Impact of Macro Environmental Factors on Business Strategies of H&M

Business strategy

Table of Contents
INTRODUCTION ..........................................................................................................................3
TASK...............................................................................................................................................3
P1 Impact as well as influence of macro environmental factors on organisation and its
strategies.................................................................................................................................3
Political Factors......................................................................................................................3
Economic Factors:..................................................................................................................4
M1 Critical analysation of the external environment for the purpose of determining and
informing strategic management decision..............................................................................4
P2 Analysation of organisation's internal environment as well as capabilities though using
appropriate models and frameworks......................................................................................5
M2 Critical evaluation of the internal environment of organisation for assessing the internal
strengths and weaknesses along with internal capabilities structure and skill set..................6
P3 Application of the model of Porter's five forces in the given organisation and evaluation of
the competitive forces on the business of the organisation....................................................7
M3 Necessary strategies that help in improving competitive edge of the organisation.........8
P4 Application of the range of theories concepts and model and interpretation of device
strategic planning for the organisation...................................................................................8
M4 A strategic management plan that has tangible and tactical strategic priorities and
objectives................................................................................................................................9
D1 Interpretation of the information and data application on the environmental and
competitive analysis for producing a set of valid strategic directions, objectives and tactical
actions.....................................................................................................................................9
CONCLUSION ...............................................................................................................................9
REFERENCES..............................................................................................................................11

INTRODUCTION
Business strategies refers to those tactics, moves and the actions which is done by the company
to attract the customers towards the product of the company. The ultimate goal of all the strategy
is to strengthen the organisation and achieve the goals of the organisation. There are different
types of tasks present in the organization and the managers of the organization have to develop
effective strategy for all the functions of the organization so that it can be completed effectively
in the organization. The organization chosen here to display this report is H&M, one of the
world's multinational clothing brands based in Sweden. This report is going to covered
description related to the internal and external environment of the organisation. This report also
provides brief discussion related to different theories and the models of strategic management.
TASK
P1 Impact as well as influence of macro environmental factors on organisation and its strategies
External factors refers to those factors of the organisation which is present in outside
environment. This becomes significant for the administration of an organisation to analyse the
external environment so that the complications of the management can be minimised. It is very
important for the management of H&M to conduct PEST analyses if they want for analysing the
influence of macro environmental factors on the business of organisation.
PEST analyses of H&M
It deals with those analyzes of strategic management that are used to evaluate the impact
of the external environment on an organization's business (Brown and Brown, 2019). Various
types of factors are present in this analysis like political, economic etc. A brief discussion
regarding these factors is given below:
Political Factors
The major part of the production of H&M are based three countries named Lebanon, Turkey and
Egypt. The country of Lebanon is one of those country of the world which is badly impacted
with the war and their consequences. The level of disturbance are very high in this country
which negatively impacts the business of the organisation. The trade war between the two giants
of the world named US and China which not impact the business of H&M but also for the entire
because the prices of the clothes are increase in international markets.

Economic Factors:
The happening of the Brexit has negatively impacts the business of many organisations but it
does not impacts the business of H&M because the sale of the company are increase by the
considerable number after the Brexit (Galletta, Mazzù and Naciti, 2021). There are many
operating countries are present with H&M under which the rates of the labour are decreases
which is beneficial for the profit margins of the company.
Social factors
Clothing is one of those brand of the market under which the customers are highly influenced
with the celebrities and the social media. There are many celebrities and the sports personalities
are present in the market which can influence the customers to use the product of the company. It
becomes the opportunity for the company to endorse their product with the helps of these
personnels and increases their sell.
Technological factors
The trend of technological advancement is one of the most important trend of the market. The
customers of the organisation has used effective technological devices for their shopping and
other activities of life. It is very important for the management of H&M to use new and
advanced technology that captures multiple employees in the organisation.
M1 Critical analysation of the external environment for the purpose of determining and
informing strategic management decision
The decision making process of the organisation is one of the important and critical process of
the organisation which the management has to perform ion effective manner. The evaluation of
the external factors has played important role in decision making of the organisation. It is very
important for the management of H&M to analyze the external factors in their organization
which are helpful in decision making (Hristov and Appolloni, 2022). The political factor of the
analyses has reflected the disturbance of the production due to war situation in Lebanon so it is
important to shift the production in another locations of the world.
P2 Analysation of organisation's internal environment as well as capabilities though using
appropriate models and frameworks
Internal factors refers to those factors of the organisation which impacts the business of the
company from inside the organisation. The evaluation of the internal factors is one of the