Business Strategy: Analysing Macro and Internal Environment, Competitive Analysis with Porter's Five Forces Model

This report analyses the impact of macro environment on Marks and Spencer, evaluates internal environment and capabilities, and explains competitive analysis with Porter's Five Forces Model. It includes PESTLE analysis, SWOT analysis, McKinsey 7's model, Resource based view, and Porter's Five Forces Model.

Business Strategy

Table of Contents
INTRODUCTION ..........................................................................................................................3
TASK...............................................................................................................................................4
P1 Applying appropriate
frameworks analyse the impact
and influence of the macro
environment on a given
organisation and its strategies....................................................................................................4
M 1 Critically evaluate the macro environment .........................................................................7
P 2 Analyse the internal environment and capabilities of the given organisation .....................7
M2 Critically evaluate the internal environment .......................................................................9
P 3 Explain the competitive analysing with the help of porters five forces model ....................9
M3 Coitally evaluate the appropriate strategies for the competitive edge ...............................10
P4 Applying a range of theories, concepts and models, interpret and devise strategic planning
for a given organisation.............................................................................................................10
M4 Critically evaluate the strategic plan .................................................................................12
CONCLUSION .............................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
The Business strategy can be defined as the clear set of plan, actions, and the various
objectives and goals which outlines that how the business organisation will compete in a
particular market. It is very important for the business organisation to take the various strategies
into consideration so that the company can have a competitive advantage of it. This enhance in
the productivity of the company. There are the various model which need to be considered by the
marketer in order to fulfil the needs of the customhouse. This report is based on the Marks and
Spencer company which is the British multinational brand in the retailing sector. The company is
headquartered in London, England. The company was established in 1884 by Michael Marks and
Thomas Spencer. It deals in various products such as home products, clothing products, food
products etc. This report will include various topics such as
TASK
P1 Applying appropriate frameworks analyse the impact and influence of the macro
environment on a given organisation and its strategies.
The use of the various models can help in analysing the different aspects of the macro
environment which can influence the business operations and its other activities. Here is the
discussion of the models which can help in context of Marks and Spencer
PESTLE analysis
This is the tool which is used by the business organisation in order to analyse the
different macro factors which can impact the operations of the business organisation. In context
of Marks and Spencer the various factors are discussed below:
 Political- This is the factor which is related to the extent to which the government
policies may interfere within the operations and other activities of the business enterprise.
such factors include trade policies, tariffs, trade restrictions etc. it is been analysed that
the Brexit move impacted the Marks and Spencer in the various aspect. The trade

restrictions outside the European unison have bee4n more strict in which the company
has to now look for the export of the products,.
 Economical- This is the factor which is related to the performance of the economy which
have a direct impact on the business organisation. Such factor include interest rates,
inflation rate, etc. this has a great influence on the Marks and Spencer. As it is analysed
that the pandemic over the world have impacted a lot to the organisation. Due to the rise
in the inflation rate there was decrease in the demands of the products and services which
affected the company.
 Social This is the factor which is related to the current market trend in the market and this
can impact the business organisation. This is the most important factor for the
organisation in order to meet the demand of the customers. Such factor incudes the
lifestyle, attitude, behaviour of the consumers. It is very important for the Marks and
Spencer to understand the consumer trend in order to satisfy them. This factor has the
great influence over the customers and this can impact the organisation
 Technological- This is the factor which is related to the innovation and development in
the technology over the world can influence the operations of the business organisation.
Such factor include artificial intelligence research and development etc. This is the factor
which should be taken into consideration by the Marks and Spencer in order to attract
customers. The company need to provide the both online and offline services. It is very
important for the company to use the new latest machines in the production process for
the exclusive designs which can help in attracting the wide range of customers.
 Legal- This is the factor which is related to the certain laws which can impact the
operations and activities of the business organisation. Such factor include labour law,
employment law etc. This is the most important for the Marks and Spenc3er to adhere to
the certain laws so that the company does not have to face any legal issues. The company
should give the fair prices to its labour which is the most important in order to be
competitive in the certain country in which the company is situated in.
 Environmental- This is the factor which is related to the surroundings which have a
impact over the business organisation. Such factors include sustainable development,
climatic c0ondistion, dusters etc. The marks and Spencer need to take initiative in the
sustainable development practices which can reduce the wastage of the plastic poly bags

which is been distributed by the company. To take this in consideration the company can
give the product in the paper bags and this can impact in the brand i8mage of the
company.
SWOT analysis
This is the tool which is utilised by the business organisation to identify the various
external opportunities for the business organisation. The swot analysis in context of Marks and
Spencer is discussed below:
Strength Weaknesses
 The Marks and Spencer has a clear
brand image where the company
position itself with distribution of the
high premium products under its brand
name.
 The company have around 80 thousand
employees who are working in the
outlets of the company. The
organisation encourages diversity and
have people from all the religions and
genders.
 The one of the biggest weakness of the
Marks and Spencer is its poor
scalability of the supply chain .as the
company is trying for the global access
to their merchandise through their
online store.
 There is the analysis that the customer
satisfaction is low because of the return
policy of the company. This have
resulted in the poor brand loyalty and
there is increase in the brand switching.
Opportunities Threats
 As the fashion is considere4d as an
evolving business and there is the
opportunity of the new segments which
are coming on regular basis. As in the
Asia there is the huge demand of the
ethnic clothes which the opportunity for
the business organisation.
 There the the threat of the competitors
for the Marks and Spencer which are
Uniqlo, Gap, Zara etc.
The company has the threats of its premium
priced product which can be taken over by the
small businesses by offering the lower priced
products to the customers.

