SWOT and PESTLE analysis of Marks and Spencer

This report by Desklib provides a detailed SWOT and PESTLE analysis of Marks and Spencer, evaluating changes in PESTEL factors that influence the opportunities and threats of the company. It also recommends leadership styles for the company and evaluates its corporate social responsibility. The report includes subject matter related to business and is suitable for students pursuing business courses in colleges and universities.

Context of Business

Table of Contents
INTRODUCTION ..........................................................................................................................3
TASK ..............................................................................................................................................3
SWOT and PESTLE analysis of Marks and Spencer.................................................................3
Evaluating changes in PESTEL factors that influence the opportunities and threats of Marks
and Spencer.................................................................................................................................6
Evaluation and recommending leadership styles for Marks and Spencer...................................8
Evaluation corporate social responsibility of Marks and Spencer..............................................9
CONCLUSION .............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
The term business environment may be defined as an environment that connotes all the
external factors and institution that are not in control of organisation and they directly affect the
different activities of the business(Aryshev and Ivanyuk, 2020). Customers, suppliers, rivals and
many more are comprises in this environment. Along with this the business environment also
comprises of all the strategies and decision which are taken by higher authorities in order to
achieve all the objectives of the business. For this report Marks and Spencer have been taken into
consideration, in order to understand the business context. The Marks and Spencer is a well
known retail brand of UK which was founded in 1884. The headquarters of the company is
situated in London and they have around 959 stores all across the nation. In this report, external
as well as internal environment of the chosen company has been done with the help of
appropriate framework. This report provide information about the change in external factors
which influence the opportunities of the business. Afterwords, this report cover the Daniel
Goleman’s (2000) leadership style in context to the chosen company and CSR responsibilities
which they have to follow.
TASK
SWOT and PESTLE analysis of Marks and Spencer
SWOT analysis:- it is a strategic planning technique which allow the firm to identify its overall
strength and opportunities. This framework also provide in depth information to the company
regarding their strength and weakness(Belás, Kmecová and Čepel, 2020). With the help of this
tool an organisation not only reduces their risk but also identify the different segments in which
they lack in. Along with this, this tool also help in developing strategies which help the company
to stand in competitive market. SWOT analysis in context to the Marks and Spencer has been
discussed below :-
Strengths :-
This comprises of all those factors like strong brand image, potential customers and
many more which make the firm different from their rivals. These attributes not only help the
company in increasing its profit but also help in enjoying the competitive advantage over its
competitors. In context to the Marks and Spencer, the most important strength of the company is

their strong brand image and global presence. This is because of different product range and 138
years of experience in the retail sector. In addition to this, the impressive strategies which are
made by the R&D department of the company help them in increasing their loyal customers
base.
Weaknesses :-
This factor comprises of all those attributes which affect the functioning as well as
performance of the company. The areas in which they are lack in is related to this factor. If the
firm wants to improve their stability in the market or wants to enjoy the competitive advantage
then, it is very important for them to overcome from these weaknesses. Inadequate stock, bad
image of the brand, improper supply chain management system and many more are comprises in
this(Dinh and Hilmarsson, 2020). In context to the Marks and Spencer, the most important
weakness of the company is that they more relay on the manpower. Instead of being capital
intensive they are labour intensive due to which cost of producing the goods has been increases.
Along with this, the non-availability of the goods in their stores is also suffer by the company
because of the poor supply chain management system. Due to this, they are not able to fulfil the
demand of their consumer in proper manner which result in decline in the sales and potential
customers.
Opportunities :-
Opportunities is the most important factor of this framework. This factor included all
those favourable attributes which assist the firm in improving their stability and grow in the
competitive market. By identifying opportunities in the competitive market an organisation can
increase their profit, presence and potential customers. In context to the Marks and Spencer, the
most important opportunity which are available in front of them is that they can improve its
online presence(Dörndorfer, Hopfensperger and Seel, 2019). This help them in competing with
their online rivals like eBay and Amazon. Along with this, company can also focus on the other
market segment which help them in increasing their profitability and potential customers.
Threats :-
This factor included all those unfavourable attributes which not only harm the functions
of the company but also hamper their performance in the market. In relation to Marks and
Spencer, the most important threat which are faced by the company is, availability of the stiff
competition in the retail sector. Along with this the financial issues has are faced by the company

