Business Strategy Report: Analyzing John Lewis Ltd.'s Strategy

This report analyzes the business strategy of John Lewis Ltd., a British retail company. It begins with an introduction to business strategy and its importance. Task 1 applies the PESTEL framework to assess the macro-environmental factors influencing John Lewis, including political, economic, social, technological, environmental, and legal factors. Task 2 examines the internal environment through SWOT and VRIO analyses, identifying strengths, weaknesses, opportunities, and threats, as well as valuable, rare, inimitable, and organized resources. Task 3 applies Porter's Five Forces model to evaluate the competitiveness of John Lewis in the retail market. Finally, Task 4 applies concepts and models, including the Ansoff matrix, to devise a strategic management plan for the organization, and concludes with a summary of findings and recommendations. The report provides a comprehensive overview of John Lewis' strategic position and future prospects.

BUSINESS
STRATEGY

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
P1 Application of appropriate frameworks with its impact and influence on the macro
environment.................................................................................................................................3
TASK 2............................................................................................................................................5
P2 Examine internal environment and capabilities of the organisation......................................5
TASK 3............................................................................................................................................8
P3 Apply Porter’s Five Forces model to evaluate the competitiveness of the organisation,......8
TASK 4............................................................................................................................................9
P4 Application of a concepts and models, interpret and devise strategic management plan of
the organisation...........................................................................................................................9
Strategic management plan.......................................................................................................10
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Business strategy is a set of various actions or decisions which aid the entrepreneur while
achieving their business objectives. This mainly focuses on the aim of grabbing attention of large
number of people in order to successfully accomplishing organisational goals within the given
time period. Business strategy refers to a master plan used by management team of the company
to maintain their sustainability at the competitive marketplace. Present report is based on John
Lewis Ltd. which is a British retail company. It deals in products which is cloths, watches,
jewellery, furniture, etc. (Brewster, 2017). In order to gain knowledge how macro environment
influence the working of the organisation PESTLE analysis has been discussed. In addition to
this, SWOT along with VRIO has been conducted to know about the insight capabilities of the
organisation. Furthermore, for knowing the competitiveness of the firm Porter Five Force
analysis has been carried in this report. At last, for analysing the present strategic option Ansoff
matrix has also been used along with strategic management framework.
TASK 1
P1 Application of appropriate frameworks with its impact and influence on the macro
environment.
For smooth running of business activities in an effective manner, it is essential for the
management team of organisation to examine the examine the macro environmental factors.
With this, managers of the company will be able to analyse external factors along with their
impact. For analysing the environmental factors, managers of John Lewis Ltd. has carried out
PESTEL analysis.
PESTEL Analysis
It is a strategic tool used by management team of the company for analysing all external
elements which directly influence the organisation for developing effective strategies. For
smooth running of business activities it is very essential to formulate suitable plans (Cavusgil
and et. al., 2014). In the present context of John Lewis Ltd PESTLE analysis is defined below:-
Political: Company has decides to expand its business and enter into the market of UK
which is part of European Union. Market area of Europe is vast which leads to enter with ease.
As a result it creates huge competition at marketplace for John Lewis Ltd. For reducing
competition and increasing the profitability at marketplace government of UK decides to

decrease corporate tax from 30% to 28% (John Lewis PESTEL Analysis, 2019). In addition to
this, company need to develop strategies according to policies framed by government. Also with
the implementation of such factors, company can run in an effective manner as well as generate
more revenue.
Economical: Brexit affects the economic system of UK as it cause recession within the
country with high fluctuations in interest rates. In order to handle such adverse situation in an
effective manner, it is required by the company to provide goods and services to their customers
at very low price (Chang, 2016). Business operations of John Lewis Ltd. Has also been affected
with such market situations, as a result they should also cut the prices of their products. In
addition to this, company should provide attractive offers to their customers in order to maintain
the sustainability at marketplace. Also it is very difficult for the management team of the
company to formulate strategies accordingly.
Social: Culture of societies are changing very which creates opportunities for the
company in order to grab the attention of customers by providing them attractive products and
offers. With the help of this, company will able to increase their customer base as well as
profitability at the marketplace. In order to grab attention of large number of customers John
Lewis Ltd. launch new products and services. With this, company also creates threat among their
competitors within the marketplace by introducing new products. At present, John Lewis Ltd. is
very competent by launching new products and services at the marketplace according to the
demands and requirements of customers.
Technological: With the main aim of reducing wastage of paper company is adopting
online or internet platform for selling their products. At present, John Lewis Ltd. Is currently
adopting digital technology in order to attract customers from all over the world (Chen and
Jermias, 2014). With the help of this, company can generate more revenue by providing
attractive offers via online shopping. In order to manage business activities in an effective
manner company is using advance tool and techniques. But on the other hand, adopting latest
technology is expensive which affects the overall financial position of the company. In addition
to this, by adopting new technology it is required by the company to develop strategies and plans
accordingly.
Environmental: In today's competitive world, building clean and safe environment is the
main aim of large organisation. For reducing their carbon footprint, John Lewis Ltd has use

