Comprehensive Business Report: Next plc Analysis and Strategy Review

This business report offers a comprehensive analysis of Next plc, a British multinational retailer. It begins with an introduction outlining the company's background, type, size, and scope within the retail sector. The main body delves into the interrelationship of various functions within the organizational structure, emphasizing the functional structure and the interconnectedness of departments like human resources, marketing, finance, sales, and production. The report further examines both internal and external factors influencing Next plc's business operations, utilizing PESTEL and SWOT analyses to identify political, economic, social, technological, environmental, and legal factors, as well as the company's strengths, weaknesses, opportunities, and threats. Finally, the report concludes by discussing the impact of globalization on Next plc's strategic decision-making processes. The report highlights the company's strategies to meet customer demands and expand globally, providing a holistic view of Next plc's operations and market position.

Business Report

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Type, size and scope of organisation...........................................................................................1
Interrelationship of functions on organisational structure...........................................................2
Internal and external influencers on business operations............................................................4
The influence of globalisation on organisational strategy and decision making.........................6
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
An organization has four common elements that can significantly impact its business
operations. The elements can include chain of command, span of control, work specialization,
experience etc. Organization chosen for this report is Next plc, which is a British multinational
retailer of home, clothing, beauty and footwear products (Kimmel, Weygandt and Kieso, 2018).
The company is headquartered in Enderby, Leicestershire. It was founded by Joseph Hepworth
in the year 1864 and has nearly 700 stores in the United Kingdom. The report explains the type,
size and scope of the chosen organization along with a description of the interrelationship of
different functions within organizational structure. The report also explains the various internal
as well as external factors that can influence business operations of the organization with the
help of PESTEL and SWOT analysis. Lastly, influence of globalization on organizational
decision-making as well as strategy is also explained.
MAIN BODY
Type, size and scope of organisation.
Next Plc is a well established company which is offering its high quality products and
services to different market area all around the world. This organisation is dealing in retail sector
and providing high quality of fashionable products and services to customer in order to meet
with their needs and requirements. There are different types of organisation such as public sector,
private and voluntary sector. All of these sectors are performing business activities with different
motivate and goals (Bell, Bryman and Harley, 2018). These organisation are managed and
controlled differently in order to attain desired goals and objective. Scope and size of respective
company is mention below in detail.
 Type – This can be describe as the kind of business which is providing its services and
products to customers. Next Plc is private type of organisation in which all activities and
task of business will be controlled and managed by owner of the company. This type of
business are majorly conducting business operations in order to increase sales of business
as well as earn more revenues or profits. Next Plc is private organisation and it owner is
responsible to taking important decision of organisations.
 Scope – Scope of this business refer as the wide ranges in which respective company is
offering its products and services to customers. Scope of Next Plc company is very vast
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and it is providing its offering to large customer base and market area. Respective
company is providing it products and services to customers all around the world and it is
considering different approaches in order to meet with the needs of customers (Ghauri,
Grønhaug and Strange, 2020). Scope of Next Plc organisation consist of full filling
customers requirement and globally provide its offering to different types of customers. It
is using digital tools and techniques in order to enhance functioning of business in global
market area and meet with the requirement of customers.
 Size – Next Plc company is designing and manufacturing high quality products and
services in order to offer it to large market area. This organisation have very large size
of business that is located in different part of the world. Respective company is approx
546 stores that is located in different part of the world. It is developing products which is
as per the need or requirement of customers. This helpful for respective company in
attracting large number of customers towards business and it lead to have around 900,000
active customers of Next Plc globally. Next Plc company have its store in different area
all around the world which provide easy to customer for purchasing products and
services.
Interrelationship of functions on organisational structure
Organisational structure is combination of different task and business process that needs to
be performed in effective manner in order to attain desired goals of business. There are different
department of business that is linked or interconnected with each other in order to enhance
business performance (Bovée, Thill and Raina, 2016). It is very important for Next Plc
company to have strong interrelationship with its functions or department which needs to be
performed organisational task in more effective and better manner. Next Plc organisation is
considering functional organisational structure. It can be describe as the structure in which
business activities is divided into different function of business and employees are classified into
different teams as per function. The major functions of respective company includes human
resource, finance, marketing, sales and production. All of these function of business will support
in conducting business activities and task in more effective manner so that desired goals and
objective of business can be successfully attain. Interrelationship of various Next Plc functions
on organisational structure is mention below.