before Brexit due to instability in the economy. It is very important for the management of the
company to make proper strategies to overcome from these issues.
PESTEL analysis :- organisations use this tool in order to identify all the external factor which
has a huge impact on the performance as well as the functions of the business. This Framework
has been used by the management of Marks and Spencer in order to identify the impact of Macro
environment factors on the business. This helps the company in making proper strategies and
policies to face all these problem. PESTEL analysis in context to the Marks and Spencer has
been discussed below :-
 Political factor :- this factor determine the extent to which the government of the nation
may influence the economy or a particular industry(Jamel, Saidani and Nurcan, 2018).
This factor comprises of tax policies, fiscal policy, trade tariffs, political stability and
many more which affect the business environment of the company to a great extent. In
context to the Marks and Spencer, due to the event of Brexit, unforgettable losses has
been bear by the company which impacted their sourcing cost and operations in a very
bad manner.
 Economical factor :- these factors are basically the determinants of an economy's
performance which directly impact on the performance of the company and have a long
term effect. This factor included inflation rate, interest rates, foreign exchange rates,
economic growth patterns and many more. In context to the Marks and Spencer, after the
arisen of COVID 19 and due to Brexit the overall functioning of the company has been
affected. Instability in the currency has been faced by the company due to which they
have to increase their product price, which is not generally accept by the consumer.
 Social factor :- this factors comprises of cultural trends, demographics, population
analytics and many more which scrutinize the social environment of the market. These
factors affect the operations as well as efficiency of the company in a very negative
manner(Kohnová, Papula and Salajová, 2019). In context to the Marks and Spencer, due
to the excessive chain of the product recalls backlash from its potential has been faced by
the company. In addition to this, due to the improper supply chain management system
the management of the company is not able to fulfil the needs and demands of the
consumer.

 Technological factor :- this factor is totally related to the innovation in technology
which may affect the functioning of the industry in positive and negative manner.
Automation, research and development and the amount of technological awareness that a
market posses is also refer to this. In context to the Marks and Spencer, the management
of the company have identified a suitable technology partner which improves its online
presence and innovate their production process. This helps the company in increasing
their profitability by saving the cost.
 Legal factor :- these factors have two side i.e. external and internal. This comprises of
different laws of the country which affect the business environment and certain policies
which are made by the organisation for themselves. In context to the Marks and Spencer,
due to Brexit different types of complexities and issues in trading have been faced by the
company. Not only the supply chain management of the company but also the production
process of the company has been affected in a very bad manner. This result in declining
of profit as well as sales.
 Environmental factor :- this element comprises of all those factors which influence or
determined by the surrounding environment(Komljenovic and et. al., 2019). This aspect
is very crucial for all the industries. In context to the Marks and Spencer, all the
environmental related rules has been follow by the company and along with this a green
policy has been developed by the management which assist them in expanding their
business in environmental friendly product. This boost up their brand image and potential
customers base.
Evaluating changes in PESTEL factors that influence the opportunities and threats of
Marks and Spencer.
It has been observed that there are different types of external factor which affect the over
functioning of the Marks and Spencer. It has been seen that, the management of the company is
not able to perform their all functions at optimum level. This result in declining of market share
and profitability of the firm. Factors which influence the threat and opportunities of the M&S has
been elaborated below :-
 Political:- different types of issues such as improper supply chain management, rise in
cost of goods and many more has been faced by the respective company because of
Brexit. In addition to this, the opportunity for increasing their presence in the global

market has also been hinder, due to which customer base of the company has been
affected. Reputation as well as years of experience has been utilized by the company in
order to overcome form the effect of these issues. This help them in increasing their
customer base.
 Economical :- the management of the Marks and Spencer have to increase their product
price because of pandemic and Brexit. The currency, interest rate and many more has
also been affected due to this. This create a threat for the Marks and Spencer as they
have to remain competitive in the unstable market(Leminen and et. al., 2020). The
goodwill of the company and years of experience has been used by the management to
faced this issue. This help them in attracting more and more customers as well as
suppliers which result in decreasing the cost of producing the goods.
 Social :- due to the improper supply chain management system the company is not able
to meet the demands of the people in effective manner. Due to this the popularity as well
as the image of the company in the mind of consumer has been affected. The company
is not able to target new customer which affect the presence as well as sales. Issues
related to the product recall, not only affect the trust of the customers over the brand but
also sales of the company. Due to this the potential consumer of the company has been
attracted towards their competitors. In order to overcome form the issue of decreasing in
consumer, the management is going to utilize its global presence and years of
experience.
 Technological:- as the future of the business is e-commerce, so it is very important for
the M&S to focus on selling their product online. It has been observed that the online
presence of the respective company in comparison to their rivals is very low. New as
well as innovated technology has been adopted by the company which help them in
making their operations automated (Osuszek and Ledzianowski, 2020). This develops
opportunities for them like reduces the cost of production, reduces wastage, save time
and many more. The R&D department of the M&S is gong to utilize different types of
tactics to remove the problem of relay on manpower. Along with this they paid more
focus on their online stores to increase the potential customers which result in increasing
goodwill as well as profitability.

