Strategic analysis of a company and its competitive environment Essay - 1

Strategic analysis of a company and its competitive environment - Essay Example The company has employed over 7600 employers in the UK and overseas. M&S ultimate goal is to become a major retailer in the global market. The company has come up with strategic plans to help them achieve this goal. The first plan was launched in 2007 and aimed at achieving at attaining 100 commitments in 5 years but the plan has extended to 180 commitments to be attained by 2015 (Thompson 15). The first section of the paper analyses M&S external environment. The external environment analysis pays attention the factors affecting the company and is often referred to as the macro environment. This entails the study of the how the company deals with change in the market, how it responds to the market demands and any competitive forces in the market. The analysis of the external market is done using the PESTEL analysis and the Porter Five Forces (Baines et al. 33). The second section analyses the company’s internal environment using the SWOT analysis. Analysis of both the internal and external environment affects the strategic analysis of the company. The strategic analysis of a company helps identify the environmental factors that impact on a company (Harris 55). Additionally, it clearly outlines the activities in the organisation and outside the organisation. M&S External Environment The external environment is made up of the forces and conditions that are beyond the company’s control and influence the company’s strategic options. Furthermore, it defines the competitive forces that could have positive and negative effects on the company (Harris 55). The PESTLE model is used to analyse the classes of external factors that can affect M&S ability to expand and survive in the current competitive market. PESTLE Analysis The company’s growth depends on the political stability, business growth and investor growth in the country. The government sets rules and regulations that companies must abide by including risk control and assessment, healt h and safety and planning for hazard identification. Additionally, the legal and administrative factors in the economy including trade regulations, tax rates, incentives, pricing regulation and employee benefits (Hibbit 1998). The company has been faced by various political factors such as the war in Iraq that led to instability in the UK economy. The company failed to abide by the health and safety regulation established by the British Standards. George Blair who was injured in the line of duty after the company continued to ignore repairs also charged the company (Hibbit 1998). Finally, in 2006 the company was the first giant retailer to be affected by the Fair trade route on its clothing and food sections. This included a regulations relating to animal welfare protection and to cut down on the fat and salt content. Economic Factors The economic environment surrounding the company is highly uncertain and has huge impact on all the company’s segment including food, clothing and furniture. M&S was adversely affected by the global recession and cut down on the number of employees and closed a number of stores. The government’s legislation to increase the VAT led to a drastic decline in the company’s sales (Harris 55). However, in the recent times, the economy has had a positive