Strategic Management Report: John Lewis Business Environment Analysis

This report provides a strategic management analysis of John Lewis, a leading UK retailer. It begins with an introduction to strategic management and its importance. The report then delves into an analysis of John Lewis's internal and external environments, utilizing Porter's Five Forces model and PEST analysis to identify strengths, weaknesses, opportunities, and threats. A strategic business process model for John Lewis is presented, outlining the company's vision, opportunities, future strategic intent, and business design considerations. The report also includes a reflection on the strategic process model, discussing how it enables effective working. The analysis covers key aspects such as business ethics, growth plans, and the competitive landscape, providing valuable insights into John Lewis's strategic positioning and potential strategies for future success. The report concludes by summarizing the key findings and offering recommendations for improvement.

STRATEGIC
MANAGEMENT

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
Internal and External Strengths of John Lewis...........................................................................1
A Strategic Business Process Model...........................................................................................3
Reflection on strategic process model of John Lewis.................................................................6
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
Through Strategic management, employers of a firm formulate various policies and
strategies for execution of a project in order to achieve goals (Hair and et. al., 2012). It includes
various plans as well as actions to give direction accordingly for developing business of an
organisation in a wide manner. This would helps in attaining sustainability at marketplace and
getting better position from competitors. This present report explain the factors of strategic
management in order to identify strengths and weaknesses of internal and external factors of
organisation of UK names by John Lewis. It is one of the leading retailer firm having 49 stores in
all over the world. This report also develop strategies for this company to remove its weaknesses
in order to get better position at market place.
TASK 1
Internal and External Strengths of John Lewis
Business environment of a company consists various internal and external factors which
impacts on operational activities of a company in large manner. Therefore, in order to achieve
objectives and goals of a business, it is necessary for firms to measure impact of these factors. It
includes various attributes like employees, stakeholders, technologies and more. In context with
John Lewis, it deals in retail business by selling household products (Strategic Management,
2018). Currently it has more than 38100 numbers of employees working in 50 stores at UK
including 12 at home stores and remaining flexible stores in Exeter and York. The main mission
of this company is to produce the high quality of products well as gives effective services to its
customers. This would aid in providing high satisfaction to customers according to their
demands. For attainment of this aim, John Lewis has employed high qualified staff members at
stores and provides them healthy working environment so that they can work in better way. For
analysing strengths and weaknesses of this firm at marketplace, its management has used Porter's
5 force model and PEST which as explained below:
External environment analysis of John Lewis
Porter Five force model is used to analyse internal strengths and weaknesses of a
company. Management of John Lewis use this technique to examine the potential of marketplace
to enhance profitability.
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Threat of Competition- Since business of John Lewis is based on retail sector so it has
many competitors present at marketplace (Freeman, 2010). Therefore, its management is
required to consider on threats of rivals and formulate effective strategies accordingly. Along
with this, in order to gain competition this firm needs to make differentiation strategies also
which shows its products better and different from other rivals.
Threat of substitution- Due to large number of competitors, threat of substitute is also
arise at marketplace in a high manner. It results to give so many option to customers in
purchasing products or services available at different prices of various companies. Therefore, it
produces a threat for John Lewis deals in retention of customers.
Threats of new Entrants- Government of UK supports entrepreneurs to open their new
outlets at marketplace on minimum finance. This would generate threats of new entrants to
establish companies having same products (Hodgkinson and Healey, 2011). Since, John Lewis is
one of the leading retailer organisation which has made its impressive brand image at
marketplace. So, arise of new entrants not much affects the business of this company as
compared to others.
Bargaining power of buyer: As in marketplace, a wide range of products are given on
various rates which gives many options to customers to avail as per choice. This would arise
bargaining power of them which forced companies to offer their products at low cost.
Bargaining power of the Supplier: It is also an important factor which impacts directly
on production and cost of a company. High rate of raw materials affects quality of products in a
large manner.
Internal environment analysis of John Lewis:
Growth Plan: The internal strength of John Lewis is that it is one of a leading firm of UK
and has effective brand image in customer's point of view. In order to expand its business and
increase growth this firm aims to set up 20 new stores in other cities of this country ( Evans,
Stonehouse and Campbell, 2012). Along with this, to gain more profit it needs to open new
outlets in international marketplace also by digitalise the business. Its other objectives which
shows advantages are this firm wants to increase sales by 25% which will increase profit share
at marketplace by 40%.
