Business Management Analysis: Sainsbury's Report, Module 1, Semester 1

This report provides a comprehensive analysis of Sainsbury's, a major UK retail business, examining its management practices and business environment. The report begins with an introduction to management, followed by an application of Mintzberg's theory of management, detailing the ten roles a manager must fulfill. The main body then delves into the business environment using PESTLE analysis to assess political, economic, social, technological, legal, and environmental factors impacting Sainsbury's. Porter's Five Forces model is then used to evaluate the competitive landscape. The report concludes with an examination of corporate responsibility initiatives, specifically Sainsbury's efforts to reduce plastic usage, and an overview of Hofstede's five dimensions of national culture. The report emphasizes critical thinking in management and the importance of considering stakeholder interests. The analysis provides insights into how Sainsbury's navigates its complex operating environment, addressing both internal management strategies and external market forces.

Introduction to Business
Management

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
PART A- Management....................................................................................................................3
Mintzberg’s Theory of Management...........................................................................................3
PART B- Business Environment.....................................................................................................5
1 PESTLE Analysis.....................................................................................................................5
2 Porter’s Five Forces..................................................................................................................7
PART C- Corporate Responsibility & National Culture.................................................................8
Practices to Promote and Monitor Corporate Responsibility......................................................8
Examples and Effects of Corporate Malpractice.........................................................................9
Hofstede’s Five Dimensions of National Culture........................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Management in a business organisation relates to the strategic process of overseeing and
supervising all the different operations and functions of a business organisation, allowing for the
business organisation to operate smoothly, efficiently and productively in its operational
industry. Management functions in a business organisation encompass all the planning, staffing,
organising, directing and controlling operations within it with the main aim of effective
management being to enable the business organisation to achieve its organisational objectives
and goals (Davis and Comeau, 2020). This report analyses the management operations within
Sainsbury’s which is a public retail business organisation that was created in 1869 and went
public in 1973. Sainsbury’s chain of supermarkets is the second largest in the entire UK,
accounting for over 16% of the total market share of the retail industries. Sainsbury’s operates
through more than 1,428 distinct retail establishments all across the UK and employees more
than 116,400 distinct individuals at various operational positions in its hierarchical structure.
MAIN BODY
PART A- Management
Mintzberg’s Theory of Management
Management is the strategic process through which employees of a business organisation
such as Sainsbury’s engage in planning, motivating, decision making, organising, leading and
controlling operations with the intention to make optimum and efficient use the various
organisational resources of the business allowing for the business organisation to achieve its
organisational objectives and goals.
Any manager can make use of the Mintzberg’s theory of management which details the
10 distinct roles that a successful and competent manager is required to fulfil, in order to
effectively conduct their management operations in the business organisation. The 10 different
roles of managers within businesses according to the Mintzberg’s theory are as follows:

Interpersonal Roles:
 Figurehead: As per this role, the manager is responsible for the social, legal and
ceremonial matters within the business, responsible for representing the business in a
professional and positive manner.
 Leader: This requires the manager to be organisational leaders, communicating, guiding
and coaching their fellow employees towards optimum performance standards and
success.
 Liaison: The manager is also responsible for creating network outside of their business
organisation and relaying back the relevant information.
Informational Roles:
 Monitor: This role of manager also requires them to monitor the micro and macro
environment of the business organisation towards identifying issues and problems of the
business.
 Disseminator: The manager is also needed to relay all relevant and valuable information
to their subordinates and delegate operations accordingly (Raut and et.al., 2019).
 Spokesperson: The manager should also act as the spokesperson of their business,
communicating to employees externally.
Decisional Roles:
 Entrepreneur: Just like an entrepreneur, managers should also encourage innovation and
change within the business, creating new and innovative ideas. Disturbance Handler: All internal or external roadblocks or challenges of the business
are required to be handled by the manager. Resource Allocator: The manager should responsibly allocate the organisational
resources of the business and oversee their efficient usage. Negotiator: The manager is also responsible for directing and participating in
negotiations of the business organisation.
The Mintzberg’s theory of management roles details the major roles and responsibilities
that a successful and competent manager is required to satisfy within a business organisation in

