This document provides study material and assignments on International Business. It covers topics such as the organizational structure, PESTLE analysis, and more. Suitable for students studying International Business.
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Running Head: INTERNATIONAL BUSINESS0 International Business (Student Name) .
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INTERNATIONAL BUSINESS1 Table of Contents Introduction......................................................................................................................................2 Background of the company............................................................................................................2 Organizational structure and governance of company....................................................................2 PESTLE Analysis............................................................................................................................4 Conclusion and Recommendation...................................................................................................6 References........................................................................................................................................8
INTERNATIONAL BUSINESS2 Introduction The strategy of group is marked by the position of leading market that are combined with strong franchise in the established countries along with the usage of the emerging countries platform to drive the earnings growth as well as volumes. The company also focuses on meeting the ever changing consumer demands through the continuous innovation with expanding the product portfolio that directly operated store network, selective wholesale distribution channels as well as enhance the operational capabilities that result in the healthy growth in the recent years (Cameron and Green, 2015). One of the leading companies Burberry has positioned its brand as a functional luxury in the mind of their consumers. Burberry maintains a product line with a great width as well as depth that consist of huge variety of products in effective manner. Such products fallen into two main categories which include fashion or continuity. The company has grown at greater level in the international market. However, the market is unpredictable that create a risk for the company. The market changes with period of time that may affect the overall performance of the company at greater level (Noe et al., 2017). In the following part there will be detailed discussion on management structure of the company and the level of impact of external forces on the overall business of the company. It would help them to analyze the risk that occurred due to fluctuation in the market and prospective measures can be adopted by them in effective and efficient manner. Background of the company Burberry Plc. is one of the international companies that were established in Basingstoke in the year 1856 by Thomas Burberry. It is international leading brand for both women as well as men.
INTERNATIONAL BUSINESS3 Burberry Group PLC operates as manufacturing, holding company that design as well as distribute the apparels with accessories under the brand Burberry. The company has established their first foreign outlet in Paris in the year 1910 as well as the company has soon had retail established chains in South America as well as United States (Straker and Wrigley, C, 2016). They have first shipment of their raincoats to Japan in the year 1915. It was the World War I; however such circumstances brought widespread acclamation as well as fame to the Burberry. They were considered as first worn by high-ranking generals during the turn of the centaur Boer War in South Africa, the coat of Burberry soon was accepted as standard issue for all the British officers. In the year 2000, the company operated own stores and their products were also found in the department as well as specialty stores round the world. In the year 1999, the company launched the Prorsum designer collection as a part of their efforts to reinvent the luxurious brand of Burberry (Robinson and Hsieh, 2016). The Company has spread their roots in great number of countries with different languages.The reputation of the company was improved through the development of the Burberry of “gabardine”- a material was resistant to tearing that was weatherproof but was also breathable (Rome, 2018). Organizational structure and governance of company
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INTERNATIONAL BUSINESS4 Role of Board Committee The Board is supported in their activities by a number of commit7tee which include Audit committee, Nomination Committee as well as Remuneration Committee. All the non-executive directors are the members of each of the main committee of the Board. The board has a view that such things are essential as it ensure the appropriate connection between the work of the Committee and the Board as a whole. The committee can also involve third-party consultants as well as independent professional advisers that can call upon more resources of the Group to guide them in allocating their respective responsibilities (Cooper, Miller and Merrilees, 2015). Number of Members
INTERNATIONAL BUSINESS5 With the help of the organizational chart for the company, it can be analyze the board of the company currently consist of 12 members which include Chairman, the Chief Creative as well as ChiefExecutive,theChiefOperatingOfficers,theChiefFinancialOfficersandeight independents no-executive director. Detailed Explanation The Board of directors as well as their governance are explained in below points as they are: Sir John Peace who is the chairman of the company is majorly responsible for leading as well as managing the business of board that also assures its effectiveness. He became the Chairman of the Board in the year 2002 of June as well as he is also the Chairman of the nomination Committee. He is the Chairman of Standards Chartered PLC as well as Experian plc. He is responsible for the leadership of the Board as well as ensuring their effectiveness on all aspects of their roles in effective and efficient manner. He promotes high standards of the corporate governance within the group that are taking account of the corporate governance code. He set the agenda for the Board discussion as well as ensures that the board receives the accurate timely as well as clear information. The chairman of the company promoted the culture of the openness as well as trust that allows for the debates with great challenges of the executive directors. The Chairman also coordinate with the Chief Creative as well as Chief Executive Officer in setting the agenda of Board as well as ensuring the actions that agreed by the Board are effectively implemented.TheChairmanisalsotheresponsibletotheshareholdersforthe performance of the company as well as has regular connection with the main institutional shareholders of the company (Pedersen, Gwozdz and Hvass, 2018).
