increment in sales and revenue.
There are several benefits identified from international trade to mobile companies like Three and Vodafone. With the help of international trade practice both companies have recorded tremendous growth in sales, revenue and profit. In international trade, companies have increased quality of mobile services that will provide competitive edge over domestic firms. This process increases reputation and goodwill of both companies in new overseas market. With the help of overseas trade practices, both firms have developed various joint ventures with domestic firm which enhance brand value and market share of company (What Is the Impact of International Trade?, 2015). It reduces company's reliance on domestic market as well as decreases losses.
In the process international trade, various kinds of risks are faced by Three and Vodafone. It includes risk of non-acceptance of consumers, highly fluctuated exchange rates, alternation in policies of government, different type of exchange control regulations, cultural differences, language barriers, corruption etc (Ali, 2014). All these factors create negative impact on different business operations of Three and Vodafone.
Cross-border migration can be defined as transformation of people from one country to another nation for job. This thing increases cultural diversity in business entity. It also helps company in order to recruit worker in very less cost (Ditlev-Simonsen and Wenstøp, 2013). This concept also assists management in handling of consumer belongs from different culture.
There are several potential impact identified of global rise in handset price on mobile companies Three and Vodafone. If rate of mobile handset is going up then people avoid to purchase mobile phone which are having 3G and 4G facilities that will reduce usage of high speed mobile network (Chen and Mohamed, 2008). It lowers revenue of mobile companies as well as profit. It also reduces demand of other value added services.
There are several global factors influencing various various aspects of Three and Vodafone. Some important factors are explained below:
International economy: It affects business operations of every of organization along with mobile companies (Wang and Wang, 2008). If international economy boots up then sales and revenue of both companies will be increased but business can face loss in situation of recession.
Technology: It is the most important global factor that greatly influences several business elements of mobile companies like cost, quality and variety of services . Both companies make efforts in order to adopt new technologies and equipment that will reduce overall cost of services and improve services quality.
Global environmental norm: Various international authorities formulate different kinds of standards for mobile companies like level of radiation in environment (Elements of Business Environment, 2013). Change in these norms influence both firms in order to manage business activities with new standards as well as upgrade infrastructure for mobile network with the help of new equipment.
On the basis of above study, it concludes that American Express has to evaluate its responsibilities towards consumers and government legislation in order to improve service quality and overall efficiency of business. This report of Instant Assignment Help UAE finds that economy system creates huge impact in allocation of several types of resources. Study concludes that management of Hilton Hotels has to adopt online business operation to increase accessibility of services. It figures out that global economic factors such as technology and market situation create huge impact on several management decisions of mobile companies.
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