Organisational Strategy Assessment 2: Debenhams Report Analysis

This report provides a comprehensive analysis of Debenhams' organizational strategy. It begins with an executive summary outlining the report's focus on strategic issues within Debenhams' external and internal environments in the UK. The report utilizes PESTLE analysis to examine the challenges in the external environment and SWOT analysis to assess the internal business situation. It explores strategic options for sustaining future growth in both the UK and international markets, including innovation, customer retention, partnerships, diversification, operational efficiency, and flexible leadership. Finally, the report offers specific recommendations for developing Debenhams over the next five years, such as adapting to fashion trends, optimizing store presence, and leveraging digital marketing. The report aims to guide Debenhams in achieving its long-term goals and sustaining future growth in the competitive retail landscape.

BM6024 Organisational Strategy
Assessment 2

Executive summary
The use of the business strategies that help in achieving the goals and objectives and
sustaining the future market is referred to as organizational strategies. This report will contain
about the various strategic issue that Debenhams faces in the external and internal
environment in the UK. The challenges that are faced by Debenhams in the external
environment in the UK will be shown by using PESTLE analysis. The SWOT analysis is also
done to understand the important aspects that are related to the internal business situation of
Debenhams in the UK. Debenhams should use the various business strategies that are
required to sustaining future growth in both the UK and international Market. The last section
of the report contains the some recommendations are provided that will help in developing
the company over the next 5 years in the UK and International market.

Table of Contents
Introduction................................................................................................................................4
Overview of the company..........................................................................................................4
1) What are the key challenges facing the company in the external environment in the UK?. .4
2) What are the important aspects of the internal business situation of the company in the
UK?............................................................................................................................................5
3) What strategic options and directions could the company consider sustaining future growth
in both the UK and international Market?..................................................................................6
4) What steps would you recommend to develop the company over the next 5-year years in
the UK and International market?..............................................................................................8
Conclusion..................................................................................................................................9
Reference..................................................................................................................................10

Introduction
Organizational Strategy of a business organisation refers to the various business strategies
that are taken to achieve the long-term goals and objectives. The completion of the strategies
as plan takes more than a year to complete along with the involvement of all the top
management employees of a business organization. This report will contain about the various
strategic issue that Debenhams faces in the external and internal environment in the UK. The
challenges that are faced by Debenhams in the external environment in the UK will be shown
by using PESTLE analysis. The important aspects of the internal business situation will be
shown by suing the SWOT analysis. Some of the strategic options and direction will also be
discussed to understand Debenhams sustaining future growth in both the UK and
international Market. At the last section of this report some recommendations are provided
that will help in developing the company over the next 5 years in the UK and International
market.
Overview of the company
Debenhams is a retail departmental multinational store, which is located in UK, Denmark and
Ireland. Debenhams was founded in the year 1778 by William Clark and officially started it
business in the year 1813 by Clark and Debenham. The company has 178 stores located all
over the UK, Denmark and Ireland. The retail products that Debenhams sells are fashion
apparels, shoes accessories, cosmetics and toys. Debenhams has its headquarters in London,
UK and England (Taylor 2018).
1) What are the key challenges facing the company in the external environment in the
UK?
The key challenges that are faced by Debenhams environment in UK is shown by using the
PESTLE analysis.
Political factors- The impact of the political factors on the business activities such as the level
of profit and survival in the UK business environment are widespread. The presences of the
political instability in UK due to the regulations carried out by Berxit has a negative impact
on the business activities. The increase in the higher taxation level in the UK is a major
challenge that Debenhams has to face, which leads to fall in the profit level (Perera 2017).
Economic factors- The economic factors are also the major factors that has an impact on the
business activities of Debenhams such as the increase in interest rate will affects the business

