Impact of Business, Cultural and Natural Environment on Organisation Behaviour

This report discusses the impact of business, cultural, and natural environment on the behavior of organizations, using Marks and Spencer as a case study. It explores the influence of economic, social, technological, legal, political, and natural factors on the behavior of the company. The report also includes a PESTEL and SWOT analysis of Marks and Spencer's business environment.

Contemporary Business
Environment

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................4
Impact of business, cultural and natural environment on organisation behaviour......................4
PESTEL and SWOT analysis......................................................................................................8
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................12

INTRODUCTION
Business environment always includes such all activities and operations which a business
conduct and operate for earning huge profit in market. There are many internal and external
factors has included a business environment which influence it in both ways positively and
negatively. Top-level management of any business is always responsible to take various effective
decision for taking huge advantages from these factors. Culture and natural environment are
completely shaping the behaviour of any business or company. Mostly all businesses always take
different steps to systematically deal with culture and natural environment. There are employees,
manager, supplier, government policies, climate change, technology, legal terms, marketing,
customers etc. are major parts of business environment. These all things are highly affecting
daily operations of an organisations.
This report discusses business environment of Marks and Spencer (M&S). It is one of the
leading British retail companies, which currently has large customer base in the UK’s retail
industry. It has the second largest distribution channel in its home country. M&S is too excellent
in its business expansion process, because it currently has many supermarkets and stores in
different countries like; United Kingdom, Ireland, France, Germany, Netherlands, China, etc. Its
research and development team is very perfect in own job role (Sinthupundaja, Chiadamrong and
Kohda, 2019). This is basically company’s one strength. Reason is, the company can easily
produce exclusive range of products and services with the support of its research and
development team. This company is also completely influencing by culture and natural
environment aspects, because it always need to consider these aspects while developing their
business plan.
Top-level management of the company is mainly responsible to take decision for dealing
with all internal and external factors of its business environment. Currently it has large number
of employees who day or night giving their great contribution in all over growth of M&S. In this
case, work culture of this company and existing natural environment are affecting behaviour of
these employees. The management is always try to make a happy and healthy culture in their
business environment, because employees can capable to more improve their existing
performance in this type of cultures. Leaders within company always try to remove such

elements from workplace which can negatively influence their teamwork. It is too necessary to
run all business operations on progressive path. Currently most companies are trying to avoid
implement such strategies in their daily operations which raises conflicts within work culture. On
the other side, top-level management is responsible to adhere those all legal and ethical
considerations in their business culture which local government has passed to protect natural
environment.
MAIN BODY
Impact of business, cultural and natural environment on organisation behaviour
Business environment indicated about different external forces impact the business
operations of company. All corporate houses operate business operations based on the factors
comprises in business environment. Different factors impact on the operations of Marks and
Spencer that can be demonstrated in the following ways.
Business Environment
Business environment is among the crucial factor influence the organisation behaviour of
Marks and Spencer.
Economic Environment
Business environment comprises with economic environment and non-economic
environment. Economic environment further comprises with economic system and economic
policies. The impacts of economic environment over the organisation behaviour in Marks and
Spencer can be summarised in the following manner.
Economic System: Economic system impact over every aspects of the organisation behaviour
such as individual, team behaviour, communication and other elements involve in organisation
behaviour. Economic system comprises with plenty of factors such as currency value, exchange
rate, government system and other aspects (Askool, 2018). All policies and strategies frame by
employee’s and teams in organisation structure are highly depends upon the different aspects of
the economic system. Economic situation also affects organisation behaviour as if the country
carry strengthens economic situation all individuals and teams framed in the organisation

hierarchy of Marks and Spencer will positively operate the business operations of company.
Economic situation directly effects on the attitude of the employees of company.
Economic Policies: Economic policies frame by government has a direct implication with the
operations of the Marks and Spencer. Organisation behaviour also get affected with the
economic policies frame by government. If the economic policies of government are well
effective and impactful it will create a positive impact on the employee’s and teams of company.
Employees will be able to frame all business strategies confidently. Ineffective economic
policies create hustle for the employee’s as the Marks and Spencer operates all its business
operations in retail sector so all aspects of the economic policies will directly influence on the
operations of company.
Non-Economic Environment
Non-economic environment is comprising with different social aspects such as natural,
demographic, technological, legal, political and social factors.
Natural: Natural factor involve climate change and other natural factors affect the business
operations of Marks and Spencer Company. Retail sector is highly depending upon the natural
factors as many products are considered seasonal in nature (Barbaranelli, Erbasi, 2017). Natural
factor also involves natural calamities which directly affect business operations of company. If
the weather condition is not suitable enough it directly affect the attitude and behaviour of the
entire individual and teams part of the organisation structure of Marks and Spencer.
Demographic: Demographic factors are also among the crucial non-economic environment
factor. Demographic factor put a huge impact over the organisation structure of the company. As
demographic factor comprises with genders, sex, caste, religion and other social elements
attached with the populations of country. Management of Marks and Spencer are very keen
towards diversified organisation culture of the company. Demographics of the country allows
management to establish such a well-diversified corporate culture. As it enables diversified
culture demographic factor positively influence the behaviour and attitude of the employee’s and
teams in the company. This factor also supports management of the company to oppose
discrimination in the company which further resulted into efficient organisation behaviour.
Demographic factor also supports management of Marks and Spencer to establish an effective

