Context of Business of Debenhams Assignment
Added on 2021-02-19
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Context of Business
Table of ContentsINTRODUCTION ..........................................................................................................................3Impact of Macro Environment ...................................................................................................3Debenhams leadership style........................................................................................................4Motivational Theory ...................................................................................................................6Recommendations ......................................................................................................................7Reflection ..................................................................................................................................8CONCLUSION ...............................................................................................................................9REFERENCES .............................................................................................................................10
INTRODUCTION The functioning and processes of a business is highly dependent upon its external forcesand it is affected by its external environment to a large extent. It is essential for an organisationto cope with its changing surroundings so that it can function in an appropriate manner. Thisreport is based upon an enterprise named Debenhams which is an UK based organisation that isthe largest departmental store in United Kingdom (Debenhams, 2019). This business entity iscurrently facing issue for surviving in market as its value is dropped by 95%. This report coversimpact of micro environment upon this issue faced by this organisation. It also covers itsleadership style and its relevance to the current situation faced by the enterprise. In this report, amotivational theory is also provided that would help in providing motivation to workforce so thatthey work in more appropriate manner. At the end, reflection and recommendations are alsocovered in this project report. Impact of Macro Environment Macro environment refers to all the external factors that has affects and implications overthe functioning of a business enterprise. It is mandatory for an organisation to identify theseexternal factors in order to make necessary changes in its functioning as per accordance. Thisorganisation is facing problem of decrease in its value which has decreased by 95%. It has takenplace due to various range of factors in which the most vital role is played by macroenvironment. In order to identify the impact of external factors upon current situation, thisenterprise can use PESTLE analysis. PESTLE Analysis- This is defined as a strategic tool which is utilised for analysing the externalforces that can affect the functioning of a business (Riddle, 2019). These factors includespolitical, economical, social, technological, legal and environmental. The impact of these factorsupon the current situation faced by a company are stated as follows-Political- There are various political factors that has impact over Debenhams and itspresent situation. The political related to governments relatively approach of arm's length toEurope and to remain outside of single currency area. For a business enterprise such as
Debenhams which has international operations in other countries, can be seen as a negativeaffect with foreign exchange prospect. This is one of the reason of dropping of its value by 95%.Economical- UK is facing financial crisis since the year 2007, which has generatedproblems for retail sectors of United Kingdom. Debenhams is expanding its business to largeextent for which it requires adequate monetary funds that can be generated by economy of acountry. Moreover, this enterprise provides lots of discount and sale to its products by whichcustomers only purchase its products when there is discount or sale is going on. This is the majorreason why this organisation is facing losses. Social- Due to rapid changes in customer's tastes and preferences, the sales and brandimage of Debenhams has reduced to a large extent (Nascimento and et. al., 2019). Thisorganisation has failed to cope with changes in fashion and trends of customers. It is not onlylacking in predicting current fashion trends but also lack to respond to these changes. This is thereason why this enterprise is lacking behind of its competitors such as John Lewis because of itslack of focus upon social factors. Technological- Technology and innovation is increasing in UK to a large extent. Anorganisation is required to update its products and services by using latest ideas and innovationin order to stay in the market. Currently, this enterprise is facing problem of reduction in its salesand profitability. One of the major factor that is giving arise to this situation is that Debenhams isnot updating its products by using innovation and technology as its competitor John Lewis isdoing. Due to this, it is losing its customers because consumers prefer latest technical products ascompared to traditional ones. Legal-Due to large number of stores of Debenhams, it is facing financial crisis at globallevel. Because of this, it is not able to provide adequate facilities to its staff members which isgenerating demotivation among them. In this context, this organisation is largely affected bylabour laws UK, according to which employees must be provided with the better workingfacilities. Environmental- The current situation of Debenhams is also impacted by environmentalfactors such as like other companies, it do not produce products that are healthy and safe towardsenvironment (Tan and Meyer, 2019). Due to increase in environmental friendly customers, thisorganisation must produce such products that are beneficial for environment.
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