Leadership and Business Environment Case Study | Desklib

This case study on Marks and Spencer examines the impact of COVID-19 and Brexit on the business, conducts SWOT and PESTEL analysis, recommends a suitable leadership style, and discusses the company's CSR activities. The report is relevant for students studying leadership and business environment courses in universities and colleges.

LEADERSHIP AND
BUSINESS ENVIRONMENT
CASE STUDY

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
SWOT and PESTEL analysis of Marks & Spencer.....................................................................3
Influence of COVID-19 and Brexit on Marks and Spencer, critical analysis of strengths and
weaknesses impacting the threats and opportunities of the business...........................................6
Recommending a suitable leadership style for Marks and Spencer
......................................................................................................................................................7
Corporate Social Responsibilities activities of the Marks & Spencers........................................8
CONCLUSION..............................................................................................................................10
REFERENCES................................................................................................................................1

INTRODUCTION
Leadership is defined as the ability of leader or an individual which helps to guide and
influence the members of an organization. It is an important function that helps an organization
for improving efficiency and achieving the goals. Business environment refers to the collection
of external or internal factors which directly or indirectly affects the functioning of a company. It
helps in identifying the business opportunities and improving the overall performance and
growth of the businesses. The current report will be based on Marks and Spencer, a British
multinational retailer which specializes in home products, clothing and food products. It is one of
the most popular brands in UK which offers top quality products to the customers. The report
will examine key factors impacting the organization with the help of SWOT and PESTEL
analysis, influence of COVID-19 and Brexit on company, a suitable leadership style that will
suite the organization, corporate social responsibilities activities with help of evidence.
MAIN BODY
SWOT and PESTEL analysis of Marks & Spencer
SWOT Analysis
It is defined as an effective framework which is used to evaluate the internal environment
of a company. It helps the organization to develop better strategies by analysing the internal
factors that have an effect on the business environment of the company. The internal factors are
as follows:
Strengths:
Marks and Spencer have a wide network in the world and it has expanded to many
developing countries increasing its market share and productivity. The e-commerce site of
organization have been successful in increasing the popularity of the brand among customers.
The products designed by the organization may be developed by top designers from various
countries which is its major strength as company may not sacrifice on its quality (SWOT
Analysis, 2022). It has helped the organization to remain sustainable and increase the trust of
customers towards the brand. The company may have developed a vast variety of products for
the customers in different locations all over the world.
Weaknesses:
The company may execute many of its important operations manually which is a major
weakness for the brand as it may require a lot of time and a huge workforce. It may result in

increasing the costs of the company which is disadvantage in the improvement of the
organization. The market image of organization may be highlighted as a brand for the elderly
people due to its limited fashion range for the youth with puts a negative impact on the
organization (Rudolph, Rauvola and Zacher, 2018). The sales have decreased for the brand due
to COVID-19 pandemic which may have led to its demise. It annual sales may have reduced
significantly due to improper management of the supply chain.
Opportunities:
In order to improve the image among youth, company may have an opportunity to
segment its customers on the basis of the market needs. It can help the brand to develop
different products according to needs of different customers and by considering the requirements
of the customers. It can help the company to increase its sales and lower the excess costs in order
to enhance its productivity. The organization can look upon developing its online site to
increase the customer engagement towards the brand. The organization may have a better
opportunity to expand its services in various countries as the consumer market in these countries
is very large. It can help Marks and Spencer to gain competitive advantage in the industry.
Threats:
A tough competition in retail industry may be major threat for the company as it may
have a negative impact on profitability of the organization. These competitors may be
continuously developing new strategies and policies to gain advantage in the market which may
not be beneficial for organization to stay sustainable in the market (Cheong and et.al., 2019). The
organization may get into many controversies which may have a negative influence on its
image, the company have to take care of its key stakeholders preferences and needs in order to
stay relevant in the market and develop a good image in the industry.
PESTEL Analysis
It is defined as a strategic framework which is used to analyse the external factors that
may have an effect on the business environment of a particular company or industry. The
external factors are as follows:
Political Factor:
This factor may have a negative impact on the business due to the instability in the
political structure of various countries and markets. The trade regulation policies and taxes
implied by various governments on the company may reduce its profits and create problems in