organisation hierarchy in the company by recruiting individual employee from all parts of the
world.
Technological: Technological factor is also among the crucial non-economic environment factor
effect over the organisation behaviour of the Marks and Spencer. Management of the Marks and
Spencer always initiate to update all the latest technological advancement in the organisation
structure of the company (Friedmann, Garg and Holtbrügge, 2018). By availing latest and
advanced technology company management try to improve the productivity of all individual and
teams in the company. Technological implementation also positively affects the individual and
team behaviour in the company. Technological advancement also improves the resources of
company which supports the employee’s to better fulfil all the associated duties and
responsibilities as a part of the designated role. Technological implementation also improves the
motivation and team behaviour in the company. As it improves the employee loyalty in respect
to the corporate organisation.
Legal: Legal factor is also considered as the crucial non-economic environment factor affect the
organisation behaviour of the company. Legal factor involve all laws and legislation framed by
government in regards to the corporate sector. Implementation of governmental legislation and
regulation improves the organisation behaviour of companies (Hack-Polay, 2018). As by
implementing legislative functions effective company management of Marks and Spencer
improves the work culture of company. Laws like equal wage payment act, equality and other
laws enables employee’s if company to grow potentially in the organisation structure irrespective
of any discrimination. All the laws applied on the Marks and Spencer provide equal opportunity
to all individual and team to work effectively and have equal growth and development
opportunities company. Legal factors put positive impacts on the individual and team’s
behaviour in the company. It also supports company management of Marks and Spencer to
sustain an effective organisation hierarchy in the company.
Political: Political factor involve political stability and policies frame by government. Political
stability is considered as the effective business environment factor affects the business operations
of company. Political stability allows company management to operate all operational functions
effectively which also further affect the individual and team behaviour in the company. If the
government is sustainable in the country, it will allow to individual and teams in the Marks and

Spencer to frame long term policies and strategies in the company for operating different
operational functions. Sustainability of government affects positively all employees of company.
Social: Social aspects if also considered as the crucial organisation behaviour factor.
Organisation behaviour is defined as the behaviour of individual employee’s in the company
(Lamprakis and et.al., 2018). All the organisation hierarchy framed under the Marks and Spencer
are highly depends upon the social elements such as diversification, caste and other religious
elements. It enables company management to have a well-diversified corporate culture in the
company.
Cultural Environment
Cultural elements are considered as the diversification of the organisation structure.
Cultural factor involves the culture of the corporate organisation. Culture of the company effect
on all aspects of the organisation behaviour such as individual employee’s, teams in company,
organisation structure, hierarchy, coordination and all aspects involved in the organisation
behaviour. Culture of the company affect all aspects of the operational functions such as strategy
formation, team behaviour, team formation, leadership, organisation hierarchy, attitude of
individual employee’s in company and other aspects of the company.
Handy model of cultural factor
Handy has projected the cultural aspects associated with the organisation structure. This model
emphasis on the following aspects associated with the organisation culture.
Power culture: Power culture involves allocating specific power and authorities to employees of
company. Management of Marks and Spencer allocate different operational power to employees
of company based on the designation requirements. This cultural factor has improved the
organisation behaviour of the company. It has also resulted into employee loyalty in respect to
the organisation.
Task culture: Task culture is also associated with the organisation structure of the Marks and
Spencer. Task culture emphasis over forming teams in the company to operate certain tasks.
Management of Marks and Spencer has improved the team culture in the company by