different machineries and strategy. Along with this, company started using biodegradable papers
in order to decrease pollution from the environment. In addition to this, company is providing
eco friendly products and services to their customers with this they can maintain the competition
at current market situation. But on the other hand, for developing such products, it is required by
the company to implement latest technologies within their business organisation (Goffee and
Scase, 2015).
Legal: It is the responsibility of John Lewis Ltd. to follow all legal association related
with health and safety of customers and employees. In manufacturing process of clothes,
company should apply appropriate renewable resources. With this, company can take care about
the health of their employees by using proper measures while manufacturing products. In
addition to this, by adopting appropriate factors by John Lewis Ltd. they can run their business
activities effectively. But on the other hand, ordinary change in legal factors can affects the
decision making process of the organisation.
TASK 2
P2 Examine internal environment and capabilities of the organisation.
For examining internal environment of John Lewis Ltd. Managers has performed SWOT
analysis. On the hand, for analysing capabilities VRIO analysis has been performed. As a result,
it will aid them in order to know their strength, weakness along with their capabilities.
SWOT Analysis:
Strength Weakness
 One of the biggest strength of John
Lewis Ltd is they have high brand
image which help them to grab large
number of customers to buy their
products (Jeston, 2014).
 Also, John Lewis Ltd is dealing
through digital technology which help
them in expanding their business.
 One of the weakness face by John
Lewis Ltd. is they do not have has
enough knowledge about international
market.
 Company is not making effective
marketing strategies which reduces
their potential customers.
Opportunities Threats

 By expanding their products and
services at international marketplace
company have the opportunity to
generate more revenue.
 Company can also attract new
customers by launching new product
range.
 With the help of personalise labels,
John Lewis Ltd. can grow demand at
the competitive marketplace.
 With the implementation of new laws
company faces many negative impact
on their business operations.
 Main threats for the company is there
competitors which includes TESCO,
Marks and Spencer and many more
(Jocovic and et. al., 2014).
VRIO Model:
In order to identify internal capabilities of organisations, VRIO model has been used. In
the present context of John Lewis VRIO model is discussed below:
Factors Valuable Rarity Inimitable Organized What is the
result?
Global image Global image - - - Competitive
Disadvantage
Products Products Products - - Partially
competitive
Software Software Software Software - Competitive
advantage for
temporary
basis
Staff Staff Staff Staff Staff Competitive
advantage
In order to identify the internal capabilities of John Lewis Ltd., four major resources have
been considered by management team of the company, are global image, technology, staff and
products (Klettner, Clarke and Boersma, 2014).

Valuable: It refers to those elements which provide assistance to the company in order to
achieve organisational goals and objectives within given time period. In context to John Lewis
Ltd valuable factors for the company are:- Global image : Image of the company at global market is very high, effective and broad.
With the help of this, company will be able to gain competitive advantage effectively. Products: By adopting latest technology company will be able to produce high quality
products which will satisfy the requirements of customers. As a result, it will aid the
company in building strong customer base (Laudon and Traver, 2016). Software: John Lewis Ltd. uses software in order to manage things in an effective
manner as well as for successful achievement of organisational goals.
 Staff: The staff members of John Lewis are highly trained and experienced which will
aid the company in achieving their targets within the given time period.
Rarity: It includes those aspects of the organisations which are very rare and provide
competitive advantage at the marketplace. In the present context of John Lewis Ltd., global
image of the company is not rare because there are numerous number of company available at
competitive marketplace. Rare resources of John Lewis Ltd. Are as follows:- Products: Products offered by John Lewis Ltd. are developed by analysing market trends
and by adopting latest technologies. So it is quite hard for any company to copy them. Software: John Lewis Ltd. use software's for maintaining records along with the
execution of its operational activities is very rare as it is mainly developed according to
their requirements (Lawton, 2017).
 Staff: Staff members of John Lewis are very rare, reason behind this is they have their
own skills, talent and capabilities which will help the organisation in achieving their
goals and objectives.
Inimitable: These are the resources which are not easily copied by any rival company.
In references to John Lewis, products of the company do not have this element as technology
used by them is easily used by its rival companies. Software: John Lewis Ltd. developed software according to the needs and requirements
of organisation, therefore, it is quite hard to copy by any rival company.
 Staff: Every individual have their own skills and knowledge and according to them they
provide training to their employees which is hard to be copied by other organisations.