the management of the supply chain operations. The industrial safety regulations by the
governments may create pressure on the organization to change its existing policies and structure
while will require a large amount of capital and time (PESTEL Analysis, 2022). The Brexit may
create issues in the supply of the products in different countries which will affect the business.
Economic Factor:
This factor may have a negative influence on Marks and Spencer as the exchange rates
and interest rates may be higher due to the inflation and the COVID-19 pandemic going around
the world. The new competitors in the market may be offering products at fewer prices to the
customers which may be a major factor to consider for the progress of the company. These
budget friendly stores may be direct threat to the company and reduce its sales in the industry.
Social Factor:
It may have a negative impact on Marks and Spencer may be highly recognized as a
brand of the elderly people which has a negative effect on the image of the company among the
young population. The attitude of customers towards the brand may be unhealthy which may be
a disadvantage for the company to increase its market share and productivity (PESTLE analysis,
2022). The retail market may experience cultural and psychological changes which may have
an influence on the purchasing behaviour of the consumers.
Technological Factor:
This factor may have a positive impact on the company as the business may have
developed a technology transformation programme which may have enabled the business to
deliver a better customer experience than its competitors. The introduction of AI and self
checkout systems in organization may have beneficial in improving the purchasing process of
customers. The e-commerce store developed by organization may have been quite effective in
increasing its slakes in the UK region (Daniëls, Hondeghem and Dochy, 2019). A good
command over the technological department may have helped the company in creating
awareness among new generation.
Environmental Factor:
This factor may have a positive influence over the company as the management is highly
concerned about environment effects of the business in the region. The organization may have
developed a sustainable approach to carry out the production process. It may have been

beneficial for the organization as governments highly support companies who care about the
environment.
Legal Factor:
This factor may have a negative impact on the business due to the complex legislative
framework of various countries. This may not be beneficial for the organization as it may affect
the policies and framework of the organization. The governments around nations may be
focusing on penalizing companies conducting unfair or inappropriate practices and it may put
pressure on the organization to ensure a fair practice in its environment which might require
huge capital and labour to manage the operations of the company.
Influence of COVID-19 and Brexit on Marks and Spencer, critical analysis of strengths and
weaknesses impacting the threats and opportunities of the business
The COVID-19 pandemic may have a deep impact on the business as it may create
problems in managing various aspects of the business such as supply chain management,
operations management, import & export etc. The pandemic may have led to several losses for
the company which may be the reason for reducing the profitability of company. The pandemic
may have created a pressure on company to release employees which may have been the major
reason for loss of earning for many people (Pegram, 2019). It may have resulted in a bad image
of the brand in the industry which is harmful for its sustainability in the market. It may have led
to various changes in the policies of the company which is not fruitful for the company to deliver
consistently in the market over its competitors.
Brexit may have a significant impact on the trade of the goods and services of Marks and
Spencer as the businesses It may have made the administrative process complex and increased
difficulties for the organization to supply its products to various countries. The Brexit policies
may have a negative impact on the whole supply chain which may restrict the organization to
source raw materials and important resources from various places (Sohns and Wójcik, 2020).
The sales of the organization may reduce due to the scenario which can lead to loss of advantage
among the competitors.
As the organization may have a wide network it may help in expanding to various
countries despite the COVID-19 pandemic. It may help the organization to increase its market
share and establish better relations with the new customers it may be targeting. There is a high
demand for the online ordering of fashion and food products after the pandemic which may

