Business and Business Environment (Part 2)

This presentation discusses the business environment and its impact on organizations. It includes PESTEL and SWOT analysis of M&S and NHS, as well as the interrelation of strengths and weaknesses with external macro factors. The presentation provides insights into decision making and the importance of understanding the business environment.

Business and Business Environment (Part 2)

Table of Content
• Introduction
• PESTEL analysis of M&S and NHS
• SWOT analysis of M&S and NHS
 Affecting decision making process
 Interrelation of strengths and weaknesses with external macro factors
• Conclusion
• References

INTRODUCTION
Business is an activity in which an individual do efforts for
producing and selling good and services for a profit and for
satisfying society's needs(Business Environment. 2018). On the
other hand, business environment is total of all the external and
internal factors which can influence a business's performance,
profitability, and growth. In addition positive and negative
influence on macro environment and determining affect of internal
and external strengths of specific business on external macro
factors.

PESTLE ANALYSIS
To study the external environment of organisation it is
essential for the organisation to execute PESTLE
analysis so that the business can determine the factors
which are influencing their working-

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Political factors: These are the factors which involves government
interventions, policies, rules and regulations. Mark and Spenser
needs to follow these rules and regulations established by
government regulatory to sustain in the market.

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Basis M&S NHS
Positive Mark and Spenser can survive in
the UK markets and can earn
higher profit as the government
policies over UK does not changes
rapidly due to which they can
maintain their sustainability.
NHS can survive in the UK
market for a long time as in
the UK policies are not
change very quickly.
Negative Increase and decrease in the rate
of taxes will reduce the chances of
growth and opportunity of the
organisation.
Government cut their
spending on the healthcare
industry is greatly affected on
their growth.
.

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Economical factors: These factors describes that how the organisation is working and
what it does and to what extent they are profitable to the company(Al-Saleh and
Mahroum, 2015). Mark and Spenser is also affected by this factor .
Basis M&S NHS
Positive The increase infrastructure development
can provide more transport links
resulting in higher production level and
increased distribution of products by
M&S .
The increase infrastructure
development can improve medical
services and increase the investment
in the healthcare industry.
Negative The reduced investment by the
government in the retail industry can
also affect the development of Mark and
Spenser
They also impact in a negative way
like increasing unemployment rate
and reducing buying power of
customers can greatly impact on their
business.

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Social Factors – These factors are those which involves customers belief , socio-
culture and their changing preferences. This has also affected the business of Mark
and Spenser positively and negatively.
Basis M&S NHS
Positive - As it meets all the ethical changes and
ensure smooth trade between suppliers and
customers(Schaltegger, Lüdeke-Freund and
Hansen, 2016). Customer perception towards
the products of Mark and Spenser has higher
the development of economy.
At present situation there is a great change
in their expectations and they are now more
demanding so the healthcare industries can
get benefits from these changes.
Negative The company needs to focus on both local and
global market and customers expectations as
it only give preferences to the higher or richer
society due to which the local market remains
under developed.
It becomes essential for organisations to
considered the culture of their customers so
they able to avoid beliefs and values but in
the case they does not considered all these
they can affect their organisational
performance.

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Technological Factors – It involves rate of technology innovations and development which
affects the development of markets. Mark and Spenser is also affected by these
technological innovations.
Basis M&S NHS
Positive Advancement in tools and
technology to produce the goods
of updated quality has maintained
the profitability level of business.
As development in computer
application, live chat, and email
allows the patients to take treatment
online which is a positive sign of
technology for the healthcare
industry.
Negative Customers may shift to other
brand if they found the substitutes
of better quality.
By adopting new technologies in
their organisations, competition is
increasing day by day.

Trends
Legal factors – - Employment laws, health and safety norms, environment act etc. are some
example of legal factor which determines that rules play an crucial role in organisation. For
this manager and officer of organisation analysis the legal formalities that helps M&S to
perform their work smoothly in organisation (Deasy, and et. al., 2015).
Basis M&S NHS
Positive An effective employee retain in the
organisation as Mark and Spenser
follows all the act related to employee's
protection.
As NHS is public company as it is
concern for citizens healthcare, they
should follow all the rules and
regulation so they able to build trust
among the citizens.
Negative It is difficult for the organisation to
adopt all the rules and regulations in the
organisation.
If they are not able to follow new
laws and legal rules this can lead
them to immediate failure of their
strategy.

