Strategic Management: Process, Impact of Internal and External Factors, and Organisation's Plan

This report discusses the process of strategic management, including the steps involved in determining a strategy. It also analyzes the impact of external and internal factors on an organization's strategy, using PESTEL, SWOT, and Porter's 5 forces models. The report concludes with an overview of Marks and Spencer's strategic plan, including its mission, vision, objectives, and strategies.

Strategic management

Table of Contents
Introduction .....................................................................................................................................3
Main body........................................................................................................................................3
Definition of strategic planning..................................................................................................3
Process of determining a strategy...............................................................................................3
Impact of external and internal factors on the organisation's strategy........................................4
Organisation's strategic plan.......................................................................................................6
Conclusion.......................................................................................................................................8
References........................................................................................................................................9

Introduction
Strategic management refers to the process of setting goals, objectives and procedures in order to
make sure that the company is ahead of competition. Strategic management helps the company
in becoming more competitive and make sure that there is proper planning in regard with the
tasks of the company so that the company will be able to achieve their assigned tasks and the
goals of the company (Samofatova., 2017.). In context to Marks and Spencer, is a major British
multinational retailer who is dealing majorly in clothing, food items and home products. The
company was incorporated in the year 1884 by Michael Marks and Thomas Spencer. The
company is headquartered in London, England, UK and they are currently operating in more than
100 countries including their online presence. In this report, the process of strategic management
along with internal and external environmental factors are given. An organisation's strategic plan
along with an overview of strategic planning is also demonstrated in the report.
Main body
Definition of strategic planning
Strategic planning refers to an ongoing process of planning, monitoring, analysing and
assessment of tasks which is needed to be done by the company in order to fulfil and achieve the
goals of the company. As the environment of the industry is constantly changing specially
fashion industry, it is important for the companies to make sure that they are constantly assessing
their management strategies and making essential changes according to the needs (Abd and et.
al., 2019.). It is important for the company to make sure that strategies are made in accordance
with all the aspects of the company as well as the purpose of the company. The benefit strategic
management is that it generally concentrates upon the future plans of the company. It is a
continuous process that helps the company and its employees in analysing and selecting a correct
path through which the company can avail benefits.
Process of determining a strategy
There are five steps in the process of formulating a competent and an effective strategy for the
company. It is important for the company to make sure that they are working according to the
strategy so that they will be able to achieve the company goals. The steps in the process of
strategy are given below:

 Identification: The first step is to analyse the current direction of the company
(Hodgkinson and Healey., 2018.). It is an important step as it will help in understanding
the goal, objectives and values of the company and then make strategies which can help
the company in making strategies accordingly.
 Analysis: It refers to the step where analysis has been done on the factors that are
working in favour of the company's goals and factors that are not working for the
company. It will help in analysing the necessary elements of the strategic plans which are
needed to be included in the strategy.
 Formation: It refers to the action plan which will help the company in reaching to the
goals and objectives (Augier and Marshall., 2017.). It is important to make sure that the
strategies are clearly focussing on the goals which are needed to be accomplished.
 Execution: It refers to the implementation of the strategy in the workings of the
company. It will help the company in making sure that they are on the right path and the
company is continuously moving towards their goals and objectives.
 Evaluation: This stage refers to the evaluation stage where the company is try to
evaluate the results of the strategy which was implemented in the management of the
company (Drobyazko and et. al., 2019). It is important to analyse what are the factors that
worked for the company and what are the factors that did not work for the company and
are needed to be changed.
In case of Marks and Spencer, the company is currently working on enhancing the online
presence of the company so that they can reach to a wider audience and will also be able to
capture the potential customers for the company. The company is also working on a new clothing
line which can attract the Asia and Middle East's potential market.
Impact of external and internal factors on the organisation's strategy.
PESTEL analysis
Political factors: It refers to the factors that determines the degree up to which the
government of the country can interfere in the free market or can affect the workings of the
company. In includes political stability, government policies, foreign trade policies and tax
policies (Agha and Dixon., 2021.). In case of Marks and Spencer, Brexit policy can have a major
impact on the workings of the company as it will have a direct impact on the import as well as on
the export duties.

