Business and Business Environment Analysis for Marks and Spencer

This report provides a comprehensive analysis of the business environment, using Marks and Spencer as a case study. It begins by defining the business environment and its importance, then categorizes organizations into public, private, and voluntary sectors, outlining their legal structures and purposes. The report then examines the size and scope of different organizations, focusing on Marks and Spencer, the National Health Service, and childcare services. It delves into the relationships between different organizational functions, such as finance, human resources, and marketing, and how these functions contribute to achieving business objectives. Furthermore, the report identifies the positive and negative impacts of the macro environment on business operations and conducts an internal and external analysis to identify strengths and weaknesses. Finally, the report explores the interrelationship between these strengths and weaknesses and external macro factors, offering a well-rounded view of business operations within a dynamic environment.

Business and Business
environment

Table of contents
INTRODUCTION................................................................................................................................3
MAIN BODY.......................................................................................................................................3
Different types and purpose of organisations; public, private voluntary and legal structures....3
Size and scope of different organisation ....................................................................................5
Relationship between different organisation functions and its link to organisation objective and
structure.......................................................................................................................................7
Identify the positive and negative impacts the macro environment has upon business operations.8
Internal and external analysis of organisation in order to identify strength and weaknesses...10
Strengths and weaknesses interrelate with external macro factors...........................................11
CONCLUSION..................................................................................................................................13
REFERENCES ..................................................................................................................................14
...........................................................................................................................................................14

INTRODUCTION
Business environment is an aggregate of all conditions, events and influences that are
surrounded and affect business. It consist of combination of all internal and external factors that
influence company's operating function and decision making of business (Alles and et.al., 2018). To
operate smoothly and functionally organisations depend on environment and the society in which it
is operating to analyse the factors prevailing out there and helps organisations to sustain for long
term. These factors are complex in nature and changes from time to time. In this report chosen
organisation is Marks and Spencer which is a British multinational retailer headquartered in
London, UK. It provides home and food products. Marks and Spencer chosen as private sector,
National health service in public sector and Child care in voluntary sector. This report will analyse
the size and scope of different types of organisation. Along with determining interrelationship of
various function within the organisation and its connection with achieving business objectives.
Moreover it also analyses the positive and negative impact that have influence on macro
environment business operations . In addition to this it also identifies the strengths and weakness of
different organisation and their interrelationship with external macro environment factors.
MAIN BODY
Different types and purpose of organisations; public, private voluntary and legal structures.
Business environment consist of all those factors which enables organisation to compete
with its complex factors and attain goals and objectives of organisations. These factors play an
important role and allow business to properly function in the dynamic environment. There are three
types of business organisations which are subdivided as public, private and voluntary organisations.
Private sector organisation
Private sector organisations are run by the individuals rather than the government and also
helps in the economic development of the county by satisfying customer needs which in turn
increase revenue for the respective company. As the chosen company Marks and Spencer is a
private retail based company specialising in clothing sector, home products and luxury food

products.
Legal structure- Marks and Spencer has a flat organisation structure which has limited
levels of administration and management which allows execution of task in a proper manner and
encourages all the employees to participate in decision making process for the company and allows
respective company to realise its goals (Cantwell and et.al., 2010).
Types of legal structure
Proprietorship- A single individual or a trader when run business whole and sole by
themselves they are legally responsible for all the aspect of business. They are responsible for
taking decision which help them to run smoothly and attain goals. They have all the liablities
towards business.
Partnership- It is that form of legal structure in which two or more parties cooperates
integrally to mange and operate business smoothly. In this form partners equally share profit and
losses of the company and share same liabilities towards business.
Limited by guarantee- A company limited by guarantee is distinct from its owners and is
responsible for its own debts.
Limited by shares- liability of the shareholders to the creditors of the respective company is limited
to the capital originally invested.
Stakeholder of Mark & Spencer- The major stakeholders are owners, employees,
customers as well as all other internal ans external stakeholders (Carroll,and Shabana, 2010).
Purpose of private organisation
Purpose of private organisation is to provide products and services that benefits the
consumer and help respective company to increase sales and revenue.
Public sector organisation It comprises of all those organisations which are owned and operated
by government. In other words it is under the control of government and provides services to the
individuals. Government can raise funds through many sources such as by charging fees and tax and
internal transfers from other government levels. In this report chosen public sector is National
health service (NHS), which is a public health service in United kingdom.
Legal structure- The primary legal structure of NHS is to provide a wide range of health
services and to meet necessary and responsible reasonable requirement of the individuals.
Types of legal structure
Local government- Local government have power regarding the specific geographic region
and cannot enforce power or laws on particular state. They play an important role in taking care of
health of general public and are responsible for many services which doesn't have impact on the
health and for the well being of local population.
State government- It is subdivision of federal in the country which have certain power and

