Business and Business Environment: Marks and Spencer Report

This report provides a comprehensive analysis of the business environment, focusing on Marks and Spencer (M&S). It begins by defining and classifying different types of organizations, including public, private, and voluntary enterprises, as well as Micro, Small, and Medium Enterprises (MSMEs), comparing their purposes, structures, and legal frameworks. The report then delves into a PESTLE analysis of M&S, examining the positive and negative impacts of political, economic, social, technological, legal, and environmental factors on the company's operations. Furthermore, it explores the internal analysis of M&S, identifying its strengths and weaknesses and how these relate to external environmental factors. The report also examines the relationship between organizational functions, objectives, and structure, including a discussion of flat versus tall organizational structures. Finally, the report concludes by summarizing the key findings and implications of the analysis.

Business and business environment

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
LO1..................................................................................................................................................1
P1 Types & purpose of organisation and its legal structures......................................................1
P2 The size and scope of differences types of organisation............................................................3
LO2..................................................................................................................................................5
P3 the relationship
between organisational functions its objectives and structure....................................................5
LO3..................................................................................................................................................8
P4 negative and positive impacts of macro environment upon business operation ...................8
LO4................................................................................................................................................10
P5 Internal analysis of organization in order to identify their strength and weakness.............10
P6 Strength and weakness interrelated with external factors....................................................11
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Business environment includes all those external and internal factors (ex. Legal, political,
economical, sociological, ecological factors) that influence business and for analysing business
environment there are various tools like SWOT, PESTLE etc. Present study is based on Marks
and Spencer, it is a multinational retail organisation is a private company has its own legal rules
and business environment. The report will explain purpose and legal structure of about different
public, private, voluntary enterprises. Furthermore, it will explain size, scope of these companies.
In addition, report will conduct pestle analyses of M&S and will describe positive and negative
impact of these factors on business.
LO1
P1 Types & purpose of organisation and its legal structures
Types of organisation
Public company
A public company comprise of organisations which are owned and operated by
government with the motive of providing services to society with no motive to earning profit.
National Health services is and health and social care organisation of UK. The firm is considered
to fifth largest employer across the globe. The firm provided different kind of health care
services like mental health, learning disability and children's nurses. Purpose of NHS is to meet
responsibilities and commitments which are in interests of patient and staff. The vision of firm is
to operate fairly regardless of any differences. Legal structure of NHS is governed by the present
version of the National Health Service Act 2006. In accordance with this Act organisation
provides comprehensive health services and the act is completely influenced by Health h and
Social Care Act 2012.
Private company
A private company is the company set up directly by registering the company with
company’s house .it has its own separate legal entity to its shareholder and directors. For
example - Marks and Spencer is the private co. it has to complete various legal formalities to
register itself as a private company. Purpose of this company is to maximise profit and expand
operations globally (Quinlan and et.al, 2019)
There should be an Article of Association and Memorandum of Association that should
cover following details - the objectives of the business, its headquarters and registered office, the
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amount of capital to be raised from sale of shares, details concerning meetings within the
business , the arrangements for auditing the accounts of business.
Voluntary company
A voluntary company is the company or an association where members enter into an
agreement , usually as a volunteer to achieve a common goal, it do not have separate legal entity,
cannot own property in its own name , both members of the association and member of the
committee may incur personal liability and it is governed usually by a constitution .It includes
trade associations, professional associations, environmental associations and trade unions. The
main purpose of such organisation is to improve wellbeing of people and offer them satisfactory
health services (Hamilton and Webster, 2018)
For e.g. Welcome trust is a voluntary association, composed of members, power is
delegated to management committee to carry out association's activities.
Micro small and medium enterprise (MSME's):
Micro business has less than 10 employees in its organisation and turnover under £2
million, small enterprises should have less than 50 employees and turnover under £10 million
and medium enterprises can be defined as the business carrying its activities with less than 250
employees and turnover under £50 million. For example - Craft Brewery is a small enterprise
that produce 6 million barrels of beer or less and less than 25 percent of the craft brewery is
owned and controlled by a beverage alcohol industry member that is not itself a Craft Brewer
Profit and non-profit organisations
Basis Profit organization Non-profit organizations
Meaning Organization formed for the
purpose of earning profit is
known as for-profit
organization.
Organization formed for the
purpose of serving society as a
whole and has legal entity is
known as Non-Profit
Organization.
Type of organizations Sole proprietorship and
partnership firm
Public hospitals, trust, club etc.
Sources of revenue Sale of goods and services of Subscription, membership
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Marks and Spencer ((Malesios
and et.al, 2018.)
fees, donation etc. of Welcome
Trust
Financial statement Income statement, Balance
sheet and cash flow statement
Reciept and payment A/C,
Income and Expenditure A/C
and Balance Sheet.
P2 The size and scope of differences types of organisation
Public
Organisation
(NHS)
Private-organization
M&S
Voluntary
Organisation
(Welcome, Trust)
Objective Objective of NHS is
to reduce health
inequalities and keep
people healthy. To
achieve this
organisation, aim ta
respecting
confidentiality of
patient information
and provides open
access to
information about
treatment,
performance and
health care services.
The objectives of
marks and spencer is to
develop the new
varieties of product and
provide best service to
their customers with
satisfying their needs
and wants.
Objective of this
Welcome Trust
voluntary organisation
is to provide the social
services to needy, old
aged and poor people.
Vision & mission Vision of NHS is to
deliver better health
to society with
individual focused
Vision and mission of
marks & spencer is to
create new products