 The another opportunity for the Marks
and Spencer is the global expansion
which can be benefited to the company
in targeted the new wide range of
customers and as well as in the profits
maximisation.
Ansoff matrix
This is the matrix which is used by the business organisation in order to analyse the
different business aspect of the company. The various strategies are discussed in context of this
model in respect of the Marks and Spencer:
 Market penetration- This is the strategy which invokes the selling of the existing
products to the existing market. This strategy is considered the most least risky as
compared to the other strategies for the business organisation. The company tries to
increase its market share with the use of the market penetration strategy.
 Product development- This is the strategy which is used by the business organisation in
order to increase its market share. Here the company focus on the new product or the
innovation with the existing market. This is the strategy which is considered as the
beneficial for the company in order t gain the competitive advantage.
 Market development- This is the strategy where the business organisation focus on the
new market with the existing product of the company. In this strategy the company needs
to find the new market in which the organisation will promote its product. This is a risky
strategy for the company because of the new market segment.
 Diversification- This is considered the most risky strategy for the business organisation
because the company focus on the new market with the new product. The company
should able to understand the customers in which the product need to be promotes and
the product should be acceptable by the people.
According to the above discussed strategies it is been suggested that the company can
adopt the market development strategy in order to increase the market share. This is the most

suitable strategy for the Marks and Spencer where the company can increase its market share by
identifying the new market for the selling of products or services. This strategy can help in
increasing profits for the company and increasing the brand image in the differe4nt countries.
M 1 Critically evaluate the macro environment
The external factors suggests that the company needs to evaluate the different factors
which can impact the business organisation. The various factors such as social, political,
technological need to be taken into consideration for the Marks and Spencer
P 2 Analyse the internal environment and capabilities of the given organisation
The internal environment can be evaluated with the help of the various model for the
Marks and Spencer. There are various model which is discussed below:
McKinsey 7' s model
This is the model which is used by the business organisation in order to evaluate the
success and the various strategies of the business organisation. This model consists of the seven
internal factors which help in evaluating the strategies of the business organisation. The Severn
factors are discussed below in context of Marks and Spencer:
 Strategy- it is the plan which is made by the business organisation in order to remain
competitive in the market. Marks and Spencer examines if the strategy adopted is
appropriate for the company in the competitive market and if these strategies are meeting
those expectations.
 Structure- the structure of the organisation is made up of the corporate hierarchy. It
includes that how the organisation functions its day to day activities and interact and how
the employees work in the organisation. The marks and Spencer follows the
centralisation and decentralisation among the different parts of the organisation so that
the structure facilitates the coordination and cooperation among the employees.

 Systems- this refer to the business organisations daily procedures, workflow and
decisions that are utilised in the operations within the organisation. The company Marks
and Spencer derives various systems in the company such as marking, finance ,
production, procurement and these system need to be followed in the company for the
regular outcome in the organisation.
 Shared Values -these are the commonly accepted standards and norms within the
business organisation that both influence and temper the behaviour of the employees and
the management . The Marks and Spencer company shares values that signify the goals
or the organisation and this makes the company to stand together.
 Skills- This comprises the talents and capabilities of the company's employees and
management which can determine the achievements of the business organisation. Marks
and Spencer focuses on the fresh talent with the experience of the fashion industry people
for its organisation.
 Style- this means what kind of approaches of leadership style does the business
organisation adopts to influence the performance, productivity, and corporate culture.
Marks and Spencer follows many leadership style to sustain its employees . The
management provide the transforming of the employees within the organisation so that
they bare motivated .
 Staff- It refers to the personnel of the business organisation , that how large is the
workforce is and how they are motivated and prepared for for the tasks assigned to them
by the management. Marks and Spencer have a huge workforce in this organisation with
different level of departments and also have adopted different strategies to motivates its
employees and also the proper training is given to them before they are actually on the
floor.
Resource based view
This is the model through which the organisation can make different kind of strategies as
through which they can maintain the growth and the sustainable advancement and the
competitive edge in the analysation of business practises. It generally are of two types they are
like tangible and intangible. The Marks and Spencer can efficiently use all their services and