policies for the particular state. They are responsible for meeting the needs of local people and have
power laid with them to benefit the individuals in that state.
Central government- This type of government holds absolute power and has the authority
to make laws for whole country, unlike local and state government (Cavusgi and et.al., 2014). It is
responsible for the benefit of whole country.
Stakeholder of NHS-Academy for health science(AHCS), National school of healthcare
science( NSHCS), North west healthcare science network and Heath science professional bodies
etc.
Purpose of public sector
The main objective of NHS is to provide health care services to the individual patients and
their families by satisfying them with different range of products and services according to the need
and preferences. As well as purpose of public sector is to provide services in the benefits of general
public.
Voluntary associations It is a union made by the group of individuals who enter into an
agreement with mutual purpose of serving society and not for earning profit. Chosen voluntary
organisation is Child care which is supported by combination of rights at work place, public sector
provision and private companies (Chavis, Klapper and Love, 2011).
Types of legal structures
Charity- It is the type of organisation which raises money in order to help the poor, disabled and
sick people by giving money, food and clothes to those who are in need. This type of organisation
help the needy people by providing necessities.
Charity- Organisation who provides money, food and clothes to the one who are in need. It also
raises money in order to help sick, poor or disabled people to provide them certain facilities.
Stakeholder of voluntary association- Investors, members and the local community.
Purpose of Voluntary association
The main purpose of voluntary association is to provide daily necessaries to individuals to
raise their standard of living. The main objective of child care is to provide facilities to the parents
who are going out for work and provide financial support for the cost of child care.
Size and scope of different organisation
Scope of organisation consist of different available opportunities for the respective company.
Marks and Spencer has a renowned name in the market and has various opportunities of increasing
its product lines to food and home products by satisfying the customer.
Marks and Spencer
Size- M&S is one of the leading retailers with around targetting 21 million customers. They
can increase their size by selling high quality food products and devote fashionable clothing as per

the needs of customer and increase the number of target customer.
Mission- Its main mission is to provide standard quality products to its customer and
increase its potential customers.
Vision- Its vision is to provide products according to changing needs of customer and
improve its competitive strength.
Scope- They can increase their scope by increasing the number of product lines to increase
the no. of potential customers as well as increase productivity in fashionable clothes. To target
trendy
people to increase sales of the product.(Deasy, and et.al., 2015).
National Health services
It is a publicly funded world's largest health service which comes with new idea of providing
good health care facilities which benefits all the individuals and their families.
Size- NHS is sizing up with world's biggest employers by employing large number of people
in health care service and are operated an managed by trustees to provide better health care
facilities.
Mission- Its mission is to provide health care services to the individuals according to their
needs and requirements.
Vision- Helps people to stay healthier and enjoy life with good health through quality care.
Scope- To develop values which provides high quality products with utmost care to
safeguard the life of many individuals. They provide child care, medical health care facilities to
raise the standard of people.
Child Care
Child care in UK, provides facilities for parents and more often by the mother who goes
outside for office.
Size- The size of child care market has continued to grow and expand from overseas
investors and providers.
Mission- Its mission is to operate best and successful nursery schools by proper
development of children's.
Vision- Its vision is to raise child by providing certain educational facilities and supporting
parents by helping their children to develop and providing them the most rewarding career.
Scope- To shape and support in such a way which is beneficial for the child and rest of its
life. It should provide facilities which is to be trusted in every part of child's life. They majorly
focus on taking care of child by proving them proper eduction when their parents are out for job.

