Business and Business Environment Report: M&S, Functions, and Analysis

This report provides a comprehensive analysis of the business environment, focusing on Marks & Spencer (M&S). The report is divided into two parts: an essay and a report. The essay covers the different types, size, and scope of organizations, including private, public, and voluntary sectors, with specific examples of M&S. It also explores the various functions within organizations, such as human resources, finance, marketing, and sales, and their interrelationships. The report section delves into the micro and macro environments of M&S, examining both positive and negative aspects. It utilizes PESTLE analysis to assess political, economic, social-cultural, technological, legal, and environmental factors. Furthermore, the report conducts an internal and external analysis of M&S, utilizing SWOT analysis to identify its strengths, weaknesses, opportunities, and threats. The report concludes by summarizing the key findings and their implications for M&S's operations and strategic decision-making.

Business and business
environment

Table of Contents
INTRODUCTION...........................................................................................................................1
PART 1: ESSAY.............................................................................................................................1
P1 and P2 : Covered in PPT.......................................................................................................1
P3 Different functions of organisations......................................................................................1
PART 2: REPORT...........................................................................................................................3
P4: Positive and negative aspects of micro environment ...........................................................3
P5: Internal and external analysis to determine its core strength & weaknesses........................4
P6: Connection of above factors in the operation of M&S.........................................................5
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................7

INTRODUCTION
There are various kinds of organisation structure are used in order to have the business .
However, these are divided into private, public and voluntary organisations. Business
organisation are totally based on their operations. If the firm have charitable purpose then it is
presumed to be the voluntary organisation, private organisation are owned by the privately
owned person. While the public organisation are those which is controlled by the government.
Under this report, their size scope and relationship are also defined. With the help of macro
environment factors, company can make environmental audit and internal analysis are to be done
in order to make specific strategies.
PART 1: ESSAY
P1 and P2 : Covered in PPT
P3 Different functions of organisations
Organisation: it is a social unit which have lots of people and managed to meet the
activities to achieve the organisational goals. All organisations have different departments which
determines their relationship between different activities and members. It assigns the roles and
responsibilities to each member which they perform to achieve the targets.
Organisation has various departments which operate individually to accomplish the targets.
Functions of the different department are given below:
Illustration 1: Organisational chart
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(Source: Brandon Harper, 2013)
Human resource department:
This department is responsible for manage the employees in the company. This the main
department which helps in determining the structure of the company. They have many functions
to perform which are:
l Recruitment: To recruit the employees in the company and fill the important positions. So
they are playing the important role of developing the employers workforce.
l Safety: One of the major factor on which they give emphasis is safety of the employees in
organisation and also manage the company's workers and compensation issues.
l Compensation and benefits: They also undertake the responsibility to give the
compensations and benefits to the employees according to their work.
Accounts and finance department:
This department is responsible to mange all financial issues in the company and to
mange the transactions of the company. They also have the many functions to perform which
are:
l Cost control: It is the main essence of accountancy to control cost and report activities.
l Billing and credit control: Another duty of the accounting department is to ensure that the
customers pay their correct bill on time (Carlin and Schaffer, 2012).
l Investment appraisal: Another important work of the accounting department is to
appraise the investments made by the individuals in the company and to calculate the
return.
Marketing:
marketing department is responsible to make better customer relations. They also have to
perform many functions which are:
l Focus on customer
l Monitor the competition
l Own the brand
l Create new ideas
Purchasing:
This department is responsible to make the purchases in the company to regulate the business
effectively. There are many more functions of the department are:
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l Receiving indents
l Assessment of demand
l Selection of source of supply
l Placing order
Sales:
This department is responsible to make sales of the products of the company and to
increase the revenue (Cavalcante, Kesting and Ulhøi, 2011). Many other functions of the sales
department are:
l Develop sales plan and strategies
l provide accurate sales figure
l monitor customer, market and competitors
Advantages:
 In organisation staffs is manage by an individual those are having specific skills and
experiences. They carry adequate knowledge of handling team and ability to review their
work.
 Employees and workers have opportunities to move one step ahead within their
functional areas which is the primary reason to continue their work for very long period
of time.
Disadvantages:
 Functional areas have hurdles while working with other departmental areas. They think
that they are working against them without having proper understanding of work.
 As company expand their operations in order to attain large number of profit and
sustainability. Because, they are not able to manage their work in proper allotted time.
PART 2: REPORT
P4: Positive and negative aspects of micro environment
Macro environment: It is simply means that basic environment of businesses. Macro
factors are not in the controlled as compare to the micro forces of environment. It also
responsible for making small impact in decision making on the allocation of resources. Macro
factors are useful for studied the pattern of demand and supply as well as identification of
outputs and price in the specific marketplace (Besharov and Smith, 2014.). For the purpose of
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growth and survival of businesses is totally depend upon its adaptability related with
environmental issues. It is categories into two parts: Economic and non- economic environment.
