Impact and Influence of Macro Environment on Organisation and its Strategies

Business Strategy

INTRODUCTION
Business strategies refer to that plan and tactics that are formulated and framed by the
administration of the corporation so that organisation can run and function its industry in
effective manner in competitive marketplace. It can be those strategies or actions that are
executed by the administration of a business enterprise to accomplish its vision, mission and
objectives in set time duration (Akter, and et. al., 2016). This assignment is based on Nest plc
which is a British international clothing, footwear and home appliances and headquartered in
Leicestershire, England. This written report will discuss about the impact and influence of macro
environment by using appropriate frameworks and analyse the internal environment and
capabilities of the company. Further, will explain Porter's five force model to measure the
competition in specific sector. By implementing diverse conceptions, models and theories
deliberate setting up will also interpret and devise.
TASK 1
P1. Impact and influence of the macro environment on organisation and its strategies
Mission- To become the primary choice retailer in the world in term of fashion to aware
customers who anticipate style, difference and superiority for their clothing and apparel.
Vision- The vision of Next plc is to propose stimulating, beautiful calculated, better excellence
clothes and home appliances that are well made and offer outstanding value to meet consumer's
expectations.
Objective- The purpose of respective corporation is to maximise the number of profitable
consumers by both online and offline sales. The management of the company want to
administrate gross and net profit by effective product sourcing, stock management and by
controlling cost.
Macro environment indicates to those components and elements that influence the
business of the corporation externally which influence firm in positive and negative way. To
monitor this impact, management of Next plc can use PESTEL analysis and the explanation of it
is defined as below:
PESTEL Analysis- It is a framework that administrators of companies utilise to scan the
external macro environment in which business runs in order to make better strategic decisions.
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Political- This factor consist different elements like political stability and instability,
taxation policy, trade restriction, foreign trade, government attitude etc (Higgins, Omer, and
Phillips, 2015). In UK, the stable political environment positively affect the company because it
is the foundation of long term decisions that are made by the firm. UK is a member of the
European Union which is also beneficial to Next plc because it can trade its products to various
European countries.
Economical- It one of the most critical factor that include exchange rate, interest rate,
currency rate, inflation and deflation rate etc. Currency rate is an element which that is affect the
business of the firm because due to Brexit inflation is arisen (Johnson, 2016). Cause of it the
value of currency is increased which influence the business of the corporation in unfavourable
manner.
Social- This factor consider population growth rate, living standard, change in customers
needs and demands, cultural barriers and others. Now these, fashion and trend change rapidly so
due to it, changes are occurred in customers’ needs and demand fashionable and trendy cloths. It
creates negative impact upon the business of Next Plc in term of its sales and profit.
Technological- It consist technology incentives, automation, advance technology,
research and development process and technological changes. In UK, most of the people are
working so they prefer to purchase products by online mode. This factor favourably influences
the business of organisation because it also distribute its products through online way.
Environmental- This factor include environmental aspects like weather, climate and laws
that are formulate by the national authorities to provide protection of the environment. The
management of Next plc also recognises the current trends in customers and administration
challenging business to minimise their carbon foot prints. The firm is dedicated to minimising its
own by reducing reprocessing dissipate, inferior convey emissions and using environmental
friendly covering in some of its goods. It will create favourable impact upon the business of this
firm.
Legal- This component indicates to those regulations and legislations that are formulated
by the government of country. For example, this factor affects business firms when government
make changes in its rules and legislation. In UK national authorities of the nation maximised
VAT and it influenced Next Plc because it will create maximisation product pricing and add high
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