Macro Environmental Influence

This report discusses the macro environmental factors that influence businesses and organizations. It explores different types of organizations, their size and scope, and the interrelationships between various organizational functions. The report also covers the application of PESTEL analysis and its strengths and weaknesses, as well as the interrelation between micro and macro factors. The case study focuses on Marks and Spencer, a well-known retail brand.

Macro environemental
influence

Contents
INTRODUCTION...........................................................................................................................1
PART A...........................................................................................................................................1
Different types of organisation....................................................................................................1
Size and scope of a range of different types of organisations.....................................................4
The advantages and disadvantages interrelationships of the different organisational functions
.....................................................................................................................................................5
Organisational structure...............................................................................................................6
PART B...........................................................................................................................................7
Application of PESTEL analysis along with its strengths and weaknesses................................7
SWOT Analysis and its influences upon decision-making.......................................................10
Interrelation between micro and macro factors.........................................................................11
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Macro environment is stated as the accumulation of that factors as well as conditions that
have ability to influence the business in affirmative and pessimistic way. It involves influences
that impact whole business economy. Also, business environment is regarded as the
accumulation of external and internal aspects which influence an entity’s operating situation
(Alrishani, 2020). Moreover, the organisational success is wholly depends upon their potential to
apt modification within macro environment as well as for this firm required to closely observe
several factors of surroundings. This report is based on Marks and Spencer is a well known retail
brand due to their reasonable prices and higher quality. It basically deals into food items, home
items and clothing and having headquarters is in London, UK. The topic which is going to be
described in this report is various kind of organisation along with size, scope, purpose and others.
Moreover, the critical analysis of interrelation of different organisational functions, external
environment with its strengths and weaknesses and SWOT analysis and its influence on decision
making are also described in this report.
PART A
Different types of organisation
Organisational success is effectively based upon experiences and proficiency through target
marketplace. There are several kinds of entity that are categorised as per its objective, vision,
mission, purpose and others. Basically there are three forms of organisation which are described
underneath:
Private sector organisation: This organisation play essential role within system of country’s
economy. It is performed through entity and sole proprietors with intent of gaining higher
profitability (Berger and et. al., 2020). One of the best illustration of it is M&S, it is renowned
British retailer which specialises in selling food, home, and clothing items to their direct
audiences. It was set up through Michael Marks and Thomas Spencer in 1884.
 Vision: Its vision is to develop effective quality of goods and formed trust among
customers.
 Mission: Its mission is to build an aspiration quality items that are easily reached to all,
by deep as well s range of their products.
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 Objectives: Its objective is to develop a benchmark for other as per basis of their goods
and services quality. This includes ore value as creativity, quality and others. Types of Public sector organisation
 Sole proprietorship: When venture is handled through a person, then it is considered
to be sole proprietorship where their business owner has to shares benefits as well as
cost through itself. Also, it is traditional as well as simplest way of operating venture.
Along with this, there is less restriction and can be dissolving easily.
 Partnership: When above two person working in combined way with intent of
gaining expected profit as well as growth is considered to be partnership (Draijer,
2020). These types are made through doing agreement of partners which includes
authorised details of member, progression of capital, profit sharing and others.
 Joint venture: Joint stock firm are those in which monetary resources are limited but
this drives them towards huge burden of risk. It also develops a kind of venture
capital by sale demanding shares.
 Purpose: Its key intent of private entity is to gain profitability as well as be a leader into
their respective industry. Also, the intent of M&S is to render quality goods and services
to their potential audiences for gaining pre defined profitability and sustainability of
enterprise.
 Legal structure: Marks & Spencer comply the Public limited legal structure and having
huge number of working firm where it render good quality services to its potential
audiences.
Public sector organisation: This organisation is that company which is usually regulated
through government of respective country for rendering product and services and also perform
for societal benefits (Kwon and Cho, 2020). National Health Service (NHS) is taken as the best
example of public sector organisation as it render healthcare services to whole region’s citizens
based on the requirements of health care instead of assessing their payment capacity.
 Vision: Its vision is to coalesce 3 key components as good care, effectual heath and
quality values.
 Mission: Its mission is to delivering quality within services of health care for betterment
of potential audience’s health.
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 Objectives: It objective is to give better value, heath and care to their patients. All these
targets integrates future aim what actually they work hard to provide or why Types of Public sector organisation
 Departmental undertaking: The activities of entity’s department are similar to
governmental one as in both there are not any separate existence of them instead of
regulatory bodies. It performs underneath government departmental supervision.
 Public or Statutory corporation: Statutory corporation is regarded as corporate bodies
that is developed through some special act of parliament or central legislation. This
type is wholly financed through regulatory bodies (Lindgreen and Di Benedetto,
2020). Also, the legislative act decided restrictions, objects and power of those units.