It is known as continuous changes and new risks problems which is arises in business are more
difficult to control and managed. It is necessary that managers of Marks and Spencer will can get
ahead on these particular changes in order to formulate and control company operations. One of
the effective tools used by managers to determine the macro-environment factors is PESTLE. It
consists of both positive and negative aspects that influence the businesses and organisation at
the same time.
Illustration 2: PESTLE
(Source: PESTLE, 2016)
Political factors: M & S is favoured as per European free trade agreements and have assist to
decrease sourcing costs. It has been seen that higher cost structure has been considered as big
limitation for M & S in global market. They are known for its CSR initiative but because of lack
of clearness of UK government on energy efficiency plan which made pessimistic impacts over
their initiatives. Examples: The political stability and VAT is the primary factors that affect
business of company.
Economic factors: Because of competitors discounted pricing the business of M&S is
getting affected. They always planning to give higher quality which is only assists to short term
losses. Customers were attracted to quality with creating maximum values. With the effect of
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financial crises customers are become more price sensitive and M&S is working more on market
flow to maintain their sustainable sales growth.
Example: Issues such as rate of interest, inflation rate, GDP and level of employments. It
is done to encountered all these issues to make sustainability.
Socio-culture factors: It is considered as those factors which are more favourable for the
society. The change over from someone into the new generation x and company requires
improvisation to cater for the new segment. It can be seen that because of changing behaviours
and value, it tend to influence the ways clients are responding regarding buying processes.
Examples: Some of the shops are situated in London do not keep classical collection but
more prefer to go with limited stock collection.
Technological factors: It has been seen that M&S is having a wide range of social media
and online presence so it will be placed to utilised on the total revenues. Customer are become
more technological effective as they are using mobile and internet websites to book their orders.
Examples: In recent time, M&S stores in Britain captured with free Wi-Fi facilities to
make customers more concern about their payment or choice.
Legal factors: The company is using more omni mode experiences that allow customers
multiple option for home delivery or shore pickup (Grimpe and Kaiser, 2010). Decision to
remain with European union may alone with other retailer have to face legal action.
Example: Some of the workers claim that they are getting half amount for their extra
working hours. If any one refuse to do so they were asked to leave their jobs.
Environmental factors: It consists of two factors, the environment internal as well as
external factors are need to be considered. While its impact on businesses are not ignored as they
are more valuable for the company for future decision making.
Examples: In current times, they are major concern about environment damage for this
they are charging 5p per bags which is made of paper from the customers need to carry their
products.
P5: Internal and external analysis to determine its core strength & weaknesses
The performance of the company is mostly depend upon both internal as well as external
factors. It affects the profitability of the businesses. If talk about internal analysis is considered
as one of the impact process used by managers in order to identify and evaluate an organisation
capability. It consists of resources, capabilities and core competencies. While external factors are
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strategic tools that affect the organisational performance (Hair, 2015). This analyse considered
as essential aspects of the company that provided information about threat and opportunities for
M&S. It will also help them to make align plan with other companies in order to make there
business more effective and profitable. According to the business environment of various factors
that consists of various aspects such as competitors, customers, suppliers, public and other
marketing intermediaries.
These all are working together to generate maximum profit for the company so that they
can become more superior from other competitors. The macro factors consists of certain specific
factors those are making huge impact on the business organisation of M&S. It positive aspects
are based on diversification in products which will be more helpful for the company to take
effective decision (Kolios and Read, 2013). As, it has been seen that M&S is perfect brand and
leading retailers in UK market. In order to develop more suitable business strategies for its
growth they primarily target those market which is not buying their products. SWOT is the best
techniques to determine the internal business in terms of its strength and weaknesses of M&S.
While, opportunities and threats are also considered as external factors of business enterprise.
Strength:
It has been seen that M&S is having so many strength which make then more effective in
terms of brand values in every parts of UK. Some of them are:
 High recognition of brand: M&S is the great giant of UK market. It is all because of its
product quality deliverer from last so many years. Its brand value is more as customers
visits to market street they used to go in M&S shops.
 Wide varieties in product: It has been seen that M&S is offering multiple variety in
products in each stores which help them to make perfect option to select their own
products. In the current scenario they are having more than 1200 suppliers and over 400
different varieties for products are available to them (Wheelen and Hunger, 2011).
Examples: They aimed at developing a sustainable future by making positive impact on
well-being to the society. Some of them are councils, Charities, NGOs and other businesses.
Weaknesses:
 It has been bad record of publicity as non trendy store: It has been noticed in the market
that M&S is having out fashioned and non trendy products. Although, they are known for
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wide variety of products but customer are wrong assumption that men's wear and
women's cloths are only offered for old age people.
 Increase in cost because of manual work: They are using very outdated techniques to
produce product rather than, using new one which can help them to increase the different
aspects of the work done. It is mostly, related with cost, time etc.
Examples: The ROIC was recorded at 3.27% in the last financial year. That make huge
impact on their financial performances. Stock prices of M&S is going down drastically because
they are mostly depend on UK markets.
Opportunities:
 Increasing international presence: It is mostly established in UK and even it operated in
large number of stores in all over the world. It will have more effective impacts over
company's performances.
