ASOS Business Contexts: Environmental Analysis and Management Report

This report provides a comprehensive analysis of ASOS, a British e-commerce fashion company, focusing on its business contexts and management strategies. It examines the external environment using models like the business cycle and blue ocean strategy, and the internal environment through frameworks such as McKinsey's 7S and VRIO analysis. The report assesses ASOS's operational management, including its approach to total quality management, just-in-time delivery, and continuous improvement through kaizen and Six Sigma. It further explores the impact of change within the firm, referencing Kurt Lewin, John Kotter, and Kubler-Ross theories. A detailed stakeholder analysis, based on Edward Freeman's theory, identifies key internal and external stakeholders and their significance to ASOS's success. The report concludes with strategic recommendations aimed at fostering future growth and improvement for the company.

Business Contexts and its
Management

TABLE OF CONTENTS
TABLE OF CONTENTS..............................................................................................................2
INTRODUCTION...........................................................................................................................4
MAIN BODY...................................................................................................................................4
PART -1...........................................................................................................................................4
Presenting the external environment of the company.................................................................4
Identifying the internal environment...........................................................................................5
Assessing the operational management of the firm....................................................................7
Identifying the impact of change within the firm........................................................................7
Presenting the Stakeholder analysis............................................................................................8
PART 2............................................................................................................................................9
Report..........................................................................................................................................9
Strategic recommendation...........................................................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Business management is very important so that losses could be minimised and maximum
revenues could be generated for any firm. Further, the present report is based on ASOS British
E- commerce fashion Company that sells variety of products to its targeted customers. Also, the
report will analyse the impact of internal and external factors on the business environment of the
company through using various models. Also, various operational management activities of the
firm along with impact of any change on the activities of the firm will also be analysed under this
report. Lastly, detailed stakeholder analysis along with certain recommendations for the future
growth and improvement will also be covered under this study.
MAIN BODY
PART -1
Presenting the external environment of the company
Thus, from the above chart it can be said that firm revenues has been continuously
increased over the years in UK. Also, the company had been able to successfully cover large
market areas through selling variety of products that are according to the needs and wants of the

customers (Rossmann, Wilke and Stei, 2017). Moreover, it can be said that quoted firm market
size based on the total available market is very huge as it identifies the total market potential and
stability. Furthermore, through SAM the company is able to analyse the potential customers for
the future products while SOM allows the firm to identify the actual proportion of market share
that it is likely to get in the future (Scholz, Redler and Pagel, 2021). Also, ASOS does all these
things through conducting primary research and collecting the financial reports for proper
analysis. Moreover, it could be linked with the business cycle model where initially in
expansion stage ASOS started its business in various parts of UK through analysing various
economic conditions of the market. Over the years the firm had been able to reach the peak
stage where maximum growth was achieved and the company has the highest amount of
revenues earned in terms of total investment.
However, the firm move to the recession stage especially during the times of Covid
where the sales were heavily impacted due to the less purchasing power among the people of
various regions. Moreover, this period lasted till the depression and trough period where there
were situations of unemployment in the country (Singaraju and Niininen, 2021). However, with
the current situations becoming much better the company has been able to employ better
techniques and new products on the website to attract more potential customers.
Also, through successfully implementing blue ocean strategy the firm has been able to
enter into new markets and create new demand among its potential buyers for its various
products. Further, ASOS has developed action framework through four of its components such
as eliminate in which various old technologies and operational processes are removed. Also, in
raise the firm identifies all the possible factors that would help the company in gaining
competitive advantage and stay ahead against its competitors (Osuszek and Ledzianowski,
2020). In create element the firm identifies certain strategic factors and capacities so that
sustainable advantage could be gained. And in last through reduce certain aspects are analysed
that could be reduced so that benefit could be maximized largely.
Identifying the internal environment.
Internal environment is very important for any firm as it helps in identifying those factors
that affects the business on internally and through best efforts the management could make
several positive changes in most effective manner. For the company like ASOS this internal
environment could be better analysed through MC Kinsey 7 s framework that is based on

