Answer To: CRITICAL THINKING ASSIGNMENT (100 points) Choose a company within Saudi Arabia and assess its...
Soumi answered on Mar 26 2021
Running Head: CRITICAL THINKING ASSIGNMENT 1
CRITICAL THINKING ASSIGNMENT 2
CRITICAL THINKING ASSIGNMENT
Table of Contents
Introduction 3
Estimation of industry market potential 3
SWOT Analysis 3
PESTEL Analysis 4
Porter’s Five Forces Analysis 8
Conclusion 9
References 10
Introduction
The company selected for the assignment Zain. Zain is the third largest mobile network operating company of Saudi Arabia. This company was launched in 2008. Zain operates all across Saudi Arabia and it is headquartered at Granada Business Part of Riyadh, the capital of Saudi Arabia. It offers fixed lines, mobile connections and internet services. Zain has more than 10 million customers all over Saudi Arabia. This company consists of around 5000 employees (Zain, 2019). International expansion is a good idea because it creates an international recognition for the company and increases its market revenues. Therefore, market potential is being analyzed for Zain to identify an international market suitable for it.
Estimation of industry market potential
A thorough research is needed by every organization that wants to enter the international market to identify its potential needed in international market. Precise areas are evaluated to identify the potential using methods such as SWOT analysis, PESTEL and Porter’s five-force analysis.
SWOT Analysis
As suggested by Adar, Karatop, İnce and Bilgili (2016), SWOT analysis is a method, which is used to analyze the strength, weakness, threat and opportunities of the company.
Strengths
Weaknesses
· It has continuous profitable operation.
· It is market leader in Saudi Arabia.
· It focuses on cost effectiveness.
· Its brand value is strong in the country.
· It uses innovative technology.
· It has reduced debt in comparison to equity
· It has decreased in customer base
· Falling ARPU and biometric registration put brake on growth.
· Competition level has been raised.
Opportunities
Threats
· It has opportunities in business-to-business methods.
· It has introduced in 5G technology.
· It must face costly license renewal.
· It has constant threats of cyber-attacks.
By using the SWOT analysis method, it has been found that company has great opportunity in international market due to its 5G technology. It has a brand value in Saudi Arabia, which helps the company to seek popularity in international market. This company has weak customer base. The constant threat, which is faced by company, is high competition, high cost of license renewal and constant cyber-attack. All the threats can be tackled, and company can enter the market.
PESTEL Analysis
As suggested by Widya Yudha, Tjahjono and Kolios (2018), PESTEL can be defined as a strategic analytical tool, which stands for political, economic, sociocultural, technological, environmental and legal factors. Following analysis helps to identify the potential of the international market.
P
Political factors
· Policies of the nation, in which they are entering.
· Political corruption to enter the market
· Barriers made by politics of countries in obtaining the license.
· Favoritism for the native companies.
· Government taxes
E
Economic factors
· Skilled workforce
· Fluctuation in currency market
· Efficiency of financial market
· Inflation rates and interest rates
· Infrastructure quality of the organization
· Government intervention in the free market
· Product rate going in the market
· Potential competitors
· Economic growth rate
· Unemployment rate
· Labor cost and productivity in the economy
S
Sociocultural factors
· Attitude of the people
· Culture of the society
· Brand promotion in society
· Demography and skill level of the population
· Education level and standard of the society
· Class structure, power structure and hierarchy of the society
· Reaching...