Relationship between different organisation functions and its link to organisation objective and
structure.
Organisational structure determines the hierarchical arrangement of lines of authority and
responsibility and power and responsibilities of employees within the organisation. It defines how
roles, power and responsibilities are assigned, controlled and coordinated and helps business
organisation to attain business goals (Drucker, 2017). Organisations need efficient, flexible
structure in order to achieve sustainable competitive advantage. There are various types of
organisational structure such as flat hierarchical structure, functional and matrix structure. Their are
different departments in the organisation which functions accordingly and helps to attain goals and
objectives. Functional department in an organisation are interconnected with each other are as
follows-
(Source: Organisation Chart, 2018)
Finance department- This department is concerned with managing of funds and capital. It
is basically concerned with planning, organising and auditing of funds and resources in he
organisation. In short it is accountable for all the work related to accounts and is interrelated with
other departments. This department of M&S takes data from all other departments such as
marketing, Hr, sales and production and helps in measuring profits and loss and estimate the
expenditures. It is also connected with marketing department to estimate all the sales and marketing
expenses and also provide funds for distribution of goods and services and increase profit for the
company and allows M&S to achieve targets (Gecevska and et. al., 2010).
Human resource department- This department is responsible for recruiting and selecting
the prospective candidates. It carries various other functions such as compensation, hiring and
selection of employees. HRM department of Marks and Spencer provide information to all other
departments about employees knowledge and skills which can work accordingly and helps
Illustration 1: Organisation Chart

respective company to meet its objectives.
Marketing department- Marketing department of M&S is responsible to drive the sales of
its products and services to immediate customers. They are responsible for analysing the needs of
the consumer by providing products as per their needs and demands. Managers at respective
company connects with the finance and the HR department as finance department provide them
funds which helps them to conduct market research and achieve targets.
Advantages and disadvantages of interrelation of departments
When departments in the organisation are interrelated it brings higher efficiency in carrying
business operations and helps respective company to realise its business objectives. On the other
hand departments becomes highly interdependent on each other and sometimes failure of one
department leads to failure of all other departments and doesn't allow business to attain goals.
Critical analysis of different business structures and interdependence of departments
As per the view of (Gupta, A., 2013) there are different types of business structures such as
corporation, non profit as well as proprietorship which allows business to carry their operations
accordingly and helps company to attain goals as well as their interdependence on other
departments make them highly dependence to work as per the functions of all other department.
Marks and Spencer adopts flat organisational structure with few levels of management and allows
business operations to carry in proper manner and attain business objectives, There are few levels of
management that are interrelated and are dependent on each other for attaining business goals.
Identify the positive and negative impacts the macro environment has upon business operations.
PESTEL analysis helps in determining how these factors affects business and performance
in long term. Marks and Spencer which is private retail company is effected by such factors and
impacts its operations. Below PESTEL analysis of Marks and Spencer is given to understand the
impact of macro factors on business.
Political factors- It includes various government policy, tax purpose that impacts the functioning of
organisation. There are various taxes which affects the functioning of respective organisation. There
are various positive and negative impacts of political factors on respective company.
Positive
-It allows M&S to coordinate within the government rules and allows company to develop
strategies which acknowledges wider public objectives. Nd meet high sales by working in context
to government policies.
Negative
-They are highly affected by the heavy taxes of the government which leads to increase in the price
of the products and would decrease potential customers.

