Strategic Management Approaches of Marks & Spencer

This report discusses the strategic management approaches of Marks & Spencer, including a comparison of theory and practice, competitor analysis, and external environment factors. It also explores the company's history and working process since 1884.

strategic management

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
Compare theory and practice.......................................................................................................3
Competitor Analysis....................................................................................................................6
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Strategic management refer to the formation of strategies on the basis of different goal sets and
objectives of the organization. His report is a case study based on Marks & spencer company in
the approaches of strategic management of it. Marks & spencer is an UK based company
working form more than 136 years. Company was founded in the year 1884, Company deals in
quality food, high quality clothing and other products related to food and home. This report will
further project the strategic management approaches of the company & the working process of
the company since 1884. The comparative theory and practices of the Marks & Spenser, analysis
of the company which will be explained in the report. External environment factors of the
company and the utilization of the strategic management will be done in the report. Strategic
management is important for the company to understand the basic environment of the internal
and external factor of the business environment (Lasserre,2017).
MAIN BODY
Compare theory and practice
Retail sector is one of the biggest market sectors across the globe with a huge number of
competitors in market. The demand of the sector in the market is very high because of the
product range which can belong to the basic needs of the people. With the help of different tools
of competitive analysis, business analysis and comparative analysis help in the target market
projected (Ginter,2018).
Business environment analysis: -

Business environment refer to the consideration as the environment in which the
company is working its operations. External business analysis on the basis of PESTEL tool, it
supports company to get all relevant information about the market & its sector.
PESTEL analysis: -
Pestle is used to analysis macro environment factor that effect on the growth of the
organisation. Marks & Spencer is one of the leading organisation in Britain and below discuss
different external factor affecting growth of the organisation for example political, economical,
social, technological etc (Nurmi,2018).
Political Factors:-There are number of political reason which effect on the growth of industry in
UK. After BREXIT, there is three PM changes hence political stability decrease chance of a
robust policy and law to growth of Industries. Each Prime minister in subsequent tenure amends
policy and it become difficult for Mark and Spencer to implement and hence loses market share
in UK as well as abroad. In the Europe Union, it will easy for organisation to trade or supply and
chain management in the country. Raw material cost that comes from European countries again
increases and hence product cost hike which leads to decreasing purchasing power of customers.
Schengen visa which was one of the leading factors in increasing tourist in the country is
assuming to close which will effect in revenue of the organisation as company has strong hold on
European tourist. However, it is assuming that new government will frame policy to growth
industrial sector in the country and hence Mark and Spencer have chances to expand its business
in different part of the country. European is now less interest in investment in company which
decreasing financial capacity of the organisation. Government is decided to give subsidies and
funds to new organisation and hence it will decrease market share of Mark and Spencer.
Economic Factors: - UK inflation rate is decreases which increase purchasing capacity of
customers and hence Mark and Spencer to better expand by providing better services to
customer. New government decided to frame new economic policy for various industries growth
and Mark expand can take it as opportunity to increase market share. Unemployment percentage
in the country is decrease from last 2 years and hence more customers can purchase Mark and
Spencer product. Past policies and laws of UK government leads to close many of Mark and
Spencer store in the country and hence effect on the growth of the organisation. However,

financial market of the country is in crisis after BREXIT and hence company is in loses but it can
protect its market by taking advantage of new policy.
Social Factors:- There are many social factors affecting growth of Marks and Spence for
example UK citizens welcome new trends and taste and it becomes difficult for the organisation
to operate the business. UK is diverse country and it become difficult for the company to satisfy
need of different kinds of people as regular design and modification demand by customer
increase its expenditure. One stop shop hobbit of customer attracts large number of customer for
Mark and Spencer as it have variety for product. Mark and Spencer have a good reputation
among citizens as serving in the country from so many years but because British youth welcome
new product and brands and hence it will difficult for Mark and Spencer to continue its existence
among young generation. As the market of ready meals demands increased by customer and
Mark and Spence foot hold in this category. As the market taste rapidly changes in UK which
effect for selling old product of the organisation as it produce in bulk (Rothaermel, F.T., 2016).
Technological factor: - Technological factor involves the advancement of the technologies and
the development in the technologies sector. It guides the company in the advancement of the
technologies, Technologies are among the key Factors of the business environment in external
factors as it has transformed the entire corporate sector. Technologies also help the company
Marks & Spencer in the online retailing sector and increase the business. It also works in
different hierarchy of the company by supporting the functional activities. It helps in the
different functions like the marketing of the company and the finance sector of the company &
also help in the sales departments etc. These things increase the public relation of the company.
It supports the innovation in the company by product development activity. Development of
products and using the technologies to sale the product on online retailing increase the company
business and can cover more audience. It has the ability to increase the growth of the company
on the international level and can give huge benefits to the company. Company is using the latest
tools and technologies to operate and control the functions of company. Technologies helps the
company in its brand presence as the tools helps in better marketing campaign. The technologies
work as an advantage in the function to make things easy and better for the Marks & spencer.

