Value Chain Model and Internal Environment Analysis of Marks and Spencer

This report analyzes the value chain model and internal environment of Marks and Spencer, a multinational retailer. It discusses the primary and secondary activities of the value chain and their impact on the company's performance. The report also examines the mission, vision, and values of Marks and Spencer, as well as its objectives and internal environment. Overall, it provides insights into how the value chain model can help companies manage their activities effectively and enhance productivity and profitability.

Business
Environment

Contents
INTRODUCTION.................................................................................................................................3
MAIN BODY........................................................................................................................................3
Value Chain Model............................................................................................................................3
Overview of Mark & Spenser............................................................................................................4
Internal environment..........................................................................................................................5
Reflection on Value Chain Model.....................................................................................................7
CONCLUSION.....................................................................................................................................8
REFERENCES......................................................................................................................................9

INTRODUCTION
Business environment is a collection of individuals, groups, entities & other factor
that sometimes not be in control of company and impact on the overall performance as well
as growth of the organisation. It include both external and internal factor, which impact on
the efficiency as well as profitability of the company (Arnold, Beauchamp and Bowie, 2019).
It is important for an organisation to analyse the affect of internal and external factors as it
help in rising productivity and leads to positive outcome as well. For the present report,
Marks and Spencer is taken into consideration. It is a multinational retailer whose head office
is situated at Westminster, London. The company mainly offer high quality food products
and clothing. Marks and Spencer was founded in the year 1884 and at present it offers
product as well as service in more than 15 countries. The report cover value chain analysis
model in relation to chosen company. In addition to this, internal environment analysis is also
describe in the report.
MAIN BODY
Value Chain Model
It is also term as Porter’s chain analysis that is a business management concept
proposed by Michael porter. It is basically a collection of activities that is performed by
companies in order to develop to their customers. By the assistance of this, an organisation
can gain an insight regarding the impact of external factors on the activities as well as
performance of the company. In addition to this, it create an opportunity for companies to
attain competitive advantage at marketplace that leads to increase in profitability of the
organisation. The value chain model is categorised into two activities that is primary as well
as secondary activities. The primary activities involve outbound logistics, operations,
marketing & sales service, inbound logistics whereas secondary activities consist of
technological development, human resource department, recruitment, infrastructure and so on
(Akhtar and Sushil, 2018). All these activities is define below in relation to the chosen
company:
Primary activities
 Inbound logistic – Herein, the relationship with suppliers is included along with the
activities required to store, disseminate as well as receive inputs.

 Operations – It is associated with the activities that is required to convert raw
material into the finished goods that is input to output.
 Outbound logistics – Herein, those activities and task are covered, which is required
for sorting, collecting & distributing output as well.
 Marketing & sales – By the assistance of primary activity, an organisation is able to
aware people about their goods and services (Chernopyatov, 2018). In addition to this,
it will impose customer to purchase the product that leads to increase in profit of the
company.
 Service – It include activities that is required for goods as well as service working
effective for customer after it deliver. Basically, it involve activities associated with
the after sale service.
Secondary activities
 Procurement – It is define as acquisition of resources as well as inputs for business
firm.
 Human Resource management – It include all the activities that is related with the
employees and human resource such as training, compensation and benefits,
recruitment, selection, laying off and dismissing of staff members.
 Technological development – It is related with the technical knowledge hardware,
equipment’s, software that is bring in order to transform firm’s input into the output.
 Infrastructure – It is essential for companies to have good as well as systematic
infrastructure, which will help in implementing activities in an effective manner. In
addition to this, there are various departments that involve within it such as general
management, accounting, planning finance, quality assurance, public affairs,
government relation and so on.
It is an effective model that help companies in managing activities in an effective and proper
manner (Becher, 2018). In addition to this, implementation of this help an organisation to
manage day-to-day activities and operations properly that leads to enhancement in
productivity as well as profitability level of company.
Overview of Mark & Spenser
Marks and Spencer is an international British retailer, which head office is situated at
Westminster, London, United Kingdom. The company was founded by Michael Marks &
Thomas Spencer in the year 1884 that is 135 years ago. The company specialization in

offering clothing and food products. Marks and Spencer have more than 979 stores globally,
including 615 stores that odder only food products. It shows the company has high market
share and high profit level. The mission, vision and values of company is given below:
 Mission – The mission statement of the company is “To offer high quality product in
the market and gain competitive advantage at market place”. The mission statement
mainly reflection what a company want along with its purpose.
 Vision – “To gain the leading position in the industry and to be the first choice of
customer” is the vision statement of the company.
 Values – Innovation, quality, service & trust.
In addition to this, the objectives of M& S is given below:
 Employee orientation – Employees plays an important role that reaches company
towards success as well as growth. It is important for an organisation to provide the
right path to the employees so that activities can be implemented in a proper manner
(Chukhray and Mrykhina, 2018). with reference to Marks and Spencer, its higher
authorities motivate employees by providing them financial and non-financial benefits
that help in retaining staff members for longer period and enhance productivity of
company.
 Organisational objectives – The organisational objective of Marks and Spencer is to
gain leading position in the clothing as well as food sector. The company can achieve
this by offering quality products to customers and fulfilling the promise of customer
as well.
 Sales objectives – The sales objective of Marks and Spencer is to raise sales by 10%
in every 3 months. It can be attained by company by educating and reaching
maximum number of people and engage customer for longer period.
Internal environment
The value chain model is renowned is business for its effective and appropriate
working. The value chain analysis requires M & S group PLC to realise that every activity
did not require same analysis. Therefore, the initial step of acquiring porter value chain model
is to analyse the significance of activities as per their role in goods as well as service deliver
process. The primary and secondary activities is described below with relation to Marks and
Spencer:

Primary activities – It refers to the activities directly linked among Mark & Spenser
functions which are related with manufacturing and selling of goods and services. Examining
the primary activities can improve the performance of business entity which are going to be
discussed as follows:
Inbound logistic – For the business entity like M&S it is quite important to crate and
manage strong and health relationship with the suppliers as their support is very necessary for
receiving storing & also in distribution of the goods and services (Quinlan, 2019). Without
examining the logistics chosen business entity can face different issues and challenges within
the product development stage. For examining, retrieving fresh and raw material as well as
internal distribution from the material and other elements in order to enhance the production
process.
Operations – In a business entity, significance of examining the operational functions
which enhances the raw material rise for manufacturing purpose. In the present context of
Mark and Spencer, it has been said that they need to convert raw material into finished goods
and services. There are different types of activities which needs to be analysed by operation
activities which is necessary like enhancing productivity & ensuring competitive growth and
so on.
Outbound logistics – In consists of those activities which provide goods to the user by
passing different intermediaries. Therefore, outbound logistics includes scheduling,
warehousing, order processing, material handling, transportation as well as delivery of goods
to the end destination (Luiz, Ganson and Wennmann, 2019). In context of M&S, it has been
said that the need to pay attention against outbound activities while providing goods and
services which are perishable and needs to be delivered quick.
Marketing & Sales – Herein, Marks & Spencer highlights differentiation point of
providing products the potential customers. It will assist company to attract more number of
customers that leads to raise in sales and profitability of the organisation.
Services: This is associated with the pre-sale and after sale service that plays an
important role in retaining for longer time. The customer nowadays analyse the post –service
given by company and then take the decision of repeat purchase. Therefore, it is important for
Marks and Spencer to provide quality and on-time service to customer that will assist in
increasing customer and positively impact on performance of company.

Secondary activities – This activities play vital role in coordination and facilitating
primary activities of value chain. The company can also get an opportunity from identifying
its supporting activities that is given below:
Infrastructure: It include activities such as financing, quality management,
accounting, strategic management and so on. It assist Marks & Spencer to optimise value of
the whole value chain effectively.
Human Resource management: This activity include training, recruitment and
selection, employee relation, compensation and many more (Kozubikova, 2019). In context
to Marks and Spencer, managing the human resource effectively decline the level of pressure
of competition and enhance productivity of the organisation.
Technology development – Nowadays, people prefer to consume those that is innovative
and new in market. By the assistance of technology development, the company have the
advantage to attract more number of customers and earn higher profits.
Procurement: It is associated with the procedure that involve buying of machinery,
raw materials, equipments and other items that are required for transforming finished goods.
The managers of Marks & Spencer required focusing on procurement activities in order to
optimise value chain and operations in an effective manner.
Reflection on Value Chain Model
This model was proposed by Michael porter with an aim to analyse the impact of
external environment on the business growth as well as survival. It plays a vital role in
examining external factors. Value chain model is divided into two parts that is primary and
secondary activities. It involve activities such as outbound logistics, inbound logistics, sales
& marketing, recruiting, infrastructure and so on (Hamilton and Webster, 2018). With
reference to Marks and Spencer, this model will provide assistance for sustain in market for
long time period. In addition to this, it will also assist company to attain competitive
advantage and fight with their rivals in an effective manner. It Include all those activities that
ensure implementation of activities in an effective manner to the organisation. Moreover, it
help company to decline the level of risk associated with the external factors and enhance the
overall performance of the organisation. It will lead to increase in profit as well as market
share of an organisation effectively.

CONCLUSION
From the above discussion, it has been analysed that business environment is flexible
as well as dynamic in nature and impact on the overall performance of an organisation. It is
important for an entity to examine internal and external factors along with their impact on
business activities, which will help in declining the level of risk and enhance productivity of
the organisation. It has been analyse that there is no control of an organisation on macro
environmental factors so it is necessary to develop effective strategies in order to deal with
this in an effective manner. By the assistance of value chai model, the higher authorities can
examine the impact of external factors in the organisation. It assist an entity to sustain in
market for longer time period and gain competitive edge at market place.

REFERENCES
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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>