Business Ethics: John Lewis has promoted its business as more ethical and traditional.
This can be seen throughout its business like transparency by using social media as well as
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conducting operations according to a code of ethics and more. Along with this, it has provided
healthy working environment to staff as well as treated them equally. This process radiate
positive brand image and effective services of John Lewis.
A Strategic Business Process Model
John Lewis has proved successful in acquiring large number of competitors. It has
effective brand image as well as impressive goodwill. Its departmental store sells home-ware,
electrical, toys and clothing products. But to arise competitors, its sales performance has much
affected. Along with its poor strategies and high prices of products also impact on sales and
production of this company. In addition to this, due to lack of knowledge of trends of
marketplace as well as usage of old techniques shows major weaknesses of John Lewis.
Therefore, its management is required to formulate new strategies and policies in order to
achieve competition at marketplace. A strategic business model for this company is given as
below:
Illustration 1: A Strategic Process model of John Lewis
Sources:A Strategic Process model of John Lewis, 2018
Vision of the company: John Lewis Company wants to open its new outlets in other
locations of UK as well as in international market through digitalisation (David, 2011). For
achievement of this business, it needs to make an action plan which includes various activities of
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organising the firm at international level. Along with this, managers need to measure resources
required for carrying these operations in an appropriate way.
View of the opportunities space: After making new vision and strategies, managers of
John Lewis need to grab opportunities present at marketplace where it wants to expand the
business (Keupp, Palmié and Gassmann, 2012). They are required to analyse latest trends, choice
of people, their life style and more. This would help in providing services to customers according
to their wants and needs.
Future strategic intent: It gives an idea to John Lewis to attain its future desires in a
profitable way. Globalizing the business will prove beneficial for this firm to increase number of
national and international customers in a profitable way. This firm needs to adopt new marketing
techniques to promote its products or services in foreign market.
Assessment of Current business Design: It means when a company is examining their
current procedure and functionality in order to check whether firm is dealing in changes that are
occurring in business environment because this type of behaviour is necessary in maintaining
current market position. John Louise company is doing their business in garment industry and it
is required for corporation that all current trends and fashion should be followed by association
so that customer retention could happen and more number of buyers could get attracted by
serving products of company (Poister, 2010). There are some questions that is to be answered
while assessing business design:
Q1) How much switching cost that is customer paying in market?
 If switching cost is high and customer is ready to pay this then this actions is showing
that corporation need to change their business structure.
Q2) How business model is scalable?
 It means how flexible business model is, in context to expanding business activities in
market. If it is scalable then it is a profitable situation for association.
Q3) Earning before spending?
If marketing activities of associations is good and prominent then it is required from corporation
that they should analyse their market position to get information about how people is waiting for
John Louise company's products.
Choice of Business Design: In is very important for organisation to analysis their own
strength and weakness, capabilities, employees abilities and many more in order to design
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business effectively (Barney and Hesterly, 2010). For this, they develop strategies and plan that
help to find of improvement area. There are various filed which want improvement like finance,
marketing, human resources, operations, research and development or many more. To manage all
these department enterprises want to develop plan which help to achieve goals and objectives in
an effective manner. So that, management of an organisation select business design according to
their needs and want. For this, they want to identify their own demand and develop effective
business design in limited period of time.
Business Design Prototypes:It is kind of project work in which new firm prepare design
related to whole business activities that are completing in order to achieve set goals and
objectives. Firstly, person are think about what kind of prototypes should be create for their
business. Mostly three type of prototypes are used by organisation are explain as follow: Low in cost, quick and rough to build: In this kind of prototypes, organisation has can not
want to spend lot of money in business design. They only focus on implementation of
strategies which provide high sell and profitability. Low cost prototypes has not provide
effective design, through this, individual can not able to achieve aim. Give more detail but still rough and closer to solution: In this, company develop plan of
entire business activities in detail which help to achieve goals in an effective manner.
But, it is still rough and can not provide full information about each one of activities.
Rather then this, individual are much closer to their aim as compare to first method
business design (Schilling, 2010). Most of the company are used this method to design
business effectively. Thus create positive environment for all companies in an effective
ways in specific period of time. Much Closer to final: I is a focus strategies, in this management of an organisation has
develop strategies in order to achieve goals and objectives in limited period of time in an
effective ways. Thus help to gain final outcome effectively. In this, firm are gain
competitive advantages as compare to their competitors at market place. Through this,
enterprises are able to enhance employees productivity as well as performance because
this method help to manage all working environment effectively.
