Influence of Globalisation on Organisational Strategy

This report explores the influence of globalisation on organisational strategy and decision making process. It discusses the interrelationship between organisational functions and the impact of internal and external factors. The report also includes a SWOT and PESTLE analysis of Marks and Spencer, a globally renowned retail corporation.

Business Report

Table of Contents
INTRODUCTION...........................................................................................................................1
1. Type, size and scope of organisation......................................................................................1
2. Interrelationship between organisational functions................................................................2
3. Intrinsic and Extrinsic influencers through execution of SWOT and PESTLE analysis........3
4. Influence of globalisation on organisational strategy along with decision making process...6
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
An organisation is highly affected by the environment within the confines of which it
operates. In this regard, it is identified that there may be internal or external influence upon the
operations of a company. Both of them need to be analysed by a corporation in order to reduce
the adversities and capitalise upon the positives. The present project is based upon Marks and
Spencer which is a globally renowned retail corporation having it’s headquarter at UK. The
project contains type, size and scope of concerned company along with interrelationship between
different departmental functions. Further, it includes external and internal influence upon the
operations of a company. Lastly, the impact of globalisation over organisational decisions and
strategy is included within the report.
1. Type, size and scope of organisation
Business environment is consisting of several kind of business activities which are
performed by business manager on the basis of the type, size and scope of the respective. With
reference to Marks and Spencer all of these terms are specified as below:
Type
Marks and Spencer belongs to Private type of company which operates its business at
international market scale. The company offers high quality of products and services to its
customers at premium price range. The main objective of Marks and Spencer is to deliver quality
of product to its customers in order to maximise their profitability in effective manner.
Size
Size of Marks and Spencer is very broad as it provides its product and services at
international market place. Product portfolio of Marks and Spencer includes premium quality
clothing products, food as well as home products. All operational activities of the company are
managed and handled by around 78,597 employees who are highly skilled. The company follows
functional organisational structure that makes it easier for the company in executing its work in
rightful and ethical manner.
Scope
The scope of Marks and Spencer is very vast as the company is providing high
importance to the employees. For this, they provide regular based training to them. These
training sessions allows business in growing its performance in rightful manner. Along with this,
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it can be said that the respective business manager of the company are taking regular based
initiatives to expand operational activities of the company in maximum nations that leads to
enhancement in their sales performance. It also increases profitability of the company in quicker
manner.
2. Interrelationship between organisational functions
In the surrounding environment of any organization each and every department
contributes proportionately as per its responsibility and job to attain the highest level of
organizational success. In this relation, it is identified that the interrelationship of such
organizational functions lay down the foundation for smooth flow of business operations. This
provides assistance to the companies in timely achieving the business objectives. Marks and
Spencer is a top notch retail firm which realizes the significance of capitalising upon such
interrelationships in order to inflate its market share at international level. Thus, some of the
relationships being leveraged by respective retail firm are explained as underneath:-
Sales and HR Department: In order to maintain ethical code of conduct among the
people of organization, each department needs a strong team. Now, a team can only be
considered strong and effective when it has the maximum talented individuals who work with the
same flow for the achievement of corporate goal. Marks and Spencer has the ultimate objective
to attract potential customers to facilitate increment in sales figures. Thus, hereby HR department
gets talented pool of individuals interested in doing the job within sales function of Marks and
Spencer. Whereby the sales team is equipped with skilled and experienced candidates, the firm is
able to inflate its revenues in a rapid course of time. Thus, it is identified that for the successive
functioning of a company at market place, it is essential that sales and HR department work in
sync with one another.
Marketing and Finance Department: The basic factor to run each and every process of
company is finance. In organizing a promotional event or launching a new product campaign for
the organisation, the most important thing which is considered before actual planning is the
budget. It is quite necessary for marketing department to coordinate effectively with the finance
managing department. This is important because finance is the organisational function that
renders funds to marketing department in order to produce commercials, fliers, packaging
designs, logos and all those ways and techniques which provide assistance to Marks and Spencer
in inflating its existent level of revenues as well as profits. Thus, it can be said that the
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coordination between marketing and finance department is essential with a view to the
organisational structure of Marks and Spencer in achieving the desired objectives and goals
within due course of time.
Marketing and Production Department: Production department is regarded to be the
most crucial function of a manufacturing concern. In this regard, it is identified that in absence of
effective coordination between marketing and production departments, neither an organisation
can supply or produce the product at the time of demand nor can it do the effective marketing of
product which can facilitate increment in market demand for the offering. Thus, within the
confines of Marks and Spencer, both these departments work together on new as well as on
existing products to enable rise in sales figures as well as profitability of company. Production
department conveys to marketing what it takes to produce an item, its unique features,
technologies utilized for savings of time while marketing communicates the same to public to
significantly appeal to them and enhance the volume of sales.
3. Intrinsic and Extrinsic influencers through execution of SWOT and PESTLE analysis
It is important for an organisation to constantly scan the environment to which it pertains
in order to recognise the influence that the internal and external factors have upon the business
operations. In this regard, companies functioning across the globe make use of 2 business
management models, namely, SWOT and PESTLE analyses in order to identify such impact in
an effective manner. Looking upon the same, the management of Marks and Spencer has decided
to conduct PESTLE and SWOT analyses of the firm. The same is presented by the company in a
detailed manner below:-
PESTLE Analysis
PESTLE analysis is considered as the effective tool that allows company in exploring its
macro environmental factor which have influence over the performance of the company. The
respective tool is mainly used for developing understanding of company over opportunities as
