Business Strategy for Desklib - Online Library for Study Material

This report discusses the business strategy of Desklib, an online library for study material. It covers the influence of macro environment, internal environment, and competitive forces within the market. The report applies various frameworks such as PESTLE analysis, Ansoff matrix, McKinsey's 7's model, VRIO framework, and Porter's five forces model to evaluate the capabilities and resources of Desklib.

BUSINESS
STRATEGY
1

Table of Contents
INTRODUCTION ..........................................................................................................................3
TASK 1............................................................................................................................................3
Applying distinct framework in order to analyse the influence of macro environment upon
business as well as on their strategies.....................................................................................3
TASK 2............................................................................................................................................6
Evaluating the capabilities as well as internal environment of a business through utilizing
proper frameworks..................................................................................................................6
TASK 3............................................................................................................................................9
Implementing porter's five force model to evaluate the competitive forces within market for a
business...................................................................................................................................9
TASK 4..........................................................................................................................................10
P4 Apply different models, theories and concepts to interpret strategic planning for a
company...............................................................................................................................10
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13
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INTRODUCTION
The term business strategy denotes to the various decisions as well as tactics which
provides various advantages to the company in achieving their objectives or goals. It is
mentioned as a key plan that is being executed by a person within a business in order to have
huge competitive stand in market. The present report includes Marks and Spencer company that
is being situated in UK and sells retail items such as home products, food, clothing and other fast
moving consumer products. The report discusses about the macro environmental impact upon the
company's strategy of business, different logical frameworks are applied so to identify the macro
environment (Amri-Asrami and Aghaei, 2021). Organizational culture as well as various internal
competences are mentioned with a combination of evaluating through implementation of porter's
five force and other models. Further, differentiated concepts, models or theories are used within
the report in order to understand the strategic directions of a company.
TASK 1
Applying distinct framework in order to analyse the influence of macro environment upon
business as well as on their strategies
The various macro environmental factors are mentioned below:
PESTLE Analysis
The framework refers to a strategic tool that is being utilized by companies in order to
acknowledge the macro environmental aspects within effective manner at marketplace. The
analysis of macro environment factors with context to Marks and Spencer is done below: Political: This factor is related with various aspects such as regulation of tax,
governmental stability or instability, tariff rates and other related components. The
country UK is experienced with high governmental stability along with comfortable tax
rates for companies which is lesser. This encourages businesses to run their operations
and generate high profits for the firm (Herciu, 2020). Through this it is easy for Marks
and Spencer to develop its policies by keeping government stability in mind and earn
greater revenues. Economical: This involves discussion about GDP, inflation or deflection rate, monetary
or purchasing power, economic growth rate and other concerned aspects of the nation as
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a whole. UK experiences huge growth rate which is highly beneficial for the businesses
along with a combination of high disposable income assistance of which the audience
becomes competent to purchase more and more items for their regular consumption due
to which the organisation Marks and Spencer enjoys high profitability. On the other hand,
the moment economy is experiencing the presence of high inflation as happened in year
2018, the company seems to face hardships in its sales and revenues part.
 Social: Various societal components such as people's beliefs, opinions, ethics,
perceptions, morals, etc. are concerned within which the human beings as well as the
business exists. The society of UK is experienced to be the open minded where the
society people are always open to new things and adapt the changes with a twist in latest
items. Through this, the company Marks and Spencer is able to offer better quality of its
items created with latest form of technology to the market where customers are ready to
pay even high prices for the quality products. Technological: Most of the businesses within UK are operating with latest technology as
the country is always updated with the newest technology in market such as high internet
bandwidth or digital media in order to make their daily operations with ease and comfort.
With the going trend the organisation Marks and Spencer is needed to get updated with
advanced form of technologies or methodologies such as could be done in its supply
chain or in production process that could rise the company's profit margin. Legal: This force talks about the legal norms and regulations which are required by the
businesses to follow upon with full concentration as prescribed the UK government or
permitted authority. This is done with a purpose of safeguarding the customers interest as
well as employees benefit. Marks and Spencer is required to comply with all the
necessary policies or norms in order to run effectively with no harm upon its brand
image, violation of any could be extremely hazardous for the brand (Hongpisuttikul and
Sookcharoen, 2021). Environmental: This force is interconnected with the ecology and nature that safeguards
the environment form hazardous actions that are done by business companies. Abiding by
the laws of environment is always beneficial for the business as this assists companies in
developing positive brand image in the eyes of customers. With context to Marks and
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Spencer, the business follows each law regarding environment and this assists in huge
sales with higher revenues.