Environmental Factor: - This factor involves the business environment & also plays a part of
the PESTEL analysis tools. The recent development in the business environment after the
emergence of the social factors and the society towards the protection of the environment & the
utilization of eco-friendly product. People now a days are so concern about the eco-friendly
products that they ask for the product which does not harm the environment and can be reused
again and again. Marks & Spencer deals in the clothing, food product with high quality of
products range which contain the eco-friendly ways of doing things and support the environment.
Supporting the eco-friendly companies and social group to support the environment awareness in
the society. Marks and spencer’s works in providing the product which can be utilise without
damaging the environment. Corporate social responsibilities of the company are to contribute in
the social conversion of environment. Social activities help the company in growth in sales of the
product and helps in achieving the desire objective of the company. But it also involves the
restrictions from the government sector over the corporate operations as protection guidelines of
the environment. It helps the company in getting the market growth as the trends are of the Eco-
friendly market products (Schilling,2019).
Legal Factors: - Legal is one of the mot important external environment factor associated in
PESTEL analysis. Legal factor refers to all the laws and regulations of the corporate sector in
which the company is working in. To work with better operations in the company it is necessary
for the company to cope up with the different laws of the sector which include the equality, wage
payments, data protection etc with the legislation of Mark & spencer’s company. Company is
coping up with all the laws and legislation with all the guideline associated to the order of
conduct to different activities and functions of the company, it is also necessary for the
expansion in the business to fulfil the laws and legislations properly.
The above content mentions the factors external business environment of the business
environment. The influence of the different factors on the different operation of the company
along with the growth of the company and to find its potentials in the markets. Pestel analysis
cover all the uncertainties of the external business environment of the Marks & Spencer’s in all
the different factors of business environment (Song,2017).

Competitor Analysis
Marks and Spencer Company is associated with the retail sector. Over the period of time
the sector has emerged rapidly all across the globe. The product demand in the sector is huge this
is why the sector has grown up immensely. Marks and Spencer Company has been involved
selling in products like food, clothing, electronic and other products associated with the retail
market. Most of the retail sector products are comprises with the basic needs and demands of the
human being. Marks and Spencer Company is one of the major brand part of the retail market
this is why the company is operating its business at more than 1400 locations across the globe
(Aigelsreiter, 2018). The demand of the sector is massive as the products are demanded on day to
day basis to customers. Irrespective of any religious and cultural values the sector serves its
products to all class and category people. Retail market in United Kingdom is growing at the rate
of approximately 5% every year. The effective growth rate of the sector has attracted to many
investors and entrepreneurs in the sector to entertain the benefits of the high growth rate and
market demand of sector.
Marks and Spencer Company is involved in selling its retail products with both the
mediums online and offline mode. Sainsbury’s is one of the biggest competitors of Marks and
Spencer Company as per the recent competitive position of company. According to the last
financial year there is approximately 18% growth rate has been entertained by Marks and
Spencer Company which indicate the strong dominance of company in retail market at a global
level (Hesford and et.al., 2019). Company face aggressive level of competition from other top
retail sector brands like Tesco, Wall Mart, Big Bazar and many other brands. All these
companies serve competition at offline market.
Along with the offline retailing by stores company also involve in selling its product
online. Marks and Spencer Company is one of the major organisation involved in ecommerce
sale in retail market. Online retailing is the emerging trend of doing business across the globe. In
United Kingdom online retailing is growing at the rate of 30% every year which indicate about
the strong demand of online retailing in the market of United Kingdom. Marks and Spencer
Company has boosted its online retailing growth rate at the rate of 25% as compared to last year
sales report (Zhong and et.al., 2018). Along with the aggressive level of competition from brands
like Tesco, Sainsbury and much other company could effectively register the high growth rate.