Economic factors: The purchasing power of the consumers is majorly affected by the
economic factors (Dzwigol and et. al., 2019.). It is important for the company to make sure that
the prices of the company are lower than those of competitors as the markets of UK are highly
price sensitive and in order to have competitors advantage in the market it is important for the
company to make sure that their prices are low.
Social factors: It refers to the factors that are related to the norms and culture of the
society. It is important for the company to make sure that they are complying with all the rules
and regulation of the society in order to operate without any disruptions (Hutaibat., 2019.). It
includes socio cultural factors such as population growth, health consciousness, etc. In case of
Marks and Spencer, the company operates within clothing industry and society of respective
countries have their own taste and preference in regards to clothes and fashion and it is important
for the company to update their collection according to the needs of the society.
Technological factors: It refers to the analysis of the technology that is prevailing in the
society or the technology that the competitors of the company already have (Katsero and et. al.,
2019.). In case of Marks and Spencer, currently the feature of online shopping is providing
benefits to the company as in today's time people are looking for shopping with the comfort of
home.
Environmental factors: These factors came into existence due to the increasing scarcity
of resources and due to the increasing concern of environment. It is important for the company to
make sure that they are doing business in ethical and sustainable way and must also ensure that
the company is not providing any harm to the environment (Moharramnejad and et. al., 2017.).
The consumers are willing to pay extra prices for products that are ethically produced. In case of
Marks and Spencer, the company makes sure that they are working ethically and sustainably and
the strategies of the company are according to the Green Policy.
Legal factors: It refers to the factors that provides much needed awareness to the
company about the rules and regulations that are prevailing in the market. It is important for the
companies to make sure that they are complying with these rules and regulations in order to
operate in the country (Suriyankietkaew and Petison., 2019.. In case of Marks and Spencer, the
company has its presence worldwide and it is important for the company to make sure that they
are complying with all the rules and regulation of respected country and which is the reason why

the strategies of the company must be made separately for each country according to the set of
rules of the country.
SWOT analysis
Strengths: Innovation is one of the major strength of Marks and Spencer and it is
important for the company to make sure that their strategies must involve innovation. Another
strength of the company is positive and renowned brand image (Doz., 2017.). The company has
a good reputation in the market and it is important for the company to make sure that their
strategies are not harming the reputation of the company in any way.
Weaknesses: One of the major weaknesses of the company is that they are unable to
capture the market share of Asia and Middle East as they are generally offering highly modern
clothes and people of these area are not really impressed with the collection of the company. It is
important for the company to offer new range of clothing line according to the interest of Asia
and Middle East customers.
Opportunities: Fashion industry consists of dynamic market and provide major scope
for growth as well. If the company is able to analyse the market and its demands then the
company will be able to capture the market in an excellent manner (Leiblein and et. al., 2018.).
Marks and Spencer must analyse the market of the Asia and Middle East as it has a lot of scope
for the company.
Threats: One of the major threat which needs to be considered by the company can be
stated as the aggressive competition within the respective industry. It is important for the
company to make sure that they are making their strategies keeping in mind the workings and the
strategies of the competitors such as the low pricing policy of ZARA, so that the company can
get competitors advantage in the market.
VRIO framework
Basis Valuable: Rare: Imitable Organised
Financial
resources
yes no no yes
Human resources yes yes no no
Distribution
channels
yes no no yes

