SWOT and PESTEL Analysis of Marks and Spencer: Evaluation of Impact and Leadership Style Recommendation

This report covers the SWOT and PESTEL Analysis of Marks and Spencer, evaluation of impact of the opportunities and threats on its business, and recommendation of appropriate leadership style from those introduced by Daniel Goleman. It also comments on the corporate social responsibility of Marks and Spencer.

Context of Business

Table of Contents
INTRODUCTION ..........................................................................................................................4
TASK ..............................................................................................................................................4
1 SWOT and PESTEL Analysis of Marks and Spencer : ..........................................................4
2. Evaluation of impact of the PESTEL Analysis factors on creating Opportunities and
Threats for the business...............................................................................................................7
Comment on Addressal of Strengths to avoid threats and weaknesses affecting the
opportunities for company..........................................................................................................8
3 Recommendation of appropriate leadership style from those introduced by Daniel Goleman
.....................................................................................................................................................9
3. Comment on the Corporate social responsibility of Marks and spencer..............................10
REFERENCES..............................................................................................................................13

INTRODUCTION
Business organization is an undertaking that engages in commercial activities of purchase and
sale with a vision to earn profits and desired objectives thereby(Shibata, Baba and Suzuki, 2022).
Businesses need to plan their strategies in order to compete with the similar businesses in the
market. To get the competitive advantage, they need to follow the appropriate strategy for the
growth of their business. For implementing any strategy, it is required to make an analysis of the
dynamic environment to cope up with the changes occurring in the market (Pirson, Wasieleski
and Steckler, 2022). The following report will cover the SWOT and PESTEL Analysis of Marks
and Spencer (a public limited company and one of the leading company of retail sector in
London,UK ; dealing in the products like clothing, home and food products etc.) and the
evaluation of impact of the opportunities and threats on its business by considering the factors
taken in that analysis. It will also explain the leadership style followed by the company that
assists the company in achieving their goals and objectives by taking into account the changes in
the internal and external business environment. Further, the corporate social responsibility and its
influence on Marks and Spencer is also explained in this report.
TASK
1 SWOT and PESTEL Analysis of Marks and Spencer :
SWOT Analysis
SWOT analysis is used to measure the performance of business by evaluating its internal
Strengths & weaknesses and external Opportunities and threats. It serves as a tool to analyse the
business position to get the competitive advantage by considering the internal and external
factors (SABRINA FAJRIATI, 2022). In context with Marks and Spencer, its Swot analysis is
explained hereunder :
Strengths
 It is operating worldwide with around
1000 outlets with an efficient and large
workforce.
 Due to its powerful brand like Louis
Vuitton, Versace etc. and wide range of
products, its offerings are accessed by
Weaknesses
 Marks and Spencer has strong
competitors like TESCO, Asda , Aldi
etc. that also shared the same industry
market. Due to the shared market, it is
not having large market share.
 Marks and Spencer has a great brand

price sensitive as well as insensitive
customers that assist in generating
more operating revenue.
 With its Popular brand, it has its label
brands as well such as Autograph,
Indigo Collection and per una etc. that
help in making the customers more
aware about this company (Raharjo and
Arisman, 2022).
 It has a good value chain of product
acquirement. As it deals in fresh
vegetables too, it involves local farmers
as well in its value chain.
reputation worldwide, so it has a fear of
imitation of brand products.
 Due to the western design of its
products, it is not able to make
customer base in Asia markets because
of the traditional preferences of
customers there.
Opportunities
 It can expand its business by
penetrating the markets of India and
China with more traditional offerings as
these markets will create the
opportunity to grow further.
 Apart from the clothing and food
products, it can develop its product
range by engaging into other segments
such as Telecommunication etc. Due to
its famous brand, its other segments
will have the opportunity to grow
because of brand awareness of this
company.
 By getting indulged in E commerce
retail, company is ensuring further
growth globally because customers feel
more convenient in buying clothing and
Threats
 As it is operating globally, it has to
follow the economic as well as
political policies of other countries as
well such as interest and exchange
rates, food protection standards,
changes and violation, respectively,of
which may affect its operations
adversely (Salsabila and Mafruhat,
2022)
 High Competition in the retail industry
with major competitors worldwide such
as Amazon, Morrisons etc. is reducing
the company's expansion because it is
shutting its stores down in the markets
of France and china.