Ansoff Matrix
The Ansoff matrix framework is denoted as a strategic tool that is utilized for the
planning concerning towards the business growth and expansion. The analysis of Ansoff matrix
with relation to Marks and Spencer is done below: Product Development: Within this component, the business comes up with a launch of
new item in same market with an objective of raising its revenues through generation of
high sales. Here the existing buyers of company's products are offered with an
opportunity of buying more and more items in huge amount. This allows Marks and
Spencer to raise its sales and brings more revenue to the business (Idota, Taher and Tsuji,
2021). Market Development: Within this strategy of growth, the company offers its current
items in a new untouched market to the newest consumers. This is done as when
company's existing customers are fully satisfied with the current offerings. By this Marks
and Spencer is gaining benefit of increasing its consumer base and generates its revenues
from new customers. Market Penetration: Under this, a business firms adopts this strategy with an aim to
develop its present market share through offering its current items within current
marketplace. Under this, Marks and Spencer minimizes the prices of its offerings to the
possible ratio for its items or even offers certain complementary services to the buyers in
order to raise its market share within existing area of operation.
Diversification: The highly riskiest strategy for any business is of diversification which involves
launching of new item in new market. The strategy if proven successful could result into boom
for the business but if experienced some roadblock then could result into huge losses for the
organisation. Marks and Spencer being a famous brand across the world can easily diversify its
business into new international market with new item that can cater large customers with higher
revenues for the firm (Samosir, 2020).
With respect to the discussion made above, the manager at Marks and Spencer is required
to go with market penetration where it can sell its current items with certain discounts or offers
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that can attract more and more customers within current market. This would be done with an aim
of generating higher revenues with mild changes. This would not give rise to any chance of
losses to the firm from its operations or products.
Stakeholders analysis
The concept of stakeholder’s analysis denotes to a set process of analysing such
competencies or people who could create a favourable impact upon the business before the
initiation of any business project. This would allow company Marks and Spencer in categorizing
the stakeholders according to their level of participation and interest. The analysis involves
different elements which are discussed below:
High interest, high power: This involves highly important stakeholders for Marks and
Spencer such as its management team, investors, etc. who through their participation brings huge
growth to the business and runs its activities in flawless way (Mohanty, 2020).
Low Interest, high power: Such stakeholders encourages the business actions to the
highest but does not possess any interest in the activities or projects of Marks and Spencer like
suppliers, distributors.
High interest, low power: Such stakeholders does not possess any power into the
business but are highly interested in its affairs therefore they are required to be informed with the
business affairs like employees or other staff members.
Low interest, low power: Such kind of stakeholders are neither interested with the
affairs of company nor carries any power within the business like customers (Gelen, and Alis,
2019).
TASK 2
Evaluating the capabilities as well as internal environment of a business through utilizing proper
frameworks
Resource based view strategy
The concept of resource based view is denoted as specific framework that is being
applied by a business company in order to analyse such resources that could be exploited by an
organisation in regards to attain the sustainable competitive advantage for the company. With
relation to this framework, there is an existence of two different forms of resources which are
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tangible & intangible one. The resource tangible comprises of physical capital like building, land
and machinery, supportive equipment and various other assets that can be touched, felt and seen.
On the other hand, in relation to intangible capital, the assets of Marks and Spencer includes
brand image, intellectual property, trademarks and various other assets that could not be touched
but has a great impact upon the existence of Marks and Spencer (Kumar and Rodrigues 2020).
McKinsey's 7's model
The McKinsey's model is that strategic tool which assists company in evaluating its
organisational structure through using 7 essential elements. Such aspects are required to be
directed properly with high effectiveness. The elements of framework with relation to Marks and
Spencer are discussed below: Strategy: This includes a plan that is being developed by an organisation in order to
achieve competitive edge so that the business can perform its actions in highly
competitive manner. In context to Marks and Spencer, the company is required to create a
robust strategy so that can compete properly with its rival firms and maintain its
consumer base (Obel and Gurkov, 2021). Structure: This represents a business unit or even a specific division that includes well
organized organisational information. In context to Marks and Spencer, the company is
required to adopt appropriate strategy otherwise, it would lose its effectiveness and
competitive advantage. System: Under this, the business is targeted to present their regular actions as well as
decision making system. Going with the proper system is highly suitable for Marks and
Spencer in order to generate huge benefits for the business. Style: This shows the specific way within which a business is managed and run by the top
level management along with a manner for interacting any information or making any
communication with each other. In context to Marks and Spencer, the company adopts
participative style where the views or thoughts of each employee is being respected and
are considered (Obydenov, 2021). Skills: This comprises of certain capabilities & competencies in company's employees
during their course of action. With context to Marks and Spencer, each staff member is
competent to deal with hardships and present their best in their tough time.
