Organizational Structure and Business Expansion - Desklib

This presentation discusses the organizational structure and functional areas of Marks & Spencer that contributed to its global expansion. It also covers the impact of digital technology on global expansion. The report analyzes the external and internal factors that impact the global functioning of the organization and helps in corporate strategic planning.

Organizational
Structure and
Business Expansion

Table of content
Introduction
International Expansion of Marks & Spencer
Suitability of Organizational Structure in Business Expansion
Suitability of Functional areas in Business Expansion
Factors that influence the international expansion of Marks and Spencer
Impact of Digital Technology on Global Expansion
Conclusion
References

INTRODUCTION
Every business organization wants to expand its business to earn long term profitability and to increase market
share to be stable in the market for further growth. Business expansion requires a suitable organizational
structure and appropriate functional areas of business to face the global competitors in the international market.
To expand the business, it is required to analyse the impact of technology on the business to get its optimum
advantage. The following report will cover the business expansion of Marks and Spencer in international
markets. It is a multinational public limited company in retail sector headquartered in London, England, UK. It
deals in clothing, home and food products. The report will explain the organizational structure of Marks &
Spencer and its functional areas that contribute to its global expansion. This report will also cover the internal
factors of the company that influence its international expansion. Further, it will also cover the impact of digital
technology on its global expansion.

International Expansion of Marks & Spencer
Marks and Spencer was founded by Michael Marks & Thomas Spencer and was established in
1884 in UK. It serves worldwide with almost 1463 locations with more than 75000 employees
as of 2022. It offers different variety of brands in clothing for both men and women. It has also
expanded its food business domestically. M & S has a wide domestic expansion of clothing and
food business. It began its international expansion with the introduction of Asian food in 1974.
further in 1975, it opened its stores in continental Europe and in Ireland as well.
In 1973, Marks & Spencer expanded in Canada but due to the small size of the stores,
it did not contribute to increase the customer base. Consequently, in the year 1999 the less profit
generating stores were to be closed that included almost 38 stores. Further it expanded its
operations in France with the stores opening in Paris and Lyon in 1975. The shops in Paris were
profitable but in 2001, it had to close its western Europe operations due to unprofitability.
Further in 2011, it introduced its food outlets in Paris with clothing products

Suitability of Organizational Structure in
Business Expansion
An organizational structure is a system that defines how the activities of task allocation and
supervision are directed to achieve the objectives of the organization. It affects the flow of
information between the top level and employees of the company. Different organizations
follow different kinds of structure of their organization according to the size of business and
scale of its operations and functions. Some of the types of organizational structure are listed
below:
 Hierarchical
 Functional
 Divisional
 Flat

Suitability of Functional areas in Business
Expansion
In large organizations, functions are allocated department wise due to various specific functional
areas such as marketing, finance etc. Companies need to specify the functions of each
department and ensure collaboration among departments for smooth conduct of operations and
making the top management to consider and concentrate on various business projects and plans
relating to expansion. Marks & Spencer's functional areas include the following:
 Human resource function
 Finance Function
 Marketing Functions
 Research and Development Function
 Technology Function

Factors that influence the international
expansion of Marks and Spencer
There are various external and internal factors that impact the global functioning of the
organization. Analysis of these factors helps in corporate strategic planning. These are
considered as drivers of international strategies. Some of the drivers that affect global
expansion are explained hereunder :
 Government Drivers
 Competitive Drivers
 Market Drivers
 Cost Drivers

Impact of Digital Technology on Global
Expansion
For business organizations, it has become imperative to adopt Digital
Technology for expanding their businesses. It includes new innovative ideas
to promote the products such as use of E- commerce and social networking
sites for advertising the products to build a large customer base globally.
Companies should develop their own websites to demonstrate their products
and make them accessible to domestic as well as global markets. They
should introduce automation processes and use of artificial intelligence in
the organization. Digital technology has a very crucial role in expansion of
the business as it supports the organizations in accessing the customers of
international market.

Continue…
Marks & Spencer is investing in Digital marketing and expanding its business in big markets such as
Zolando, Asia and other new markets. It has introduced 46 flagship websites in different markets and has
expanded its online business in more than 100 countries and is still striving to build a large customer base
globally. It has launched a digital showroom to avoid costly operations. It has expanded its global E-
commerce online Platform through a single website that is accessible to different markets. Marks &
Spencer is growing globally by introducing digital stores that include trials first. It is offering innovations
internationally in multiple ways such as self checkout and QR Codes for accessing the online ranges.
Marks & Spencer is introducing Artificial Intelligence Supply chain Technology to its Food
stores. It is using modernisation for its supply chain by machine learning for improving the availability
for food waste cutting.

CONCLUSION
From the above discussion, it has been concluded that organizational structure and functional areas of the
organization such as marketing, Finance etc. have crucial role while planning for expansion of business.
Companies need to analyse the external environment and degree of competition to expand its business
globally. It needs to consider the impact of technology to face the competition. Companies should follow
the digitalization at its multiple global operations to access the customers globally and increase the market
share in international markets. Business organization should use online platforms and E-commerce for
offering as well as promoting their products. They should use automation processes in the organization for
better and smooth functioning of the operations.

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