well as threats so that business manager could take associated decision over the same. In this
regard, business manager of Marks and Spencer have conducted PESTLE analysis so that they
can easily improvise performance of their company at international market scale in effective
manner. All the factors of PESTLE analysis are explained below:
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Political: The political stability of United Kingdom renders aid to Marks and Spencer in
inflating the existent scale of operations of company and thereby reaching to a wider base of
audience.
Economical: Being an economically developed nation, UK enables growth of large scale
companies such as Marks and Spencer which capitalise upon innovation and creativity to gain an
edge at market place.
Social: Marks and Spencer considers the latest market trends and demands so that it can
effectively appeal to the citizens of United Kingdom and thereby gain maximum satisfaction
from them.
Technological: Advancements in technology within United Kingdom renders aid to
management of Marks and Spencer in implementing latest and market disruptive systems and
processes. As a result, firm is able to retain larger number of customers.
Environmental: This is concerned with the initiatives taken by a company to act in the
interest of environment. In this regard, Marks and Spencer is an eco friendly firm which applies
sustainable practices in order to ensure least harm caused to the environment. With such
initiatives, the entity is able to attain rapid growth at market place.
Legal: This factor of macro environmental analysis constitutes laws such as employment,
health and safety, workplace regulation, minimum wages and many more. The HR department of
Marks and Spencer enforces an organisational culture whereby the compliance with all of such
laws and legislations is regarded to be mandatory for the employees belonging to the
organisation.
SWOT Analysis
Swot analysis is termed as the strategic framework that is used by company to analyse its internal
as well as external factors which holds power of placing impact over the company’s
performance. With reference to Marks and Spencer, its respective manager have conducted
SWOT analysis within the company in order to determine available opportunity for the company
along with the possible threat that could develop due to external factor. SWOT of Marks and
Spencer is defined as below:
Strengths Weaknesses
 Variety of products and the value of  In-spite of wide range of products and
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brand in organisation is considered as
its main strength.
 Other strength of the company is
number of retail outlets so that the
customers buy their services and
products as available to them.
 Operational design of Marks and
Spencer is unique in nature which aids
the entity in effectively appealing to the
consumers and has been one of the
major strengths of the company over
the course of time.
services the company Marks and
Spencer still have outdated image in
front of the customers.
 Many products of the company are
handmade that increases the cost of its
production.
 This makes the product expensive for
the consumer to purchase it.
Opportunities Threats
 Marks and Spencer possesses the
resources as well as tendency to
explore new markets with a view to
enhance its market presence and to
expand its sales.
 The company also has the opportunity
to introduce online selling in order to
provide product and services to their
customers.
 Simplification of operating model can
be done in order to ease down for
customer.
 BREXIT had created a negative impact
on the European market and has
affected the sales and profits of various
companies. That is why companies are
struggling for their survival and growth
due to decrease in profit.
 Marks and Spencer is having tough
competition from the local competitors
and international competitors that is
impacting growth and survival of the
company.
 Trends are changing day by day that
has also become a threat to Marks and
Spencer because this requires rigorous
market analysis.
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4. Influence of globalisation on organisational strategy along with decision making process
Globalisation is a concept that is gaining massive awareness in last some years. It has
provided aid to organisations in attaining rapid growth by gaining access into new markets at
rapid intervals of time. In today's world there is drastic enhancement in the global market due to
which the external environment of business has made an important impact over the abilities of
organizations, resulting in improvement in growth and profitability of business. It includes
various aspects such as currency exchange rate, employment legislation, government laws etc.
However, it is seen that globalisation has a massive impact over organisational strategy and
decision making because there are a number of negative aspects that are linked with occurrence
of globalisation.
The primary strategic issues encountered by organisations are slow growth of GDP and
increasing cost of operations. In relation to first one, it can be acknowledged that it has created
various uncertain problems such as slow growth of economy having a direct impact over the
productivity and profitability of an enterprise. Also, companies in this regard face the issues in
the form of risk and geographical changes. With respect to the second challenge of cost, it can be
said that this is the most important factor for a corporation as it provides assistance in execution
of business practices in an effectual manner. It is important for the company to get enough
amount of finance in appropriate manner if a business has to be moved at global level. Further,
whereby the entity is expanding across international borders, it is necessary to manage the
strategies and plans in order to use the funds in most effective manner.
Thus, to deal with the negatives of globalization and to attain the maximum benefits of
taking a business to global level, it is essential that corporations like Marks and Spencer take
effective decisions and make strong strategies. In this relation, it is further ascertained that there
are certain factors which place an impact over the procedure of decision making at a global scale.
Companies such as Marks and Spencer have to focus on social responsibility, culture and values.
If a decision is devised by the organization to expand their operations on an international scale,
then the plans and strategies are to be prepared accordingly for gaining the attention of customers
prevailing in the new market. A number of strong strategies have to be put into action so that
firms can retain their loyal customers. This would result in increment in sales and profit ratio of
the company. Other side of society present in the market is of different nations and there can be a
possibility that changes have to be made in activities that are linked to Corporate Social
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Responsibility. These changes if effectively implemented in the decision process connected with
CSR may result into ease of performing corporate operations on international scale with
maximum level of business efficiency.
CONCLUSION
On the basis of above described information, it has been concluded that business
environment is very vast in nature, thus it creates requirement for business managers to develop
their understanding over the same in order to improve their business performance. Each and
every decision of business manager which are taken in the company are based on size and scope
of business entity. Usage of SWOT and PESTLE analysis allows firm in finding out available
business opportunity that will allow company in improvising their performance and gaining
competitive edge in effective manner.
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REFERENCES
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