Economic factors- It include all those factors such as interest rate, inflation rate which affects
economy performance and directly impacts the respective company's performance. It also affects
the purchasing power of consumer and changes in their demands.
Positive
-M&S can focus on fashionable products in clothing sector and target the younger generation which
have more focus towards lifestyle and personalities and can satisfy consumer demands (Hilton and
Platt, 2013). Increase in the purchasing power of consumer helps the company to earn high revenue
and sales.
Negative
-The company is highly effected by the high inflation rate in particular country which leads to
decline in sales.
Social factors It involves the beliefs and attitudes of the people towards respective product and
service. Sales of the M&S can be effected by due to changing preferences of their prospective
consumers. Increase demand in the market led the respective company to concentrate on clothing
segment an meet the needs.
Positive
-M&S are improvising as well as providing products to the customer according to changing taste
and achieve business objectives of increasing profits and sales (Iskanius and et. al., 2010). They are
focusing on fashionable and trendy clothes to meet the needs of young generations.
Negative
-Because of changing demands the company has to change their products according to the customer
which incurred high level of expenditure in research in fulfilling needs of consumer. This require lot
of expense in form of research and require high level of funds and time.
Technological factors-
It is the way company market their products with the adoption of new methods and process. Fast
growing retail company can adopt new methods of delivering goods to the ultimate consumers.
This has some positive and negative impacts for the company.
Positive
-Marks and Spencer can provide improvised products to the customers changing needs by adopting
appropriate technologies.
Negative
-The respective company has to modify their products according to the customer needs which incurs
high level of expenditure in research for analysing the potential needs of customers.
Environmental factors – These are those factors which is influenced by surrounding such as
includes climate, weather, geographical location. Marks and Spencer has to properly analyse the

environmental factors regarding the quality of food products (Kewand and Stredwick, 2017).
Positive
-It increases the emphasis of the company to determine the factors and introduce wide variety of
products related to food processing.
Negative
-Climatic condition allows marks and Spencer has to properly determine sourcing of fresh milk
from dairy farms and produce environment friendly and sustainable products.
Legal factors
It covers aspects like health and safety laws, quality requirements which affects businesses
to comply with certain rules and regulation of certain industry.
Positive -By this respective company insures integrity and enhance consumer confidence by
choosing appropriate standards of raw materials.
Negative
-It has created difficulty in production process as it has to fulfil all aspects of laws related to
production and health regulation. Marks and Spencer has to ensure with the safety laws in their food
quality.
Internal and external analysis of organisation in order to identify strength and weaknesses
Strengths:
 Clear brand image – Marks and Spencer take position itself as a high valued product that
are mainly target premium segmentation. With the help of brand image, they are sold variety
of goods and services in the large market area (Klapper, Lewin and Delgad, 2011). As per
the result, they are clear branding and customers make sure about what they are expected
from marks and Spencer stores.
 Multi channels presence – M&S has offer products and services to their desired customers
in all over the world. The firm mainly operate and regulate their business 300 full line
stores, 910 stores in the United Kingdom.
 Wide variety of products – Marks and Spencer has wide variety of goods and services that
can assist customers to select the best offer among all commodities. They are mainly focus
on analysing customers needs and demand as per them they are make proper changes in
their products.
Weaknesses:
 Inability to penetrate successfully in foreign market – Marks and Spencer has operated
and existence in United Kingdom, United states and Europe. With the help of this, they have
opened stores in some other nations such as Asia and Middle East where they have
unsuccessful winning of customers.