home products online to avoid rush.
PESTEL Analysis
This Analysis evaluates the multiple external factors such as political, Economical,
Social, Technological and legal factors that impact the business and assist the company to get an
understanding of the dynamic market and conduct the operations of business accordingly
(Skoultsos, 2022) .
 Political factors : It includes government policies and regulations such as import and
export policies, customs, trade restrictions, tariffs etc. The operations of business are
affected by changes in the regulations of the country. For example ,the free trade policies
among some countries enable Marks and Spencer to conduct its trade practices freely
such as import of foreign products at reasonable prices that ultimately increase
profitability of business. But after Brexit, when trade relations between UK and Europe
has got affected adversely, various trade policies have been affected which make it hard
for marks and Spencer that operates mainly in UK to get engaged with the suppliers in
Europe.
 Economic factors : Changes in the interest and foreign exchange rates, rise in the
inflation rate are the economic factors that affect the economic activities of the business.
For example, if disposable income of consumers is low in any economy, it affects the
demand for luxury products of the company that ultimately affect the profit of the
company (Krahl and et. al., 2022). Marks and Spencer , however, is operating in a
growing economy, UK that is one of the largest economies in the world and has a low
rate of inflation because of strong fiscal policies. But it has to adapt to the economic
policies of other countries as well due to its expansion therein.
 Social factors : The change in preferences of the customers, location of business and
demographic factors fall under this. The cultural, and psychological changes in the
market affect the purchases made by the customers. As regards Marks and Spencer, it has
introduced its products in the ready meals industry as well because there has been a high
rise in the consumption of fresh meals worldwide and in the UK market as well. By
coping up with the dynamic social factors, the company has become one of the leading
business in fresh meals industry in UK.

 Technological factors : These factors include innovations, artificial intelligence and
other digital factors used by the businesses to attract the customers. The company needs
to adapt to the technology trends. For example, enhancing the artificial intelligence and
conducting the business via E commerce increase opportunities for the business to grow
worldwide. Marks and Spencer has opened the self check out stores and using E
commerce by demonstrating all it s products via its own website. It helps in reaching the
customers worldwide and meet their needs.
 Environmental factors : It includes the factors like fair trade, following the environment
protection laws, creating sustainable environmental produce etc. (Ferreira, Silva and
Casais, 2022). In context with Marks and Spencer, it offers the food and clothing
products that are produced by sustainable manufacturing process leading to the protection
of environment. It sells fair trade products that create environmental benefit. In this, they
use those production methods that are environmental friendly and involves low cost of
production. As this company is a top brand, it always strives to create the sustainable
business environment to maintain its brand reputation.
 Legal factors : It refers to the laws and regulations that the company needs to follow
such as norms regarding the safety of employees, food protection standards and other
laws. The Company must remain update of the prevailing laws and legislations of the
country and of those foreign countries as well where it conducts is business at. In context
with Marks and Spencer, it had violated the Health and Safety at work Act by failing to
protect its workers from the risks of poor working conditions due to which its brand
reputation was impacted adversely.
2. Evaluation of impact of the PESTEL Analysis factors on creating Opportunities and
Threats for the business
PESTEL Analysis evaluates the external environment and its positive as well as negative
impact on the business. It helps Marks and Spencer company in identifying the available
opportunities in the market to be grabbed to get the competitive advantage in the market and
become the best performer. Through this evaluation, companies are able to recognize impact of
threats and how to avoid them. Marks and Spencer is losing the opportunity to penetrate the
markets of Europe because of the change political policies after Brexit. The free trade policies

