Business Strategy Assignment : Mark & Spencer

Business Strategy

INTRODUCTION
Business strategy is a framework which help company to identify its potentiality to adopt
challenges or threat as well as the current market stability so as to bring company ahead than
their rivals. In other words, business strategy outline the tactics, methods and pathways attained
by an organisation in order to accomplish future goal (Aithal, 2016). An appropriate strategy
recognises where position of business has attained and how it create cohesion within an
organisation to achieve target goals. It exist in two types i.e. generic or general and competitive
strategies. However it plays as a vital role as it enable company to do future projection for
growth or activity by considering past performance and fundamental values. In relation to Mark
& Spencer, one of the famous multinational retailer which is commenced in the year of 1884. It's
headquarter in London, UK and it offer wide range of products like clothing, home ware, food
products etc. This report covers application of PESTLE to analyse impact and influence of macro
environment on company and its business strategy, implication of SWOT and VRIO analysis yo
assess organisational internal environment and capabilities. Usage of Porter's five force model to
evaluate competitive forces of company, applying theories, concept, models to understand
business position among market and develop strategic plan for an organisation.
TASK 1
P1
Business strategy refers to an activity or plan consisting of managing and utilising
different kinds of resources such as human, physical resources etc. with an objective of achieving
organisational goals and objectives within pre-determined time period. It is an integral
component of company as it help organisation to identify or analyse internal and external
environment, evaluate current strategies, develop and analyse most productive alternate
strategies. Every business environment is a combination of internal and external or micro and
macro factor which impact company's profitability positively and negatively (Aithal, Shailashree
and Kumar, 2016). Thus in order to evaluate the macro factor, there is a tool which help firm to
understand challenges or opportunities i.e. PESTLE. It is a tool which is used to identify macro
(external) factors facing by an organisation as it help company to examine external forces which
impact business operations and productivity. In relation to Marks and Spencer, a famous retailer
in UK which deals into clothing, home ware , foods products etc. They have great influence of

external environment but Mark and Spencer is flexible in nature as they do optimum utilisation
of available business opportunity in order to maximise profits effectively. Therefore, to gain
more competitive advantage among market, Mark and Spencer apply PESTLE analysis which is
described below:
Political Factor: This factor determine the extent to which government and its policy may
impact on an organisation like taxation policies, regulation, rules etc. Recently, UK government
modified the safety regulation of food segment for providing better quality and healthy product
which negatively affect Mark and Spencer business operation (Mark and Spencer PESTLE
analysis essay, 2019). However, to reduce this negative affect Mark and Spencer reduce salt and
fat in food products which enable them to gain competitive advantage.
Economic Factor: This factor determinants economy performance that directly impact company
long term goal or objective as it includes inflation rate, interest rate, economic growth patterns
etc. . In current scenario of UK there is a conflict with small retailers over product price rise due
to currency impact of Brexit which negatively impact Mark and Spencer and its productivity.
However, UK has open economy and it rank among the fourth largest in world and its interest
rate is low to moderate which signifies as healthy economy. Thus, Mark and Spencer
concentrated more in clothing area and reduced the price of clothes which attracts more
customers towards company and it enhance their productivity.
Social Factor: These factors focus on social environment and identify emerging trends as well as
help marketer to understand customer's needs and wants (Akter and et. al., 2016). In present
scenario of UK , there is huge demand of different trends and fashion regarding clothing among
middle aged group customer i.e. classic collection, limited collection etc. which influence Mark
and Spencer productivity negatively. However, to tackle this negative effect Mark and Spencer
offered trendy clothes for 40 to 55 aged group people which enrich their profitability effectively.
Technological Factor: Under this factor, this is mainly determine the technological advancement
which can drive business to achieve competitive advantage in global market. It include changes
in digital or mobile technology, automation, research and development etc. In UK, there is
demand of online trading or shopping among customers which impact negatively on Mark and
Spencer's profit maximisation. Therefore, in order to tackle this negative impact Mark and
Spencer introduced innovative technology i.e. provided online shopping facility to UK customer

