Business Environment Analysis and Report: Marks and Spencer

This report provides a comprehensive analysis of the business environment of Marks and Spencer. It begins with an introduction to the concept of the business environment, highlighting the influence of macro and micro elements on organizational performance. The report then delves into the specific case of Marks and Spencer, examining its organizational structure, which is identified as a flat structure, and how it facilitates effective resource utilization and decision-making. Various organizational functions such as marketing, human resources, production, accounting, and research and development are discussed in relation to their roles in achieving the company's objectives. The report also explores the positive and negative impacts of the macro-environment on business operations, utilizing PESTEL analysis to assess political, economic, social, technological, environmental, and legal factors. Furthermore, the report includes SWOT analysis to evaluate Marks and Spencer's strengths, weaknesses, opportunities, and threats. The report concludes with a summary of the key findings and their implications for Marks and Spencer's strategic management.

Business Environment

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
TASK 2............................................................................................................................................1
P3 Relationship between different organisational functions and its link with organisation
objectives ...............................................................................................................................1
TASK 3 ...........................................................................................................................................4
P4 Positive and negative impact of Macro environment on Business operations..................4
TASK 4............................................................................................................................................6
P5 Internal and External analysis of Marks and Spencer.......................................................6
P6 Advantages and disadvantages are interrelated with external factors...............................7
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Business Environment comprises various macro and micro elements such as
management, employees, customer and business regulations that influence on organisation's
performance. It is necessary that administration makes system function appropriately and deliver
adequate items and services in marketplace. These elements may influence on system
performance either positively or negatively (Hamilton and Webster, 2015). These are various
companies which are conducting business in several sectors and are required to carry out number
of activities. Internal and external are factors which need to be coordinated with business
environment operations. Present report is based on Marks and Spencer, is a retail store which
have outlets established in various countries. Executive of company require to conduct business
operations in according to market conditions and situations. It is necessary that administration
examine the impact; business environment components have on business performance; thereby
making system function accordingly. This assignment mainly specifies components such
purpose, size, scope and legal structure which differentiate firms from each other. Moreover, it
also specifies organisation's functions interrelatedness with goals and objectives of companies.
Apart from this, elements which have positive and negative influence of macro environment are
also discussed in report.
TASK 1
Covered in PPT
TASK 2
P3 Relationship between different organisational functions and its link with organisation
objectives
Organisations differ with each other in respect to size, scope and structure, so it is
necessary that administration make system function in according to business environment. They
even require to conduct business operations appropriately and formulate adequate structure;
through which goals and objectives are accomplished timely. As in case of Marks and Spencer,
which is private firm require to utilise resources properly and deliver product and services in
according to needs and wants of people (Bah and Fang, 2015). It is a multinational retailing
company which have around 90000 workforce employed in different nations. Executive of
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enterprise have adequate amount of capital, through which they are able to deliver luxury items,
food products, clothing and so on in marketplace.
Illustration 1: organisational structure
(Source: Organisation Structure, 2018)
In Marks and Spencer, flat organisation structure is used by administration, which
benefits firm to utilise resources appropriately and make system function effectively. This
concept helps staff members to perform duties properly, as they get direct guidance and
supervision from top personnels. This structure also advantage company to frame adequate plans,
policies and strategies. Apart from this, decision-making process is conducted timely and
appropriate judgement are made with help of employees suggestions. So, Marks and Spencer
deliver quality items in marketplace, which helps firm to enhance their market image and
reputation.
Human resource management, finance, accounting, sales, research and development are
various functions that are performed by members of Marks and Spencer. These departments are
being operating appropriately, so company is able to attain top place in marketplace. Thus,
functions are coordinated with structure, so that organisation goals and objectives are
accomplished timely. This benefits Marks and Spencer firm to utilise resources properly, with
help of these:
 Marketing Department: This is defined as segment which specifies that
members require to design message to communicate information about
products and services to public (Georgescu and Popescul, 2015). It helps Marks
and Spencer to grab attention of large number of people and establish
advantage over competitors. Company have good marketing team, through
which manager is able to improve market position and image.
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 Human Resource Department: Recruitment, staffing, training and
development are various tasks that are performed by employer. It is essential
that organisation have adequate number of workforce available. HR manager
of Marks and Spencer conduct sessions and seminars to enhance capabilities
of members; and make them motivated towards duties assigned to them. Apart
from this, human resource department main responsibilities is to coordinate
and make all units to function appropriately.
 Production and Operations: This is important segment which determine that
organisations require to deliver appropriate amount of items and services to
fulfil demands of people. Marks and Spencer have adequate workforce,
through which quality products are manufactured (Khan and Quaddus, 2015).
This help company to utilise material and manpower properly and provide
offerings as per needs and wants of consumers. So, management is able to
enhance sales and generate adequate profit for business.
 Accounting and Finance: This segment consists members whose duty is to
take care that firm have adequate amount of capital available. They even need
to evaluate business operations and ascertain cost and expenses that are
involved. Thereby, take appropriate actions to purchase assets, equipments
and material. Thus, Marks and Spencer have skilled and competent members
in accounting and finance department; so administration is able to make
system function appropriately and utilise funds properly.