 Purpose: The key intent of NHS is to deliver an excellence as well as professional
services to their potential patients. Also, its intent consist an effective quality care that is
protected, purposeful and efficacious in context of services user.
 Legal structure: This essentially obeys regulations and rules according to public
corporation that is financed through United Kingdom parliament.
Voluntary organisation: This organisation gets funds from states, person and groups to
perform for the advantage of people instead of shareholder profits. Its basic aim is to make a
societal impact without giving priority to gain profitability. So, OXFAM is one of the suitable
example of voluntary organisation as it basically work for charity and was established in 1942.
Moreover, its aim is to remove poverty from world.
 Vision: Its vision is to develop a poverty free world and perform for equality.
 Mission: its mission is to formed effective solution against discrimination and poverty.
 Objectives: Its objective is to make permanent solution to poverty and inequality.
Moreover, involve into change international movement for developing future that is
protected free from discrimination and poverty. Types of Voluntary organisation
 Unincorporated Association: thee types are mainly by the contract within person who
are interested and join their hand for similar intent and objectives (Long, Xu and
Yang, 2020).
 Trust: It mainly formed for managing land or obtains funds for specific reason that
have some societal benefits.
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 Purpose: Its purpose is to encompass primary freedom as well as rights to needy
audiences and societies. Also, key purpose of Oxfam is to make permanent solution to
poverty and inequality. Moreover, involve into change international movement for
developing future that is protected free from discrimination and poverty..
 Legal structure: Oxfam is unincorporated association that was developed along with
contract among one or more people for intent to perform against inequality activities as
well as poverty.
Size and scope of a range of different types of organisations
The sizes as well as scope of different organisation are described underneath:
Private sector organisation
 Size: Marks & Spencer is large size entity which have in around 82, 000 staff who
perform for attaining their objective in effective and efficient way. Moreover, it sells
various product items such as cloths, food and others. Also, this directly contact with
about 400 suppliers and it manufacture their products at above 800 sites which is situated
into 44 countries.
 Scope: Marks & Spencer operates internationally and nationally both as well as it
perform its business in around 29 countries including Hong Kong also, they has about
198 franchised stores along with 19 owned outlets into Hong Kong, Irelands and
Gibraltar.
Public sector organisation
 Size: National Health Service (NHS) is a large size company that render societal as well
as hospital healthcare service to potential audiences through providing jobs to nurses,
doctors, technical employees, professional administrative authorities and others. It has
doctors in about 106,430, nurses 285,893. Along with this, it also deals with above 1
million patients in every 36 hours.
 Scope: NHS is rendering their services internationally through its effective quality
services. Moreover, for exploring their experience of services, they seek to extend their
operations within numerous locations of Northern Ireland, Scotland and Wales where it
exits to work with minimal workforce. Also, they can explore their business into various
more countries or regions rather than these so that they can able to gain higher
profitability and productivity.
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Voluntary organisation
 Size: It is considered to be medium size company that render facilities of health within
UK for solving poverty, disaster problems and more. They work in about twenty
charitable firm across country. Presently, it has above 10,000 individulas who are
performing harder to fight against poverty.
 Scope: It perform in above ninety countries along with numerous societies, various
partners etc. for assisting person for re-developing its livelihood through creating
enduring modifications. This is the international organisation that has massive reach.
Oxfam supporters assisted about 12.8 million people in year 2018-2019.
The advantages and disadvantages interrelationships of the different organisational functions
Within entity, the functional areas depend upon their organisational framework. It mainly
aids to develop a relationship of network that categorise task within various departments. So, the
interrelations between several functional units of M&S are described below:
 Production and human resource department: As M&S is a leading firm across the world
as it render standard quality goods or services to their clients based on its desires. Within
this procedure, production unit facilitates their involvement by producing good quality
services for satisfying audiences’ needs (Luiz, Ganson and Wennmann, 2019). While human
resource unit also facilitates its contribution through recruiting competent as well as
proficient workforce who may manufacture standard quality of products or service which
results in gaining more organisational profitability. Benefits: As proficient staff are recruited through HR department and work with
production unit which help firm to produce standard quality products. This will
outcomes in gaining higher profitability. Limitation: Misconception of staff requirements and having lack of production
knowledge leads HR towards recruiting in competent employees which cannot able to
perform the activities in effective manner. Also, this reduces organisational productivity
and fails to accomplish customer needs.
 Marketing and human resource department: Within entity, both HR and marketing units
play crucial role. As HR division perform for orientation, staffing, workers retention and
many more for rendering productive personnel. While marketing unit perform for promoting
the goods and services of business as well as formed opportunity of product selling through
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determining the needs of marketplace (Nam and Bao Tram, 2019). So, Within M&S both
functional units perform together as human resource section recruit competent marketing
workforce for entity who can able to maximise opportunities of sustainable market through
evaluating desires of potential audiences.
