International Business: Sainsbury's Strategic Response to Change

This report explores the contemporary management issues faced by businesses, focusing on Sainsbury's strategic responses to change. It identifies key dynamic forces impacting business and society, such as political, economic, social, technological, environmental, and legal factors, using PESTLE analysis. The report discusses the relationships between these forces and examines decision-making tools like SWOT analysis, decision-making diagrams, Pareto analysis, cause and effect analysis, force field analysis, break-even analysis, and ratio analysis. It also touches upon relevant theoretical foundations supporting corporate responses to contemporary management issues. A case study of Sainsbury's strategic responses to major drivers of change is presented, followed by recommendations for addressing these issues effectively. The report concludes by emphasizing the importance of proactive management in navigating the complexities of the contemporary business world.

International
contemporary business
issues

Table of Contents
INTRODUCTION ..........................................................................................................................3
MAIN BODY...................................................................................................................................3
Key dynamic forces impacting on business and society........................................................3
The relationship between the forces in the contemporary business world.............................5
The decision making tool that are used to address contemporary drivers for change............6
The relevant theoretical foundations to support the identification and application of effect
corporate responses to contemporary management issues.....................................................8
CASE STUDY...............................................................................................................................10
The way Sainsbury has strategically responded to the two major drivers for the change ..10
RECOMMENDATIONS...............................................................................................................11
CONCLUSION .............................................................................................................................14
REFERENCES..............................................................................................................................15

INTRODUCTION
The contemporary management issues are problems which are faced by a business entity
in the market. There are various global and national issues which arise in the contemporary
business world and the company should be ready to tackle these issues for survival in the market
(Anwar, 2018). It is major responsibility of management of a company to face the contemporary
issues in a precise manner for the growth and development of business. The companies follow
effective strategy in order to get succeed in the market with better margin. In this project report
various contemporary management issues are explained along with the ways used by a business
to tackle the same. In this report decision making of an organisation is explained in relation to
the contemporary management issues. In this report a case study related to change management
is also discussed in order to understand drivers of change. In this project example of Sainsbury
multinational retail company is taken into consideration which was found in 1869. The
company is one of the largest chain of supermarkets in the United Kingdom. The company is
headquartered in London, United Kingdom and has gross revenue of 3000 K. GBP
MAIN BODY
Key dynamic forces impacting on business and society
In the functioning of a business there are various elements present in the external
business environment that contributes to forces impacting on business society. It is essential for a
business entity to take major steps that are required to understand and assess the forces that are
impacting on business and society. The key dynamic forces that impact on business society are
explained with the help of PESTLE analysis which is helpful in understanding the external
business environment. The PESTLE analysis of Sainsbury is given below:
 Political factors- The political factors are related to rules and regulations imposed on a
business in the market by government of United Kingdom. Functioning of a business in a
proper manner depends on the stability and instability of the government. It is essential
for the Sainsbury to focus on different political factors that have critical impact on
functioning of a business. In the recent times the political interference due to Brexit
impacted several national and global companies by creating economic chaos.

 Economic factors- The economic factors are considered as major factors that are present
in the economic environment of the country. Economic environment includes the
monetary policy and economic policies developed by the government. The revenue and
turnover of a business is majorly impacted by the economic factors that are present in the
economy. There are many different cases where economy and its functioning fluctuates
due to various economic forces.
 Social factors- These factors are important as they are measured by the influence caused
by whole society on a business. The social factors in a country are related to the way
society impacts a business. Culture is considered as major factor that is derived by the
characteristics and traits of the society.
 Technological factors- The information and technology brings major changes in the
working of a business organisation. It is major responsibility of a business to deploy IT
related changes on the business and it also influence on the technology. Sainsbury uses
advanced computer systems and software to gain growth in the competitive market. The
technological factors help a business to grow at faster pace in the market. The customer
engagement is facilitated by environmental factors that are essential for business growth
and development (Bhagra, 2018). Most of the companies try to develop operations and
functions using information and technology to get immense success in the competition.
 Environment factors- It is the moral duty of every business to follow the environment
related policy which is essential for sustainable growth of the business firm. In the
business world the environmental factors are most crucial factors that impact on business
operations. The environment should be considered precisely by the company and it is also
essential to follow the Policies related to environment by Sainsbury. It is also major duty
of strategic department of Sainsbury to consider all the environment factors for gaining
customer attentions.
 Legal factors- The legal policies which are formulated by local authorities must be
considered by the company in a major sense. It is also essential for the company to put
legal policies and plans into consideration for the long term success of the business.
Sainsbury also follow various designed legal factors in order to conduct an ethical and
legal business. Most of the successful companies in international and national market
takes assistance of legal factors that are assigned by the business entity. It is the major