resources to be used in better manner so as to gain the advancement and all the unique offers can
be made for them.
M2 Critically evaluate the internal environment
The McKinsey model which is been discussed suggests that the company can use the
strategies in order to motivate its employees which can help the organisation to achieve its goals
on the right time.
P 3 Explain the competitive analysing with the help of porters five forces model
The tool which is utilised in order to find the competitive forces is the porters five forces.
This helps the business organisation to evaluate on the different forces which can impact the
business organisations and its operations. There are five forces which are discussed below in
context of the Marks and Spencer :
 Bargaining power of the suppliers- This is related to the power of the suppliers t
bargain with the business organisation. Here the power of the suppliers is low because for
the Marks and Spencer there are large number of suppliers from whom the company can
purchase the raw material. In this case the power of supplier is low.
 Bargaining power of the customers- This factor is defined as the ability of the
customers to bargain with the organisation. It is been analysed that in case of the Marks
and Spencer the bargaining power of the buyers is significant because the customers
haver a very low switching cost and has many alternative available in the market.
 Threats of substitutes- This is the factor which is related to the substitute over the
product or service from one product to the other. In case of the Marks and Spencer the
threat of the substitute product is low because of the brand positing of the company is so
strong that the company focus on targeting the customers who have the requirement of
the products.
 Threats of new entrants- This is the factor which is related to the new entrants of the
organisation in the specific industry. In case of the Marks and Spencer the threat of the
new entrant is low because the company is already well established in the market and has
a brand loyalty which cannot be vanished by the new entrants.

 Competitive rivalry- This is the factor winch is related to the competition in the market
between the different companies within the industry. The Marks and Spencer has the high
competition in the market which need to be consider5ed in order to be competitive.
M3 Coitally evaluate the appropriate strategies for the competitive edge
The porters five forces suggests that there is the risk of the various forces for the Marks
and Spencer winch need to be taken into consideration in order to haver a competitive advantage.
the competitive rivalry is the factor which is the most considerable for the comapny in order to
be competitive in the market.
P4 Applying a range of theories, concepts and models, interpret and devise strategic planning for
a given organisation.
Porters generic strategy
This is the model which is used by the business organisation in order to identify the
various strategies which is the most suitable for the company and its growth. The model is ex
plied below in context of Marks and Spencer:
 Differentiation- This is the strategy which involves the company to use the uniqueness
in the product or services which can help the organisation to attract the more of
customers. This strategy focus on being different from its competitors. This is the
strategy which can be used by the organisation in order to have a competitive advantage
and gain more profit.
 Cost- This is the strategy which is used by the business organisation where the company
focus on the low cost for the customers which can attract them. This is the strategy which
helps the business enterprise for targetting the wide range of customers.
 Focus- This is the strategy which consider the two segments which need to be focused by
the business organisation in order to have a competitive advantage. The company needs
to apply the cost focus or differentiation strategy which can help they company to attract
customers and be competitive in the market.
It is suggested that the company can opt for the differentiation strategy in which the
company can focus on the product. The Marks and Spencer can focus on producing the different
product by introducing exclusiveness designs in the clothing. This will help in targetting the
wide range of customer and increase in the profits of they company.

Bowman's strategic clock model
This is the model which is used by the business organisation in order to evaluate the
present strategy in which it is important for the company to understand the different position of
the company. The various elements is discussed in this model in context of the Marks and
Spencer : Low price- This is mainly a method acting in which the organisation can accommodate a
low pricing performing which will assist out to make all the changes and the formation
through which the profit margin can be applied and it will provide the general terms and
meaning for the working. This can be adopted by the Marks and Spencer by powering the
price which can help in attracting them. Low value added and low price- It encourage the pricing to be kept low so as to make the
benefits and also to apply all the nature and the working frames to be easily captured.
This can be adopted by the Marks and Spencer.
 Differentiation- This involves render he best services for the products and also to make
the accepted areas and goals so as to make the specific changes as in according to the
services and products. The Marks and Spencer can focus on this in branding the company
name in increasing the loyalty.
Strategic marketing plan
 Summary- The Marks and Spencer is the well established company in the London which
deals in the various products and services such as home products, clothing products, food
products. The company is planning to expand its business by operating in the other
segment. This is the plan which need to be taken into consideration to increase the market
share and profits for the company.
 Vision- To provide the standard against its competitors by giving the best customer
experiences to its customers.
 Mission- To make the best quality of the products in order to satisfy the needs and wants
of their customers.
 Objectives- To increase the market share by increasing the market share of the company.
To generate more revenue.
 Tactics- Product- This will include the same product which is been provided by the
company such as clothing, home and food products.

Price- The company can use the competitive pricing strategy in order to attract customer.
Place- The company can focus on the both online and offline distribution of the products.
Promotion- The company can focus on the various promotional tools such as use of the social
media in order to promote the products.
 Controlling and monitoring- For this the company can use the benchmarking technique
where the marketer can focus on evaluating the strategy adopted is beneficial or not for
the company.
M4 Critically evaluate the strategic plan
It is been planned that the company needs to increase its market share. From the various
model it is analysed that the Marks and Spencer can focus on the market development in order to
have the profit maximization. The various digital tools can help in promotion of the products to
the customers.
CONCLUSION
From the above report it is concluded that business strategy is the various action plan
which need to be taken into consideration for the business organisation. In this report from the
various model sit is been analysed that the company can us the various strategies in order to
increase its market share. The pestle analysis suggests that the company need to take care of the
social factor in order to attract customer. The internal and external factors are important for the
Marks and Spencer in order to expand its business. The company can us the market development
strategy where it can focus on the various aspect of increasing the market share into the new
segment.

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