Investigating how Businesses work Essay

Introduction For this assignment I am investigating how Marks and Spencer plc works, and I will look at its aims and objectives, functional areas, employment law, communication methods and organisational structure of the company. Marks and Spencer is a publicly owned company in the retail sector. It is in the retail industry and is a large company. The company has been running for many years. Marks and Spencer is one of the UK’s leading retailers of clothing, foods, homeware and financial services. It serves 10 million customers a week over 300 UK stores. Aims and objectives All businesses have aims, this helps them achieve and reach their targets to make their business successful. Therefore Marks and Spencer’s aim is to attract the customers with appealing, superior quality products at attractive prices. They do this by creating exclusive products for the customers. The company aims to put the customer first in everything they do and offer the highest values of customer care in order to satisfy them. In order to achieve the aims, businesses need to decide what objectives to take to help them. According to Marks and Spencer’s objectives are to: 1. Deliver the agreed minimum customer service standards 2. Carry out and develop new systems 3. Reduce theft and loss 4. Create a visually exciting store 5. Permit people 6. Improve effectiveness through managing risk 7. Recruit the right people to provide service standards 8. Deliver customer focused training Functional Areas In large businesses people work as a team in order to help the business run smoothly and effectively, they work together in different functional areas which relate to them. Businesses have these functional areas to help them achieve their aims and objectives. I will be looking at four functional areas, which are: 1. Human Resources 2. Finance 3. Marketing and Sales 4. Administration Human Resources Human Resources are involved with the staffs that work for the company. The staffs in this area are important because they are partly responsible for keeping the business successful. The Human Resources staffs are involved in: * Recruitment * Working conditions * Health and safety * Training and development * Employee organisations and unions Recruitment Vacancies for Marks and Spencer are mainly advertised in recruitment agencies, local or national newspaper, local job centres and careers offices. Marks and Spencer has a company policy to reply to every application sent. These applications are filed for 3 months and then are destroyed so applicants will have to reapply every 12 weeks. There are three ways to apply for a position in store management. You must be either a graduate/undergraduate with a degree or HND and GCSE Maths and English grade C+. For school or college leavers, with A Levels and GCSE Maths and English C+. Marks and Spencer look for people with high standards, who will enjoy working in the retail environment and they look for people who are good with customers or at customer service and people who will work harmoniously in a team. Working Conditions Marks and Spencer has several of working conditions, these include holiday entitlement, hours of work, pay etc. All staff, including temporary and permanent, is entitled to a holiday each year. This holiday entitlement runs from April 1st to March 31st. You can take a holiday if you have a contract of 13 weeks or more. Marks and Spencer has a store policy that all staff should plan and book their holiday in advance because the store operates on a first come first serve basis. They need to book their holiday before to avoid any disappointments. Health and Safety Many health services at Marks and Spencer are provided for the staff such as the staff doctor, store dentist and smear tests for the female staff. The staff doctor attends the store regularly to help and give advice. All staff is entitled to make an appointment if they wish to see the doctor. Every 6 months the store dentist also attends the store for a routine check. He will recommend treatment to staff if needed. A private medical is available to all permanent staff. Cervical smears are available for the female staff and wives of male employees every 3 years. Training and Development Marks and Spencer provide staff with training opportunities. The NVQ programme was one of the largest training programmes they had. At Marks and Spencer, people skills are important whoever you come into contact with, such as customers, suppliers or members of the staff. Employee Organisations and Trade Unions The employees do not officially have union representation, but are entitled to join a union if they wish to. The company wishes all its contacts with unions to be conducted in a decent and co-operative manner. It is illegal for management to interfere with the right of an individual to belong to an independent union as defined in the Trade Union and Labour Relations Act 1976. The types of job roles in human resources are: Job Title Job Role Human resources Managing the HR department and staff, involved with Manager industrial relations and trade unions negotiations, Implementing the organisations HR policies. Training/staff Responsible for training and staff development. development Health and safety Overseeing all the health and safety matters and Officer monitoring Personnel/staffing Keeping staff records, monitoring staff welfare officer HR administrative Administrative work relating to the human resources Assistants function. Finance Businesses need to manage and control the money coming in and going out of the business. They