taking of loans from the bank would be difficult. Due to the presence of Berxit the there is an
instability in the exchange rate which would be as major challenge for Debenhams as this
will not encourage the global investors. The rise in the rate of GDP will create problem, as
the expectation of the company to grow in the future will get affected (Visnja et al., 2016).
Social factors- The various social factors such as the culture, values and attitude of the
society has a huge influence on the business activities of Debenhams. Debenhams should
target all the people in the society irrespective of their caste, creed religion and sex.
Debenhams needs to focus on niche marketing so that it does not face any challenges
regarding the class distribution problem in the UK. The difference in the education level of
the marketers and the targeted market is also a major challenge that is faced by the company.
Technological factors- The development of the recent technologies that are used in
Debenhams increase the level of competition with the rival firms. The copying of the
innovative technologies by the rival companies from Debenhams as it will increase the level
of competition. The cost of production increase due to the use of the technologies that are
used in the process of production.
Environmental factors - The impacts of the environmental factors has huge effects on the
business activities of Debenhams. Debenhams are facing problem regarding the
transportation of the resources and finished goods due to the critical weather conditions. The
global; warming is creating negative impact on the clothing department of Debenhams as the
sale of the winter wears are decreeing due to the rise in global warming.
Legal Factors – The legal factors such as the Health and safety laws, Discrimination law and
intellectual property laws has a major impact on the various business activities of
Debenhams. The discrimination law helps in maintain the equal rights and fair treatments
among the employees in Debenhams (Thompson and McLarney, 2017).
2) What are the important aspects of the internal business situation of the company in
the UK?
The important aspects of the internal business situation of Debenhams in UK can be analysed
using the SWOT analysis.
The strengths of Debenhams in the UK business environment are
o The brand equity is high among the customers and the fashion industries.
o The customer services that are provided by Debenhams are excellent.

o The presences in the digital world of Debenhams is helping in the growth of the
company (Phadermrod et al., 2019).
o Increase in the usage of the channels in partnership.
The weakness of Debenhams in the UK business environment are:
o The increase in the number of retail store cause a fall in the market share.
o Not exploring all the fields of the customers segments leads to it low presence in the
global market.
o Instability in UK market due to the presence of Berxit.
The opportunities of Debenhams in the UK business environment are:
o The restructuring of the policies helps in the growth of the business.
o Opportunities in unexplored countries and new domain.
o The changes in the taste and preference of the customers help in the growth of the
business.
o Partnership using the franchise model help in the rise in market share.
The threats of Debenhams in the UK business environment are:
o Shut down of the stores due to rise in cost related to business activities.
o Increase in the level of competition from the rival firms.
o Chances of the rise in Cybercrime on the level of sales.
o Increase in the brand switching due to the other awareness of high-end brands in the
UK (Gürel and Tat, 2017.).
3) What strategic options and directions could the company consider sustaining future
growth in both the UK and international Market?
The strategic actions and direction for Debenhams foe sustaining the future growth in both
The UK and international markets are discussed here:
Innovation and market development- Debenhams should consider the expansion of its
product line by continuously innovating new products and launching it to the market. This
will not only increase its share in the market but will help in sustaining the future growth in

the local and the global markets. The chance of opening up the new markets for Debenhams
can be achieved by changing the packaging of the products and modification of the products
(Kaleka and Morgan, 2019).
Retention of the customers – Debenhams should use innovate techniques such as the
feedback system so to understand what the customers are expecting out of them. The
feedback strategy of understanding the customers will help in understanding the wants and
the expectations of the customers so that they will modify the existing products. This will
help in retention the existing and the potential customers.
Partnership and collaboration- Debenhams should engage in partnership or collaboration as it
will help in decreeing the cost and increasing the sale of its products. Debenhams can use the
various website and market place that are available online that will help in the providing
necessary resources that are required for the development and design of the sales of the
products. This strategy will help in achieving the long terms goals and sustaining the future
growth in the UK and the international market (Watson IV et al., 2018).
Diversification – Debenhams should not restrain itself in the specific areas such as clothing,
fashion accessories and toys. It should use innovation in the products and explore the diverse
market areas in the global and the local economy. The diversification of the products line
and the services will help in sustain the future growth of Debenhams in UK and international
market.
Operational efficiency- Debenhams should use new efficient ways and methods for cutting
down the cost and embed outlook that prevails in the business organization. This will help in
making the people sensitive to the cost of the products and help the company in connecting
with the various opportunities. The efficiency in the business organisation can be maintain by
supporting the cultural diversification in the workplace. The efficiencies in the business
operation will help in creating an alignment with needs of the business that helps in achieving
the future growth in the UK and international market.
Flexible leadership- To sustain the future growth of the business activities of Debenhams in
the UK and the international market the leadership style should be flexible and adaptive in
nature. The activities of the leaders has huge role to play for the sustained of the business
organisation. A good leader with flexible leadership quality will help easy communication
and achieving of the goals and objectives of Debenhams by the help of its workforce (Hill
2017).