 Research and development: This sector consists members which require to
conduct activities and make alterations in tools and techniques; to make
system function in according to market conditions. They even need to carry
market survey to anticipate demands of people and acknowledge rival firms
offerings (Moroni, Arruda and Araujo, 2015). Thereby, make changes in items
and services to grab attention of large number of customers and enhance
sales. So, these are functions which are being conducted in Marks and
Spencer company; through which products are delivered in according to taste
and preference of public.
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Thus it can be concluded that in each and every organisation; human resource, marketing,
production, accounting, research and development department plays essential role. These units
need to conduct appropriate business operations and utilise resources properly, so that firm
deliver adequate products and services in marketplace. Therefore, company's goals and
objectives are accomplished timely.
TASK 3
P4 Positive and negative impact of Macro environment on Business operations
Administration require to design system and conduct adequate business operations,
through which organisation are able to generate appropriate profit. They need to conduct market
survey to acknowledge different components that are present in environment and have impact on
business (Cull and et. al., 2015). Members can regulate internal elements, but regulating external
factors is difficult task. It is necessary that management to anticipate positive and negative
impacts of micro and macro environment on operations. Apart from this, it is essential that
adequate policies, strategies and structure are designed; which helps superior to make employees
function effectively and attain objectives timely.
In Marks and Spencer, executive formulate policies and execute appropriate business
activities. This helps company to establish advantage over competitors and enhance market
position. To examine market conditions and situations, PESTEL analysis is adequate tool which
benefits administration to acknowledge external factors and their impact on business operations.
This helps them to anticipate positive and negative impacts of these components have on firm's
functionality. Thus, Marks and Spencer's PESTEL analysis is discussed below:
 Political factor: This element specifies that government formulated laws to provide
advantages to organisations. For this, administration require to formulate policies in
according to government rules and regulations of country in which business operations
are being conducted (Huang-Horowitz, 2015). Marks and Spencer firm need to make
alterations in system and strategies in according to government laws; thereby
manufacture products and services in respect to customer's requirements and market
situations.
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Positive effects: Political factor such as free trade policy benefits Marks and Spencer to lower
down sourcing expenses and operate business globally. Apart from this, implementation of
Brexit helps administration to conduct activities in appropriately.
Negative effects: Government keeps on changing policies and legislations, which impact on
functionality of Marks and Spencer. With alterations in tax rates; resources will get costly and
this influence on cost of items. Thus, sales and profitability of company will be get impacted.
Therefore, Marks and Spencer need to have strong relationship with government; so that they are
able to timely acknowledge government policies and make changes in system appropriately.
 Economical factor: Interest, exchange, growth and inflation rate are various components
which are different for each country. It is necessary that administration conduct business
and take care that resources are utilised properly (Hair Jr and et. al., 2015). Marks and
Spencer which is multinational firm require that management have complete information
about exchange rates; so that products and services are delivered appropriately.
Positive effects: Marks and Spencer sales will increase, if there is inflation in economy. So,
people have adequate income and they will be able to purchase items in according to their
demands.
Negative effects: Brexit impact on value of currency, so this will create problem for retailers and
conflict will arise between them in respect to prices.
 Social Factor: This is essential component which specifies that management need to
utilise resources efficiently, so that appropriate products and services are delivered by
firms. Marks and Spencer require to conduct activities to execute corporate social
responsibility and deliver items in according to fulfil requirements of people (Skiter,
Semenychev and Litvinova, 2015).
Positive effects: Marks and Spencer provide variety of products in respect to taste and
preference of customers. This benefits company to enhance sales and grab attention of large
number of people.
Negative effects: It is necessary that changes in products and services are made in according to
needs and wants of people. To increase sales and provide adequate items, Marks and Spencer
require to make alterations in system.
 Technological Factor: This component defines that administration require to implement
updated tools and techniques; so that appropriate products and services are delivered by
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Marks and Spencer. Therefore, adequate business operations are conducted and resources
are utilised properly.
Positive effects: Marks and Spencer uses modern technologies in system, so quality items and
services are delivered by company.
Negative effects: Large amount of funds will be invested by management to make changes in
system and update techniques.
 Environmental Factor: This is essential component which specifies that administration
need to utilise resources properly and deliver adequate products and services (Klovienė
and Gimzauskiene, 2015). They even need to conduct appropriate activities and take care
that environment is not affected.
Positive effects: Red-tapism will get lower down and activities are conducted effectively; this
provide benefit to Marks and Spencer functionality.
Negative effects: It is necessary that internet is used by members to use paper appropriately and
take care that environment is not affected.
 Legal Factor: Government had formulated various laws to safeguard public from being
exploited and provide appropriate facilities to staff members. So, Marks and Spencer is
able to make system function effectively and retain competent workforce.
Positive effects: Marks and Spencer is able to enhance market position and share, as business
operations are conducted legally and employees are given adequate working conditions and
facilities in organisation (Klapper, Love and Randall, 2015).