also need to understand this information in order to plan what to do next and to see if they need to make any changes. All businesses deal with: * Preparing accounts * Paying wages and salaries * Obtaining capital and resources. The major sources of finance include back profits, shares, banking facilities, hire purchase/leasing and trade credits. Preparing accounts The finance staffs at Marks and Spencer have to deal with a range of activities related to checking and recording of all amounts of money received and paid. These are entered into an account each customer has. When money is being received it is banked as soon as possible and also is checked carefully and recorded against each item sold and against each customer’s account. Every Business including Marks and Spencer has to pay its own bills. They will owe money for raw materials used in the manufacture of a product and for the services it uses. Paying wages and salaries Wages and Salaries are done by a computerised procedure. Marks and Spencer pay their staff monthly direct into their bank account, using a system called credit transfer. The company’s bank transfers money to all the employee’s accounts. The bank keeps payroll records, which shows how much each staff earns and how much they are meant to be paid, this helps the bank to transfer the right amount of money into the staff account. Obtaining capital and resources Capital is the money the owner puts into Marks and Spencer. This will be needed when the business starts trading. The money buys all the requirements Marks and Spencer needs. When the business starts to trade and make a profit, the profit is used to buy new stock to sell and also saved incase the company wants to buy new equipment. The job roles in finance are: Job Title Job Role Finance Director Giving advice to senior managers on the overall financial Policy of the organisation. Financial Manager Managing the finance function and staff. Advising on financial resources. Management Producing continuous financial information for Accountant management Credit controller Advising on credit policies. Ensuring that money owing to the company is kept within agreed levels. Payroll Responsible for overseeing the company payroll and Administrator salary/wage section. Ledger Clerks Assist the chief accountant in the recording of all financial transactions. Marketing and Sales Businesses carry out a range of activities to identify the customer’s needs and then try to provide for them. These activities include: * Market research * Promotion * Sales promotion Market Research Marks and Spencer has a separate department, which is involved with market research. Market research deals with customer feedback and external agencies. Other types of market research that are used at Marks and Spencer are through credit card, database, direct mailing, and telephone and through the customer services department. Market research can be carried out through primary and secondary research. Promotion Marks and Spencer have to decide how to promote their products, this usually depends on the type of product or service they want to promote Marks and Spencer advertise its promotion through corporate advertising, for example with seasonal products like strawberries in the summer. The major markets are the consumer markets worldwide but Marks and Spencer find their main shoppers are middle aged, middle class and female. Sales Promotion Sales promotions are campaigns, which offer special discounts and attract customers to try a new a product. Sale promotions at Marks and Spencer include offering free samples of food, special discounts and offers. Marks and Spencer set up campaigns for a few reasons such as attracting more buyers but mainly if a new product is not selling as well as it should be then the campaign is set up. The major customers for the products are the general public. The job roles involved in Marketing and Sales are: Job Title Job Role Marketing director Responsible for the overall marketing function and its aims and objectives. Sales manager Responsible for sales staff and the achievement of sales targets, often within the UK. Advertising In charge with advertising and agency staff over Manager publicity campaign. Export manager Responsible for overseas agents and the achievement of sales targets overseas. Market Find out consumer opinions on current and proposal Researchers goods and services. Order clerks Accept and process sale orders Administration The administration function helps a business run smoothly from day to day and keeping things up to date. It covers a number of different tasks including: * Clerical work, collecting mail, keeping records, organising meetings, responding to enquiries * Cleaning, maintenance and security Clerical work Every day Marks and Spencer would receive telephone calls that need to be answered, mails that needs opening and replying, a list of tasks to do, visitors that arrive at the reception some without a appointment, Fax messages, documents to sort out and need to prepare and documents that need updating etc. Every morning Marks and Spencer receive a number of mails, these mails are then sorted correctly, date stamped then delivered to different departments and individual staff. Marks and Spencer also arrange for their mail to be collected to sent out at a certain time. Marks and Spencer receive enquiries from a variety of people, companies and also other people from inside the organisation departments. Marks and Spencer try to answer these enquiries quickly with correct information. Marks and Spencer has a large amount of documents