order to effectively carry out their management operations, which can allow for the business
organisation to accomplish its organisational objectives and goals. Critical thinking is essential
for effective operations of the managers within the business as without being able to think
critically, the managers would not be able to successfully conduct any of their decision making
operations within the business organisation, which would contribute towards the business not
being able to achieve its end objectives and goals (Strydom and Rudansky-Kloppers, 2016). The
managers of a business organisation can take into account the diverse interests of their various
stakeholders by conducting a thorough stakeholder analyses and grouping the individual interests
of the various stakeholders. This can allow for the managers to take into account the most
common or vital interest of the stakeholders as part of their operations.
PART B- Business Environment
1 PESTLE Analysis
The macro environment of Sainsbury’s can be effectively analysed by making use of the
PESTLE framework as follows:
Political Factors: The current political uncertainty in UK owing to the phenomenon known as
Brexit can influence the operations and functions of Sainsbury’s significantly. Even though the
exact details of changes to the policies and laws of UK post Brexit aren’t clear as of yet,
Sainsbury’s can benefit from this political factor as Brexit would involve the scraping of the
current complex global trading legislations of UK towards simpler, transparent ones.
Economic Factors: Economic factors such as inflation in the UK’s economy can have
significantly adverse influence on the operational and financial performance of Sainsbury’s.
Inflation in the UK’s economy can decrease the overall purchasing power of Sainsbury’s
customers in the retail sector, which significantly hampers the customer’s ability to interact and
purchase the goods sold by Sainsbury’s in the retail sector of UK.
Social Factors: The current social trend of online shopping, in which increased number of UK
consumers are choosing to exclusively conduct their shopping operations through the digital
online retail stores can have an immensely positive impact on the financial and operational
performance of Sainsbury’s (Nuthall, 2018). Through its digital retail store, Sainsbury’s can

effectively use this social trend to its advantage and service increased number of customers,
through which the business can enhance its financial performance and productivity.
Technological Factors: New technological solutions present in the external environments such
as new and innovative manufacturing machines and equipment which is able to operate with
increased performance and efficiency can have immense influence on the operational
productivity and overall profit margins of Sainsbury’s. Sainsbury’s can install such new
innovative technological solutions to increase their operational performance and efficiency while
reducing their operational and energy costs as well.
Legal Factors: Alterations to the legal regulations and legislations, which Sainsbury’s has been
mandated to adhere to by the government of UK, such as the Employment Laws, minimum
wages act etc., can have significant impact on the operations of Sainsbury’s, as these changes
would force organisational change within Sainsbury’s which can negatively impact its
performance and profit margins (Adekola and Sergi, 2016).
Environmental Factors: Initiatives taken on by the business organisation or forced onto the
business organisation by governing authorities of UK relating to decreasing their carbon
footprint, use of plastics etc., can have immensely negative impact on the financial performance
and operational productivity of Sainsbury’s, as these would force the management and leadership
of Sainsbury’s to change various operational processes and methods which can adversely impact
the business organisation.
Most Significant External Forces for Sainsbury’s
The external forces that have most significant implications for operations of Sainsbury’s
relates to the social and technological factors as both these provide opportunities to Sainsbury’s
to significantly increase its total customers, market share, productivity and profit margins.
Organisational Policies Accounting for These Factors
The organisational policies of Sainsbury’s have taken account of these factors to some
degree. Sainsbury’s has started to operate its own online retail store as a direct response to the
social macro factor relating to increased number of customers choosing to conduct their
shopping operations online. Although constant upgrade of the manufacturing machines of