Negative effects: Marks and Spencer's administration require to make policies in respect to
government legislations, so this impact on system functionality.
TASK 4
P5 Internal and External analysis of Marks and Spencer
Before making any decisions of company, it is required for management that they should
consider all strengths and weaknesses of company so that decision upon good or bad could be
made. Marks & Spencer is able in doing same thing and they conduct SWOT analysis to get
information about their strengths, weaknesses, opportunities and threats before making any
decisions. Below is the analysis of TOWS terms which is able in analysing all aspects related to
capabilities of firm.
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Strengths: M&S is having prominent number of strengths which are responsible for
success and growth of company in marketplace. Company is getting high recognition through
customers because organisation is able in fascinating more number of clients towards them.
Corporation is having strong brand image in industry because of which consumers are getting
attracted towards company and making purchases and these buying are able in proving
satisfaction to clients.
Weaknesses: As it is known as nobody is perfect in its working and because of this M&S
is also having flaws in their working (Lisowska and Stanisławski, 2015). Enterprise is having
garments for all age people but in market it is spread for them that association is having clothes
for old age persons only and this rumour is decreasing brand image of M&S. Management is also
facing failure in adopting new promotional techniques along with formulating adequate
strategies for business growth and success.
Opportunities: M&S is company that is having a prominent market share in industry by
having more than 600 stores in multiple nations and they are regularly increasing these numbers
on year basis. As per market analysis, it is clear that company is having around 21 million
customer per week. This firm can use appropriate tool for promoting their product range and to
make all population aware that firm is having clothes for all age group people so that more and
more person could make purchase from Mark & Spencer.
Threats: In garments and fashion industry, companies face very tough competition and
this rivalry also getting increased according to time. Fashion is a thing which is getting change as
time passes in short time span and it is hard to catch all variations which and if rivals are able
then this factor also increases rate of competition in market along with reducing goodwill of
corporation. Because of this action, venture is not able in generating strong customer base that
impacts negative on working style of company.
P6 Advantages and disadvantages are interrelated with external factors
Like as each organisation, Marks and Spenser are also having its merits and demerits.
Extrinsic factors are providing both negative as well as positive impact on companies growth.
They are earning higher revenue mostly from United Kingdom ( Blahová, Haghirian and Pálka,
2015). M&S are registered in this organisation. Brexit is a political incident which restrict this
business from achieving their targets of fast expansion. M&S are having a strong presence of
international mainly in Europe but posted in Brexit (SWOT Analysis of Marks &
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Spencer.2017). They are facing a new hurdles when they are expanding operations at a time in
more Europe regions (Hamilton and Webster, 2015). These factors will create more challenges
for Marks and Spencer in further times due to that they are required to spend much time as well
as money. Post Brixit, for fulfilling different type of responsibilities.
M&S has failed to get a success in their food segment enterprise. In this segment, their
sales are continuously decreasing and this has made them behind their competitors. Emerging
legal restrictions as well as market development regarding food packing will increase burden of
finance on Marks and Spencer. Likewise, M&S are known for their proper Corporate social
responsibility strategy. It is a strength of organisation which help in raising their image as well as
goodwill within a market. They have started program for managing all waste within an
organisation. Management of the firm consider all factors which are linked with environment.
Company develop strategies and plan which helps in managing waste with in work place. They
know that their stores are release waste which affect environment. This program are called plan ,
M&S are organising their corporate social responsibilities in an effective manner. So that,
through this activities, firm are able to attain their strong market image in front of all potential
customer's. Manager of M&S are share profits for welfare of environment.
Brand value of M&S is very strong in current competitive environment. It is a one of the
leading brand segment as compare to their competitors. They spread their market area very fast
and run business activities in emerging market like India. In this country, purchasing power of
clients is very high and they are able to spend high mount of money in lifestyle products. It has
highest economic growth rate which increase per person income (Bah and Fang, 2015).
Company is operating their business activities in premium segment of clothing. High income of
upper middle class person is a good news of the company, because more income show high
ability of expenditure capabilities. Company Revenue is increasing very fast, because they open
new store in India which helps to enhance overall profitability.
The main key weakness of the M&S is logistic. Management of the company use latest
technology in their work place which improve quality of product and services. It also enhance all
operations as well as logistic. M&S is a international company which run their business activities
in various countries. In order to manage all these store firm use latest software in their operations
task. Through this, firm are able to reduce cost as well as minimise waste.
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CONCLUSION
From the above report, it can be comprehended that business environment comprises
various micro and macro components which need to be examined by administration. It is
essential that business operations are conducted appropriately, so that adequate products and
services are delivered in marketplace. Private, public and voluntary are various kinds of
organisation which vary with each other on terms of size, scope and structure. These companies
need to conduct PESTEL analysis to acknowledge strengths and weaknesses. Apart from this,
executive even require to anticipate positive and negative impacts of factors. Thus, these firms
will have different goals and objectives to be accomplished by them.
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