 Benefits: Both department perform together to accomplish each other requirement and
attain its goals and productivity.
 Limitation: In case some misunderstanding formed among two functional units then this
leads them towards ineffective operations and task will not get completed on time.
Organisational structure
The work cultures of various functional units are totally depends upon organisational
structure which could be:
 Functional structure: It is the structure where individuals perform similar kind of work
who are grouped as per its expertise and specialism.
 Flat structure: It is the structure that utilise a traditional top to down structure of
management.
 Matrix structure: It is accumulation of two or above kinds of firm’s structure and uniting
these with other one to provide them balance. Generally, there are two command chains
in which member of project team has two managers.
Marks & Spencer organisational structure:
Marks & Spencer comply flat organisational structure as well as its working practices of
functional units are depends upon the procedures of decision making within respective structure.
So, the main reason besides executing respective firm’s structure is to motivate staff to
participate within the procedures of decision making (Popescu and Popescu, 2019). It aids them
to minimise bureaucracy and to develop staff enthusiastic through creating its involvement into
practices of entity. Moreover, with assistance of this, respective organisations increase whole
company’s productivity which aids in enhancing opportunities of growth.
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Figure 1Marks and Spencer Group.
(Source:Marks and Spencer Group, 2020)
PART B
Application of PESTEL analysis along with its strengths and weaknesses.
For entity, it is vital to determine several external factors as well as this affects so that it
may reduce undesirable impact of particular factors. Also, may utilise opportunities present
within business atmosphere (Sinha, 2020). So, to determine optimistic and pessimistic affects of
external factors, PESTEL analysis is applied by M&S that described below:
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Political factor: The United Kingdom government Polices and agreement related to free
trade with other countries have affects upon M&S.
 Positive impact: It may have optimistic affect upon entity. But Brexit have unfavourable
effect upon them as because of it free trade agreement not be given to them.
 Negative Impact: Its production cost will enhance that will have adverse affect upon
entity’s profit.
Economical factor: M&S have been performing on huge level with large store into present
marketplace and economy but trends within UK shows that changing is consider towards small
retail shops.
 Positive impact: Because of it M&S mark up cost has low down that allows them to be
premium brand so developing this affordable to whole has optimistic impact upon sales
enhancement.
 Negative impact: Reducing individuals buying power force them to move towards local
smaller retailer instead of premium brand and has adverse impact on M&S profit.
Social factor: This has huge affects upon entity as it undertake consumer’s choices and tastes
which helps them to develop its products based on their desires (Sivarajah and et. al., 2020).
 Positive impact: As ready to meal industry demands are maximising, firm have vital
market share as it effectively tapping into particular market segment.
 Negative impact: As M&S are performing for long time because of this they has great
brand image but it do come up with any creative new products for audiences because of
that they are known as non trendy.
Technological factor: This factor has affects on entity as M&S opted self checking counter
into its retail shops.
 Positive impact: This helps them to facilitate developing shopping experiences to clients
as it decreases billing process queue and standing time.
 Negative impact: This regular development of technology impacts firm’s cost framework.
Legal factors: Entity has to follow with several legal inferences upon them as it assures
ethical enterprise operations and great reputation within clients (Somers, 2019).
 Positive impact: As it use whole legal factors that assure that it has ethical policies into its
firm as well as it have affirmative affects upon firm.
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 Negative impact: Respective firm have go through several legal issues because of that
firm’s brand reputation got impacted in pessimistic way.
Environmental factor: With maximising concern of individuals so entity has to undertake
many affect of its practices upon atmosphere.
 Positive impact: As M&S are concern about sustainability into its offerings because of
which it has optimistic affect upon their enterprise as they get support from government.
 Negative impact: But this maximises complex and price into firm’s procedures because
of this shareholder can get impacted.
PESTLE ANALYSIS OF NHS
Political factor: The political atmosphere into country ha influence upon NHS. Some things
are there which has optimistic and adverse impacts on its political surroundings (Tóth, Nieroda
and Koles, 2020). Positive impact: The UK political stability is aspects that optimistically
influence NHS business.
 Negative impact: NHS’s manager cannot become competent to concentrate upon longer
term strategy as regular modification into political atmosphere that pessimistically impact
entity’s development.
Economical factor: This involves economic development, inflation rate and others.
 Positive impact: Within UK, government established particular austerity measures for
dealing with economic break down so under cutting budget measures affirmatively as
NHS may able to deal with monetary crisis.
 Negative impact: Because of Brexit, the inflation circumstance raise and product cost are
enhanced that adversely impact NHS’s operations.
Social factor: The societal presence of country into NHS is present and will ascertain the
changes it needs to form (Wu, Buyya and Ramamohanarao, 2019).
