Business Environment Report: Marks and Spencer and Macro Factors

This report provides a comprehensive analysis of the business environment, focusing on various types of organizations including public, private, and voluntary sectors. It uses Marks and Spencer as a case study to examine the size, scope, and legal structures of different organizational forms. The report delves into the relationships between organizational functions such as HR, operations, sales, marketing, IT, and finance, and their association with organizational structure and objectives. A key component is the identification of positive and negative influences of macro-environmental factors, assessed through a PESTLE analysis, which includes political, economic, social, technological, and legal factors. Furthermore, the report conducts internal and external analyses of Marks and Spencer to identify strengths and weaknesses, and discusses how these relate to external macro factors, providing insights into the company's strategic positioning and operational challenges. The report concludes with an evaluation of the key findings and their implications for business strategy and performance.

Business Environment

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
P1 State various types & purpose of organisation and their legal structure................................3
P2 Explain the size & scope of different forms of organisation.................................................4
TASK 2............................................................................................................................................5
P3 Explain the relationship among various organisational function & how they associate to
organisational structure as well as objective...............................................................................5
TASK 3............................................................................................................................................7
P4 Identify positive & negative influence of macro environment factors on business
operations with examples............................................................................................................7
TASK 4............................................................................................................................................9
P5 Conduct external and internal analysis of respective organisation for identifying strength
as well as weaknesses..................................................................................................................9
P6 Explanation of how strength & weaknesses interrelate with external macro factors..........10
CONCLUSION..............................................................................................................................11
REFERENCES................................................................................................................................1

INTRODUCTION
Business environment indicates the aggregate total of individuals, business entities &
other forces which are not in control of the industry but impact on its production as well as
operations. In addition to this, business environment determines the profitability, growth & even
longevity of an organisation & gets changed by them as well. The awareness of business
environment assist an organisation in assessing opportunities which in turn help in planning and
attainment of growth as well (Arnold, Beauchamp and Bowie, 2019). In the present report,
Marks and Spencer, which is a private organisation is chosen as a base company. The
organisation was founded in year 1884 and head office in England, United Kingdom. It
specialise in selling food products, clothing and home products as well. As a public organisation,
National health service is taken into consideration that is founded in year 1948. Oxfam is chosen
as a voluntary organisation that objective is to decline poverty and enhance conditions of
societies. The report describes the size, scope and legal structure of different types of
organisation. Along wit this, organisation structure and interrelationship among department is
elaborated. Moreover, internal as well as external analysis is conducted and how macro
environmental factor interrelates with strength and weaknesses is discussed in the report.
TASK 1
P1 State various types & purpose of organisation and their legal structure
Public organisation: This form of organisation is controlled and owned by government of
country. In addition to this, herein the policies are developed by the government only with an
objective of economic growth and development. NHS is a public organisation that is founded in
year 1948 in order to provide free health service to people.
Purpose: The objective of National Health service is to provide best health service to
people that enhance their health conditions in an effective manner.
Legal structure: In relation to National Health service, all the decision is taken by state
and central government. All this decisions is followed by managers and staff members of NHS
for performing the activities in a proper way.
Product and services: National Health service provide primary care, mental health,
emergency care service to people that assist in improving the mental as well as health conditions
of people.

Private organisation: It include partnership, agency, sole proprietorship that take place with an
objective to achieve profit. Marks and Spencer is a private organisation which provide home
essentials and clothing in more than 15 countries.
Purpose: The main purpose of Marks and Spencer is to earn higher profits and leading
position at marketplace by offering quality products to customer at affordable price (Biloslavo,
Bagnoli and Edgar, 2018).
Legal structure: In private organisation, the legal structure is wholly depend on the CEO,
higher authorities of the organisation. They mainly take decision and communicate it to the
employees in an appropriate manner.
Product and services: Marks and Spencer provide wide range of products that is men and
women apparels, footwear, home essentials and food products as well.
Voluntary organisation: It is basically a group of people who start working together with an
objective to achieve particular objective. Oxfam is founded in year 1942 and is a voluntary
organisation that has 20 independent charitable trust.
Purpose: The purpose of Oxfam is to remove poverty and upgrade the living standard of
people of society.
Legal structure: Herein, all the decision regarding the laws & policies, development and
execution of activities is taken by trustees and higher authorities of Oxfam.
Product and services: Oxfam is focuses on bringing long term development within the
societies which leads to welfare and improvement of living of people.
P2 Explain the size & scope of different forms of organisation
Private organisation- Marks and Spencer
Size & scope: Marks and Spencer has a wide scope as it provide quality products in more
than 14 countries by its around 7500 stores all over the world. The operating profit of Marks and
Spencer is 2.19 billion that is higher than last year. The organisation offer distinct design and
quality which attract large number of people which in turn leads to raise in profitability and
revenue of Marks and Spencer.
Mission and Vision: “To gain leading position by offering quality products” is the
mission statement of Marks and Spencer. The vision of respective organisation is “To be the
customer first choice by providing high experience to them”.
Public organisation- National Health service