create opportunities for business to provide its services even in the remote areas. As products of
the brand are designed by top designers of the world it may be sold at higher prices in UK and
may be beneficial for the company in increasing their market share. The organization may have
designed a wide variety of products which may have a positive impact in segmenting customers
according to their behaviours and preferences to gain benefit in the pandemic scenario (Bloom
and et.al., 2019). It might help in targeting the potential customers and retaining the existing ones
effectively amid the difficult situation.
As the operational process of the company is manual it may create difficulties for the
management as the recent scenario after the pandemic may be suitable for the companies that
have a digitally strong and sound structure to operate effectively (Kark, Van Dijk and Vashdi,
2018). It may have a negative impact on the company as it may reduce the competitive
advantage of the organization in the market. The negative image of the brand among the
consumers may be a major threat as it may reduce the productivity and sales of the organization
amid the pandemic.
Recommending a suitable leadership style for Marks and Spencer
For overcoming the problems faced by the M&S, it is recommended that the company
should use the transactional form of the leadership style in the company. As the company aims to
achieve its goals by ensuring that the high performance working is maintained by the teams at
the level of the management of the company (Kalsoom, Khan and Zubair, 2018). Transactional
leadership style refers to improving and increasing the efficiency of the employees at the
workplace by motivating them to work by rewarding them with the incentive. It is one of the
most common leadership styles which is used by large organizations to develop the confidence
of employees in the management of the company and collaboratively work towards achieving the
goals.
As per the Al-Malki, and Juan, (2018), using transactional leadership style best suits the
company as it increase the dedication level of the employees for performing the routine task in
the company. This system helps in guiding the inexperienced individual of the company who
need to be guided and supervised for performing the operations of the company. This may help
the organization to improve the quality of its workforce and increase the motivation in the
employees to work with their full potential towards the organizational goals. This leadership
style can be beneficial for the company in enhancing the commitment of employees towards the

work and provide the management with the opportunity to retain its potential employees. It is an
effective method to increase the interest of employees in the company's decision making and take
initiatives in the development of the crucial aspects of the company.
According to the Syafrian, (2020), as company believe that adding value to the
consumers' life is the main purpose of the many organizations. So they motivate employees to
perform better so that their employees are able to handle the customers in such a way that they
can increase the customers' loyalty towards the organization. This can have a positive impact on
the image of the company in the mind of its customers which will be able to create a major
positive difference in the sales and profitability of the business. The transactional style of
leadership may help the organization in gaining competitive advantage in the industry and create
an effective image of the business in different new markets in the world where the company can
potentially expand its services.
As per the Al Khajeh, (2018), the company is encouraging the employees to involve in
the activities of the company that will act as the motivating tool for the employees. The leaders
of the company makes decision after involving the employees of the company. That helps in
creating the mutual trust and understanding among the employees of the company. This can be
beneficial in generating new and creative ideas for the development of the organization. The
valuable input and feedback from the employees may help in developing effective strategies to
increase the productivity of the business and gaining competitive advantage in the industry. This
can have a positive impact on improving the sustainability of the business and developing better
market dominance in the industry.
Corporate Social Responsibilities activities of the Marks & Spencers.
Marks and Spencers has always taken their corporate social responsibilities seriously. As
the CSR is one of the way of increasing the brand awareness of the company and increasing the
customer loyalty. As CSR is the responsibility of the every company that needs to be fulfilled on
time. This helps in explaining how the company is managing their ethical and social
responsibilities towards the company. The brand is taking care of every aspect of the society that
needs to be taken care (Sharma, 2019). The company has cover every aspect relating to the
climatic change, industrial management, society related aspects, waste management, and
sustainable development. The CSR activities undertaken by the M&S is described as follows:
charity and community funding donations

the company is doing its CSR activities by providing donation to various organization
through local stores of the company (He, and Harris, 2020). The company has done this limiting
the budget for increasing their support towards this organization. These activities have helped the
company in raising the brand awareness of the company.
Sustainable raw material
The company has formed five-year plan for accomplishing the goals and objectives of the
M&S. For ensuring the sustainability the company is using the resources that are available with
them. The aim of the company is to use wood that can be recycled or that has certificated. They
are selling only organic food to its customers. The company is not using plastic for packaging
and use clothing material, so that it can be recycled easily. The company is trying to use less
water for the production.
Clothing and equipment.
For its CSR policy it has decided to make donation of the returned cloths and surplus of
the business to the other person those who are in need of that cloths. During the time of the
pandemic the company has donated cloths and masks to the new-life funds medical research, to
their nurses, and they are also providing the equipments to the medical research centre. M&s for
using its returned clothing has sold its products to the other business and the money earned from
this is used in buying equipments for the donation. The company has also used these returned
cloths for making garments and then donating it to disabled children. The M&S is sending their
clothing samples to the homeless people and to their partners for supporting them to provide this
as charity.
Fundraising
The M&S has started the campaign for raising the funds from their customers who visit
their stores. The company has initiated this fundraising for the breast cancer patient and many
other disease. This is not an obligation on the customers but this is a voluntary action that has to
be done for saving the cancer patients. The company is donating the amount and also collecting
funds for this activity.
Waste management
Under the eco plan, plan A five-year plan of the M&S has taken initiative under this to
not sending waste to the landfill of the UK. They have made plan for reducing the usage of the
plastic in the stores for packaging and carry bags (García-Sánchez, and García-Sánchez, 2020).