available earlier are no longer available post Brexit, leading to the lose of opportunity to get
large market share in foreign markets. Adapting to the Artificial Intelligence and opening of self
check out stores at multiple stores has enabled the customers to get large customer base. Offering
the products through website attract the customers worldwide creating the opportunity for the
company to penetrate other foreign markets. Although the economy of UK is one of the leading
economies in the world but after the Covid19 pandemic, the economic condition of the country
got hindered leading to the low disposable income of the people. It made people invest low in the
luxury products that led to the reduced sale of the luxury products offered by Marks and Spencer.
As the company has introduced Fresh meal products, it is meeting the preferences of customers
worldwide that is creating the market development as well as product development of the
company. It is creating an opportunity for business expansion globally and further growth.
Comment on Addressal of Strengths to avoid threats and weaknesses affecting the
opportunities for company.
Marks and Spencer is one of the leading brand of UK operating globally with multiple
outlets. Due to its strong brand with label brands as well, consumers are more aware about the
company that helps the company in facing the competition with major competitors like TESCO,
Asda etc. in the market and in getting the competitive advantage. The popularity of the brand
creates an opportunity for the company to enter in other segments as well such as
telecommunication sector etc. Marks and Spencer has a good value chain in the market that does
not make it fall out of stock. It assists in fulfilling the demands and preferences of the customers
consistently that contributes to the increased customer base and thereby large market share. As
marks and Spencer has its own website to demonstrate the products globally, it is able to attract
customers globally. By innovating traditional products with its current western offerings that are
more accessible in UK, France, US etc.; it can penetrate the Asia market as well due to the
traditional preferences of customers there and can promote further growth.
By introducing Fresh meals in the UK market and other foreign markets, it has expanded
its business by increasing its product range in food segment with its own brand. Marks and
Spencer is creating its customer base globally by adapting to environmental friendly methods of
manufacturing the products for fair trade.

3 Recommendation of appropriate leadership style from those introduced by Daniel
Goleman
For implementing any leadership style in the business, it is imperative to have an
effective and smooth organizational structure. The organizational structure of Marks and Spencer
is not complex i.e. it has limited hierarchy from top level to the employees level as this company
focuses to encourage employees in decision making activities. Initially, Tanith Dodge(group HR
director of M&S) followed the transformational leadership in the organization. According to the
Goleman, leaders should be adaptive to the dynamic environment (Gregersen and Mercer,
2022). The following are the various leadership styles provided by Daneil Goleman :
 Coercive : This is also known as coercive leadership style. In this, a leader himself
makes the decisions and gives command to the team without any prior explanation. It is
not appropriate for high skilled employees in complex organizational structure. This style
is appropriate for leading a semi skilled or low skilled team of employees.
 Authoritative : It is also called as Visionary leadership style. In this, leader set a long
term vision and communicate to the team. The employees are inspired to achieve the
vision by way of motivation in their self interests. This style is not suitable for the
complex organizational structure as the vision can be misunderstood due to the large
levels of hierarchy (Poiger and Brücklmeier, 2022). To achieve the vision and getting
high contribution from the employees , leaders are required to motivate the employees by
the application of Emotional intelligence. It requires collaborative efforts to achieve the
objective as a whole.
 Affiliative : A leader following this leadership style strives to maintain bonds with and
among the team members. It involves bringing cooperation and harmony amongst the
team members to get the targets achieved by the combined and collaborative efforts of
the team. But excessiveness of this style can be the reason of less productivity due to
friendly behaviour of the leader.
 Democratic : In this leadership, ideas of all team members are taken for effective
decision making. It involves emotional intelligence(a state of understanding the emotions
of individuals being lead) as agreement from every member is taken which requires high
commitment. This style is not appropriate when the decisions are to be made quickly.