Evaluation and recommending leadership styles for Marks and Spencer.
Leaders may be defined as those individuals who have to the ability to motivates it
employee's towards the objectives of the business. Leaders of the company work in a way to
convert the vision and objectives of the company into reality. In order to do this leaders of the
firm use different types of leadership style within the organisation. With the help of these styles
good as well as healthy environment has been developed. Daniel Goleman's leadership styles has
been discussed below :-
Meaning:- this is basically a six emotional leadership style model which state that the leaders of
the company have to maintain an effective working environment with the help of utilizing
effective leadership style. The theoretical discussion of this model has been discussed below :-
 Affiliative leadership:- with the help of this leadership style, the leaders of the company
develop a harmonious as well as happy working environment within the work floor.
This result in removing of negative ambiance as well as also help in maintaining balance
among the team members(Rachinger and et. al., 2018). By using this style, leaders can
focus on developing effective solutions for resolving the problem between the team
members.
 Democratic leadership:- in this style the collaboration of the individual within the team
has been appreciate by the leaders. The value has been give to the voice of every team
member and they are engaged in the decision making process of the company. The
working environment is more flexible and collaborative. This style has been used by the
leaders when, they depend on the expertise of the workforce.
 Commanding leadership: this is also known as Coercive Leadership Style. In this style
a specific task has been given by the leaders to their subordinates and they expect that
they complete the given assignment with raising any questions and within the given time
limit. The leaders us this style when there is short time available to complete the task.
 Pacesetting leadership:- in this style focus has been paid on final result and high quality
work(Song and et. al., 2019). Leaders expect that the each and every employee of the
company carry out the assigned task with full productivity and with in the set time limit.
 Authoritative leadership: this style also known as visionary style. In this style focus
has been paid by the leaders on motivating and energizing the team members in order to

achieve the objectives of the company. This help them in developing good relation with
their subordinates.
 Coaching leadership:in this style, focus has been paid by the leaders of the company on
the strength and weakness of the employees. By utilizing this style, leaders of the
company develop new skill and knowledge within their employees. In addition to this,
focus has been paid by the leaders on achieving the goals of the company and how
employees contributes in this.
From the above discussion on leadership style it has been observed that the management of the
M&S have to use authoritative leadership style in order to overcome from the different issues
which are faced by them like Brexit, high cost of production, reduction in sales and potential
customers. By using this style employees of the company has been motivated in a positive
manner. An importance and significant role has been played by this style during this pandemic as
employees of the company work with utmost productivity.
Evaluation corporate social responsibility of Marks and Spencer.
If the management of the company wants to improve their image in the competitive
market the they have to perform social responsibility(,Song and et. al., 2019). If the firm wants
to become socially responsible then they have to adopts different policies which promote the
social well-beingness. In order to fulfil all the social responsibility CSR business model has been
utilized by the organisation. Following are the different types of social responsibility which have
been discussed below :-
 Ethical responsibility: ethical responsibility is refers to the welfare of the workforce
within the working environment of the company and also promote the ethical practices
for the supplier. By fulfilling this responsibility, discrimination among the employees in
relation to gender, cast, religious has been removed form the organisation (vom Brocke
and et. al., 2021). Moreover to this, this responsibility also promote the fare wages and
accurate working hour with in the company so that the employees live a better life. In
context to the Marks and Spencer, it is very important for the management of the
company to focus on the developing effective and healthy working relationship with
customers workers and supplier. This result in increasing the sales of the company.
 Philanthropic responsibility:in this responsibility focus has been paid by the
management on the humanity and unprivileged individuals. Donation has been done by

the company in the form of charity at national as well as international level. In context
to the Marks and Spencer, different types of charity programme has been developed and
volunteer by the high authorities of the company. In order to give support to the
different types of humanitarian organisation, fund as well as food product has been
provided by the company to them.
 Environmental responsibility: this refers to the unavailability of raw material and
increase in the pollution over a period of time. Management of the company have to
follow have to follow all the rules which are made by the government and
themselves(Weinzierl, Revoredo and Matzner, 2019). In relation to M&S, it is very
important for the company to paid focus on the environmental protection laws. In
addition to this, they also give funds in the form of charity to the different organisation
in order to protect the environment.
CONCLUSION
From the above report it has been concluded that if the management of the company
wants to operate their business functions in effective manner then first they have to understand
the business. With the help of this an organisation track as well as monitor their growth by
developing effective business strategy. This report concluded the utilization of the analytical
tools i.e. PESTEL and SWOT in order to understand the environment of the business. This report
also concluded that how a company use its strengths and opportunities in order to face the threat
and overcome from the weaknesses. In addition to this, this report also concluded the different
types of leadership style in order to motivate the employees within the company to increase their
productivity. Furthermore, this report concluded that it is very important for the organisation to
maintain and perform the social responsibilities on continuous basis. This help the company in
developing good brand image in the market and improving relations with their stakeholders.

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