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 Human resource and marketing – Human resource function of business in majorly related
to hiring of employees as well as developing strong relationship with them in order to
enhance business functions and activities. Where as marketing function of organisation will
lead to provide information to customer about the offering of respective company (Joyce,
and Paquin, 2016). Both of these function of Next Plc company is interrelated with each
other and focusing in attaining needs of business. Human resource function of respective
company will communicate with marketing team in order to identifying the requirement
with in employees to fill the vacant position of business. This will interrelation of human
resource and marketing team will lead hire more capable and skilled employee with in the
organisation in order carry out business operations more effectively. Marketing team will
support in promotion of vacant position of company in order to attract large pool of
candidate with in the business.
 Finance and human resource – Finance team of respective company is responsible to
budget planning, cost analysing and determining financial factors of business. human
resource team of Next Plc company will provide proper training to employees of finance
team to carry out functions in more effective and efficient manner (Massa, Tucci and
Afuah, 2017). It is interrelated in motivating employees and boosting their moral and
capability to perform organisational task in more effective and efficient manner. This
interrelations of finance and human resource team is responsible for increasing finance team
capabilities in order to manage business budgets and cost in more better manner. This will
support in providing strategies to business that will lead to attain desired goals of business as
well as earning more profits.
 Sales and production department – It has been identified that sales and production team
needs to link their work as well as functions with each other in order to accomplish set
objectives. Sales department of respective company will lead to determine the customers
needs and wants so that they can develop product and services as per customers requirement.
This team will identify the actual needs or requirement of customer as well as determine
current trends of business. This collected information will be provided to production team of
respective company. Production them of Next Plc company is responsible for manufacturing
products and services as per the information provided by sales team. It is essential that both
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of these two department are linked with each other in order to produce appropriate product
as well as full fill customers wants. It is responsibility of sales team to increase sales of
respective company in market area and earn more profits.
Internal and external influencers on business operations
PESTEL Analysis
PESTEL analysis is a framework that is usually used by organizations in order to identify
the various macro environmental factors as well as their impact on its overall business
operations. This helps the organization in formulating effective strategic decisions in order to
enhance its performance and productivity. The PESTEL analysis for NEXT plc is described
below –
Political Factors – The United Kingdom is a politically stable country and offers a
variety of opportunities to businesses that operate there. The government is proactive and split
into local as well as national administrations (Laothamatas, 2019). But there is some hidden
corruption and Brexit has also given rise to various uncertainties and debates.
Economic Factors – The nation also has a strong economic position as compared to
other countries. Since the population living in the United Kingdom is large, eve the small are
markets are profitable. But there has been a slow recovery since the 2008 recession and the
government has taken necessary steps regarding the same.
Social Factors – There are many social factors that can affect the overall business
operations of Next plc like age, gender, income levels etc. of the people. The people have a high
standard of living, but there is a high dependency ratio. Since the population is multicultural, it
will be beneficial for Next plc.
Technological Factors – People living in the United Kingdom have effective innovation
skills because they have an expertise in information technology. The nation also has access to
good technology with various laws for intellectual property (Li and Hall, 2020). But the overall
technological development is slow in comparison to the US, although the nation is considered to
be a hub of various technological institutions.
Environmental Factors – Companies today have understood that people are increasingly
becoming aware about the environment and the harm that is caused to it through various
industrial activities. The UK government and other local authorities have taken various
initiatives to make sure that the business operations of different companies are sustainable.
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Legal Factors – Organizations operating in the United Kingdom are expected to adhere
to various legislation. One of the legislations is the Equality Act 2010 that protects employees of
a company from any kind of discrimination. Similarly, The Employment Act 1996 protects the
rights of employees at the workplace.
SWOT Analysis
SWOT analysis is a technique that is used in strategic planning and can be used by an
organization or by an individual. It helps an organization in identifying its strengths, weaknesses,
opportunities as well as potential threats that can influence it. The SWOT analysis of Next plc is
descried below –
Strengths – Next plc is a multinational company that has a track record for developing
new and innovative products. Also, the company has invested significantly in building s strong
brand portfolio over the years (Nowiński and Kozma, 2017). Apart from this, the company has a
strong distribution network and also has been performing extensively in the market. The
company has an expertise in entering new markets with a highly skilled workforce as they are
trained. Also, the customer base of Next plc is satisfied and loyal to it.
Weaknesses – One of the weaknesses of Next plc is that it does not plan its finances
properly. Also, the company lacks investment in new technologies which can act as a major
weakness in the expansion of the respective company in new geographies. The company is also
not very good at forecasting demands and thus, many times ends up keeping high inventory in its
warehouses. Also, there is a lack of research and development as compared to other leading
brands in the company.