which saves cost, time, energy (Arasa and Gathinji, 2014). By which company was able to
increase their satisfaction level as well as in enrich their profitability.
Legal Factor: political and legal factor are very similar in nature as the key difference between
them is political factor are direct by government and legal must be complied with. Legal factors
involves legislation, law, trade regulation etc. Recently, in UK its government did a checking
regarding ethical pratices for which Mark and Spencer was judged for unethical practices i.e.
failed to protect staff and customer from asbestos ( highly heat resistant silicate mineral) which
impact negatively on Mark and Spencer productivity. However, to tackle this negative impact
Mark and Spencer admitted their failure and took corrective course of action for injured
individuals which improves the morale of both parties i.e. customers and employee which
improve their overall performance among competitors.
Environmental Factor: These factor is related with the influence of surrounding environment and
impact of ecological aspect as it includes climate, recycling procedures, waste disposal,
sustainability etc. In present scenario of UK, the concept of corporate social responsibility is in
high demand among customers which negatively impact Mark and Spencer's proficiency and
efficiency (Ashtari and et. al., 2015). However, Mark and Spencer took this negative impact as
an opportunity for growth. They introduced a trend i.e. shopping which means donating old
clothes to Oxfam and they recycle those clothes or sell it t third party. By the result of this
productive step of Mark and Spencer, it enable them to gain competitive advantage and became
one of the most sustainable brand among market which create positive attitude in customer
towards company.
From the above discussed statement regarding PESTLE analysis, it help Mark and
Spencer to evaluate or examine their macro factors and allow them tom take corrective course of
action in order to attain high productivity and profitability.
Stakeholder analysis
Stakeholder analysis is a technique which describes interest and power of stakeholders to
achieve growth and success of an organisation. It also includes understanding where
shareholders stand, develop cooperation between shareholder s and project team. This analysis
contains three steps which clearly define stakeholder resources and their prediction regarding
achievement of organisation goal In order to analyse stakeholder position, Mark and Spencer
implies stakeholder analysis which is described below:

 Identifying Stakeholders: In this stage, company identify or determine the shareholders
who effect their brand image (Babafemi, 2015). In relation to Mark and Spencer, a
leading UK retailer which provide high quality of product and service. Its main
stakeholders are owners, employee and customers who lead the to attain high profitability
and productivity effectively.
 Prioritize the stakeholders: The major stakeholders of Mark and Spencer are customer,
owner, employee. In this stage, company identify the power and interest of each
stakeholder over their profitability. In case of Mark and Spencer, its customer are high
interest and high power people as there was a huge demand for trendy clothes among
customer for which M&S introduced creative or trendy and fashionable clothes which
enhanced their business operation. Whereas, in case of employees they have high power
but less interest for which Mark and Spencer provide better working condition which
enable them to keep satisfy.
 Understand stakeholders: In this stage, company discover how stakeholder feel towards
organisational goal. In case of Mark and Spencer, it always seek for an opportunity to
grow for which they provide good quality of products and offer trendy clothes specially
for middle aged group people which enhance their growth (Barba and et. al., 2016).
Apart from this, they provide better working culture as well as they are transparent in
providing information which enrich their proficiency effectively.
TASK 2
P2:
This analysis is define as the procedure in which enterprise analysis structure that forms
part of the firms larger strategic scheme. VRIO consist value , rareness , inimitable ,
organisation. VRIO analysis of Marks and Spencer is explain below.
Value: In this resources are seen as valuable when they change a firm to implement
strategies that modify a firms efficiency by exploiting opportunities. Marks and Spencer
considered resources valuable in there organisation. This resources help Marks and Spencer to
increase the perceived customer value. This can be done through by increasing differentiation
and decreasing price of a product. In Marks and Spencer when the resources cannot meet this
condition then they lead as competitive disadvantage. In Marks and Spencer there is a