The company decided to not send the food waste to the landfill and use it to produce green
energy. They have also reduced the use of the non glass packaging and has made plan to use
products that are easy to recycle and bio decomposable. They have also made rules for their
customers to dispose of their wastage of clothing without sending it to the landfill. The company
has also tried to make closed loop relating to the recycling of the packaging.
CONCLUSION
The report concluded that SWOT analysis is of the company has helped in availing the
competitive advantages of the company. As SWOT is the brief description the strength,
weaknesses, opportunities and threats of the M&S. The strategic analysis of the PESTLE of the
company has helped in increasing and expanding the businesses on the large scale throughout the
world. The company is recommended to adopt all the sustainable approaches as it CSR policies
so that it can attract the customers to its store. The company has adopted various CSR activities
such as waste management and many more. The leadership style that is used by the company id
for motivating to work effectively and efficiently in the company. All the models are adopted by
the company to improve the effectiveness of the company.

REFERENCES
Books and journals
Al Khajeh, E.H., 2018. Impact of leadership styles on organizational performance. Journal of
Human Resources Management Research. 2018. pp.1-10.
Al-Malki, M. and Juan, W., 2018. Leadership styles and job performance: A literature
review. Journal of International Business Research and Marketing. 3(3). pp.40-49.
Bloom, N. and et.al., 2019. The impact of Brexit on UK firms (No. w26218). National Bureau of
Economic Research.
Cheong, M. and et.al., 2019. A review of the effectiveness of empowering leadership. The
Leadership Quarterly, 30(1), pp.34-58.
Daniëls, E., Hondeghem, A. and Dochy, F., 2019. A review on leadership and leadership
development in educational settings. Educational research review, 27, pp.110-125.
García-Sánchez, I.M. and García-Sánchez, A., 2020. Corporate social responsibility during
COVID-19 pandemic. Journal of Open Innovation: Technology, Market, and
Complexity. 6(4). p.126.
He, H. and Harris, L., 2020. The impact of Covid-19 pandemic on corporate social responsibility
and marketing philosophy. Journal of business research. 116. pp.176-182.
Kalsoom, Z., Khan, M.A. and Zubair, D.S.S., 2018. Impact of transactional leadership and
transformational leadership on employee performance: A case of FMCG industry of
Pakistan. Industrial engineering letters, 8(3), pp.23-30.
Kark, R., Van Dijk, D. and Vashdi, D.R., 2018. Motivated or demotivated to be creative: The
role of self‐regulatory focus in transformational and transactional leadership
processes. Applied Psychology, 67(1), pp.186-224.
Pegram, J., 2019. What Brexit Means for Non-EU IP Owners. Managing Intell. Prop., 280, p.13.
Rudolph, C.W., Rauvola, R.S. and Zacher, H., 2018. Leadership and generations at work: A
critical review. The Leadership Quarterly, 29(1), pp.44-57.
Sharma, E., 2019. A review of corporate social responsibility in developed and developing
nations. Corporate Social Responsibility and Environmental Management. 26(4).
pp.712-720.

Sohns, F. and Wójcik, D., 2020. The impact of Brexit on London’s entrepreneurial ecosystem:
The case of the FinTech industry. Environment and Planning A: Economy and
Space, 52(8), pp.1539-1559.
Syafrian, D., 2020. Political Strategies of Multinational Companies in Managing Uncertainty:
Lessons from Brexit. In Non-market Strategies in International Business (pp. 75-100).
Palgrave Macmillan, Cham.
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<https://corporatefinanceinstitute.com/resources/knowledge/strategy/pestel-analysis/>
PESTLE analysis. 2022. [Online] Available Through:
<https://www.cipd.co.uk/knowledge/strategy/organisational-development/pestle-analysis-factsheet#gref>
SWOT Analysis. 2022. [Online] Available Through:
<https://www.mindtools.com/pages/article/newTMC_05.htm>

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