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 Staff: This includes amount of manpower which a company has to run its operations with
smooth flow. In case of Marks and Spencer, the organisation hires, trains, rewards,
motivates and retains their staff member who are highly competent and are dedicated
towards the company's success (Parsipoor, 2021). Shared Values: This talks about company's norms or standards that directs the business
actions such as Marks and Spencer who is fully directed towards attainment of goal
through its values and behaviour.
VRIO framework
The concept of VRIO analysis stands for value, rarity, imitable and the organized manner
of company's internal resources. This would assist Marks and Spencer in attaining high
competitive edge over competitive firms within industry. The strategic analysis through VRIO
with respect to Marks and Spencer is done below: Valuable: It is essential for Marks and Spencer to utilize its valuable resources in
effective manner so that they could be able to compete appropriately. For instance, for
Marks and Spencer the company's valuable resources comprise of its staff, supply chain
management and distribution department.
Rareness: The component assists firms in attaining certain benefits while understanding about
the product that whether it is rare or not. Marks and Spencer offering rare items would help the
business in attaining consumer loyalty which ultimately enhances company's revenue as well as
sales. The rarity for Marks and Spencer comprises in production & manufacturing department,
machinery and its process. The company believes in offering innovative & unique items to its
buyers (König, and et. al., 2019). Imitable: Marks and Spencer is needed to supply such items that could not be copied by
competitor firm within industry. When the competitors of Marks and Spencer can easily
copy the company's resources then it would become tough for business to maintain its
brand image and sales. For the business Marks and Spencer its offerings such as clothes
eatables are imitable for the organisation.
Organisation: It is essential for Marks and Spencer to manage its prevailing resources within an
optimal structure. The resources would produce loses for the business if are not utilized in proper
manner to their higher extend. The resources that needs to be organized in appropriate manner
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comprises of suppliers, employees, stakeholders, investors and other related (Lopes and et. al.,
2021).
TASK 3
Implementing porter's five force model to evaluate the competitive forces within market for a
business
The concept of Porter's five forces denotes to a framework that is being utilized while
making strategic decisions for the business through considering various upcoming results instead
of looking only for current competition. The framework comprises of five distinct elements that
are analysed below: Threat of new entry: For Marks and Spencer, there is not stress for the entry of new
firms as being a renowned multinational business the capital and other resources are too
huge which is not easy for new companies to make this possible within a short span of
time. Bargaining power of a supplier: As Marks and Spencer operates with clothings and
eatables so there is high bargaining power with suppliers within the industry. If the
company's suppliers shift to other firms, then it would become tough for firm to manage
its production and supply chain. This would ultimately reduce its sales as well as
revenues.
Bargaining power of a buyer: For Marks and Spencer, the buyers carries huge bargaining power
as there is tough competition within retail industry. If Marks and Spencer would charge premium
prices for its offerings then it would lose its large customer segment which eventually results in
loss of its revenues (Mahrinasari and Pandjaitan, 2020). Threat of substitution: The company is freeing from the threat in respect to the
substitution of food & clothing items as these are such products which do not have any
substitution. Therefore, Marks and Spencer enjoys its sales but on the other hand if it
offers less quality then the consumers would react reluctantly.
 Rivalry among the existing competitors: The UK market is operating with numerous
business firms that deals in retail sector due to which Marks and Spencer is required to
face huge competition in industry. The competitors of Marks and Spencer offer their
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items at competitive prices due to which the company could not make any alterations in
its current offerings otherwise it would lose its customers.
TASK 4
P4 Apply different models, theories and concepts to interpret strategic planning for a company
Porter's generic strategies
These refers to such strategies that creates several advantages by identifying the different
ways of attaining competitive edge. Regarding Marks and Spencer such strategies are explained
as follows:
 Cost leadership: Porter generic strategies makes price sensitivity developed which can
be targeted in easy manner. This strategy helps an organization like Marks and Spencer
offer product to its customers at low price that helps organization in maintaining trust and
loyalty of customers.