Trends
Environmental factors – It includes the factors like surroundings, climatic conditions
etc. Mark and Spenser uses all the resources available in order to accomplish
organisational goals.
Basis M&S NHS
Positive This provides an opportunity to the
business of Mark and Spenser to sell the
product in the market as customers are
aware about all environmental factors.
NHS needs to follow green
environment practices which
increase their corporate social
responsibilities that helps them
to increase their brand value and
growth.
Negative High level of competition in the market
has decrease their performance
As NHS is a public company, so
if they avoid environmental
factors in their operational
activities then they lead to
downfall position.

Swot analysis of M&S
Strength
• Mark and Spenser is a giant of retail market with high recognition of brand
among their customers
• Mark and Spenser has strong research and development teams that helps them
in analysis the current trend and keeps updating according to that.
Weakness
• Company is operating their businesses in developed country due to this the
company did not have shares in the market of China, Africa, and India.
• Mark and Spenser faces increased cost of operations due to their manual
working.

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Opportunities
• Mark and Spenser have the opportunity to grow their business and profit margin by
launching new segments in the market.
• Organisation has a large experience to sustain in market so it helps them to enter in
the market of developing countries and tackle different situation that helps to grow
their business.
Threats
• The company have to face high level of competition in the market as there is huge
competition from the competitors like ZARA, United colour of Benetton.
• M&S is a luxury brand and provide quality goods to its customers which results
that customers are not able to purchase their product specifically clothes which
creates threat for organisation.

Swot of NHS
Strength
• NHS is provide range of heath services free of cost for the social welfare.
• NHS has loyal, engaged and committed staff towards their work with high level of
morale.
Weaknesses
• The major weakness of NHS is under funding by government which decrease the
growth opportunities for them.
• In the UK, NHS does not have good health services as compared to others rich
countries.

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Opportunities
• It is the big opportunity for NHS to develop high quality of care to people with
mental ill health and speeding up cancer diagnosis.
• It the second great opportunity for them by assuring the people that they are
overlap with primary, community and social care.
Weaknesses
• They have to face financial problems and uncertainty of economy in near future.
• NHS have to face tuff competition in the healthcare industries which become
harmful for them.

Influence of Swot in decision
making
From the preceding discussed table it is easy for the NHS to increase their
strength that helps them to take first mover advantage in the industry.
Along with these it also helps to overcome from weakness through which
they increases possibility to reduce their value in organisation.

Interrelation of strengths and weaknesses
with external macro factors
In this section, it is explained that how the macro factors and strength and weakness of private
and public organisations are interrelated with each other which are described below:-
POLITICAL- - These are those factors which are related with government inventions,
policies and regulations. These factors have a great impact on the M&S which can explained
below:-
ECONOMICAL- These factors are those which are related to the environment like interest
rate, growth rate and exchange rate. These factors can impact the M&S performance in the both
positive and negative way (Deasy, and et. al., 2016). The strength and weakness of these factors
on M&S is as follow:-

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Social factors- These factors are those which is related to the
customers belief, socio-culture and their changing
preferences. This has also affected the business of Mark and
Spenser which are described below:-
Technological factors:- These factors include rate of
technology innovations and development which might affect
the M&S performance which are described below:-

Conclusion
From this report it can be concluded that Business environment is affected by various factors
which has affected the performance of the organisation. Every organisation have different
purpose, size, scope depended on the organisational structure. Management of every
organisation decides their goals based on the environment in which they are operating. To
analyse the impact of internal and external environment SWOT and PESTLE is implemented
through which it is easy for the organisation to formulate strategy which will help them to
achieve the objectives within a specified period of time.

REFERENCES
Adeoye, A. O. and Elegunde, A. F., 2012. Impacts of external business
environment on organisational performance in the food and beverage
industry in Nigeria. British Journal of Arts and Social Sciences. 6(2).
pp.194-201.
Andersson, U., Forsgren, M. and Holm, U., 2015. Balancing subsidiary
influence in the federative MNC: A business network view. In
Knowledge, Networks and Power (pp. 393-420).
Belás, J. and et. al., 2015. The business environment of small and medium-
sized enterprises in selected regions of the Czech Republic and Slovakia.
E+ M Ekonomie a Management.
Chang, J. F., 2016. Business process management systems: strategy and
implementation. Auerbach Publications.

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