produce by organisations such as forms, fax/telephone messages, letters and reports. These documents are then filed and some are stored in the computer. Cleaning and maintenance Marks and Spencer employ cleaners to do routine cleaning duties. Some employees do the basic cleaning and the others don’t. If a cleaner is off sick, the supplier has to replace them as part of their contract. Security Marks and Spencer security staff are not employed by the company but by a specialist security firm. The responsibility of the firm is training and supply. The security staffs are responsible for patrolling the premises. The job roles involved in Administration are: Job Title Job Role Administration Managing the administration operations of the Manager organisation. Company A senior executive responsible for all legal affairs of the secretary company, dealing with shareholders, insurance and organising meetings. IT manager Managing all the IT requirements of the company, including Equipment and advising on future needs. PA/secretarial Responsible for providing secretarial and administrative Staff support, usually to senior managers. Equal opportunities and employment legislation Recruiting and keeping the right employees is important to every business. Both employers and employees have rights and responsibilities. These are safeguarded by employment law, not only by employee organisations and unions. The 4 main Acts are: 1. The Employment Rights Act 1996 2. The Sex Discrimination Act 1975 3. The Race Relations Act 1976 4. The Disability Discrimination Act 1995 The Employment Rights Act 1996 This act establishes a wide range of rights that employees have when they are being employed, for example: * The right to a contract of employment must be given within two months of starting employment and must include details such as name of employee and employer, date when employment began, rate of pay and when its due, hours of work, sick pay etc. * All female employees have the right to maternity leave, this can be up to 29 weeks and also can return to work afterwards. * Employees have the right to take time off to look for a new job, attending interviews and still be paid. * Employees have the right not to be unfairly dismissed. * Employees have the right to redundancy payments if an employee is dismissed because the job is no longer available. The Sex Discrimination Act 1975 This act makes it illegal for anyone to be discriminated against someone on the grounds of gender either directly or indirectly. In employment this applies to recruitment and selection for jobs and promotion, training the way you are treated in a job, dismissal and redundancy. The Race Relations Act 1976 This act makes it unlawful to discriminate against people of colour, race, nationality or ethnic origin. In the track of employment it is unlawful to discriminate in the arrangements for employment, which are: * In the interview or advisement’s * In the terms of employment * By refusing employment because of colour, race, nationality or ethnic origin. * In promotion and training * By dismissing a person The Disability Discrimination Act 1995 This act is concerned with discrimination against people with disabilities in employment. The disability may be physical, sensory or mental but must be relatively long-term. Employers must not treat a disabled person less favourable than others. Employers must be prepared to make reasonable adjustments to the workplace to help the disabled person do the job. Disabled persons who suffer discrimination can complain to an employment tribunal. Below are some examples of how employees at Marks and Spencer are protected by these Acts: 1st example A female staff from Marks and Spencer was pregnant and she was due to a maternity leave as agreed on for 30 weeks, she carried on working for a couple of weeks before she was due to the leave. When she took that leave, it happened to be longer than she thought, she had to take an extra few weeks of and when she came back, the job was still there for her. 2nd example New black female staffs were starting work at Marks and Spencer. On her first day, she needed to be trained and taught about the health and safety matters, this had to be done by a health and safety officer from Marks and Spencer. When she met the officer, he wasn’t very welcoming and didn’t seem pleased. He showed her around but the woman thought he wasn’t explaining very clearly and she was worried because she wouldn’t know exactly what to do if there was a fire, so she reported this to the employer and it seemed that he didn’t give her the full instructions, so another officer had to be arranged to train her. 3rd example A man applied for a job at Marks and Spencer, he was unsure whether he would get the job because of his disability problem but when they called him in for an interview he was surprised. They discussed his disability problem and the arrangements for him to work, so in the end they gave him a part time job, which he was very pleased about. Communication People working in different functional areas have to communicate with each other as well as with people outside the business such as customers and suppliers. In order to keeps the business running smoothly and effectively they need to keep the other people in the business well informed, to do this they might use: Internal External Telephone Telephone E-mail E-mail Pager Advertisement Face to face Internet Advertisement Fax Interview Letter Memo Video conferencing Notice Intranet Meeting Marks and Spencer Internal methods of communication to different functional areas are the