implementing the task culture in the company (Mullins, 2019). This also improves the attitude of
all employee’s in company in respect to the team work.
Person culture: Person culture is also a crucial part of organisation culture of Marks and
Spencer. It enables company management to value individual employee’s in company. Person
culture has supported the management of Marks and Spencer in improving the organisation
behaviour of the company. Person culture also resulted into employee motivation in the
company.
Role culture: Role culture is also a crucial part of the organisation behaviour of the Marks and
Spencer. This culture allows company management to allocate defined role in the operational
function of the Marks and Spencer. Role culture directly impact over the individual and team
behaviour in the company (Williams and Efendic, 2019). Role culture also improves the
organisation hierarchy of the company.
All the four cultural aspects project about the impact of cultural factor over the
organisation behaviour of the Marks and Spencer.
Natural Environment
Natural environment involves geographical and ecological factors.
Geographical: Geographical factor comprises with geological locations of the country, weather
condition in country and other climatic aspects. All the factors involve in geographical impact
over the operations of the Marks and Spencer.
Ecological: Ecological factor is also a crucial aspect of the natural environment. Ecological
factor influences the internal structure of the company. Factors like sunlight, water and other
directly affect the individual behaviour in the company. It also affects the attitude of company’s
employee’s. If the country is facing a bad weather condition, then it will negatively affect the
attitude of employee’s in company.
All the aspects have projected about different impacts on organisation behaviour.

PESTEL and SWOT analysis
PESTEL and SWOT analytical tools are very important tools for M&S to identify major
internal and external factors of its business environment (Tomás‐Miquel, Molina‐Morales and
Expósito‐Langa, 2019). PESTEL analysis mainly helps in knowing external factors and SWOT
analysis helps in knowing internal factor of business environment.
PESTEL Analysis
Political Factors: M&S is highly influencing by political factors of the United Kingdom,
because the management of company is always responsible to fulfil those all formalities which
local government has imposed on existing businesses or companies. There is taxation is one
example of political factors, in which the management always need to take various decisions for
fulfilling taxation formalities.
Economic Factors: Economic factors are positively influencing this company, because the
United Kingdom is one of the richest countries in the world. That’s why here is most people are
comes from high income groups. They can easily afford products and services which M&S has
offered in the market. These factors give chance to company for increasing its sales ratio by
attracting lots of customers towards brand.
Social Factors: Social factors of this country are too favourable to M&S, because almost all
people of the UK are completely literate. They ready to pay any cost for buying quality products
and services, so these factors influence to company for producing quality products and services
for customers (Murphy and et.al., 2019). The company already has gained large customer base in
this country because of its excellent product quality.
Technological Factors: The company is able to increase its all over performance with the
support of these technological factors. Reason is, currently those all technological gadgets,
machineries, tools and equipment are available in the UK’s market which helps to company for
improving existing operational processes. For example; new generation machines help to
company for producing many unites of different products in few hours.
Environmental Factors: Top-level management of M&S is always responsible to avoid such
activities in their business operations which can harm natural environment. These factors mainly

encourage to company for taking various productive steps to protect our natural environment.
Currently many environment protection organisations have imposed many strict rules and
regulation on businesses or companies to maintain a healthy environment in nature. In this case,
this company is also need to follow all rules and regulations to protect natural environment.
Legal Factors: The government of United Kingdom has passed many legal and ethical
considerations which M&S is responsible to adhere in its daily operations. It is necessary task to
the company for maintaining an ethical environment in their business environment. There is
employment law, contract law, agreement act etc. are comes under legal factors. These all legal
and ethical considerations help to company for running its all business operations in proper
channel.
SWOT Analysis
Strengths: The Marks and Spencer has very large market share in the UK’s retail industry. It has
an effective workforce which day or night working for achieving common goals (Ghicajanu,
2019). Its research and development (R&D) team is too productive in its job role, because is able
to produce different range of products with the support of its R&D team.
Weaknesses: Many times top-level management of company takes such decisions in their
business environment which negatively influence their business environment, in which decision-
making skills of management is not much effective. On the other side, marketing team is not
using digital marketing tool at the large scale in their different marketing campaigns. That’s why
currently company not enables to take huge advantages from digital marketing strategy.
Opportunities: It has opportunity to build huge customer base in the UK’s retail market by
providing quality products and services on favourable prices. On the other hand, it has
opportunity to attract lots of new customers towards brand through digital marketing strategy.
Threats: Day by day increasing market completion in the UK’s retail industry is the biggest
threat to Marks and Spencer (Delgado, 2018). There are Tesco, Sainsbury and Walmart’s
subsidiary ASDA some major competitors of M&S which are currently giving very tough
competition to existing company.