responsibility of legal department of the company to consider various legal factors that
are circulating in the company.
The relationship between the forces in the contemporary business world
In the global business environment there is a prefect relationship between various forces
that impact negatively or positively on business organisations. It is the contemporary business
world it is crucial for the companies to hire professional strategic management to deal with
consequences. Contemporary business world is the current business world which is existing in
the competitive business environment (Fraedrich, 2018). It is important for the management to
maintain effective relationships between various departments in order to tackle the forces that are
present in the macro environment. Most of the major companies in contemporary business world
depend on developing a major relationship force for achievement of organisational goals and
objectives. The relationship between various forces in contemporary business world are
mentioned below in context of Sainsbury:
 Political and economic forces- The political forces are considered as major external
driver that impact functioning of a business in a precise manner. Most of the business
companies in international market consider the economic and political forces attached
with each other to understand macro environment. It is the major duty of top level
management of a company to consider political factors that are present in the economy.
Monetary policy is considered as a major economic policy which is majorly formulated
by the finance ministry of government of United Kingdom. The political and economic
forces are major drivers that impact on the functioning of a company.
 Technological and development forces- The technological forces are the forces which
are result of the information and technology in a business. The IT which is present in the
contemporary world also contribute to long term success of the business. The
development of business is dependent upon various tactics that are used by strategic
management (Green, R.M., 2018). It is necessary for the management to consider the
technology related forces which are developed and circulated by the IT department. The
development of overall business also depends on the information and technology which is
used by competitive companies.

 Social and cultural forces- In the overall working of a company at the marketplace the
social and cultural factors play a crucial role. The culture of Sainsbury is majorly
impacted by the society which is present in the economy as it decides the level of
employees. In recent times the importance of social and cultural has increased due to
increased social awareness. In majority of cases the culture in a company is handled by
the human resource management. The human resource management is majorly
responsible for handling culture and grievances that arise in the business.
 Legal and government regulations- Legal and governance related rules and policies
determine majority of functions that are happening in a company. The outside related
legal and government related policies that are circulating in the economy. Most of the
times companies takes assistance of legal advisors in order to perform various objectives
and targets. The government of a company should regularly focus on building safe and
legal procedures and formalities to develop ethical business.
The decision making tool that are used to address contemporary drivers for change
It is the important in the functioning of a business at the marketplace to use appropriate
business decisions making tools that are necessary for future goals. Sainsbury should use the best
available decision making tools that are available at the marketplace (Hakanen, T., Helander, N.
and Valkokari, 2017). It is also the major role of management to consider the necessary factors
which are essential for addressing the contemporary drivers of change. The main decision
making tools which can be used by Sainsbury in this competitive environment are mentioned
below:
 SWOT analysis- The SWOT analysis play a major role in the growth and
development along with decision making. In order to gain organisational success in
the business it is compulsory to perform assessment of internal and external
environment. The SWOT analysis includes strengths, weaknesses, opportunities
and threats that are available for the business working.
 Decision making diagram- The decision making diagram play a crucial role in
developing decision making for a company. In this approach there are various
obstacles and hurdles that are faced by a company. Decision making in a company
relates to long term functioning of the business with the help of graphical
representation.

