Strategic Management - Strategy evaluation

This report on Strategic Management of Marks & Spencer by Desklib covers the value of clear purpose, vision, mission and objectives in setting the strategic direction of organizations, competitive analysis using VRIO analysis, PESTLE framework analysis, Porter's Five Forces Model and more.

Strategic Management - Strategy
evaluation

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
Determine the value of clear purpose, vision, mission and objectives in setting the strategic
direction of organizations............................................................................................................3
In the process of assessing a competitive advantage, this can be evaluated using four attributes
under the acronym VRIO. Evaluate the competitive analysis of the selected business with the
help of VRIO analysis.................................................................................................................4
Determine the external environment of the chosen business using PESTLE framework
analysis........................................................................................................................................6
Determine the industry, market, sectors and assessing the competitiveness of the chosen
organization by using Porter’s Five Forces Model......................................................................9
Based on the above analysis, review the organization’s strategy..............................................10
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Formulating sound organisational strategy becomes important in order to carry all the
functional activity in a proper manner. Organisational strategies defines structures and procedure
of how, when, why, what different activities are to be carried in a business accomplish corporate
goals and objectives. In the context of Marks & Spencer which is a multinational retailer founded
by Michael Marks and Thomas Spencer in the year 1884. This retailer business is headquartered
in London, United Kingdom. With large number of employees deployed in the organisation, the
revenue estimated in the year 2020 was 1018.19,00,00,000sGBP. Marks & Spencer has a well-
established brand identity worldwide. Marks & Spencer have more than 1300 stores worldwide.
Marks & Spencer conduct its retail business by delivering variety of products and services to the
customers these includes apparels, home improvement tools, flowers, beauty products, services,
banking services and also the organisation comes up with new products and services in the
marketplace very often. Thus, taking Marks & Spencer as a chosen business organisation this
report delivers the purpose, vision, mission and objectives of the chosen business organisation,
evaluating the competitive analysis and strategies taken by the business organisation, macro
environment analysis, Porters five forces model to evaluate the competitive attractiveness and at
the end the report also talks about different organisational strategy that the business have
implemented (Albert and Grzeda, 2015).
MAIN BODY
Determine the value of clear purpose, vision, mission and objectives in setting the strategic
direction of organizations
The main vision, mission and values of the businesses is discussed as:
Values
The values also reflect the policies, objectives and the procedures that that works as a benchmark
for carrying all the business activities.
Vision
The vision of the business focuses what the company wants to accomplish in near future. The
vision statement of the business defines over determining the objectives of the business

(Alyoubi, 2015). The main vision of Marks & Spencer is to become the leading company in the
global competitive environment. The vision of the business also says off good decision making
and strategic planning, inspire emotion, reflect values and benchmarking.
Mission statement
The mission statement defines the purpose of the organisation. The mission statement involves
goals, direction, decision making and actions of the organisation.
The mission of Marks & Spencer is to become socially responsible and profitable by delivering
new and creative market offerings to the customers and develop quality accessible to all and the
values of the association is quality value, service, innovation and trust (Amason and Ward,
2020).
Purpose
Business the purpose of any organisation includes developing reputation, delivering and quality
services, strong customer base and objective. The purpose of Marks & Spencer supports
demographic market of the customers. The main focus of the business is to produce market
offerings of high-end merchandise at best possible prices and other service oriented strategies to
enhance the customer experiences. The business also purposes over enhancing its profitability
goal, reduce the bad debtors, enhancing the cash flow, formulating strategies to develop new
products and so on (Barca, 2017).
In the process of assessing a competitive advantage, this can be evaluated using four attributes
under the acronym VRIO. Evaluate the competitive analysis of the selected business with the
help of VRIO analysis.
Resources Value Rare Imitation Organisation Competitive
advantage
Brand
positioning
Yes No Yes Yes Provides
temporary
competitive
advantage to
the business.
Financial Yes No Yes Yes Provides