Porter’s five forces model
The competition in the market is increasing and it is very essential for the company to be
able to use an effective framework to be able to compete with them in the market. There are
going to be a lot of external and internal factors which would reduce the operations and
productivity of the organization and making the loyal customers be dissatisfied with the
organization. There have to be decisions which have to be taken after understanding the
competition in the market (Grant and Baden-Fuller, 2018).
 Potential of new entrants in market (Low)
There is a requirement of a lot of investment which businesses will have to make in order to
be able to compete with these big organizations in the market. There is a strong base which
Marks & Spencer has made for themselves in the market as a retailer and not just in the country
but globally as well which is a great advantage. There are new methods and techniques which
have come up in the market in order to be able to make a place for them in the market which is
going to be very helpful. There are no or few businesses which come in this retailing industry but
they will not be able to compete with M&S for a long run because of the experience and skills
which the organization has developed over time for them (Khosiev and et.al., 2019). M&S is not
having a threat from this factor which is a good advantage for the company for a long run in the
market and online as well M&S has made a place for them. The stakeholder’s responsibilities
and roles in the company have increased because of the existing competitors.
 Competition in industry (High)
From the experience the organization has gained which is making the organization have an
advantage to be able to compete in the market. There are a lot of companies which have
developed in the market after Marks & Spencer which have managed to capture the market and
take away the market share which the company has developed. There are a lot of loyal customers
in the company as well which have shifted to other businesses which are because of the online
services which they are providing to the people. There are chances for retail industry to have
growth in competition by 6% which is a threat for the company because they will lose the
customers further. There are new strategies and methods like online services and interactions
with the customers which have been added in the organization in order to be able to compete
with the others. There have to be right strategies which have to be adapted by the company in

order to be able to compete and to make a loyal base of customers for themselves which is going
to make the threat to the business reduce.
 Threat of substitute products (Medium)
There are a lot of competitors in the market which are getting in the substitute for the
products which already exist in the market so that they can take the base of other companies
which have set themselves in market. There are a lot of products and varieties in them which the
customers can find in market and anything which is innovative and new in the market the
customers can shift from one product to the other (Barros, Hernangómez and Martin-Cruz,
2016). Marks & Spencer is having a strong base for them in the market by putting out discounts
and offers from time to time so that they can make the customers and loyal customers are there in
the organization for a long run. The demands of customers are increasing which is a great factor
for M&S because they can maintain the productivity and match the expectations of the
customers. Clothing line is a very imitable industry which the organization is into which is why
having a strong strategy or the working is going to help the organization be able to operate
effectively in the market.
 Power of customer (High)
There is a rapid demand and needs of the customers which are changing and the organization
will have to understand them and then only make changes. In order to be able to maintain the
faith and trust of the customers the changes are important and also the pricing of the products
have to be according to the customers. The products and services of M&S are improving from
time to time because they understand the threat of the competitors and the organization does not
want to lose their customers (Ferreira, Mueller and Papa, 2018). The research and development
team has been working very hard to understand the customers and make the changes
accordingly. Technological changes are also taking place in the organization so that innovation
and invention can take place effectively in the company in order to be able to provide the best
services to the customers.
 Power of supplier (Low)
It is because Marks & Spencer has been in the market from such a long run therefore they are
aware of the suppliers present in the market (Punt, 2017). The company uses their suppliers
effectively because there has to be a good balance of suppliers and the raw material they are

getting in the organization which is going to help the company be able to keep up with their
reputation for a long run. There are suppliers who price their raw material higher which Marks &
Spencer can avoid and get another supplier to replace them. Since the suppliers are dependent on
these large organizations therefore they do not have a control on the company. The company has
a strong network in the market which is helping the company be able to maintain their
functioning and operations. The best of products and services are being received by the
customers who are making the organization have a strong customer base and the profitability is
high.
CONCLUSION
This report has projected the strategic position of company in market. Different analysis
tool like Porter Five Forces and other tools ar used to assess the market competitiveness.
Different factor like competition in industry, customer influence and other factors have assessed
to analysis the competitiveness of market. A proper recovery plan has also discussed in this
report that involve different strategies company can use to recover its market.

REFERENCES
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