 Pareto analysis- The pareto analysis is a method for decision making in a company
which includes 80/20 rule. This means 20% of self-activities account for 80% of
the results achieved by an individual. This is a universally adopted approach in the
field of change management and decision making.
 Cause and effect- In this method a brief analysis of given situation is performed
and the major decisions of the organisation are based on cause and effect. The
company in international market performs assessment of cause and effect with
better role and functioning (Hartmann, 2017). It should be the utmost responsibility
of management to consider the major elements which are present in the business
environment.
 Force field analysis- Force Field Analysis enables Sainsbury to examine different
projects. It provides a framework for looking at the factors that influence a
particular situation. This analysis helps business entity to understand the process of
any organization in a better way.
 Break even analysis- In the competitive world break-even analysis helps firm to
determine at what stage a new business product will be profitable. It’s an economic
calculation used to determine the number of products or services a company needs
to sell to cover the manufacturing costs.
 Ratio analysis- The ratio analysis is also a technique which is used in decision
making of a company. In this approach ratios are calculated in an effective manner
to develop the best strategy. In the business firm the ratio analysis is the best way to
succeed in the market with majorly focus on growth in a specific time period. Most
of the companies in domestic market focus on developing a precise ratio analysis
function (Hartmann, M., 2018). The financial management of Sainsbury should
consider effective ways of establishing relationship in order to calculate market
statistics.
The relevant theoretical foundations to support the identification and application of effect
corporate responses to contemporary management issues
It is the need of every business organisation to keep in mind and solve various issues with
effective management related approaches and models. The application of business models in the
company should be there in a systematic manner for better operations and growth. There are

many theories and concepts which are proposed by famous management scholars that provide a
clear understanding for achieving various objectives and goals. It is also compulsory job of every
company to search for the best ways to solve and deal with the various contemporary issues. In
the recent times the importance of theoretical framework has increased due to significant change
in business environment. The theoretical analysis helps in developing a precise approach which
is beneficial in increasing the profitability of the company. It is also compulsory for the company
to consider issues like Brexit and Covid-19 to prepare the desired strategy. Various famous and
renowned model states that they develop a perfect base for setting plans and objectives of the
company (Hartsfield, 2017). It is also essential for the company to manage the contemporary
issues which helps in overall growth of the business. Many different companies in national and
international market focus on building trust and faith of the customers. The companies also
prefer to develop a perfect strategy that is desired for achievement of group and individual goals.
The relevant theories in the market which are mentioned below:
 Systems theory- The premise of general systems theory is that a system is composed
of interacting elements that are affected by their environment. Because of this
interaction, the system as a whole can evolve ( new properties) and self-regulate
(Silvanto, 2017). The systems theory of management is widely used by many
organisations at the marketplace. Management should look for systems theory of
development in order to gain competitive advantage in a short span of time.
This introduces such concepts as:
Entropy — The tendency for a system to run down and die (a thing to be avoided in business)
Synergy — Working together, the parts can produce something greater than those same parts
could produce on their own
Subsystem — The whole (your business) is built on subsystems, which themselves are built on
yet more subsystems
 Principles of administrative management- The principles of administrative
management which are used in the business are developed by Henry Fayol. These
principles of management lead the organisation with proper administrative
management.
 Bureaucratic management- It is important for the organisation to learn effective
bureaucratic management for controlling administrative decisions according to

dynamic business environment. The management should also consider principles
which are supporting the implementation of bureaucratic management for the long
term growth of the business. Division of Labour in the company is facilitated
perfectly by the bureaucratic management which is the backbone of a company.
 Scientific management- The management concept of scientific functioning is
essential in growth of the company which is main in functions. Management
which is practised in a company should look for various features that together
contributes to organisational success. It is the major role of a company to
implement scientific management which is important in handling major operations
of the country (Hickmann, 2017). It is the main function of management to
consider various aspects of scientific management to also develop an effective
approach in the marketplace for growth of business.
 Human relations theory- The harmony between various employees are achieved
with the help of this theory. It is very much crucial and important to develop
effective human relations theory for business development. This also increases the
potential between employees for better growth of the business. It is important for
the business gain growth with the help of effective objectives that are essential for
human which is employee development. The business organisation should focus
on increasing employee productivity which is also beneficial in gaining human
coordination (Lutz, 2017). The coordination and communication play an
important role in the development of human relations theory for organisational
gain.
 Classical Management- This theory is a major approach which is beneficial in
increasing the value of physical needs. It is necessary for a company to focus on
classical management in order to satisfy the physical needs of the employees. The
theory of classical management focus on building straight needs for employees
and to satisfy them with the application of a classical management theory.