opportunities for brand extension (Bohari, Hin and Fuad, 2017). In this new niches are emerging
in the market and they maintain good relationships with is retailer and wholesaler. It is very
important for an organization to continue review the value of the resources. In this contentiously
changes in internal or external condition can make them less valuable ant useless at all.
Rarity: This is define as in which resources is use by few companies in there
organisation known as the rarity. This rarity and value give temporary advantage to the company.
On the another aspect when few of the company use the same resources known as the
competitive party. Marks and Spencer is in fewest company who has global and local presence.
In this company there is a great presence of highly skilled employee. In Marks and Spencer IPR
and other right are rare and competition can not be copied. If Marks and Spencer does have a
sizeable amount of resources they are valuable and rare, then its likely to have at least
competitive advantage.
Inimitable: In any organisation it is very costly to imitate of other organisation that have
it. Imitation can occur in a two way that is directly imitating or providing comparable product.
If Marks and Spencer is valuable , rare and costly to imitate resources then it will achieve
sustained competitive advantage. In Marks and Spencer there is the possibility imitating the
global and local presence by the competitor . In this there is the high chances of regularly
imitation of pricing strategy in the organisation. Product portfolio and synergy among various
product line can be imitated by the competitors (Bolisani and Bratianu, 2017). Position of Marks
and Spencer among retailer and wholesaler company name retail strategy is challenging to
imitate though not possible. Opportunity of brand expansion can be imitate by the competitor.
Organisation: This is define as which include the component that is reporting strategy ,
strategic plan , management control system and compensation policy . Without the right
organisation to acquired and proper use and monitor involved , rare and imperfectability
imitable resources will not be able to create sustainable competitive advantage. Marks and
Spencer is successful at track record of project execution. This company has utilized its leading
brand position in various segments. In pricing strategy yes Marks and Spencer has pricing
analytics engine.
Swot analysis of Marks and Spencer
SWOT analysis is a technique used to measure company's strength, weakness ,
opportunities and threat. It is a powerful tool to develop a business strategy (Brenes, Montoya

and Ciravegna, 2014). Strength and weakness are the internal part of an organisation on which
we have a control and can be changed while on the other hand opportunities and threat are the
external factors on which we have no control and cant be changed.
STRENGTH  It is the most popular retail brand known for the
quality over the years.
 It has around 600 stores in UK and above 300 in
over 40 countries.
 It offers high quality fashion, food and stylish home
ware.
 They have their own branded labels which help the
organisation to grow.
WEAKNESS  Most of the technology help to increase the
productivity in less span of time but still Marks and
Spencer using old technology
 Strong competition from other retail brand.
 Marks and Spencer has a bad publicity in the market
as the organisation is out of fashion and not so
trendy.
 Marks and Spencer has draw back of using old
technique rather than new techniques which increase
aspect such as money and time.
OPPORTUNITIES  Marks and Spencer can introduce new more market
which create profit for the company.
 In Marks and Spencer there is the great opportunity
in expanding there business in India and China.
 New technology give to Marks and Spencer to
practices distinguished pricing strategy in new

market.
 Stable free cash flow give opportunity to invest in
adjacent product.
THREATS  For Marks and Spencer other store is the threat due
to there discount policy (Yang, Ong and Nee, 2015).
 Various government policy for the retail stores.
 Rising in the cost of raw material can pose as a
threat for Marks and Spencer profitability.
 Growing capability of local distributor also pretend
as threat.
TASK3
P3
The business environment of Mark and Spencer is very different and effective from it's
competitors. Every company requires to make productive plans and strategies for its operational
activities. This is because, an organisation faces several threat and challenge from external
environment and also from competitive forces (Eaton and Kilby, 2015). These forces impact
directly or indirectly on the company's business operation which affect their productivity. Thus,
for evaluating the competitive forces of firm Porter's model can be used. Porter's five force
model is an effective tool which enable the company to examine or identify their competitive
force. Along with this, it help firm to take corrective course of action for reducing degree of risk
and uncertainty in order to attain sustainable position in market for longer period of time. In
relation to Mark and Spencer, a leading brand in UK applies Porter's five force model to analyse
their competitive forces or external environment which is described below:
 Threat to new entrants: The threat of new entrants for Mark and Spencer is relatively low.
This is because entrance of new company into retail sector requires to pay huge amount
of money as an investment charge. M&S is capable of acquire large market share so the
threat of new entrants is low. Along with this, its has good positioning among industry
and also its price of products are low so the new entrants will require to provide good