Planning of execution: It is the last step that is an essential part so that end products can
be delivered to all their clients (Ackermann and Eden, 2011). Therefore, it is important that a
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proper strategies are implemented for getting a effective results. Further there are some of the
points that they can consider before executing the plan in a better way and these are as follows: Set clear priorities: To remain in the market area for a longer period of time it is
important that a set visions are formulated so that employees have an idea of what task
they have to perform for gaining better outcomes.
 Collecting and analysing data: In this information are collected so that it can be analysed
so that valid conclusion can be evaluated.
Reflection on strategic process model of John Lewis
Strategic process model enable and define about the all major things of a company so that
better and effective working could be done. Strategy process model of a firm will going to assess
by me in order to which better and effective working could be promoted. For attaining a better
position I will first formulate the vision of the organisation so that an overview or draft can be
formulated through which I can evaluate what all things are to be achieved for sustaining
themselves in the market area for a longer period of time. To accomplish the task I will be
required skilled employees who can help me out in completing the task so it my next step will be
of viewing appropriate opportunities so that eligible candidates can be selected. For an
organisation it is important to analyse the strengths and weaknesses so that based on this
strategies can be made. Therefore, I will look out for various business deigns that have been
implemented by other organization too in order to get effective results. Further I will see what
kind of marketing segmentation can be done so as to set a target area form where maximum
benefits can be gained.
Economical condition is also an important criteria which I will consider so that I can
deliver the products in best quality to its customers. For this, future strategic intent will come
into being. It is not possible that all the strategies that have been implemented can give
appropriate results to an organisation thus, it is necessary that I will make a back plan that will be
of business design prototype. This will help me out in choosing alternative activities so that an
effective results can be gained. According to the present market situation there are various
business designs available; in the market which a company can choose in order to increase their
sales and profitability in given time period. Now it my duty to choose an appropriate business
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design and in will opt functional structure it will help me out in dividing the task according to the
capabilities and skills that they acquire so that an individual can help the organisation in giving
better outcomes. Other than this, I will see all the criteria that will assist me getting appropriate
results in specific period of time. For this all the latest tools and technologies are taken into
consideration so as to manufacture goods and products according to the choices and preferences
of customers. Planning and execution is the last step which I will look out for in order to make
sure that all the resources that are used are implemented in a better manner so that the products
that are produced are as per the satisfaction level of the consumers. Therefore, I will check
whether the commodities are executed in a proper manner to its end clients.
CONCLUSION
It has concluded from this report that strategic management is used in making
improvements in a company. It provides various framework from which a company can choose
the best one to make changes in system. Along with this, it is responsibility of management to
analyse business environment along with strengths and weaknesses. Managers should make a
proper strategic plan as well as implement it in proper order. It includes design the practices and
policies and develop business process as well.
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REFERENCES
Books & Journals
Ackermann, F. and Eden, C., 2011. Strategic management of stakeholders: Theory and practice.
Long range planning. 44(3). pp.179-196.
Barney, J.B. and Hesterly, W.S., 2010. Strategic management and competitive advantage:
Concepts. Prentice hall.
David, F. R., 2011. Strategic management: Concepts and cases. Peaeson/Prentice Hall.
Evans, N., Stonehouse, G. and Campbell, D., 2012. Strategic management for travel and
tourism. Taylor & Francis.
Freeman, R. E., 2010. Strategic management: A stakeholder approach. Cambridge university
press.
Hair, J. F. and et. al., 2012. The use of partial least squares structural equation modeling in
strategic management research: a review of past practices and recommendations for
future applications. Long range planning. 45(5-6). pp.320-340.
Hodgkinson, G.P. and Healey, M.P., 2011. Psychological foundations of dynamic capabilities:
reflexion and reflection in strategic management. Strategic Management
Journal.32(13). pp.1500-1516.
Keupp, M. M., Palmié, M. and Gassmann, O., 2012. The strategic management of innovation: A
systematic review and paths for future research. International Journal of Management
Reviews. 14(4). pp.367-390.
Poister, T.H., 2010. The future of strategic planning in the public sector: Linking strategic
management and performance. Public Administration Review. 70(s1).
Schilling, M.A., 2010. Strategic management of technological innovation. Tata McGraw-Hill
Education.
Online
Strategic Management, 2018.[Online]. Available through:
<https://www.investopedia.com/terms/s/strategic-management.asp>./
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