Organized: It refers to that element of the organisation which is required to be organised
in an effective manner in order to attain goals and objectives of the company. Software of the
present company need to be updated on a regular basis to meet the requirements of the company.
 Employees: The staff members of the company required to organised when any kind of
changes occurs within the organisation, which includes training sessions (Peng, 2017).
TASK 3
P3 Apply Porter’s Five Forces model to evaluate the competitiveness of the organisation,
In order to examine competition level available at market, organisations adopting Porter’s
five forces model. In the present context of John Lewis Ltd., managers of the company opt this
model for determining the actual competition available at marketplace for organisation. Along
with this, it will aid the company while developing strategies and executing their business
operations effectively. Porter's five force model consist of five forces which are explained in
detail:
Competitive rivalry- This factor represents the actual competition available for
organisation within same industry. In reference to John Lewis Ltd, this industry is highly
competitive. High rate of competition can affect the overall profitability as well as market share
of the company. For reducing the competitiveness, it is required by the managers of John Lewis
to formulate strategies in order to differentiate their products with competitors. As a result, with
this company will able to generate high revenue in an effective manner (Scholes, 2015).
Threat of substitutes- For John Lewis Ltd is threat for substitute is quite high, reason
behind this is there are various companies which provide similar kind of products. In order to
reduce threat of substitutes and gain competitive advantage, company should analyse the demand
and requirements of customers and produce goods accordingly. As a result, they can attract more
and more customers and retain them for a long period of time. This will ultimately maintain their
sustainability at the marketplace as well as generate more revenues as compare to their
competitors. As a result, it will enhance their sustainability at market place effectively.
Threat of new entrants- It is the situation which shows how easily a company could enter
into a industry. In the present context of John Lewis Ltd, threat of new entrants is very low.
Reason behind this is that, if a new enterprise wants to start their business operations in a retail

sector they require huge amount of investment. Therefore, it is not possible for a new
organisation to have enough funds for entering into the competitive market (Spender, 2014).
Bargaining power of suppliers- Suppliers are the person who provides required raw
material to the companies, which will aid them while manufacturing their finished goods. In the
present context of John Lewis Ltd, supplier's bargaining power is low. Reason behind this is, it a
large business corporation with numerous suppliers. They can deliver them raw material at very
low cost, therefore company have the option to easily switch to another one.
Bargaining power of customers- Customer's bargaining power is very high, as they are
the one who create opportunities for organisations. In reference to John Lewis, bargaining power
is high. Reason behind this is there are various companies which offer same products at the
marketplace. Buyers have the option to easily switch to other company if there is any
fluctuations arise in the price and quality of product. Therefore, it is essential for John Lewis Ltd
to provide high quality goods and services at feasible price to their customers. As a result, it will
aid them to maintain their sustainability at marketplace.
On the basis of above mentioned, it can be analysed that five forces model aid the
managers and leaders of company while formulating effective strategies. These strategies will
help them in gaining competitive advantages. Along with this, it will also aid help John Lewis
Ltd in enhancing their performance and maintaining their sustainability at marketplace (Veit and
et. al., 2014).
TASK 4
P4 Application of a concepts and models, interpret and devise strategic management plan of the
organisation.
Ansoff Matrix is a strategic tool used in order to direct or guides management team of
the organisation for adopting suitable strategies for growth and development of the company. In
reference to John Lewis, for identifying suitable strategy for the growth of the company,
managers use Ansoff matrix. In this context, all the strategies of matrix are discussed below
Market Expansion: It is the strategy popularly known as market development. Main
focus of this strategy is to provide existing products and services to their customers in new
marketplace. By approaching new market area, this strategy help the company in increasing their
customer base. In the present context of John Lewis, by implementing this strategy within the

