PESTEL

Introduction
PESTLE analysis is primarily used by organizations in the identification of the various factors that shape the external environment in which the organization operates (Babette & Fleisher, 2008). PESTLE normally includes the political-legal, economic, socio-cultural, environmental and technological factors, which play an integral role in describing the framework of environment that the organization is currently operating and the manner in which the factors will influence the future operations of the organization. PESTLE analysis is important during the process of strategic management owing to the fact that it is an integral tool that the organization can deploy in order to identify the various macro environmental factors that the business enterprise has to take into account in order to devise appropriate strategies for effective future operations and industry analysis (Chapman, 2006). In addition, the PESTLE analysis can be used for assessing the changes in the market expansion or decline, the position of the business, and the prospective direction that the business of operations of a company may take. The PESTLE framework is increasingly becoming an important aspect of business that companies have to use in order to assess the various through which the individual elements affect the company operations. This paper discusses the various ways through which the PESTLE factors shape the external environment in which the Marks and Spencer is operating.
Company overview of Marks and Spencer
Marks and Spencer is arguably one of the largest retailers that are based in the UK. In addition, the company is also a major retailer that deals with the selling of various product rangers under their brand name in at least thirty nations across the globe. This implies that the scope of operations of the Marks and Spencer are from an international perspective, and therefore, the firm must put a keen consideration on its external environment. The company relies on its customers’ confidence on their brand. Furthermore, research has reported that in the clothing industry, Marks and Spencer has a competitive edge over all its core competitors in terms of quality, customer trust and service, and diversity in product ranges. Over its existence, the company has focused on expansion of both scope of operation and product diversity, with a principal focus on the United Kingdom market. Currently, its global operations outside the United Kingdom comprise of mostly franchises, with a reported turnover of approximately 7.3 billion. The target market consists of the clothing, food, furniture and the provision of financial services. The following section is a PESTLE analysis of the Marks and Spencer.
PESTLE analysis
Political-legal factors are an important aspect of the PESTLE analysis that a firm operating in a global environment has to put into consideration when conducting an analysis of the external environment that it is currently operating. Political factors refer to the various ways and the extent to which the government have control of the economy. It is arguably evident that political factors play an integral role in determining the manner in which business are conducted in a United Kingdom. As such, it plays a significant role in determining the way in which a business conducts its operations in the external environment. The significant political factors affecting the external operations of the Marks and Spencer include the European Integration and the implementation of the Free Trade Agreements; this has facilitated the opening of the markets for the Marks and Spencer products and created an opportunity for the company to invest in the Eastern Europe. Some of the legal factors affecting the external operation for Marks and Spencer include the National legislation regarding the health and safety of the consumers, in the sense that the company must ensure that it adheres to consumer rights and production of clothes using renewable natural resources. This implies that the company has to deploy appropriate strategies in order to maintain its market share in the European countries (Williams & Green, 1997).
Economic factors on the other hand refers to the variables affecting the economy of a country, which may in turn have an effect on the way business enterprises operates and the decision making process for such businesses. The core elements of economic factors that companies have to put into consideration when conducting an external environment scanning include the economic growth, inflation rate, interest rates and exchange rates. Each of the above elements of economic factors determines the extent of business growth and expansion. For instance, the interest rates usually have an effect on the cost of capital of a company; this implies that it will influence the level of business growth and expansion (Williamson, 2003). The exchange rates on the other hand usually have an effect on the costs of exports, and the supply and the price of imports; the basic implication of this is that it affects the profitability of the company that significantly relies on imports and exports for its business operations. Economic growth usually affects the demand and supply of the commodities or services that a company offers (Williamson, 2003). Within the context of the Marks and Spencer, the retail sector was relatively affected by the recession and the markets for the company products are sensitive to any adjustments in the interest rates. This implies that global activities such as the 9/11 attacks and the recession are examples of instances that the company must put into consideration when adopting strategies for their external operations in order to upbeat the challenges posed by occurrences that might shake up the international economic system.
Social-cultural factors refers to the cultural and social aspects of the industry, and this usually have an effect on the demand of the goods company goods and the ways in which it conducts its business operations such as marketing and human resource acquisition. Some of the socio-cultural factors that shape the external environment for business enterprises include religious affiliations, age distribution, and the rate of population growth. In addition, it is vital for business enterprises to take into account the various socio-cultural aspects that may have an effect on the way the target population or the external environment perceive their commodities, such as language, gender aspects, wealth status and the opinion of the core industry players regarding green issues. With respect to the Marks and Spencer, changes in the lifestyle and taste of their potential customers can represent an opportunity or a threat to their business depending on the products and services that they are offering (Williams & Green, 1997). The opportunities can be perceived in terms of the creation of a new market for the company products. As a result, it is important for the company to tailor its external operations in accordance with the social factors of its target market for its products.
Technological factors broadly refer to the various technological aspects that companies deploy with the prime objective of fostering business efficiency. It is arguably evident that technology play an integral role in ensuring competitive advantage and is considered as a chief contributor to globalization, implying that technological changes provides a framework through which business enterprises can reconsider their business and cooperate level strategies. Some of the direct effects of technology in business operations include efficiency in production, decisions regarding outsourcing and barriers to market entry. In addition, technological changes can have an effect on the operation costs, quality of the commodities and services offered and innovation. Some of the technological issues that business issues must put into consideration include how technology facilitates communication and distribution, which can be used in the development of new strategies for the company (Williamson, 2003). Specifically, the internet has revolutionized the way Marks and Spencer undertakes its operations in terms of retailing; for example, e-business and the use of Information Technology Management systems.
Environmental factors generally entail the environmental aspects which may have an effect on the way companies in specific industries such as farming and tourism conduct their external operations. Some of the environmental factors include climate changes and weather. In addition, there is an increasing environmental awareness concerning being green and the effect of the changes in climate with respect to company operations and the type of products that companies produce; which plays an integral role in the establishment of new markets and integration into existing markets (Babette & Fleisher, 2008).
Conclusion
PESTLE analysis is important in affecting the ways in Marks and Spencer undertakes its operations. The PESTLE framework can be combined with other analysis frameworks such as SWOT in order to effectively devise strategic management strategies. Basing on the above, The PESTLE framework is increasingly becoming an important aspect of business that companies have to use in order to assess the various through which the individual elements affect the company operations.