Value Chain Model and Internal Environment Analysis of Mark & Spenser

This report discusses the value chain model and internal environment analysis of Mark & Spenser, a major British multinational retailer. It explores the primary and secondary activities of the value chain model and their importance in creating value and generating profitability. The report also provides an overview of Mark & Spenser's mission, vision, values, and objectives, as well as the analysis of its internal environment.

Business
Environment
LSBM103 - Part B

INTRODUCTION.................................................................................................................................3
MAIN BODY........................................................................................................................................3
Value Chain Model............................................................................................................................3
Overview of Mark & Spenser............................................................................................................5
Internal environment..........................................................................................................................5
Reflection on Value Chain Model.....................................................................................................8
CONCLUSION.....................................................................................................................................8
REFERENCES......................................................................................................................................9

INTRODUCTION
Business environment is sum total of internal as well as external factors which
influence a business. In simple term it can be said that, external and internal both factors
influence each other as well as also work together which affect working of an organisation
(Calabrese and et. Al., 2018). So it is necessary for business firm to evaluate business
environment in effective manner because it will result in implementing positive outcomes and
reducing negative effects. This report is based on Mark & Spenser which is major British
multinational retailer whose headquarters is located at Westminster, London. They are
specialist in selling high quality clothing’s as well as food products. Respective organisation
was founded in 1884 and serving at worldwide level. In relation to M&S respective report
will discuss Value Chain model and internal environment analysis.
MAIN BODY
Value Chain Model
Value chain model is also known as porter's value chain analysis which is an Business
Management concept developed by Michael porters. In simple terms it can be said that value
chain is collection of activities which an organisation perform for creating value for their
customers. In addition to this it create competitive advantage foreign business from as well as
also result in higher profitability (Rogers, 2018). It is divided into part first is primary activity
and second is secondary activities. Here primary includes inbound logistic, operations,
outbound Logistic, marketing and sales services. On the other hand, secondary activities
include recruitment, human resource management, technological development and
infrastructure (Porter's Value Chain, 2016). Explain explanation of these are as follows :-
Primary activities of Value Chain Model
 Inbound logistic – Within this relation with suppliers are includes and also activities
which needed to receive, store as well s disseminate inputs.
 Operations – It is related to activity which is needed for transforming raw material
(inputs) within outputs (finish goods i.e., product and services).
 Outbound logistics – Within this activities are covered which needed for collecting,
storing and distributing outputs.

 Marketing and sales – Through this primary activity company will be able to inform
about their products as well as services to buyers for purchasing them and also
facilitate their purchase.
 Service – Involve all activities which are needed for products and services working
effective for buyers after it sold and deliver. In simple term here services are related to
after sale services.
Secondary/Service activities of Value chain Model
 Procurement – It is the acquisition of inputs s well as resources for business firm.
 Human Resource management – It involve each and every activity related to human
resource such as recruiting, hiring, training, developing, compensation, dismissing
and laying off staff members.
 Technological development – pertains to the equipments, software, hardware,
procedures and technical knowledge which are bought down for bearing
transformation of business firm’s inputs within outputs.
 Infrastructure – It is important part of an organisation because infrastructure serves
its needs as well as ties several parts together. There are several functions and
department which consist within it such as accounting, finance, legal, planning, public
affairs, quality assurance, government relation, general management and many more.
This is an effective model which help organisation in managing their overall working within
effective manner. Along with this its implementation result in managing day to day
operations in more effective manner and also help in generating high profitability.
Overview of Mark & Spenser
Mark & Spenser is also known as M&S which is major British retailer as well as its
headquarter is located in City of Westminster, London. It was founded in 1884, 135 years ago
by Sir Michael Marks and Thomas Spencer. This retail industry organisation is specialises in
selling of clothing, home products as well as luxury food items. Across United Kingdom,
Mark & Spenser have 979 stores including 615 which are selling only food products. Every
organisation have their mission, vision and values explanation of these are as follows :-