INTERNATIONAL BUSINESS6 While Philip Bowman (Senior Independent Director) support the chairman in their role as well as guide non-executive directors in the omission of the chairman. The senior independent directors are also available for the company in additional points of contact for the investors in the company. Christopher Bailey (chief executive officer) is also responsible for the management of business, develop the directions of group that are strategically consideration. They take the approval by the Board as well as implement the agreed strategies. They are assisting by the members of his senior leadership team who meet regularly (Burt, Johansson and Dawson, 2017). Moreover, Catherine Sukmonowski (Secretary) supports the chairman for delivering the agenda of corporate governance. Lastly, board reserves relatively small as well as insure the linkage between the work committee with board. Committees can call upon the other resources of groups to support for rehearse respective responsibilities. Role of the Board It is the responsibility of the Board to support the management in their strategies aims to enable the company to continue to perform in more effective manner as well as sustainably for shareholders with wider stakeholders. The board is majorly responsible for promoting the long- term success for the group. It leads as well as provides the direction by setting the strategy as well asoverseeingtheirimplementationby themanagement.The board isalsomajorly responsible for the oversight of the system related to group of governance, their internal control as well as risk management. The Board is majorly responsible for promoting the long-term success of the Group. The Board leads as well as provides the direction for the company by
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INTERNATIONAL BUSINESS7 setting the goals as well as strategies that are overseeing its implementation by the management. TheessentialdecisionsaswellasmattershavebeenretainingforapprovalbyBoard (Burghausen and Balmer, 2015). PESTLE Analysis The PESTLE analysis of Burberry Group Plc. is one of the strategic tools to analyze the condition of the macro environment of the organization. The PESTLE stands for Political, Economic, Social, Technological, Environmental as well as legal factors that affected the macro environment of the company at greater level. The company operates in a dynamic environment where it is majorly influenced by the enhancement in the regulatory framework for the environmentalfactors, enhancement in the environmental activismamong the consumers, spending behavior of consumers, government decisions, collective social trends, evolving legal system as well as technological changes (Sammut‐Bonnici and Galea, 2015). Political Analysis The Political factors play a vital role in determining the factors that can affect the company on long term profitability in a certain country or the market. Burberry group Plc. is managing their business in Personal as well as Households products in more than dozens of countries as well as expose itself to different type of the political environment as well as risk of political system. The company is not only operating in the London but throughout the world. Different countries that the company operated need the organization to abide by their domestic rules with different laws that may be unfavorable for the company. Some of the countries impose high tax rates on the foreigners to promote their domestic production. The high rate can enhance the operating cost to the company. The political instability disrupts the stores as well as supply chain. For example
INTERNATIONAL BUSINESS8 United Kingdom has revised the tax rates from 45% to 50% that affect the purchasing power of the consumers that directly affect the sales of the company at greater level. Moreover, the company also faced the steep competition due to the cheap copies that are produced locally (Robinson and Hsieh, 2016). Economical Factor The Economic downturn affects from the level of spending money by the individual. When there is the downturn of the economic, the consumers prefer to purchase the products that are reasonable in process and able to meet the basic requirement that to purchase a luxury which manypeoplecanlivewithout.Therefore,Burberryisaffectedbythelocalaswellas international competitive brands. The inflation rate of UK increased from 3.19% in the year 2006 to 4.29% in the year 2007. Therefore, the downwards trend continued in the first three month in the year of 2009. It affects the purchasing power of the consumers at greater level. Moreover, the unemployment ate also jump to 7.1% by the end of the year 2009 that affect the spending level of the consumers as consumers mostly prefer to buy basic products to satisfy their needs that affected the overall sale of the company at greater level (Escobar, 2016). Social Factors The culture of the society as well as the way of doing the things affected the culture of a company in such uncertain environment. Shared attitude with beliefs of the population play a great role in how the company would able to understand the need so the consumers of given market. The target consumers of Burberry have distinct cultures a swell as lifestyles as Weston affirms. For instance, the dress code of the consumers varies according to their culture. Therefore, different community prefers different products. Some of the people prefer reserved
INTERNATIONAL BUSINESS9 dressing and other prefer skimpy clothes therefore; the collection of the company greatly depends on the changing takes and preference with different culture. Technological Factors The change in the technological factors affected the overall performance of the company at greater level. It is fast disrupting various industries across the board. In the UK it is estimated that over $80 billion was made by the broadcasting as well as telecoms networks with services in the year 2006. It represent that the country has upgraded towards the technology at a faster pace that give a new platform to the company to target their consumers in more effective manner. Therefore, the company issues the latest technology in advertising their products to reach out to their targeted consumers in more effective as well as efficient manner (Roberts, D.L. and Piller, 2016). Environmental Factors Different market has different environmental norms as well as standards that can affect the profitability of the company in such market. Even within the country often the states can have different environmental laws with liability laws. Burberry is strategically located as well as can avail the products to their targeted consumers easily. The company needs to manufacture their products according to the norms and standards of the country that has been set by them. in UK, the government has taken the steps towards sustainable development since the year 1999. They have focused on the ecological, economic as well as social development of the EU that forces the company to set their standards accordingly. It enhanced the overall cost to the company (Medina and Coelho, 2016).