telephone, email, fax machine, verbal meetings and appointments and also video conferencing, which are used around the country to save time on travelling and costs. The management team spend a high amount of time on the sales floor visiting various sections to see supervisors and staff. Marks and Spencer external communications include letters received from the charities, they receive about 10,000 appeals for support every year. External communications also include project work, Equal opportunities and also the company support projects, which help the elderly and the young and also people with special needs and those who require help in the members of the community. Due to the rising number of communications throughout the company, the communication problems have been encountered and one of the biggest problems has been to ensure everyone is informed. Due to the speed of the business, Marks and Spencer have to ensure that all the staffs try to ensure professional communication by being prepared and organised. The developments Marks and Spencer now have in mind is to improve and make communications more better through e-mail, to improve the in store telephone and the bleep systems such as changing to mobile phones and a speed dial network system. Below is a diagram showing how the functional areas communicate with each other externally and internally. Functional Type of Reason why Area communication Human -Telephone Confidentiality Resources -face to face Urgent -Letter Fast and easy to use -Meeting Saves time to talk to individuals Finance -Letter Security -E-mail Confidentiality -Meeting Get feedback from people quick Administration -Fax can be kept for future reference -Letter evidence and can be copied. -Email convenient while on the computer Marketing and -Meeting Group discussion, more ideas to share Sales Different functional areas use different communicational methods to communicate with each other, this is because employers need to know which type of communication to use for each purpose. For example, human resources might use the telephone or letter to communicate with a different functional area because it might be confidential, this way no confidential information is being reached out of the organisation. And also if a letter is being used, this can be kept for future reference and hard evidence for any purpose. Another type of communication is a meeting; this can save a lot of time and can get feedback from the people at the meeting immediately. Meetings also save time on having to discuss things individually. These types of communication can help Marks and Spencer achieve their aims and objectives, one of the main aims of Marks and Spencer is to put the customers first and to offer the highest values in customer care to satisfy them. To achieve this aim, Marks and Spencer keep the flow of information within the company, they keep the right people informed with up to date information so that when customers ask for certain information it will be as accurate as possible. The Marketing and Sales functional area keep the staff informed about the current range and prices of products for the benefit of the customers. When an order is being received, they pass it on to be sorted in order. To meet the needs of the customers, the staff’s listens to what customers have to say whether it is a good or bad thing and take that into account. Staff at Marks and Spencer has meetings to discuss any problems whether concerning about the customers or other matters so they can solve the problem maybe for the benefit of the customers who shop at Marks and Spencer. Organisational Structure of Marks and Spencer To make the business run successfully without any chaos, they organise their employees in functional areas and section so they know what to do. This helps the business to make decisions and carry them out. Every business has its own way of structure. Hierarchy Structure Marks and Spencer organisational structure of the business is a hierarchy structure, which is tall and has a number of levels. This type of structure may be large but also has some disadvantages as well as advantages within this structure. Below are the advantages and disadvantages. Advantages * Clear job role and lines of responsibility * Each level will have different opinions so therefore more ideas * Clear pay structure * A large number of colleagues * A range of facilities * Good promotion Disadvantages * Slow communication flow. If any staffs require information, this could take time. * Slow reaction to changes and challenges because many people have to be informed whether decisions or changes were going to be made. * Staff at a lower level may feel the manager at the top has no idea what they think or do Flat Structure Here is an organisational structure of a small company. As you can see, this structure is small and does not have many levels. This type of structure is called a Flat structure. This is very much different to the Marks and Spencer structure because Marks and Spencer is a large company. From the diagram structure we can tell that the company is rather small and has fewer levels. But there are also some advantages as well as disadvantages within this structure. Below are a list of the advantages and disadvantages of a flat structure. Advantages * Communication is quicker and more accurate * Good at responding quickly to new ideas and customer needs * Operate quite easily * Less management cost * Flexible working hours Disadvantages * Business is small * No one to share ideas with * May experience problems with shortage of staff if business is expanding.