several elements such as strategy in which ASOS has clearly defined rules and policies for the
business so that work could be carried out smoothly (McKinsey 7S Model, 2022). Also, it is
concern in conducting market analysis and finding out the total demand of products and services
in the market. In case of structure the quoted firm has flexible organizational hierarchy where
all employees feel safe in sharing and accessing to various business information. Moreover,
various inter departmental teams are formed to complete certain tasks and effective
communication channels are been established to share best of information among its workers
(Suman and Das, 2020). Furthermore, in the systems the firm analyse various process such as
finance, marketing, sales and much more so that proper control could be established for
systematic evaluation on timely basis. Moreover, all the internal processes are aligned in manner
so that greater business goals could be achieved.
In case of shared values ASOS allows employees to work better through trust,
accountability, honesty, quality, heritage and much more so that there are no confusion while
carrying out various tasks. Furthermore, in context of style ASOS follows the participative
leadership style so that collective ideas would help the firm to make better decisions in the
future. However, this is more time-consuming process and sometimes leads in poor decision-
making by the firm (Butar, 2018). In context of staff element in above framework ASOS has
sufficient number of efficient employees that are highly efficient and delivers bests outputs
through existing and acquired competencies. Moreover, potential needs of the employees are
closely identified so that better incentive and promotional programs could be developed by the
firm. Last is skills element in which it can be said that all the existing employees have high skills
to perform specified job roles. Also, through training and workshops growth opportunities are
been created for continuous improvement.
Moreover, internal environment of quoted firm could be analysed through VRIO
analysis so that better resources could be identified to gain competitive advantage. This analysis
is also based on four components. In case of valuable it can be said that the entire firm’s
financial, resources, cost structure, patents, employees etc. are valuable. In rare, distribution
network of the firm is identified as better network has allowed the firm to sell variety of products
(Krawczyk-Sokolowska, Pierscieniak and Caputa, 2021). In imitable element it can be said that
all the ASOS products could not be easily imitated by other competitors because it sells it owns
label products that are reasonably priced. And in last organization the quoted firm has chances

that competitive advantage is not maintained due to any new entrance in the local market or
formation of any new polices by the government.
Assessing the operational management of the firm.
ASOS has been able to identify several factors that are helpful for the growth of the
company and eliminate all those activities that are not useful for the future operations.
Furthermore, it can be linked to the total quality management aspect where all the products
designed are manufactured at reasonable prices and of high quality so that people are ready to
purchase and sales are increased over the years (DaSilva, 2021). Also, it follows the concept of
just in time delivery where the gods are made available from the suppliers according to the
demand so that there is no wastage and stock of unnecessary products.
Moreover, all the employees are asked to work on the kaizen concept where change in the
firm is implemented for the betterment so that operations could be improved and better processes
could be established within the firm. Also, to keep the regular check on the performance of the
operational activities six sigma is used that is benchmark tool to identify how each business
processes are working. For this purpose each defect are identified during a specific time period
so that corrective action could be taken on time. Thus, through following such operational tools
quoted firm is been able to stand better in market against its competitors so that more sales could
be generated for the same.
Identifying the impact of change within the firm.
It is very well-known that while working in any firm change is required so that better
work culture and products could be delivered to the customers in the future. Furthermore, ASOS
has also evolved over the time as it also has to stay ahead in competition against its rivalries.
Also, this change in the firm of ASOS could be linked to the Kurt Lewin theory that states that
any change in individual behaviour is result of the person and environment and therefore the firm
need to closely identify certain factors that has negative impact and try to solve it in most
efficient manner (Mba, 2019). Moreover, it could be connected to the John Kotter theory of
change that believes that for any firm there are eight steps that helps the firm to introduce any
kind of change in the workplace. Furthermore, this theory states that first changes need to be
vision, communicated, implemented and monitor properly so that employees do not find any
difficulty and better working could be ensured.