Size & scope: NHS consist of wide scope as organisation is decided to increase number
of medical staff by 14000 that is now 7000 only (Doh, Luthans and Slocum, 2016). In addition to
this, NHS offer its services in around 7 countries & is planning to enhance its operations
globally.
Mission and Vision: “To improve lifestyle and health condition of people” is vision of
NHS. The mission statement of National Heath service is “ To give quality service to every
patient treated by them”.
Voluntary organisation- Oxfam
Size & scope: Oxfam has a wide scope as it focuses on welfare of people and associated
with 20 charitable trust as well. In addition to this, it develop effective strategies for expansion of
its services in order to improve conditions of poor people.
Mission and Vision: “To make the world free from poverty” is vision of Oxfam. In
addition to this, the mission statement of Oxfam is “To provide justice to people so that that they
treated equally in context of colour, gender and many more.
TASK 2
P3 Explain the relationship among various organisational function & how they associate to
organisational structure as well as objective
An organisational structure of a company is divided into various departments, it becomes
very important for management of a company to establish coordination between it's department
which will influence growth and optimum utilisation of resources. The relation between various
departments of firm are given below:
 HR and operations: The human resource department of an organisation relates to
management of human as a resource whereas operations department of a company takes
necessary steps to manage day to day operations of production and sales (Gorla,
Chiravuri and Chinta, 2017). Human resource department hire eligible candidates for
operations department, whereas, operations department keep a note of HR department
and ensure it's better working.
 Sales and Marketing : The sales department of an organisation relates to managing it's
sales activities whereas marketing department of a company takes initiatives for
promotion of goods or services delivered to it's customers. Sales department evaluates the

feedback regarding the quality of good or services being delivered to it's customers,
whereas, Marketing department promotes goods or services provided by company to
increase sales.
 IT & Finance : Finance department provides enough financial resources to IT
department so that it could use best updated technologies and is up to date, on the other
hand IT department helps finance department by providing them upgraded software
(Hitt, 2016). In context to Marks and Spencer, it's department is well coordinated as IT
department provides up to date software to finance department for easy and correct
calculation of finance.
Organisational structure : It can be defined as structure that is consist of group of
individuals having personal goals, who are working together for accomplishment of
organisational goals.
Divisional structure: It refers to the structure that allows companies to decentralise it's
work into various working department. It helps an organisation to attain flexibility as well as
effectiveness in work.
Matrix structure : It refers to structure wherein subordinate are responsible to more than
one supervisors. A proper chain of command is been followed in this structure.

Functional structure: This structure aims at filling the right employee at the right place
according to their skills and professional knowledge.
Marks and Spencer follows divisional structure to efficiently run it's business activities. It
helps the company in it's smooth running and meeting up of demands of it's consumers (Ji-fan
Ren and et. al., 2017). So far it has been proved beneficiary for the organisation in terms of
effective working and building it's reputation in marketplace.
TASK 3
P4 Identify positive & negative influence of macro environment factors on business operations
with examples
It is determine that there are many external factors which affect in the performance and
operations of business entity. In order to gain insight about the positive and negative impact of
macro environmental factors on business activities and operations, the higher authorities of
Marks and Spencer uses PESTLE analysis model, which is mentioned below:
PESTLE analysis: It is defined as a strategic tool that help business entity to gain insight
about the external factors that impact both positively and negatively on the business performance
and organisation.
Political factor: It include aspects such as taxation policy, political condition, government policy
and so on. In addition to this, it is basically the level of government intervention on the activities
and operations of an organisation.
Positive impact: It is analysed that the government of UK supports organisation to
expand its business operations and also has less tax rate of imports that affect positively on the
performance of Marks and Spencer (Jorfi, Nor and Najjar, 2017).

Negative impact: Due to Brexit, the political condition of UK is declined that affect
negatively on the growth and profitability of Marks and Spencer.
Economical factor: This factor involve economic policies, inflation rate, exchange rate and
many more that plays an important role as it impact directly on sales as well as profitability of
company.
Positive impact: In the present time period, the labour is easily convinced to work in low
amount due to which Marks and Spencer have the advantage to cut down its cost and attain high
profitability.
Negative impact: Due to pandemic that is COVID-19, the economic conditions of UK is
declined and the buying power of people living in UK is reduced that affect on the sales and
market performance of Marks and Spencer in a negative manner.
Social factor: It include factors such as income, age, value, opinions and attitude which impact
on the sales as well as profitability of company (Kataev and et. al., 2016). It is significant for an
organisation to develop and offer those goods and services which ensure fulfilment of customer
requirements.
Positive impact: IT is analysed that Marks and Spencer producing products that fulfil
customer requirements as it impact positively on its brand image and market performance as
well.
Negative impact: It is stated that sometimes organisations are required to emphasis to use
corporate social responsibility which negatively influence on the overall business functions of
Marks and Spencer.
Technological factor: This external factor plays an important role as it help an organisation to
remain competitive at marketplace or gain high profitability. In relation to Marks and Spencer, it
make use of latest technology with an objective to attract customers and provide them on time
services as well.
Positive impact: With the help of using latest technology, Marks and Spencer is able to
offer innovative products as well as service at marketplace which in turn help in attaining
competitive advantage at marketplace.
Negative impact: Adoption of new technology on continuous basis arise high cost to
company and decline its revenue level.