CONCLUSION
It can be concluded that factors which has included in PESTEL and SWOT analysis are
effectively affecting business environment of M&S. These factors are mainly influencing top-
level management of company to take some productive decisions for properly dealing with
different business situations. The management enables to make or develop various strategies to
take huge advantages from these internal and external factors. On the other hand, the company
should take some productive steps towards maintaining an effective work culture in their
workplace. Reason is, employees always capable to improve their skills and talent in this type of
workplaces. That’s why these steps of company are too necessary for its business environment.
There is business culture is also plays great role in M&S, because it shapes people behaviour in
this company. Currently work culture of company is very happy and healthy, because top-level
management always takes various decisions for removing negative elements from their
workplace.
Natural environment is also highly influencing people behaviour in the Marks and
Spencer, because many times the management takes some decisions towards protecting natural
environment. The company always fulfils its CSR (corporate social responsibility) on time. It
provides huge fund to those organisations which works for protecting natural environment. that’s
why CSR is the best way to the company to contribute in natural environment protection.
Existing employees are very satisfied with company’s these steps, because they think this
company take care of our natural environment. Then employees get motivated from these steps
to put their huge efforts in daily operations of M&S. These are some major factors which shows
how natural environment shape people behaviour in company.
According to internal and external business environment analysis, the management of
company should develop some productive business strategies which can help to deal with impact
of business environment factors. In the terms of business culture, human resource management
of M&S is responsible to build an effective relationship between employer and employees. It is
necessary to maintain excellent work culture in company. Top-level management of company
can easily manage people behaviour in their business environment by maintaining positive work
culture. Some negative elements are always existing in any company’s business environment, so
the upper management of M&S need to remove such elements from its business environment. if

company has succeeded in maintaining positive work culture in their business environment, then
it will able to gain huge competitive advantage in the UK’s retail industry.

REFERENCES
Books & Journals
Askool, S., 2018, July. Extending Technology Acceptance Model for Proximity Mobile Payment
via Organisational Semiotics. In Digitalisation, Innovation, and Transformation: 18th
IFIP WG 8.1 International Conference on Informatics and Semiotics in Organisations,
ICISO 2018, Reading, UK, July 16-18, 2018, Proceedings (Vol. 527, p. 43). Springer.
Barbaranelli, C. and et.al., 2019. Positivity and behaviour: the mediating role of self-efficacy in
organisational and educational settings. Journal of Happiness Studies. 20(3). pp.707-
727.
Delgado, M., 2018. Firms in context: Internal and external drivers of success. The new Oxford
handbook of economic geography, pp.324-344.
Erbasi, A., 2017. THE INVESTIGATION OF HOTEL EMPLOYEES'GREEN
ORGANISATIONAL BEHAVIOUR TENDENCIES IN TERMS OF SOME
DEMOGRAPHIC VARIABLES. Tourism in South East Europe. 4. pp.159-168.
Friedmann, C. B., Garg, R. and Holtbrügge, D., 2018. CEOs' cultural and demographic attributes
and organisational performance of Indian SMEs: an upper echelon
approach. International Journal of Entrepreneurial Venturing. 10(5). pp.483-512.
Ghicajanu, M., 2019. Analysis of factors from the external environment in changing business
processes. In MATEC Web of Conferences. (Vol. 290, p. 07008). EDP Sciences.
Hack-Polay, D., 2018. Putting Across Tangibility: Effectiveness of Case-Study-Based Teaching
of Organisational Behaviour. In Teaching Human Resources and Organizational
Behavior at the College Level (pp. 211-225). IGI Global.
Lamprakis, A. and et.al., 2018. The Organisational Justice as a Human Resources Management
Practice and its Impact on Employee Engagement: The case of the Prefecture of Attica
(Greece). Scientific Annals of Economics and Business, 65(1), pp.65-79.
Mullins, L. J., 2019. Mullins: Organisational Behaviour in the Workplace. Pearson Higher Ed.
Murphy, P. R., and et.al., 2019. Why are People Honest? Internal and External Motivations to
Report Honestly. Contemporary Accounting Research.
Sinthupundaja, J., Chiadamrong, N. and Kohda, Y., 2019. Internal capabilities, external
cooperation and proactive CSR on financial performance. The Service Industries
Journal. 39(15-16). pp.1099-1122.
Tomás‐Miquel, J. V., Molina‐Morales, F. X. and Expósito‐Langa, M., 2019. Loving Outside the
Neighborhood: The Conflicting Effects of External Linkages on Incremental Innovation
in Clusters. Journal of Small Business Management. 57(4). pp.1738-1756.

Williams, N. and Efendic, A., 2019. Internal displacement and external migration in a post-
conflict economy: Perceptions of institutions among migrant entrepreneurs. Journal of
International Entrepreneurship. 17(4). pp.558-585.