Also, to bring about even any small change within the firm the quoted firm could use the
Kubler Ross theory of change that states that for any individual employee there are four stages
when any new change is introduced in the firm. Also, these stages include the stage of denial
where the person resists the new change and is not ready to incorporate it. Next is the anger
where person becomes stressed and worried but has no solution. Another one is bargaining stage
in which it talks about the supervisors the problems faced during the change that also sometimes
lead to depression and last stage is one where it willingly accepts it as challenge and develops
ways to overcome it (Avgoustaki and Xydis, 2020). Thus, in ASOS top management helps the
employees through better understanding and develop solutions that will help in introducing new
changes smoothly within the firm.
Presenting the Stakeholder analysis.
Stakeholder analysis helps the firm in identifying role and significance of various
stakeholders that are part of the company so that it could remain satisfied and happy for longer
time period. Also, this could be explained in detail for the ASOS through the Edward Freeman
Stakeholder theory in which it believes that company could only grow when all the interest of
the stakeholders are taken into considerations so that company could work together as an
efficient team.
Internal Stakeholders:
These stakeholders are the employees, managers and board and executive committee and
shareholders which are considered to be very important for ASOS. These are employees and
managers of the organization. This organization has faced shareholder revolts over the executive
paying the past. It is the response of the shareholder demands which ASOS is focusing on
meeting in the upcoming years.
External Stakeholders:
The external stakeholders of this organization include the customers, suppliers, creditors.
Competitors and also the pressure groups for the local communities. It is the duty of ASOS to
serve its customers with excellent quality of product. It is important for the company to follow
the common rules and regulations with the competitors in the market to maintain relevancy.
Paying the suppliers on time and keeping the reputation of the business is also helpful for the
stakeholder holders that are suppliers.

Due to stakeholder the company is considered to be neither equally important nor equally
powerful. It depends on how far and powerful other factors of the stakeholder are that will be
giving strategic direction to the company. It is important for ASOS to take decisions for its
organization considering the stakeholder. Due to the different types of stakeholders having
different expectations there are times when they develop a conflict. It can be between two most
important stakeholders and this can result in organization facing difficulties in making the
decision.
PART 2
Report
The external environment of ASOS concludes with the help of the business cycle model
which explains how the firm is able to identify the actual part of the market share that is linked
directly to the future for getting the results in the future (Isniah, Purba and Debora, 2020). For
this model different stages are discussed that include expansion, peak, recession and depression
towards the trough period. For this external environment the blue ocean strategy is used as the
firm is able to enter into new market which can create new demand for the action frameworks.
The blue ocean strategy includes the elimination, raise, create and reduce. For the internal
environment the McKinsey 7 frames has be used as a strategy which explain the structure of
ASOS. It is the shared values of this organization which impacts its style, staff and skills. In this
analysation VIRO analysis has also been referred to for analysing its valuable, rare, imitable and
organization. This report was able to analyse the impacts of changes in ASOS with the help of
Kurt Lewin Theory that explains the results of how the negative impacts from the certain factors
affect the efficiency. The stakeholder analysis of this organization was able to highlight the
different types of stakeholders for this organization. It is also said to be the ways of identifying
the operations of the organization which can be seen to affect the operations of the ASOS. It is
very important for the organization to understand the effective considerations of the stakeholder
analysis.
Strategic recommendation
It is said that the strategically business strategy to utilize to be utilized will use the
approach of PDCA that is,
Plan :

In ASOS the major problem is regarding the competitive issues which it faces as an
opportunity (Santoso and Mayrifka, 2019). It is said to be the main standard of the finished
product which is helpful for marketing the process of getting better results. Being able to gain
competitive advantage with the implementation of innovative products is the way in which it will
be able to plan ideas for success.
Do :
It is the potential solutions in which it helps to safely explain the purpose of changing the
desired outcomes which are minimization of disruption in the rest of the operations. This
organization will be able to grow if it can do expansion in forms of the geographical expansion
of its services.
Check :
The best way of improving on its performance would be to apply the organizational
results into the definition of the criteria which is helpful towards the assessing the ideas of
success. Monitoring will be the most effective way in which ASOS will be able to understand the
effectiveness of the organizational performance.
Act :
It is important for the organization to recognize the areas of concern in the business so
that it can be able to act according to the ways in which it defines the criteria which is helpful for
the success of the organization (Rajagopalan, 2020).
CONCLUSION
From the above report it can be concluded that both external and internal environment of the
company need to be closely analysed so that business operations could be conducted smoothly.
Also, the report had identified these factors through using VRIO framework, business cycle
model, blue ocean strategy, MC Kinsey framework and much more. Thus, through applying
these models various business practices of ASOS had been clearly identified through which the
company had gained success. Also, through concepts like total quality management and just in
time methods operational management activities of ASOS had been analysed. Further through
Kurt Lewin, Kubler Ross theories impact of any change introduced in the quoted firm is also
identified under this report. Lastly, significance of stakeholders through applying the Edward
freeman stakeholder theory had been done so that better policies could be developed in future.

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