 Mission - A Mission statement is a statement reflecting what the organisation
business is and what key purpose is there. - Mark and Spencer Mission are to make
inspirational quality accessible to others.
 Vision – To be standard against which other organisation are measuring
benchmarking.
 Values – quality, service, innovation and trust
Apart from this there are some key objectives of Mark & Spenser which are mention below :-
 Employee orientation – It is simple that staff members have their big contribution
within its success. Thus, there is requirement of proper management such as
developing career path for employees. In addition to this, manager and leader of M&S
to attract, motivate and retain their high calibre personnel for assisting transformation
of business and to deliver improved performance.
 Organisational objectives – Mark & Spenser organisational objective is to regain
their leadership within clothing as well as specialty food. Respective company can
achieve this by translating their scale and authority within superior quality, value as
well as appeal.
 Sales objectives – It has been believed by M&S that there are several options for
improvement in sales. They saw return per sales as key operational objectives which
help them in meeting their sales objectives.
Internal environment
Porter’s value chain model is well known in business world for its effective working.
However, Marks & Spencer should not take it as a rigid, standalone framework by assigning
the equal importance to all activities (Brun, 2019). The effective Value Chain Analysis
requires Marks And Spencer Group Plc to realise that each and every activities as well as
functions not need same similar analysis level. Hence, the first step of adapting the Porter
Value Chain framework is to identify the importance of activities according to their role in
product/service delivery process (Marks And Spencer Group Plc Value Chain Analysis,
2018). Explanation of primary as well as secondary activities in relation of Mark & Spenser
are as follows :-
Primary activities – These are the activities which directly involved within Mark &
Spenser activities related to producing as well as selling the product for targeted customers.

Analysing primary value chain activities can enhance performance of respective organisation
explanation of these are as follows :-
 Inbound logistic – For M&S it is essential to Develop as well maintained strong
relation with their suppliers because their support is important for receiving storing
and also in distribution of product. Without analysing inbound logistics respective
organisation can face several major challenges within their product development
phase (Vilvert and et. Al.,2018). Listen to this analysing of prospective logistic
requires company to focusing on there are each and every aspect related to
transformation of raw material within finished goods. For illustrations, retrieving raw
material and internal distribution law from material as well as other components for
starting production process.
 Operations – In an organisation importance of analysing operational activities
increases when raw material arises for production purpose. With this pen Mark and
Spencer get ready for converting raw material into their and product and launch them
within market area. Some example of operational activities are packaging machining
assembling testing and many more full stop along with this equipment repairing as
well as maintenance also Falls within operational activities. It involves both
operations that is manufacturing and services (Manninen and et. Al., 2018). There are
several activities for which analysing of operation activities is essential such as
improving productivity and ensuring competitive success, maximizing the efficiency
and many more. Enhancing productivities of Mark and Spencer’s help in several
manners such as increasing profitability, gaining competitive advantage and
consistent economic growth.
 Outbound logistics – In include activities which deliver products to the customers
through passing several intermediaries. Thus, outbound logistics are warehousing,
material handling, scheduling, order processing, transportation and delivery of
product to final destination. In relation to M&S, they have to pay specific attention
towards its outbound value chain activities while offering products are perishable as
well as needed quick delivery to its end users.
 Marketing and Sales – In this stage, M&S highlights advantages as well as
differentiation points of offering products for persuading customers which offering
better than their customers. Providing high quality products at affordable cost with