 Market segmentation: Segmentation is more important for this company in order to make
their products reached to its customers. M&S have the techniques to create profit making
opportunities so that large number of customer would be to attract towards their brand.
Examples: Planning to invest in India as it is huge marketplace where large amount of
capital and profit can be generated. Switching its presence at internet to boost its market position.
Threats:
Increasing competition in same kind of categories are more difficult part of M&S. The
biggest threat for them is losing of scope in the businesses because of huge competitions
(Turban, Sharda and Delen, 2011). There few competitors are Sainsbury, TESCO and ASDA plc
are regularly expanding their businesses at a very large scale.
Examples: Stiff competition in the food market because of company's like Tesco plc.
Changing tends in clothing sectors.
P6: Connection of above factors in the operation of M&S
Link with strength of M&S:
The positive aspects of M&S is reaching in most parts of the country. It is considered as
one of the important part of the company to become more powerful retail product and service
brand with the top of knowledge recall (Teece, 2012). There products are perceives as creating
values for money, because of quality, convenience and delivering of large number of product to
the customers. The major aspects of this company is about 80000 employees are working for the
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betterment of the company. The quality of product brands are also their in domestic market
because of that they know the social values of local markets. The use of effective techniques is
another key of M&S business strengthening.
Connection to weaknesses:
In current era, the performances of M&S in terms of finance are decreased. The main
reason behind them is because of decreasing sales revenues in the businesses. The social
alteration in UK market have made maximum impacts on the sales action of M&S (Miller,
Yablonovitch and Kurtz, 2012). They are not able to attain high level of performances due to
civil law as well as political unstableness. For making footsteps into the other marketplace, the
M&S has to considered several factor that can make responsible for taking corrective action in
order to make business more profitable.
Justification:
This project report consists a brief, discussion about M&S macro-environmental
evaluation. It determine the positive and negative aspects of M&S that are affecting the
performance of the company. Its strength and weaknesses are analyse in more effective manner
so that valuable decision can be done in order to attain future objectives.
CONCLUSION
From this project report, it has been conclude that business environment is the key
aspects for the company. It can be ignored as they help the company to determine its internal and
external factors those are associated with M&S. In the above project, various types of
organisation and their role are discussed. The report also summarised with certain information
about organisation functions. Some of the techniques are also used in order to determine the
macro-environment factors by using PESTLE analyse. The internal and external factors of M&S
is also explained above. Overall, project is the highlight of different business information that are
related with M&S performance and its sustainability.
REFERENCES
Books and Journals:
Besharov, M.L. and Smith, W.K., 2014. Multiple institutional logics in organizations: Explaining
their varied nature and implications. Academy of Management Review. 39(3). pp.364-
381.
Carlin, W. and Schaffer, M.E., 2012. Understanding the business environment in South Asia:
evidence from firm-level surveys.
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Cavalcante, S., Kesting, P. and Ulhøi, J., 2011. Business model dynamics and innovation:(re)
establishing the missing linkages. Management Decision, 49.(8). pp.1327-1342.
Christopher, M. and Holweg, M., 2011. “Supply Chain 2.0”: managing supply chains in the era
of turbulence. International Journal of Physical Distribution & Logistics Management,
41.(1). pp.63-82.
Grimpe, C and Kaiser, U., 2010. Balancing internal and external knowledge acquisition: the
gains and pains from R&D outsourcing. Journal of management studies. 47(8).
pp.1483-1509.
Hair, J.F., 2015. Essentials of business research methods. ME Sharpe.Pingali, P.L. and Roger,
P.A. Eds., 2012. Impact of pesticides on farmer health and the rice environment (Vol.
7). Springer Science & Business Media.
Kolios, A and Read, G., 2013. A political, economic, social, technology, legal and environmental
(PESTLE) approach for risk identification of the tidal industry in the United Kingdom.
Energies. 6(10). pp.5023-5045.
Miller, O. D., Yablonovitch, E and Kurtz, S. R., 2012. Strong internal and external luminescence
as solar cells approach the Shockley–Queisser limit. IEEE Journal of Photovoltaics.
2(3). pp.303-311.
Teece, D.J., 2012. Dynamic capabilities: Routines versus entrepreneurial action. Journal of
Management Studies. 49(8). pp.1395-1401.
Turban, E., Sharda, R. and Delen, D., 2011. Decision support and business intelligence systems.
Pearson Education India.
Wheelen, T.L. and Hunger, J.D., 2011. Concepts in strategic management and business policy.
Pearson Education India.
Zeng, L., Li, L. and Duan, L., 2012. Business intelligence in enterprise computing environment.
Information Technology and Management. 13(4). pp.297-310.
Online
PESTLE ANALYSES: 6 Core Variables. 2017. [Online]. Available through:
<http://www.mbahelp24.com/pestle-analysis-6-core-variables/>. [Accessed on 31st
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<http://businesschinastuff.blogspot.in/2013/10/organisational-structures.html>.
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understanding-the-context-of-strategy>. [Accessed on 31st October 2017].
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