Sainsbury’s is not possible, its organisational policies also place significant focus on installing
new and innovative technological solutions which have the potential to significantly impact the
efficiency and performance of Sainsbury’s in a positive manner.
Deciding Which Factor Identified from PESTLE Analysis Should Sainsbury’s
Management Attend to
Sainsbury’s management is required to thoroughly analyse all the external factors that
can impact the business organisation. If the management is forced to attend to particular factors,
then the management should place their focus on the factors that provide most productive and
profitable opportunities to Sainsbury’s such as the social or technological factor present in the
external environment of Sainsbury’s, or the factors which provide serious threats to Sainsbury’s
operations such as economic factors.
2 Porter’s Five Forces
In order to evaluate the competitive environment of Sainsbury’s, this report makes use of
the Porter’s Five Forces model as follows:
Competition in the Industry (High): The overall competition that Sainsbury’s faces from the
other business organisations within the retail sector of UK is very high. This is because of the
large number of business organisations operating in UK’s retail markets, all of whom provide to
the customers similar kinds of services and are operating towards increasing their own customer
base, profit margins and market share metrics (Aithal, 2017).
Threat from New Entrants (Low): Sainsbury’s faces low threat from the new business
organisations that enter into the retail markets of UK. This is because there are various barriers
of entry to the retail industry such as the huge financial investments required for starting new
operations in the retail sector, creating sustainable and productive supplier relations etc., As
Sainsbury’s has invested quite a bit into their network and infrastructure, it does not face any
significant threat from new businesses.
Threat from Substitutes (Moderate): Sainsbury’s faces moderate threat from the alternative and
substitute products available to consumers in the retail sector. This is because although many of
the goods and products provided by Sainsbury’s can be readily substituted by the consumers

from the products available in external markets, many of the other products of Sainsbury’s have
been effectively differentiated from their competitors, which cannot be substituted by the other
products in external retail markets.
Buyer’s Bargaining Power (High): The buyer’s bargaining power for Sainsbury’s is quite high
due to the large number of businesses available to the consumers to choose from based on their
requirements and preferences (Santoro and et.al., 2018). If the buyers are not excessively happy
with Sainsbury’s products or services, they can easily choose to switch and conduct their retail
operations with numerous competitors of Sainsbury’s all of whom provide similar services to the
consumers, providing high bargaining power to the buyers.
Supplier’s Bargaining Power (Low): As there remain numerous suppliers within the retail sector
of UK, all of whom provide similar services to retail business organisations, Sainsbury’s does
not face any significant threat from their suppliers, as should the suppliers of Sainsbury’s charge
increased prices for the raw materials, Sainsbury’s can simply choose to conduct operations with
another supplier without much inconvenience or trouble.
A competitor of Sainsbury’s called Aldi has changed its business strategy to cost
leadership as a direct result of the intense threat it faces from the competition within the retail
industry (Parris and et.al., 2016). Through the cost leadership strategy, Aldi hopes to gain a
competitive advantage and sustain its successful operations despite the intense threat it faces
from the high competition.
PART C- Corporate Responsibility & National Culture
Practices to Promote and Monitor Corporate Responsibility
Sainsbury’s management have outlined various practices to promote and monitor
corporate social responsibility within the business organisation. This is showcased through their
corporate responsibility initiative to halve all of their plastic usage within the business
organisation by half by 2025. Currently Sainsbury’s makes excessive use of plastics for their
packaging operations accounting up to 120,000 tonnes per year, with the plastic allowing for