CASE STUDY
The way Sainsbury has strategically responded to the two major drivers for the change
 Brexit- Every company of Great Britain is impacted by the step of United Kingdom to
leave European Union. The economy of United Kingdom is also majorly impacted by the
step of government to lead the marketplace by leaving European Union. There are
various cases that are developed due to this step taken by the government. This decision
has majorly lead to disturb trade of Sainsbury with different trading partners. In the
recent times the dependency of UK companies on EU countries has significantly reduced.
The revenue which was earlier earned by various companies has significantly decreased.
It is important for Sainsbury to consider various economic policies of the government to
take into consideration the impact caused by the same (Hult, 2020). In the competitive
scenario the Brexit has impacted on various functions that are performed related to trade
practices. The export and import of United Kingdom has also declined due to UK's
decision to leave European Union. Brexit has also impacted on suppliers and whole
sellers which used to provide goods and services at a cheap price. Company in Britain
should follow new trade and business related policies for better development and
expansion of the business.
 Takeover Argos- The Sainsbury has become more giant after taking over Argos this
increased the level of responsibility on the arms of Sainsbury. The company should take
care of new culture and practices which are essential for taking over the current
competitive scenario. The strategic and top level management of Sainsbury has also
increased the way company was doing different operations. Most of the times business
organisations change whole policies and employee related responsibilities for the growth
and expansion of business (Jafari-Sadeghi, 2019). Taking over Argos company was a
major decision of Sainsbury that has increased market value and strength of the business
entity. It was a major decision of Sainsbury to consider that Argos is also a major
company and taking it over will lead to expand operations of Sainsbury in the market.
Taking over any company in the market also increases risk associated with the operations
and functions. In most of the cases related to take over a company it is essential for a
business firm to develop prefect strategy at the marketplace. In recent times the
importance of business development has also increased which requires various legal and

formal formalities (Wazurkar, 2017). The companies in international market delivers best
performance that affect functioning of a company in a major sense. It is one of the major
responsibilities of management to overcome various challenges that arise due to dynamic
nature of the market.
 Proposed merging with ASDA- According to recent updates Sainsbury is about to
merge with ASDA that will create a deep impact on majority of operations. ASDA is a
giant multinational company and if Sainsbury will take over ASDA then the company
will have to consider different factors that are essential for business growth. In the
corporate world taking over a large and giant company is not a small task. Taking over
any giant companies raise the responsibilities of management in order to manage various
operations (Jansson, 2018). The business organisations in current scenario should also
stand financially stable for the growth in market with major perspective. Business
companies in global market also try to minimise risk associated with the operations for
growth and development of the company. In the competitive world companies should
also take assistance of the professional and skilled employees for growth and
development in a short span of time.
RECOMMENDATIONS
The recommendations for the Sainsbury requires hard work and dedication of the
management in order to achieve the goals and objectives. The recommendations for the
company should be followed precisely by the management in order to gain success in the
market. In this competitive world there are various companies which follow suggestions
given by the top level and strategic management in order to gain market share (Kolk, 2018).
The companies should follow a systematic strategy in order to get the desired success in the
market. The recommendations for the Sainsbury are mentioned below:
 Set goals and targets- The goals and targets should be framed by the top level
management and construct a strategy for systematic growth. It is compulsory for
Sainsbury to select appropriate targets for the business and achieve them with the
help of different skilled employees. Company should also frame a critical strategy
which is important for the growth in market in a rapid manner. Companies also
frame strategic goals and policies that are effective in developing a good succession
plan. It is also effective for the company to choose appropriate rules and procedures