resources temporary
competitive
advantage to
the business.
Ability to
Attract Talent
in Various
Local &
Global
Markets
Yes Yes No Yes Provides
strong
competitive
advantage to
the business.
Opportunities
in the E-
Commerce
Space using
Present IT
Capabilities
Yes No No Yes Provides
sustainable
competitive
advantage to
the business.
Opportunities
for Brand
Extensions
Yes No Yes Yes Provides
temporary
competitive
advantage to
the business.
Track Record
of Project
Execution
Yes Yes No Yes Provides
strong
competitive
advantage to
the business.
The above VRIO analysis clearly defines different factors that renders business strong
competitive advantage to the business in the external marketplace. Ability to attract talent in
various local and global market and track record of project execution renders the business
organisation strong competitive advantage (Bettis and et.al., 2015). Human capital is like the

food to the organisation, thus, having a skilled workforce to manage all the core functional
activities of the business becomes an essential aspect. Thus, capability of the business to identify
the skilled candidate from both local and global market and recruit them into the organisation
supports to have the best workforce in order to manage and conduct functional activities as per
the working standards of the business. Ability to track record of the project execution is an
important aspect for the association, where in the business focuses for keeping track records in
order to identify the strengths, weaknesses and areas of development to get the quality working
standard and business success at early stage. The other factors of the business including
opportunities of brand extension financial sources and brand positioning delivers the business
organisation a temporary advantage, as Marks & Spencer works for delivering differentiated
products and services to the customers with high-end and personalized customer experiences.
Such activities of the business supports to attain temporary advantage from the competitors.
Opportunities in the e-commerce space using present IT capabilities helps the business
organisation in order to accomplish sustainable competitive advantage. Marks & Spencer have
introduced e-commerce website where customers can get personalized attention over their
shopping experience, high-end technical support to improve the user experience by delivering
them quick responses and convenient services further, supports the business to accomplish
customer satisfaction and delivers competitive advantage to stand out in the market from other
brands (Bondarenko and et.al., 2017).
Determine the external environment of the chosen business using PESTLE framework analysis
Pestle analysis includes different dimension such as political, environmental, economic,
social, technological, legal factors in the macro environment that might negatively and positively
affect business performances (Dagnino and Cinici eds., 2015). Marks & Spencer conducts Pestle
analysis in order to evaluate the macro environment, how different factors of influence affects
the business performance and how supported strategies businesses have formulated respective of
different challenges and opportunities. Further, in Marks & Spencer is conducted as:
Political factors
There are different political factors that can be analysed in the macro environment such as:
Political factors with implication of Brexit where UK have decided to exit EU, Brexit have
negatively affected the business performance of Marks & Spencer. Such negative impacts can

reflect in losses numerous free trade policies with the EU suppliers, high cost incurred for
acquiring raw material which also further burden the pockets of the customers and other negative
impacts (Dzwigol, 2020).
Environmental factors
Sustainable produce
Marks & Spencer have implemented the concept of sustainable approach by looking at the rising
environmental concerns. The motive of the business is to introduce the concept of sustainable
produce in each and every business activity right from acquisition of raw materials to distribution
of products and services to the end prospects. Sustainable concept involves to control the carbon
footprint from the manufacturing process, deforestation of land and other green practices carried
in the workplace. carrying sustainable approaches greatly supports the business in many ways
wherein the business fulfils its CSR, adheres to the regulations of the government of UK ad
further works out to establish a brand identity worldwide to earn customer reliability and
enhance market share. Marks and Spencer has come up with new product development range to
promote the concept of sustainable produce wherein the business have introduced electricity
energy supply with the help of wind energy which is renewable sources of energy. Promoting the
sustainable energy consumption concept of the business reflects the strong brand identity and
works on enhancing the market share in the global presence.
Technological factors
Self-checkout
Marks and Spencer have introduced self-checkout options in the outlets to save businesses
expenses for rendering to the cashiers and enhance the customer experiences. Self-service
checkout options help the customer to make their final decisions for purchasing the products by
themselves and also help them to deliver Personalized shopping experience with the help of high
end technical solutions (Gallus and Frey, 2016).
Online shopping
With rising technological advancement where more than 70% of the people the week it UK have
switched to online shopping. Marks and spencer have introduced e-commerce website where in