Sainsbury’s to deliver undamaged and fresh products to their customers. The management of
Sainsbury’s realise the immensely negative effects that plastic has on the environment which is
why they have taken on the initiative to halve their plastic usage by 2025. As of yet, Sainsbury’s
has removed various plastic products such as plastic trays, bags, straws, cups and plates and
replaced them with recyclable alternatives (Barry, 2017). Sainsbury’s monitors their progress
towards this initiative by evaluating their current plastic usage against their past plastic usage
within the business.
Examples and Effects of Corporate Malpractice
The most recent example of corporate malpractice of Sainsbury’s within the public
sector, relates to the retail business being prosecuted multiple times over the years due to selling
food products to the customers that were already past their use by date. Further investigations
also showcased that many of Sainsbury’s employees have not been effectively trained to be able
to carry out their duties relating to food safety, which seriously jeopardises the health and safety
of all their customers who purchase food products from Sainsbury’s. This resulted in Sainsbury’s
placing increased focus on training their employees in matters of food safety. Another corporate
malpractice of Sainsbury’s relates to them fixing the prices of dairy products along with other
large retail businesses in an attempt to increase their overall profit margins. This resulted in
Sainsbury’s getting fined by the governing authorities due to their illegal corporate malpractices.
Hofstede’s Five Dimensions of National Culture
The Hofstede’s Five Dimensions of National culture is a strategic framework, that can be
used to analyse the differences in cross culture countries and aids the cross cultural management
operations in a business organisation. The five main cultural dimension of this theory are as
follows:
Power Distance: This refers to the extent to which the less powerful individuals within a society
accept and expect that the distribution of overall power takes place in an unequal manner. For
example, people in societies that possess high power distance accept hierarchical structure in
which all members have their designated place.
Uncertainty Avoidance: This relates to the extent to which the individuals within a society are at
ease or comfortable with the uncertainty and ambiguity. For example, countries showcasing

strong uncertainty avoidance are more intolerant of weird or unorthodox behaviour, whereas
countries showcasing weak uncertainty avoidance are more relaxed.
Individualism vs Collectivism: This dimension relates to questioning whether individuals within
a society prefer to be left alone or prefer to operate as part of a group or network (Foster,
O'Reilly and Dávila, 2016). For example, countries showcasing individualism possess members
who prefer to look after themselves alone and not as part of a group.
Femininity vs Masculinity: Femininity refers to society’s preference towards cooperation,
modesty, quality of life etc., while masculinity refers to society’s preference towards heroism,
material rewards, achieving success etc. For example, individuals from feminine societies prefer
cooperation, modesty, quality of life and caring of weaker individuals as opposed to material
rewards and achieving success.
Short Term vs Long Term Orientation: Short term orientation refers to society’s inclination
towards searching for virtue, while long term orientation refers to society’s inclination towards
absolute truth. For example, society preferring long term orientation more pragmatic approaches
such as education in order to prepare for the future.
CONCLUSION
Through this report, it is concluded that effective management of the various business
functions is of immense importance for a business towards being able to achieve its
organisational objectives and goals within the operational industries. This report analyses the
concept of effective management in business and evaluates Mintzberg’s theory of management.
The report also evaluates the external macro environment of Sainsbury’s using PESTLE
framework in order to determine the external factors that can impact the operations and functions
of Sainsbury’s. Further the report also uses Porter’s Five Force model to assess the competitive
environment of Sainsbury’s. The report also assesses practices used by Sainsbury’s to monitor
and promote corporate responsibility and identifies two examples of corporate malpractice.
Finally, the report analyses the Hofstede’s five dimensions of national culture model.

REFERENCES
Books and Journals
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Routledge.
Aithal, P.S., 2017. Industry Analysis–The First Step in Business Management Scholarly
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(IJCSBE). 1(1). pp.1-13.
Barry, W.S., 2017. Airline Management: Business Management in Transport 3 (Vol. 2).
Routledge.
Davis, C.H. and Comeau, J., 2020. Enterprise integration in business education: Design and
outcomes of a capstone ERP-based undergraduate e-business management course.
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Foster, G., O'Reilly, N. and Dávila, A., 2016. Sports business management: Decision making
around the globe. Routledge.
Nuthall, P.L., 2018. Farm business management: the human factor. CABI.
Parris, D.L. and et.al., 2016. Exploring transparency: a new framework for responsible business
management. Management Decision.
Raut, R.D. and et.al., 2019. Linking big data analytics and operational sustainability practices for
sustainable business management. Journal of cleaner production. 224. pp.10-24.
Santoro, G. and et.al., 2018. Big data for business management in the retail industry.
Management Decision.
Strydom, J.W. and Rudansky-Kloppers, S. eds., 2016. Introduction to business management.
Oxford University Press Southern Africa.