Opportunities – Implementing a new taxation policy can influence the way in which
business operations are carried out effectively. This will provide an access to new opportunity
wherein it can enhance overall profitability (Schaltegger and Burritt, 2018). Also, changes in the
customer preferences and behaviors can act as an opportunity for the organization to increase its
overall revenue and profits. The company can also gain new customers through various online
channels which can contribute to the overall profitability of the firm.
Threats – One of the major threats that Next plc can come across is currency fluctuations
because it has operations in different countries of the world. Changes in consumer buying
behavior as well as competition from other brands in the market can act as potential threats.
Also, if the competitors adopt new technologies and Next plc fails to do so, it will have to bear
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the negative consequences that will come along with it. This can also happen if the company
fails to supply innovative products in the market.
The influence of globalisation on organisational strategy and decision making
Globalisation can be describe as the concept of spreading business into different market area
all around the globe. According to this concept Next Plc company will integrate its technology,
employees, job, commodity, services, culture and so on across the geographical boards.
Globalisation is very vast concept and it will lead to have major impact in business as well as its
decision making process. It is very important for Next Plc company to consider different factors
of globalization in its business process in order to achieve desired goals and objective of
business. There are different elements that is related globalisation and have direct or indirect
impact over strategy or decision making process of Next plc.
 Competition – Globalisation of business will lead to have impact on performance of
business as well as its decision making process. Next Plc company have to dealing in highly
competitive environment while conducting business activities in global market area.
Respective company have to change business strategies and take organisational decision as
per the competition in marker area (Wirtz and et.al., 2016). strategies and decision making
process of respective company will be influenced by decision and offerings of rival
company in same market area.
 International business – This is one of the driving force of globalisation business and it
will encourage respective company to enhance business operations. Next Plc company will
be able to increase the share of market area as well as customer base by expanding activities
in international market. Strategies and decision of Next Plc company will be influence by
international business and impact on business operations.
 Market trends – Global market area have different market trends and business will be
affected by this factor. It is important for Next Plc company to identify and analyse different
market trends and conduct business operations accordingly in order to full fill the needs or
requirement of customers. Respective organisation have to identify different market trend
and consider it in business decision making process as well as developing strategies.
 Cost – Cost is important factor of business and its will lead to affect profits or revenues of
business. Globalisation will lead to increase or decrese cost of business which is majorly
depend on the strategy and decision making process of business. It is important for Next Plc
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company to consider cost of business while creating strategies and providing products to
customers.
 Trade relationship – The relationship of trade will lead to influence the performance of
business and affect decision making process. It is important for Next Plc company to
consider trade relationships while creating strategies.
CONCLUSION
From the above report, it can be concluded that there are many elements that can
influence the business operations of an organization. Also, there are many functions within the
organizational structure that work in coordination and sync with each other. This ensures smooth
functioning of the company and also significantly contribute to the overall performance and
profitability of the firm. PESTEL and SWOT analysis can be used to identify various macro
environmental factors that can have an impact on the company as well as its strengths,
weaknesses, opportunities and threats. Lastly, globalization can also have an influence on the
overall decision-making process of the company.
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REFERENCES
Books and Journals
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Education India.
Ghauri, P., Grønhaug, K. and Strange, R., 2020. Research methods in business studies.
Cambridge University Press.
Joyce, A. and Paquin, R.L., 2016. The triple layered business model canvas: A tool to design
more sustainable business models. Journal of cleaner production, 135, pp.1474-1486.
Kimmel, P. D., Weygandt, J. J. and Kieso, D. E., 2018. Financial accounting: Tools for business
decision making. John Wiley & Sons.
Laothamatas, A., 2019. Business associations and the new political economy of Thailand: From
bureaucratic polity to liberal corporatism. Routledge.
Li, W. C. and Hall, B. H., 2020. Depreciation of business R&D capital. Review of Income and
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Massa, L., Tucci, C.L. and Afuah, A., 2017. A critical assessment of business model
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Nowiński, W. and Kozma, M., 2017. How can blockchain technology disrupt the existing
business models?. Entrepreneurial Business and Economics Review. 5(3). pp.173-188.
Schaltegger, S. and Burritt, R., 2018. Business cases and corporate engagement with
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Wirtz, B.W. and et.al., 2016. Business models: Origin, development and future research
perspectives. Long range planning, 49(1), pp.36-54.
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