 Pacesetting : It involves achieving great and high performance by the employees and
members of the team. It this, a leader insists the workers to enhance their productivity
level and achieve the big results (Vargas-Hernández and López-Lemus, 2022). It aims to
make the worker feel more capable and produce more.
 Coaching : It requires a highly skilful and committed leader who can instill a sense of
sincerity and faithfulness in the team of workers. The leader trains them to conduct
professionally by creating strong commitment among them.
From the above explanation, it is recommended to Marks and Spencer to follow the authoritative
leadership style as it works in a flat organizational structure to communicate the vision to the
employees and involving them in decision making process.. As this company has smooth
organizational structure with skilful employees, it should not follow the coercive or coaching
style i.e. appropriate for low skilled workers.. It is already operating on a large scale with high
productivity in business, it need not follow the pacesetting or affiliative style of leadership that
insist on enhancing productivity. As Marks and Spencer has various business segments such as
food, clothing home wares etc. the authoritative leadership style will support in clarifying the
vision for each segment and other segments that company want to innovate according to the
needs of customers and opportunities available in the dynamic environment.
3. Comment on the Corporate social responsibility of Marks and spencer
It is a business model that helps the organisation to be socially accountable in itself, its
employees, and general public. By following corporate social responsibility companies
can be aware of the impact they are having on society including economic, social and
environmental. Engagement in CSR means organisation is operating in different ways
to enhance society and the environment. By implementing the CSR it can bring the
reward to company such as increased sales and profit, improved brand image,
enhanced customer loyalty etc. (Vargas-Hernández and López-Lemus, 2022).
Organisation are increasingly turning to CSR as it builts the positive image of the
company. It helps the company to satisfy and attract new employees and also helps to
retain old workers.
Marks & Spencer has always taken the obligation towards their customers, workers,
suppliers and local people. The company is doing their business in a responsible way
that increases their values, quality, service, trust and innovation. The brand is taking

attention of every issues of the society. Like it provides charity for the society, taking
care of the environment, industrial waste management, sustainable raw material
management etc. M&S local stores are providing donations to charitable organisations.
They provide their support to the local community as they have their fund limited. The
company donates the surplus of clothing to the new life charity. Clothing sample
donation are sent to shelter. They are the charity partners and assist the homeless
person. The company also aims to distribute date expired food to charitable
organisations. And the first donation was received by Fare share. It is a community of
food network that redistributes food from the food industry to the weak community. M&S
aims to make operations in the UK and republic of Ireland and assist customers and
suppliers to reduce their emissions (Aufar, 2022). The organisation also create low
carbon products and services to help the customers to reduce energy in their homes.
The company reduce the carrier bag use by 33% and makes from recycled plastic. The
business also decides that all the raw material should come from the sustainable source
available to them. They aim to use wood which is recycled or certified as it should come
from sustainable source. Company also aims to use recycled plastic to make home
products and polyester clothing. It aims to choose a healthy lifestyle to help customers
and employees. In stores organisation plan to put 1500 healthy eating advisers. The
company continue to reduce the salt and fats and replace artificial colours with natural
colours. They also introduce food standard agency and guideline daily amounts product
labelling. They pledged to make all the workers feel valuable and render them quality
training and career opportunities (Sarma,and Simmons, 2022). Company are committed
to help people to inform about health choices at work. They help their people to prevent
fire, health and safety incidents and report if they happen. They have also completed
the training of fire, health and safety in their stores. The company also makes an effort
to increase efficiency and do the work ethically.
CONCLUSION
From the above discussion in context of Business, it has been concluded that every business
conducts its operations to earn long term profits to expand its business for promoting growth.
Business needs to adapt to the dynamic environment to be the first to grab the available
opportunities in the market and get the competitive advantage. It should evaluate the

performance of the operations of business by using the appropriate frameworks like SWOT
Analysis to identify strengths, weaknesses, opportunities and threats in the environment;
PESTEL Analysis to cope up with the changing environmental factors and their positive or
negative affect on the business. According to the changing environment, organizations need to
follow the appropriate style of leadership according to their organizational structure. For
example, Authoritative in case of Marks and Spencer according to the suitability of its business.
With the need of the environment, companies need to comply with their corporate social
responsibility and contribute to CSR Fund accordingly.

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