Analyzing the Impact of Macro Environment on Business Strategies

BUSINESS
STRATEGY

Table of Contents
INTRODUCTION...........................................................................................................................3
LO 1................................................................................................................................................3
P1 Appropriate frameworks to analyse the impact and influence of the macro environment on
a organisation and its strategies..............................................................................................3
M1 Critical analysis of macro-environment to communicate strategic decisions..................4
LO 2................................................................................................................................................4
P2 Analysis of internal capabilities and environment of organisation...................................4
M2 Critical analysis of internal environment of organisation:...............................................8
LO 3................................................................................................................................................8
P3 Porter Five Force model to evaluate competitive forces of market .................................8
M3 Strategies to enhance the market position as well as competitive advantage..................9
LO 4..............................................................................................................................................10
P4 Devising a strategic plan for the organisation.................................................................10
M4 Strategic management plan with tactical and tangible strategies...................................11
D1 Interpretation of data to conduct competitive analysis in to formulate strategies:.........12
CONCLUSION.............................................................................................................................12
REFERENCES..............................................................................................................................14

INTRODUCTION
A set of competitive actions and steps which an organisation undertakes so that they can
move towards fulfilment of all goals and objectives which were earlier mentioned in a given
time frame is called business strategy. These course of actions helps and supports enterprises to
adopt various measures and techniques which are favourable for company. All these strategies
help company to strive in the competitive marketplace and also emerge to be leader in particular
industry it is dealing in(Anwar and Hasnu, 2016). For following report John Lewis is chosen in
order to study and analyse all of its business strategies. This report explores a number of
decisions which company have taken in its existence till date. John Lewis is a chain of retail
store in UK. It is one of the largest retail chains in this sector. It consists of clothing, jewellery,
watches, furniture, food etc. the following report includes SWOT and VRIO to analyse internal
environment of company whereas for external evaluation PESTLE analysis is conducted. This
report also consists of Porter's Five Force Model in order to study effects of competitors on
business. In the end various strategic options available with company are discussed taking into
account Ansoff's Matrix.
LO 1
P1 Appropriate frameworks to analyse the impact and influence of the macro environment on a
organisation and its strategies
It is necessary for a business to study all factors which have an effect on its functioning.
In order to study effect of macro-environmental factors on John Lewis PESTLE have been
carried on the company. Below mentioned is analysis:
Political: It have been noticed that government of UK have cut down its taxes which is
beneficial for John Lewis. This helps in increased income after tax for company. Also any
terrorist activities in company may act as threat for company as well. It is therefore, required by
company to keep a check on its stock at time of any such crisis. Such issues may have major
impact on business so it is necessary for business to keep a track of it.
Economical: There are a number of aid provided by government of UK like UK Smart
Grants, which provide help to R&D department of John Lewis. This makes it necessary fro John
Lewis to provide its product at affordable prices as cost of R&D is not added in its selling price.
Also GDP, economic growth, foreign exchange rates are various factors which affects John
Lewis' operations.

Social: All the products developed by company are done after deeply studying lifestyle
and trend followed by consumers. This makes their products to be in demand. It is necessary for
company to follow cultural beliefs in values of environment it is working as well. If a company
does not accept social factors in an environment its functioning in the market becomes difficult.
Technological: There have been a number of changes seen due to dynamically changing
technology and its advancement. It have ventured in e-commerce which requires a lot of
investment by company. It is necessary for John Lewis to consistently keep on developing new
technologies in order to gain knowledge as well as compete in market.
Legal: It is necessary for company to fulfil all the rules and regulations implied by law
in the area of their working. The laws affecting them are all the laws related to hygiene, health,
employees, wages etc (Elton nd O'Riordan, 2016). It is necessary for company to undertake
various measures in interest of these laws. Not abiding by these rules and regulations may lead
to major losses for companies in form or legal actions against them.
Environmental: John Lewis is working with IPCC (Intergovernmental Panel on Climate
Change) in order to reduce emission of carbon in environment. They also provide biodegradable
packaging. Such efforts help companies to do their part for environment.
M1 Critical analysis of macro-environment to communicate strategic decisions
From Pestle analysis of company it is clear that there are a n umber of positive as well as
negative factors in macro-environment which is affecting functioning in John Lewis. BREXIT is
heavily influencing company in terms of political as well as economical factors. It can also be
included in legal factors. There have been a number of changes in demands and perception of
consumers which are included in social factors. Other than this innovations and technological
advancement account to technological factors . All these factors have been critically analysed in
order to study the effect of macro environmental factors on John Lewis. Using these factors
efficiently helps company in running their businesses smoothly (Allen and Truman, 2016).
LO 2
P2 Analysis of internal capabilities and environment of organisation
In order to conduct an analysis of internal environment of John Lewis there are two
modes used namely SWOT and VRIO, which are helping business to gain knowledge as well as
capabilities.