distinct feature is not enough for creating value there is requirement to invest on
marketing and sales activity.
 Services – It is related to pre-sale and post-sales services which offering by Mark &
Spenser which play essential role in developing customers loyalty. Modern customers
involve post- sales services as important as marketing and promotional activities.
Within present advanced technological era power of negative e-WOM because of
poor support services will not undermined (Frederick, 2019). In addition to this, it is
important for Mark & Spenser to analyse their support activities for avoiding
damaging within brand reputation. Instead of this they can use respective tool as
spreading positive word of mouth due to quick, timely as well as efficient support
services.
Secondary activities – The support activities play essential role within coordination as
well as facilitating primary value chain activities. M&S can also get advantages from
analysing its support activities explanation of these are as follows :-
 Firm infrastructure – Infrastructure of an organisation range of activities like quality
management, legal matters handling, financing, planning, strategic management and
accounting (Liu and et. al., 2018). In relation to Marks and Spencers effective
infrastructure management result in optimising value of entire value chain.
 Human resource management – By value waiting different human resource aspects
such as recruiting training, rewarding performance management, selection and other
activities related to Staff management can analyse HRM in effective manner full stop
in relation to Marks and Spencer effective HR management result in reducing
pressure of competition which is based on commitment skills of staff members
motivation and so on (Bevilacqua and et. al., 2019).
 Technology development – In Modern era which is full of technological advancement
almost value chain activity e is dependent on technological support dog technological
integration within production human resource activities as well as marketing help
marks and Spencer’s in realising importance of technological advancement with their
working.
 Procurement - It is related to the process which include buying of computer inputs
such as machinery e, raw material, supplies equipments and many more items which
are needed for converting finished product. Value chain activities Marks and Spencer

should have to consider procurement activities for optimising the inbound operational
as well as value chain (O’Donoghue and et. al., 2019).
Reflection on Value Chain Model
Value chain model which was introduced by porters and it play important for
organisation in evaluating their external environment. As it is classified within two part i.e.,
primary as well as secondary activities. In relation to Mark & Spenser it will provide
assistance to them in their long term sustainability as well as also help in gaining competitive
advantages. As it involve all such activities within it which an organisation have to ensure
that are working in effective manner as well as result in gaining better place within external
business environment.
CONCLUSION
After going to about discussion it has been summarised that business environment is
dynamic in nature and in this several organisations are working which result in increasing
competition for each other. As it has been already discussed that it is classified within two
internal as well as external factors. In relation to this, for business firm it is necessary to
conduct external environment analysis because its control is not in hand of company. As well
as it may result in some negative impact if not analysed within effective manner. Apart from
this, through value chain model which was given by Michael Porter’s an corporation can
evaluate their external factors in effective manner along with their impact on working of an
organisation. Thus, in simple term it can be said that for long term sustainability and gaining
competitive advantages there is requirement to conduct external and internal analysis.

REFERENCES
Books and Journal
Calabrese, M., and et. Al., 2018. From mechanical to cognitive view: The changes of
decision making in business environment. In Social Dynamics in a Systems
Perspective (pp. 223-240). Springer, Cham.
Rogers, D., 2018. The Future of Lean Sigma Thinking in a Changing Business Environment.
Productivity Press.
Brun, E. C., 2019. Understanding a Business Incubator as a Start-Up Factory: A Value Chain
Model Perspective. International Journal of Innovation and Technology
Management, 16(03), p.1950025.
Vilvert, E. and et. Al.,2018. Multi-model approach for assessing the sunflower food value
chain in Tanzania. Agricultural Systems, 159, pp.103-110.
Manninen, K. and et. Al., 2018. Do circular economy business models capture intended
environmental value propositions?. Journal of Cleaner Production, 171, pp.413-422.
Frederick, S., 2019. Global value chain mapping. In Handbook on Global Value Chains.
Edward Elgar Publishing.
Liu, J. and et. al., 2018. Overview of wind power industry value chain using diamond model:
A case study from China. Applied Sciences, 8(10), p.1900.
Bevilacqua, A. H. V. and et. al., 2019. Following the Fish: The Role of Subsistence in a Fish-
based Value Chain. Ecological economics, 159, pp.326-334.
O’Donoghue, C. et. al., 2019. Measuring GHG Emissions Across the Agri‐Food Sector Value
Chain: The Development of a Bioeconomy Input‐Output Model. International
Journal on Food System Dynamics, 10(1), pp.55-85.
Online
Porter's Value Chain, 2016.[Online].Available through<
https://www.ifm.eng.cam.ac.uk/research/dstools/value-chain-/>
Marks And Spencer Group Plc Value Chain Analysis, 2018.[Online].Available
through< https://www.essay48.com/value-chain-analysis/9035-Marks-And-Spencer-Group-Plc-
Value-Chain-Analysis>