Macro Environment Frameworks

Added on - Jan 2021

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Business Strategy
ContentsINTRODUCTION...........................................................................................................................1TASK 1............................................................................................................................................1P1 Frameworks to examine macro environment of organisation................................................1M1 Analysis of macro environment to inform strategic management decision..........................3D1 Application of environmental and competitive analysis........................................................3TASK 2............................................................................................................................................4P2 Analyse internal environment and capabilities of entity........................................................4M2 Examine the internal environment to assess strengths and weaknesses............................5TASK 3............................................................................................................................................5P3 Porter's five forces model to evaluate competitive forces......................................................5M3 Appropriate strategies to improve competitive edge............................................................6D1 Interpret information to determine valid strategic direction..................................................6TASK 4............................................................................................................................................6P4 Application of concepts, theories and models........................................................................6CONCLUSION................................................................................................................................9REFERENCES..............................................................................................................................10
INTRODUCTIONBusiness strategy refers the action plan follow by entity to execute all its commercialactivities and to achieve its set business objective. One of the main benefit of this is that it guidemanager and employees to work in a specific manner which help ensure effective completion ofbusiness operations (Ackermann and Audretsch, 2013). This provide a map to management toperform all business operations. Various factors exist in business environment affect the actionsand decision taken by firm to achieve its end goal so it is very essential for manager to identifyand examine the various factors exist in environment for formulate better and effective strategyfor organisation (Auzair, 2011). This help manager in get a control over all activities and thissave time and cost of entity. M&S, a British multinational retailer that deal in various types ofproducts such as food products, home products and clothing is taken under this report for study.Major factors of macro environment and its impact on organisation is all mentioned in thisreport. Further, internal capabilities of Vodafone is also described in this. Application of Porter'sfive forces model for examine the industry and strategic plan for entity is all discussed in this.TASK 1P1 Frameworks to examine macro environment of organisationMacro environment: This refers to a mix of various factors that affect the businessdecision and working style of an entity. Macro environment is also known as externalenvironment in which various elements such as political, legal, technological, social andeconomic factors exist. Identify and examine all these element is very essential for M&S as thisaffect the decision taken by entity (Bharadwaj and et. al., 2013). One of the main benefit of thisanalysis is that it help manager in formulate better and effective strategy that support businessentity in attain its set goals and objectives. M&S (Marks & Spencer) operate on internationallevel and study of macro environment is very essential for entity to maintain its position inmarket. For examine macro environment, various tools and techniques are there which can beuse by M&S. PESTLE AND SWOT are the two major tools that help in analyse externalenvironment and at the same time highlight strengths and weakness of entity. Framework knownas PESTLE, can be understood by the points given below:Political: Government set rules and regulation for every enterprise to abide by such asplanning for identify hazard, assessment and control of risk and many more (Grover and1
Kohli, 2013). When entity do not abide such rules then it results in legal action. M&S didnot follow the British Standards as entity were charged for neglect safety and healthregulations.Economic: Due to uncertain economic conditions, individuals does not have enoughfinancial resources to spend on luxury items such as food and luxury items. This largelyaffect the sales of products offer by Marks & Spencer and due to this, firm closed numberof its stores.Social: This factor consists the attitudes, behaviour and tastes of individuals of society.When a business entity analyse these factors and respond accordingly then it help increate and maintain a positive image in market. One of the main feature of M&S is that isthat it appeal to various market in terms of demographics and social class and this largelyaffect the way entity respond to the social changes. M&S is actively involve to fulfil theneeds of individuals and this attract large number of customers towards its product.Technological: Technology is known as one of the vital component of retail market. It isvery essential for firm to manage all their brands in effective manner (Kalyani and Sahoo,2011). It is very important that position of brand should be communicated to customerson continuous basis. Every enterprise spend large amount of financial resources onpromotional activities for their brand awareness and to build loyalty. It is very essentialfor M&S to use updated technology for manufacture its products as this help in fulfilrequirements of customers.Environment: Safety of environment is known as one of the most essential element thatrequire to consider by firm before undertake production process. Environment friendlyprocess is adopt by M&S to maintain the safety of environment and this support firm inattract large number of customers towards its product.Legal: Government of every nation introduce various rules and regulations and everybusiness firm remain responsible to adhere those rules and regulations (Köseoglu and et.al., 2013). Firms who follow the rule get support from government.All these are the main element of macro environment that require to be consider by M&S inorder to work in an effective manner and to maintain its market share at workplace. Further,there is another tool called SWOT analysis that use by firm to identify its strengths, weakness,opportunities and threats.2
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