 Valuable: Some of the valuable resources of Zara includes their financial resources. the
company is in a strong position in the market and are grabbing new opportunities which
can help them in having success and will make sure that the company is moving
according to their gaols and objectives.
 Rare: The financial resources as well as the human resource of the company is
considered to be the most rare resources as it is difficult for the most of the companies to
find talents employees. These are important assets for the company.
 Imitable: The products and services of the company are very costly to imitate which
makes the switching cost for consumers really high. It helps the company in having
competitors advantage in the market.
 Organised: The distribution network of the company is extremely strong which helps
them in reaching out to a wide range of audience as there is availability of the products of
the company on various locations.
Porters 5 forces model
It refers to a framework which helps the company in analysing the competitors in the
market. It helps the company in having competitors advantage in the market and in coping with
the dynamic environment of the industry. The five forces which can influence the workings of
the company are given below:
competition in the industry: The biggest competitor of Zara is H&M, and the company
is working hard in order to cope with that competition. The supply chain management of the
company helps them in having competitors advantage in the market.
Bargaining power of buyers: The company is providing affordable clothing line to the
customers which makes the bargaining power of buyers low.
Bargaining power of suppliers: the company is a giant and suppliers are willing to work
with the company which makes the bargaining power of suppliers low.
Threat of substitute products: the switching cost for customers are high as the company
is providing affordable and stylish products to their customers which makes the threat of
substitutes low.

Threat of new entrants: the company is working in a fast fashion industry and entering
that industry requires high level of investment which is hard for new companies but still as there
is low barriers to entry the company is having a threat from new entrants.
Organisation's strategic plan
Company overview
In case of Marks and Spencer, the company is currently working on enhancing the online
presence of the company so that they can reach to a wider audience and will also be able to
capture the potential customers for the company. The company is also working on a new clothing
line which can attract the Asia and Middle East's potential market. Marks and Spencer is a
British multinational retailer which was incorporated in the year 1884 by Michael Marks and
Thomas Spencer. The company is headquartered in London, England. Including the online
presence of the company, they are present in more than 100 countries. The company is listed in
London Stock Exchange and are employing more than 78000 employees. The company majorly
deals in clothing, home appliances and food products.
Mission
The mission of the company is to provide aspirational quality products to the customers
of the company.
Vision
To set a benchmark quality against which the comparison can be made by customers.
Objectives
 To make sure that the profits of the company are increased by 10% by the end of the
year.
 To increase the market share of the company in the countries of Asia and Middle East.
 To enhance the online presence of the company.
Strategies
In order to increase the profits of the company is it important for the company to make
sure that they are capturing the potential market of Asia and Middle East. It will make sure that
the company is having profits and are able to attract a big market segment. In order to do so the
company must make sure that they are including traditional wear in the collection of the
company (Bhattacharyya., 2020.). It will help the company in attracting a large segment of the

market. In order to enhance the online presence of the company it is important for the company
to include social media effectively in the marketing of the products of the company.
Action plan
Firstly, it is important for the company to research about the market in which the
company can find potential customer. As the company is serving worldwide, there are some
countries in which the company still is not able to perform as per the expectations. With the help
of survey the company will be able to analyse the demands and wants of the customer and will
be able to work accordingly (Marinov., 2018, June.). Secondly, the company must make sure that
they have an effective presence on online platforms. It will help the company in reaching to a
wider audience and will also help the company in bringing traffic on the website of the company.
According to the business plan it is important for the company to firstly analyse the
segments in which they can perform up to the expectations. The company must include
traditional designs in their portfolio which can help them in attracting the customers of Asia and
Middle East. It will help the company in reaching to a wider audience. In order to enhance the
services of the company, they must make their presence strong on online platform which will
help them in attracting new customers and will also make sure that the company is having a
wider reach.
Annual reports of Marks and Spencer

(Source: Marks & Spencer (2019b, n.p.))

(Source: company annual report 2020)

Conclusion
From the above report it is concluded, that strategies plays a major role in the working of the
company. Strategic management helps the company in not only planning but also in monitoring
the activities and directing the company towards the right path. In the above report a process of
determining the strategy is given which will help in analysing the clear strategy of the company.
Along with that, in order to determine the external as well as the internal environment of the
company a PESTEL analysing and SWOT analysis is given. In order to analyse the competitive
environment of the company, porters five forces model along with a VRIO frameworks is
provided. These analysis will help the company in ensuring that they are working on the right
path and is working according to the plans. Strategies are a crucial part of management of a
company and it is important for the company to have strategies that are suitable for their
workings and is suitable for the processes of the company.

References
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Strategic HRM of Marks & Spencer: A Review of Training and Development Practices, 2020
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Marks And Spencer: A SWOT Analysis, 2021 [online]. Avaialble through
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