 Customer satisfaction – M&S often exhibit lower satisfaction level and there are various
issues which occurs while distributing products and services that can effect on experience.
As per this result, the customer gain poor brand loyalty and enhancing brand switching.
Opportunities:
 New segmentation – In current time period, the company has offering variety of
fashionable products and services to their customers on daily basis. In Asia, there are huge
demand and requirement of ethnic and traditional wear that are currently been unable to
capitalised. The main opportunities which are deal by company is to enhancing the methods
and techniques of market segmentation in order to increasing its branches in all over the
places (Klem, 2013).
Threats:
 Competition – The main rivals of M&S are Gap, Uniqlo, Tommy Hilfiger, Zara and United
Colors of Beneath. They are create major conflicts and disputes among employees as well
as organisation. The threat for company is to lose its scope in the business due to the high
competition in which increased competition in the retail sector is big worry as the retail
rivals like SDA, Sainsbury and Tesco (Luo and Zhao, 2013).
Strengths and weaknesses interrelate with external macro factors
External and internal factors influence the organisation and puts significant impact on the
profitability of marks and Spencer. Internal factors present within the organisation are controllable
as well as external factors present in the organisation impacts organisational profitability.
Political factors- These are connected with interference of the government and effect both
in positive and negative aspect to business.
 Strengths - M&S are interconnected with government to provide better quality of product
and services and had developed strategies and policies to satisfy wide range of consumers
and helps in economic development.
 Weaknesses
 -Due to increase in the price of their products it led to the loss of number of potential
customers and decrease the level of profit. Heavy taxes imposed on some of the products
reduces their sales and productivity.
Economical factors
-It helps to determine current and future value of the particular organisation.
 Strengths
 -One of the greatest strength of M&S is that they can focus on more fashionable products
and can satisfy the needs of younger people.

 Weaknesses
 -The company is highly effected by the high inflation rate in particular country which leads
to decline in sales and effects competition in market (Oster, walderand PigneurPulver,
2012).
Social factors-This factor include change in taste and preferences of customer according to their
beliefs and values.
 Positive
 -M&S are improvising as well as providing products to the customer according to changing
taste and achieve business objectives of increasing profits and sales and helps in achieving
larger market share.
 Negative
 -Because of changing demands the company has to change their products according to the
customer which incurred high level of expenditure in research in fulfilling needs of
consumer.
Technological factors-
This factor evaluates the technological abilities of the respective organisation in context to macro
environmental factors.
 Positive
 -Marks and Spencer can provide improvised products to the customers changing needs by
adopting appropriate technologies.
 Negative
 -The respective company has to modify their products according to recent demand in the
market and incurs heavy expenditure on the respective industry and create sometimes loss
for the company.
Environmental factors – Marks and Spencer has to properly analyse the environmental factors
regarding the quality of food products such as climate, weather and geographical location.
 Positive
 -It increases the emphasis of the company to determine the factors and introduce wide
variety of products related to food products (Sena, Ferreiraand et.al., 2012).
 Negative
 -Climatic condition allows marks and Spencer has to properly determine sourcing of fresh
milk from dairy farms and produce environment friendly and sustainable products.
Legal factors-It covers aspects like health and safety laws, quality requirements which affects
businesses to comply with certain rules and regulation of certain industry.
 Positive -By this respective company insures integrity and enhance consumer confidence by

choosing appropriate standards of raw materials (Siewiorek, and et.al., 2012).
 Negative
 -It has created difficulty in production process as it has to fulfil all aspects of laws related to
production and health regulation
CONCLUSION
From above report it has been concluded that business environment plays a crucial role while deal
in competitive era. In organisational environment insist different factors such as market, rivals,
customers, manpower and employees and society which helps to Marks& Spencer to deal in
competitive environment and control in fierce market dealings. Above report study on varies
enterprises which deals in different fields and their role in worldwide . In addition to it focus on
scope and contribution of varies enterprise that deal in market. It also elaborates external and
internal factors of marks & Spencer to access its market share and its focus on strengths and
weaknesses of marks & Spencer by concluding it that factors both internal and external play very
crucial role in Marks & Spencer.

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Online
Organisation Chart, 2018.[Online]. Available
Through<https://www.tutor2u.net/business/reference/organisation-charts>