Legal factor: There are various laws and legislation such as employment laws, data protection,
consumer rights and so on related to an organisation (Niemimaa and et. al., 2019). Marks and
Spencer follow all the laws as well as regulations that help in proper implementation of activities
without any delays and issues as well.
Positive impact: The respective organisation is comply with all the laws as well as
legislation that help in raising the performance and brand image of company.
Negative impact: It is analysed that company is facing some legal issues and restrictions
which affect on its operations and performance in a negative manner.
Environmental factor: It include factors such as waste management, pollution control, carbon
footprints and so on. With reference to Marks and Spencer, it ensure less use of carbon footprints
and also decline the use of paper so that they can safeguard the environment.
Positive impact: Marks and Spencer follow all the environmental laws and also focus on
protecting the environment that help in developing positive mind set of people towards brand.
Negative impact: The cost of execution and making use of Ec0-friendly techniques is
high which affect on the performance and profitability of company.
TASK 4
P5 Conduct external and internal analysis of respective organisation for identifying strength as
well as weaknesses
It is the process which is used by companies to increase it's efficiency in workings, this
analysis helps an organisation for maximising their sales which will ultimately contributes
towards increasing profits of a business firm (Ricciardi, Zardini and Rossignoli, 2016). It tells
about the strengths that also helps workforce to counter their weaknesses and also bring in light
future opportunities and threats to an organisation. The SWOT analysis of Marks and Spencer
are:
Strength Weaknesses
 Marks and Spencer is been a dominator
of UK retail market since 135 years. So
it has a good reputation in market and
 Marks and Spencer is been shortlisted
as one of the company which have
decreasing sales in previous year i.e.

has experience as a strength to out fame
it's competitors.
 The company has high market presence
which helps in boosting sales.
2019. It is been observed that because
of bad supply of timely products
company faced this issue.
 Currently company is facing internal
grudges which hampers it's daily
workings.
Opportunities Threats
 Marks and Spencer is already a
established brand in online market,
with current scenario it have decent
amount of opportunities to increase it's
sale in near future (Sewchurran, Dekker
and McDonogh, 2019).
 Companies policies are flexible which
enables it to adopt various segments of
product.
 Marks and Spencer being a UK retail
company is experiencing high
competition. Some of its main
competitors are Tesco, Amazon, John
Lewis etc.
 Changing government polices might be
a loophole in it's workings.
P6 Explanation of how strength & weaknesses interrelate with external macro factors
Basis Political Economical Social
Strength The managers of
Marks and Spencer
follow all the political
laws that help in
proper implementation
of activities.
Marks and Spencer
pay enough and fair
wages to its employees
that affect on the
efficiency and
performance of
company positively.
Marks and Spencer
provide goods after
identifying the
requirements of
customer which in turn
help in customer
satisfaction and
retention.
Weakness Change in the political
conditions and policies
In the present time,
economic conditions
In the present time,
people are more

affect on the activities
and performance of
Marks and Spencer in
a negative manner.
of United Kingdom is
not good and impact
negatively on
performance of Marks
and Spencer.
focused towards their
health that is
undertaken as
weakness of respective
organisation.
Basis Technological Environmental Legal
Strength With the help of using
new and innovative
technology, Marks and
Spencer attain
competitive advantage
at marketplace.
Marks and Spencer
ensure the use of eco-
friendly techniques for
protecting the
environment (Steger,
2017).
The respective
organisation follow all
the laws & legislation
which help in
developing brand
image at marketplace.
Weakness Change in the
technology
continuously decline
its revenue as adoption
of innovative
technology arise high
cost to Marks and
Spencer.
The higher authorities
of Marks and Spencer
dealing with some
environmental issues
which impact on its
brand image
negatively.
Change in the laws and
legislations affect on
the activities and
operations of Marks
and Spencer.
CONCLUSION
From the above study, it has been concluded that it is significant for an organisation to
analyse the business environment as it help in dealing with the issues and develop opportunities
for the growth of company as well. Along with this, it is analysed that departments within a
company is interrelated with each other so it is significant for an organisation to focus on
maintaining good relationship among the departments as it assist in attaining objectives within
stipulated time period. With the help of PESTLE analysis and SWOT analysis, an organisation is
able to know about the factors that impact on their productivity and performance which is
improved by developing effective strategy and grabbing of opportunities in an effective manner.

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