organisation, they can easily enhance their profitability by approaching new market place
(Wheelen and et. al., 2017).
Market Penetration: This strategy focuses on providing existing goods in the existing
market place. In reference to John Lewis, managers of the company adopt this type of strategy in
order to focus on untouched customers of their existing market. In addition to this, the strategy
help management team of organisation in order to examine their current market condition as well
as they will able to know the buying behaviour of customers.
Product expansion: This strategy mainly focuses on launching new products in the
existing market area. In the present context of John Lewis, if managers of the company adopt this
strategy, on the basis of demand of customers, company will be able to introduce new products.
In addition to this, John Lewis can expand its product line of clothing within UK and grab
attention of more customers in order to maximise its profits.
Diversification: Under this strategy company focuses on offering new product into new
market area. It is one of the most risky strategy as it is not always possible for the company to
attract customers and gain their support at the new market place. If the managers of John Lewis
adopts such strategies in their company, it will be one of the most expensive procedure for them
(Brewster, 2017). They need to adopt various marketing strategies in order to develop positive
image at the competitive marketplace. As a result, it will directly affect the profitability of the
company as their expenses is more than their total revenue.
As per the above mentioned strategies, it has been analysed that managers of John Lewis
should adopt market penetration strategy in their organisation. This strategy will increase the
market share of company as they are very well aware about their products and customers. As a
result, company can satisfy their customers which will lead to increase in sale along with high
revenue generations.
Strategic management plan
The strategic management plan framed by the management team of John Lewis Ltd. is
develop to communicate different key aspects which is mainly associated with the organisation
to their shareholders (Wheelen and et. al., 2017). The strategic management plan of John Lewis
Ltd. are as follows:
Aim of the company: Main aim of John Lewis Ltd. is to enhance their operational
activity within the existing market area.

Vision: Vision statement of the company is to become leader in retail industry at global
level.
Mission statement: Their mission is to offer high quality goods and services to their
customers along with value addition in order to satisfy maximum numbers of customers.
Values: John Lewis is one of the biggest leading brand who have the beliefs like
transparency, ethics and integrity.
Strategies and tactics: In order to attract large number of customers in the existing
market place, John Lewis will adopt market penetration strategy. This will aid the company in
gaining competitive advantage as company has very loyal customers (Cavusgil and et. al., 2014).
Tactics used by managers of the company is they will launch high quality products at very
reasonable cost to influence large number of customers.
CONCLUSION
From the above mentioned report, it has been concluded that in order to accomplish
organisational goals and objective within the given time period, strategic planning plays very
essential role. In addition to this, it has been analysed that performance of an organisation should
be according to the formulated plans and strategies. As a result company can ensure long term
sustainability along with increased profitability at the marketplace. With the help of SWOT
analysis company will be able to launch new or innovative products within the existing
marketplace in order to increase the overall market share. By doing PESTLE analysis it has been
examined that by adopting to the new technology, company is capable of introducing new
products to gain competitive advantages.
REFERENCES
Books and Journals

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Chang, J. F., 2016. Business process management systems: strategy and implementation.
Auerbach Publications.
Chen, Y. and Jermias, J., 2014. Business strategy, executive compensation and firm
performance. Accounting & Finance. 54(1). pp.113-134.
Goffee, R. and Scase, R., 2015. The Real World of the Small Business Owner (Routledge
Revivals). Routledge.
Jeston, J., 2014. Business process management. Routledge.
Jocovic, M. and et. al., 2014. Modern business strategy Customer Relationship Management in
the area of civil engineering. Applied Mechanics & Materials, (678).
Klettner, A., Clarke, T. and Boersma, M., 2014. The governance of corporate sustainability:
Empirical insights into the development, leadership and implementation of responsible
business strategy. Journal of Business Ethics. 122(1). pp.145-165.
Laudon, K. C. and Traver, C. G., 2016. E-commerce: business, technology, society.
Lawton, T. C., 2017. Cleared for take-off: structure and strategy in the low fare airline business.
Routledge.
Peng, M. W., 2017. Cultures, institutions, and strategic choices: Toward an institutional
perspective on business strategy. The Blackwell handbook of cross
‐cultural
management, pp.52-66.
Scholes, M. S., 2015. Taxes and business strategy. Prentice Hall.
Spender, J. C., 2014. Business strategy: Managing uncertainty, opportunity, and enterprise.
Oxford University Press.
Veit, D. and et. al., 2014. Business models. Business & Information Systems Engineering. 6(1).
pp.45-53.
Wheelen, T. L. and et. al., 2017. Strategic management and business policy. Pearson.
Online
John Lewis PESTEL Analysis. 2019. [Online]. Available
Through:<https://businessteacher.org.uk/pestel/john-lewis.php>.

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