 Differentiation: Within this strategy, a business firm is needed to present innovative
items that creates distinction within common range of products. Marks and Spencer
through offering innovation makes sales enhancement possible (Trendowski and Nair
2018).
 Focus: This strategy has two aspects which includes differentiation and cost focus. In
cost focus, Marks and Spencer needs to provide those products within less price that can
attract large number of customer. In differentiation, company needs to offer modern
products that enable people to purchase those products without thinking more about
pricing.
Bowman's strategic clock
Bowman strategic clock refers to model that helps business organisation in exploring
effective strategic positioning i.e. the way through Marks and Spencer can position their products
that can have high advantage over rival companies can achieved effectively. Some of the aspect
related framework are mentioned further:
 Low price & low value added: This is less competitive position for Marks and Spencer.
As products are not distinguished, consumers observe less worth for products after less
pricing.
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 Low price: Under this, the company Marks and Spencer could develop its position being
a leader of low cost within marketplace through utilizing a technique of cost
minimization. Here, profits for each product will less but due to high sale volume, overall
profits will be higher.
 Hybrid: This strategy involves elements product differentiation along with low price.
This positioning strategy can be effective in context with Marks and Spencer.
 Differentiation: This is the strategy where, Marks and Spencer is needs to focus on
innovative offerings this can help to increase the considerably of sales.
Focused differentiation: In this, products are placed at higher price. Consumer can purchase
product due to its higher perceived value. This strategy is used by luxurious brands which
operates at global level (Valjevac and et. al., 2018).
 Risky high margins: This is the strategy where organisation faces high risk that makes
business impacted negatively. Marks and Spencer can set high price without offering
anything extra in perceived value.
 Monopoly pricing: In market monopoly one business is been offering products. In this
no innovation is required and customers buy product at high price.
 Loss of market shares: This strategic position makes setting of standards price with
middle range product. In this market share is been earn over an organization is less.
In case of Marks and Spencer Upon analysis the two models organization is require to
adopt various strategies for new and unique products to be offered which makes high profit with
revenue generated. This makes organizations sales and revenue increased by enhancing
companies shares.
It is recommended to Marks and Spencer to use differentiate focus strategy to launch new
product within market to increase profit and capture large market area.
Strategic management plan- This includes organisational objectives, mission, vision,
strategy, tactics etc.
Objective- Marks and Spencer have the objective to increase their profit by 20% in next one
year through increasing quality products.
Vision- Marks and Spencer have the vision to provide high quality product to customers.
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Mission- Mission of Marks and Spencer is to enhance their productivity and profitability and get
higher competitive advantages.
Strategies- Some of the strategy which needs to be followed are discussed further.
Promotion- This strategy can help to attract large number of customer base for products.
Enhancing quality of product- This strategy is highly applicable for attracting and
influencing large customer base to purchase high quality product at same range.
Tactics- There are some of the strategy that can help to achieve long term goal for the business.
Some of the strategies are discussed further.
Rebust strategy- This strategy provides an evaluation of different strategies against various
context scenarios of strategies.
STP: It includes three strategies in where there is decision taken for launching of new products
are being formulated by the company. All the three elements of STP that are required by Marks
and Spancer are as follows:
 Segmenting: In this strategy Marks and Spencer should divide market in different segments
and selecting one of them to improve quality products in the market.
 Targetting: The process is used to identifying target customers. The target market for Marks
and Spencer will be families and all age.
 Positioning: In this procedure Marks and Spencer try to use attractive procedures to set a
good brand image in the mind of customers. Marks and Spencer should use impressive
promotion strategy like discounting etc. to aware clients regarding the products.
CONCLUSION
From the above report, it could be concluded that in absence of proper strategies, it
becomes tough for companies to attain set targets and become a successful venture. Frameworks
such as Pestle, Ansoff, Vrio, Stakeholders analysis, McKinsey's model and helpful in analysing
the company's internal & external environmental culture. Whereas, Porter's five forces could be
applied in order to analyse the company's competitive position. Through the different models of
theories, a business could be able to apply its appropriate strategic plans in order to attain higher
advantages and success.
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REFERENCES
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Idota, H., Taher, S.A. and Tsuji, M., 2021. The Impact of ICTs and Business Strategy on
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Valjevac and et. al., 2018. Development of the strategic planning process necessary for the business
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Ventures (pp. 335-350). IGI Global.
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