quality of product with low price. Hence, Mark and Spencer's business operation will not
get affected by new entrants.
 Threat of substitutes: The threat for substitutes of M&S is relatively high because it has
been noticed that its customers are shifting to several departmental store (Klettner,
Clarke and Boersma, 2014). This is because it is more convenient for customer to buy
products from department store or small store which negatively effect the business of
M&S. Thus, to tackle this issue M&S adopted effective strategy i.e. they introduce
Express store in which all products are provided at low price which became major threat
for competitors.
 Industry Rivalry: The degree of rivalry among industry of M&S is extremely high. This
is because they face insensitive or tough competition from competitors regarding prices
of products. The degree of market growth market growth is slow due to which market
rivalry of M&S is increasing. Hence, M&S introduce innovative technology and do
modification in products and services (Woerner and Wixom, 2015). This can be done by
evaluating competitors tactics and need, preferences of customers of company which will
directly enable in monitoring the competitive environment.
 Bargaining power of suppliers: The bargaining power of supplier is low. This is because
the suppliers of company faces threat in loosing contract from multinational supermarket.
So the suppliers have less option of bargaining with company regarding price. Suppliers
cannot bargain because it create negative impression for them and it effect company's
brand image (Leonidou and et. al., 2017). But, to keep this situation company needs to
make changes in strategies or plans in order to enhance its profitability.
 Bargaining power of buyer: The bargaining power of M&S is relatively is high due to
variety of options available among market as the buyers shift their brand from one to
another. This changes effect company's profitability. However, to maintain their
sustainability M&S reduce their product price which attracts the attention of customer
and it enrich their productivity.

TASK 4
P4
Every business cannot operate independently and can face the threat from external
environment. For which it require productive business environment i.e. encompasses of internal
and external environment which allow the company to identify opportunity or challenge and
make them to sustain in market for longer period of time (Linton and Kask, 2017). It includes
several theories, models which give clear direction to company for attaining high profitability.
For better understanding Mark and Spencer implies Porter's Generic Strategy which are as
follows:
 Cost Leadership: This strategy is mainly for reducing operating cost. In this company
goal is to become low cost producer as they reduce the product's price in order to
attain economies of scale and maximise sales (Scolozzi and et. al., 2014).
 Cost Focus: In this company mainly seeks to lower cost advantage in which they
modify existing products by adding new features for satisfying potential or target
customer.
 Differentiation Focus: Under this strategy, company aims to differentiate within just
one or small number of target market segment. For which company establish
themselves in niche market and attain higher prices than un-differntiated products
through specialists expertise or other ways to add value to customers.
 Differentiation Leadership: Through this strategy, the business has targeted big market
markets and has objective to obtain competitive edge through differentiation across the
globe (Mathooko and Ogutu, 2015). For this company imply premium pricing for
product in order to reflect higher production costs and extra value added features
provided for consumers.
From the above discussed statement, differentiation leadership is suitable and productive
for career growth of Mark and Spencer as it is one of the leader retailer of clothing, food, home
ware and financial services which operates across the globe with a differentiation leadership.
This strategy help the firm to enlarge its customer experience which lead them to improve brand
image and add value to customer.
Strategic Planning

Strategic planning is a contentious process of evaluating and analysing the strategies of
business as it help them to plan the future course of action in an effective and efficient manner.
This plan is mainly used to enhance the growth and scale of company. This strategy id implied
by Mark and Spencer which are as follows:
Aim: The aim of Mark and Spencer is to modify the technology bill with innovative IT plan by
reducing the manpower and enlarge its business operation through innovative and creative
technology.
Vision: The key vision of M&S is to regain the their leadership position among competitors
through meeting taste and performance or wants of customer with best quality of
product and service (Moon and et. al., , 2014).
Mission: The mission of M&S to gain customer trust and loyalty by providing qualitative
product with innovative technology in order to satisfy community and environment as
well as employees.
Values: The prime values of Mark and Spencer are Inspiration, Innovation, Integrity and in
touch. With these core values they interact and improve the morale of community and
employees which lead them to higher productivity.
Problems: Mark and Spencer facing many challenges and barriers which has great influence on
the working culture of company (Nag, Han and Yao, 2014). One of the major issue
they face is that there is an availability of risk regarding price of product within market.
Goals: One of the major goal of Mark and Spencer is to develop a value among customer by
improving the quality of products and service by adopting innovative technology in
order to accomplish their long term goal effectively.
Strategies: The main tactics or strategies of Mark and Spencer is to perform productive business
activity focusing n attaining high sales and market share.
CONCLUSION
From the above report it has been concluded that it is an essential component for every
company to develop appropriate business strategy plan for the effective functioning of various
departments. This is because, in the absence of such plan it create huge challenge and loss to
company's profitability. Along with this, business strategy can form after evaluating the internal
environment of an organisation using SWOT analysis. On the other hand, PESTEL analysis is
applied by company to analyse external environment. In order to examine competitive force,

company implied Porter's five force model. By using theories, and tools it enable company to
implement corrective course of action in order to achieve high productivity. With the help of
these, company is able to improve their profitability and increase their sale effectively.

REFERNCES
Books and journals