. Some modification impact M&S affirmatively and adversely.
 Positive impact: NHS is decided to be situated into areas so that person may reach
hospital easily at the time they needs hospital for emergency care.
 Negative impact: Because of COVID- 19 problem patient’s number gets enhanced so the
limited staff and hospital ability can impact NHS adversely.
Technological factor: As technology is enhancing constantly as well as NHS has to execute
this so that it may always be ahead into competition.
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 Positive impact: With assistance of advanced technology NHS can able to use advanced
surgical instrument regarding medical services.
 Negative impact: Higher utilisation of technology in respect of handling patient and
clients data may adversely impact NHS business.
Legal factor: The regulations and laws that are regarded through NHS for their effectual
performance. The affects are:
 Positive impact: NHS have develop accounts each year so that authority of particular
nation may able to maintain taxes track which its pay and gain.
 Negative impact: The modifying government regulations have develops adverse affects
upon NHS Business and patients desires.
Environmental factor: All entities are responsible for contributing towards environment in
which they sustain (Zhenwei Qiang, Wang and Xu, 2020). The environmental factors affects on
NHS are:
 Positive impact: NHS applies disposable surgical tools which is not harmful for
environment.
 Negative impact: Present corona virus crises impact work atmosphere of business in
respect of forming pressure and stress upon staff.
SWOT Analysis and its influences upon decision-making.
SWOT Analysis of M&S
STRENGTHS
 M&S has stronger cash flow as it assists them to explore its enterprises. Moreover, UK
government facilitates contribution to respective firm for managing trade guidelines
effectually for business expansion.
WEAKNESSES
 The rate of staff turnover is higher is because of this entity as to spend efficiently upon its
workers training. Also, Brexit enhances new challenges for M&S to manage
sustainability of business in effective war of price.
OPPORTUNITIES
 With effective cash availability it can bale to explore its business and brand reputation as
this allows firm to assure success.
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THREATS
 The trends in particular sector drives towards enhanced competition that directly affects
firm’s operations. Production cost enhancement impact respective company profit
because of free trade agreement.
SWOT Analysis of NHS
STRENGTHS
 The key strength of NHS is they are having such real rivals.
 Also, NHS are specialises in providing Accident and emergency services.
WEAKNESSES
 The key weakness of NHS is it does not compromise with demand due to population
maximisation.
OPPORTUNITIES
 The main NHS opportunities are it may apply several new market tactics as it is helpful
in boost its profile.
THREATS
 The key threat of NHS is it has more staff turnover rate.
Interrelation between micro and macro factors.
Entity has to determine business opportunities which help them to attain their gaols
effectively and efficiently. This can reduce the affects of several wide spreading threats. The
interrelationships among macro as well as micro factors are described underneath:
External factors Marks & Spencer
Political Strength: free trade agreement facilitates M&S an opportunity to
explore its business as it has strengths of stronger cash flow so this aids
in business expansion.
Weakness: Because of Brexit, production cost of M&S get enhances.
They faced few challenges because of price war as it reduced
opportunity growth.
Economical Strength: M&S is growing entity which facilitates more employment
opportunity.
Weakness: Brexit enhances various challenges as it minimises per
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capita income.
Social Strength: It has vital competition within retail market segment but they
effectively accomplishing needs in respect of ready meals. This
facilitates expansion opportunity in similar sector.
Weakness: The key weakness of M&S is it do not perform any
innovation into their new or existent goods.
Technological Strength: New technology adoption in its functional practices enhances
M&S great customer experiences.
Weakness: The inappropriate technology adaption fails to meet
competition level and customers preferences.
Legal Strength: M&S execute code of conduct into firm’s policy due to which
UK government supports them.
Weakness: Respective firm has to go through many legal implications
because of which its operations get influences but with sustainable
business activities it may assure developed operations.
Environmental Strength: The sustainable activities of business help M&S to
accomplish its goals and expand its business.
Weakness: The execution of eco- friendly production needs an efficient
amount and new technological tools as well as because of shortage of
utility M&S has to face challenges.
CONCLUSION
As per the above report, it can be concluded that macro environment play vital role as the
organisational success is wholly depends upon their potential to apt modification within macro
environment. Moreover, there are three key organisation i.e., public, private and voluntary. That
has different vision, mission, objectives, scope, size and legal structure. Additionally, PESTEL
analysis is used for determining the affirmative and adverse impact. Along with this, the SWOT
Analysis is helpful to determine strengths, weaknesses, opportunities and threats and also it
influence firm’s decision making. Apart from this, there is significant interrelationship among
micro and macro environmental factors.
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REFERENCES
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Online
Marks and Spencer Group. 2020. [Online]. Available
through:<https://www.theofficialboard.com/org-chart/marks-and-spencer-group>
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