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INTERNATIONAL BUSINESS10 Legal Factor To ensure the success, Burberry needs to abide by the legal laws of the countries within which the company operates their business. The favorable legal laws have a positive impact on the performanceofthecompanywhereastheunfavorableregulationsvancompromisethe profitability of the company. The main law that affects the company is labor and employment. According to the labor law of UK, the maximum working week is 8 hours in seven days with a minimum rest of 11 hours in each 24 hours a period. Therefore, Burberry needs to manage the working hours of their employees accordingly (Olsanova, Cook and Zlatic, 2018). Conclusion and Recommendation From the above analysis it can be concluded that management of the company play a vital role in the growth as well as success of the company. One of the leading companies Burberry has expanded their business in international market. The Chairman of the company led the activities of the company in effective manner. Other executive as well as subordinates supported the Chairman in running the business and taking important decision in effective and efficient manner. However, the market is full of uncertainty that forces the company to manage their business accordingly. The macro environment greatly influences the overall performance of Burberry. The instability in the political environment and increase in the tax rate affect the cost of the company. Every country has different political conditions that need to be managed by the company. Moreover, the increase in the rate of inflation decreases the spending power of the consumers that directly affect the sale of the company at greater level. Every country has different environmental standards and norms that also influenced the overall performance of the company. Therefore, it is highly recommended that the company should focus on the fluctuation
INTERNATIONAL BUSINESS11 in the market and take the steps accordingly to maintain their growth and success in the international market in effective and efficient manner.
INTERNATIONAL BUSINESS12 References Burghausen, M. and Balmer, J.M (2015) Corporate heritage identity stewardship: A corporate marketing perspective.European Journal of Marketing,49(1/2), pp.22-61. Burt, S., Johansson, U. and Dawson, J. (2017) Dissecting embeddedness in international retailing.Journal of Economic Geography,17(3), pp.685-707. Cameron, E. and Green, M. (2015)Making sense of change management: A complete guide to the models, tools and techniques of organizational change. New York: Kogan Page Publishers. Cooper, H., Miller, D. and Merrilees, B. (2015) Restoring luxury corporate heritage brands: From crisis to ascendency.Journal of Brand Management,22(5), pp.448-466. Escobar, A. (2016) The impact of the digital revolution in the development of market and communication strategies for the luxury sector (fashion luxury).Central European Business Review,5(2), p.17. Medina, I.G. and Coelho, P.M. (2016) How Culture has an Impact upon Product/Brand and Communication Decisions in the Global Environment.Revista EducaOnline,10(1), pp.95-103. Noe, R.A., Hollenbeck, J.R., Gerhart, B. and Wright, P.M. (2017)Human resource management: Gaining a competitive advantage. New York: McGraw-Hill Education. Olsanova,K.,Cook,G.andZlatic,M.(2018)INFLUENCEOFLUXURY COMPANIES'CORPORATE SOCIAL RESPONSIBILITY ACTIVITIESON CONSUMER PURCHASE INTENTION: DEVELOPMENT OF A THEORETICAL FRAMEWORK.Central European Business Review,7(3).
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INTERNATIONAL BUSINESS13 Pedersen, E.R.G., Gwozdz, W. and Hvass, K.K. (2018) Exploring the relationship between business model innovation, corporate sustainability, and organisational values within the fashion industry.Journal of Business Ethics,149(2), pp.267-284. Roberts, D.L. and Piller, F.T. (2016) Finding the right role for social media in innovation.MIT Sloan Management Review,57(3), p.41. Robinson, P.K. and Hsieh, L. (2016) Reshoring: a strategic renewal of luxury clothing supply chains.Operations Management Research,9(3-4), pp.89-101. Robinson, P.K. and Hsieh, L. (2016) Reshoring: a strategic renewal of luxury clothing supply chains.Operations Management Research,9(3-4), pp.89-101. Rome,A.(2018)FashionForward?ReflectionsontheEnvironmentalHistoryof Style.Environmental History,23(3), pp.545-566. Sammut‐Bonnici, T. and Galea, D. (2015) PEST analysis.Wiley Encyclopedia of management, pp.1-1. Straker, K. and Wrigley, C. (2016) Emotionally engaging customers in the digital age: the case study of “Burberry love”.Journal of Fashion Marketing and Management,20(3), pp.276-299.