4) What steps would you recommend to develop the company over the next 5-year years
in the UK and International market?
The following steps that are recommended to develop Debenhams over the next 5-years in
the UK and international market are explained here.
1. Debenhams should focus on the reason of its lagging behind in the fashion sector and in
the trends. The trends in the fashion worlds re the main game changers, Debenhams should
use innovate techniques to study the business environment of fashion to understand the trends
and to products its products according to the current trends. It should appoint some of the
talented fashion designers and fashion influencers who came help them in aligning its
business activities with the changing trends in the fashion world. It should increase its
potential in the business environment by creating a sound brand image and brand equity
among the people (Entwistle et al., 2019).
2. Debenhams should decrease the number of stores that are available offline so that it will
help them in decreasing the cost that are associated with the stores. There are more than 120
stores of Debenhams across London and UK. Debenhams should shift to online shops
through website so that it will help them in increasing the opportunities of sales and reduction
of the costs that were earlier associated with the opening and maintain of stores. The costs
that are related to run a business is minimum as the cost require for setting up a company
website is very low. The use of digital marketing will help Debenhams to develop over the
next 5-years in the UK and international markets.
3. Debenhams should offer combination of products such as the products of various designer
brands, brands that are exclusive and different other categories so the scope of the choices of
the products increase and the customers can get the things that they want to purchase. They
should also increasing its diversity of its services into different domains such as by opening
cafes and restaurants to attract the customer’s base of UK. It should also collaborate and give
franchise model to different countries so to increase its business activities in the international
market. This will help Debenhams to develop over the next 5-years in the UK and
international markets (Zentes et al., 2017).

Conclusion
The importance of organisational strategies required for the business organisation for
increasing its business activities in the local and the global economy are discussed in this
report. Debenhams a multinational retail business organization is taken and the various key
challenges that it faces in the external business environment are analysed using the PESTLE
analysis. The SWOT analysis is also done to understand the important aspects that are related
to the internal business situation of Debenhams in the UK. Debenhams should use the various
business strategies such as the market innovation and development, consumer retention,
flexible leadership, diversification, collaboration and partnership and operational efficiency
to sustaining future growth in both the UK and international Market. Some of the
recommendations are provided such as the need of reduction of cost from the number of
stores that are available across the UK, the need for collaboration and the upgradation in the
world of fashion are required by Debenhams to develop the company over the next 5-year
years in the UK and International markets.

Reference
Entwistle, J., Frankling, C., Lee, N. and Walsh, A., (2019). Fashion Diversity. Fashion
Theory, 23(2), pp.309-323.
Gürel, E. and Tat, M., (2017). SWOT analysis: A theoretical review. Journal of International
Social Research, 10(51).
Hill, T., (2017). Manufacturing strategy: the strategic management of the manufacturing
function. Macmillan International Higher Education.
Kaleka, A. and Morgan, N.A., (2019). How marketing capabilities and current performance
drive strategic intentions in international markets. Industrial Marketing Management, 78,
pp.108-121.
Perera, R., (2017). The PESTLE analysis. Nerdynaut.
Phadermrod, B., Crowder, R.M. and Wills, G.B., (2019). Importance-performance analysis
based SWOT analysis. International Journal of Information Management, 44, pp.194-203.
Taylor, L.A., (2018). Consumer reaction and perception of the physical, visual presentation
of Debenhams’ Discounting Prime Trading versus Sale Visual Merchandising
Standards. Bloomsbury Fashion Business Cases.
Thompson, J. and McLarney, C., (2017). What effects will the strategy changes undertaken
by next Plc have on themselves and their competition in the UK Clothing Retail
Market?. Journal of Commerce and Management Thought, 8(2), p.234.
Visnja, I., Jovičić, J., Arsovski, S., Živković-Drezgic, M. and Badjok, D., (2016). Economic
Factors Affecting Business Decision Making.
Watson IV, G.F., Weaven, S., Perkins, H., Sardana, D. and Palmatier, R.W., (2018).
International market entry strategies: Relational, digital, and hybrid approaches. Journal of
International Marketing, 26(1), pp.30-60.
Zentes, J., Morschett, D. and Schramm-Klein, H., (2017). Store-based Retailing–General
Merchandise. In Strategic Retail Management (pp. 47-70). Springer Gabler, Wiesbaden.