and change their
products according to
Vision and mission of
the Welcome Trust is to
follow long duration
sustainable strategies.
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initiatives.
Mission of NHS is
to maximize health
and wellbeing and
prevent illness and
therefore firm also
focuses on
promoting health by
organising health
check campaigns
and educational
programmes.
customers’ needs and
wants.
Products\ services The major services
of NHS comprise
dentist to hospital,
emergency care and
GP’s. However, to
manage emergency
care NHS own
smartphone
application where
the person in need
can seek for medical
help.
It produces variety of
products like clothing,
footwear, groceries,
health and beauty
products etc.
Scope Scope of
organisation is wide
and is focused on
improving the
experience of care
for people which is
Marks & spencer
transforming
themselves in more
relevant and more
often to delivery top
quality products.
Welcome trust has
emerged as big global
force today. It has a
definite place but
performs various tasks
and functions for the
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managed by referral
from the Department
of Health.
needy and neglected
people.
Legal Structure Legal structure of
NHS is governed by
the present version
of the National
Health Service Act
2006.
Board of director and
shareholders have right
to vote in the
organisation. The
government have right
checked any financial
document in any time.
This association is
governed by the
constitution, legal
documents which
govern the association
Stakeholder Clinical
commissioning,
Consultant medical
staff Clinical coding
manager, Medical
director, group
Clinical governance
lead,
Clinical coding staff,
Junior doctor’s IT
systems manager,
Medical records
staff Medical
secretaries, Finance
director, etc.
Marks and spencer's
stakeholders are
customers, government
and communities etc.
Primary Stakeholder-
Board members,
communities,
employees, volunteers.
Secondary Stakeholder
– Government, Interest
groups, investors.
Market Size, and
Share, No. of
Employees
Market size of NHS
can be demonstrated
by its position in
world which is fifth
It is working across the
world. Its generated
revenue in the year
2018 is £10.7 billion.
This voluntary
organisation has
invested £125.9 billion
in the year of 2017. And
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largest pubic
function health care
organisation.
Expenditure of NHS
accounts for 7.4 %
of Gross Domestic
Product (Statistics
Research
Development, 2017).
NHS is considered
as largest employer
with 1.3 million staff
consisting od
nursing staff of
317.7, 351 support
staff members and
110 doctors.
Every year shares of
NHS England are
1000 Billion Pound.
Its gross profit is £ 4
billion and net worth
income is 29.1 million
in year 2018. It has
80,787 employees,
who work for the
organisation.
currently working with
2,057 employees for the
betterment of the
society.
Organisational
structure
NHS consist of
‘tripartite system
structure.
Flat organisation
structure
Tall organisation
structure
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Figure 1: National Health Service (NHS) UK
(Source: Statistics Research Development, 2017)
LO2
P3 The relationship between organisational functions its objectives and structure.
Organisation structure: -
It defines certain activities such as coordination, direction and supervision in order to
achieve the organisations goal.
Organisation structure have several types but it mainly divided into two types: -
1. Flat organisation structure
2. Tall organisation structures
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Illustration 1: Organisation Structure
(Source: )
Flat organisation structure: -
In this organisation structure, there are few or no levels between management and
employee. The involvement of the employees is higher in the decision-making process of the
organisation. This structure is eliminated the hierarchy between the higher-level management
and staff level employees that helps to save money. In this structure the employees need less
supervision for their work. The communication will improve between management and
employees in flat organisation structure because of less levels. This structure is a flexible and
changes are easily acceptable.
Illustration 2: Flat organisation structure
(Source:)
Marks & Spencer follows flat organisation structure because they want to eliminate the
level of hierarchy between the management and employee. Marks & Spencer motivates their
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employees by involving them in decision making process that enhance the performance of the
employee and contributes in achieve the targets of the organisation.
Tall organisation structure: -
In this structure, this organisation has number of levels and extremely complex. The
communication between management and employee is very difficult because of levels of
hierarchy. Employees have no right to speaks in decision making process of organisation and
bound to follow the instruction of their supervisor. The changes are not easily acceptable because
of number of levels.
Illustration 3: Tall organisational structure
(Source: Push vs. pull: who wins, 2019)
Objectives of Marks & Spencer: -
The objectives of marks and spencer is to develop the new varieties of product and
provide best service to their customers with satisfying their needs and wants.
Relationship between various function of organisation: -
Human resource and finance function: -
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Human resource function is recruiting, interviewing and placing in various function.
Finance function is concerned with cost and money. Human resource department recruits
qualified people for the organisation and that people help in enhance the profitability of the
organisation by optimum utilization of resources. This profit helps to finance department for
future investments and provide funds for promotional activities of the organisation.
Production and marketing department: -
Production function includes creating new products and managing the quality and
quantity of existing as well as new product. Marketing function includes making marketing
strategy for promoting new products and keep maintain existing customers. The production or
marketing function of the Marks & Spencer corporates each other in their work. marketing
functions provides the customers data about their needs and wants to the production department.
So, the production department produces goods according to customer's need and wants.
Indirectly both departments help in enhance the profitability of the marks & spencer.
Sales and marketing function: -
The marks & spencer have separate Marketing and Sales department. The marketing
department of marks & spencer promotes their products through T.V and newspaper and through
survey they identify their target market then the sales department directly meet their target.
They do not need to find-out their market that save money. This money used for further
advertising of their product.
LO3
P4 negative and positive impacts of macro environment upon business operation
Macro environment of Marks and Spencer includes political, economic, socio-cultural,
technological, legal and ecological factors that has direct or indirect impact on its business.
Impact of political factors
Negative impact- Marks and Spencer was not following the standards made by
government and was charged for neglecting the safety regulation. The two main political factors
that affect M&S are political stability and VAT. Political stability is the government works
according to them and M&S wants things differently and VAT is value added tax paid by the
companies to the government ,it has huge impact on M&S company if government increases
VAT then it has to increase its prices otherwise it will decrease firm's revenue.
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