the business sell off its products and services to customers using virtual platform. With the help
of e-commerce website, the customers can get personalised experience simply by sitting at home
and business will deliver ordered products at the doorsteps. the growing online presence also
helps to reach out large number of customers irrespective of the location, where the business can
get in touch with each customers and offer them personalized shopping experiences.
Social factors
Non-trendy
Marks & Spencer have established brand identity that is continuing from very long. As the
business is operating from 135 years in the industry, which reflects the brand identity of the
business as the old retailer that sell off clothes which are non-trendy. This long reputation has a
negative consequence on the business especially in the minds of young consumers (Jenkins and
Williamson, 2015).
Ready meal sector
Marks & Spencer have a well-established brand identity over the ready meal sector. Where in the
business is also counted among the top 10 ready male distributors in UK. Marks & Spencer uses
advance food technology in order to deliver high end customer experience.
Economic factors
Discount competitor of Marks & Spencer
Prices play a significant role in the retail industry. Right from budget clothing to budget
supermarkets. Where in large number of competitors are duplicating the concepts of the premium
brands like Marks & Spencer and selling of similar products at lower prices. Such small
competitor becomes a great challenge for the business like Marks and Spencer to lose their
market share and sales margin as cheap product pricing concepts often motivates the customers
to purchase more (Johnsen, 2015).
Legal factors
With implications of different legal norms and regulations by the government of UK for
operating business in the country. Marks and Spencer adheres to all the regulations such as to

pay taxes, employee rights and welfare, health and safety and other regulation that focuses over
conducting the business activities to the utmost transparency and in the most ethical manner.
Determine the industry, market, sectors and assessing the competitiveness of the chosen
organization by using Porter’s Five Forces Model
Porters five forces analysis is a strategic tool that helps to define the industry
attractiveness, long run business sustainability in the marketplace and how the business can
implement sound strategies to attain competitive advantage. Further, Porters five forces analysis
conducted on Marks & Spencer is discussed as:
Threat of new entrants
New entrants in the industry can enhance the level of competition. The trade of new entrants is
mainly relied on the barriers of entry in the particular industry. For a small business it generally
takes 5 to 6 years to establish brand reputation in the marketplace irrespective of how larger or
how big the advertisement campaign conducted the business conducts.
Bargaining power of suppliers
Suppliers are the one who renders raw materials to the businesses in order carry further
production activities. The cost in which the suppliers sell off the product to the industry plays a
significant role. In case if the suppliers have higher bargaining power then it might negatively
affect the business performance and make the industry less attractive. Marks & Spencer selects
multiple suppliers in order to limit the bargaining power of the buyers, the business also manages
all the activities solely by itself in order to reduce the dependency upon the suppliers (Joyce,
2015).
Bargaining power of buyers
Buyers are the ones who generates the demand in the industry. Buyers always looks for products
and services at least possible prices which reduces the profitability of the businesses. In order to
limit the bargaining power of the buyers, Marks & Spencer develops new products and services
in the market and very often provides discounts and offers for the old stock. Such instances
positively impact the business performance and support to deal with the bargaining power of the
buyers. Thus it can be said that the bargaining power of the buyers is medium.

Rivalry
With number of small and large businesses in the country, there is also intense competition of
environment that negatively affects the overall profitability of the business. In order to deal with
the competition in the marketplace Marks & Spencer sell off differentiated products and services
in the market place which customers cannot acquire or experience with other brands and
collaborates with the competitors to join hands and together work for satisfying customer
preferences which further helps out to enhance the market share of the business.
Threat of substitute products or services
There are varieties of products and services in the marketplace that satisfies the similar needs of
the customers in different ways. Customers often purchases the one with cheap prices and
maximum quality. There are different small businesses that copies the idea of brands like Marks
and Spencer sell off them in cheap prices. Such cheap pricing strategies often attracts large
number of consumers. In order to deal with the substitute products, Marks and Spencer
formulates tactics to establish a strong consumer perception by working on all the touch points of
the customers and keep up the business sustainability in the external marketplace.
Based on the above analysis, review the organization’s strategy.
Marks & Spencer, the main products of the business includes clothes and food, Marks &
Spencer implements focus generic strategies in order to emphasis on the specific market
segment, the buyer group, delivering product features and differentiated products and services
from the competitor brands like Zara, Tesco’s Asda, BHS and others. The organisational strategy
of Marks & Spencer can be evaluated with the help of BCG Matrix and hands Ansoff Matrix.
Marks & Spencer sell off its own brand with the main objective of delivering quality products
and services and attain consumer satisfaction. The market penetration is business tactic practiced
by Marks & Spencer since very long time. The association adopts a group growing path with the
help of strategic alliances and joint-venture with the suppliers and other stores in the country.
The strategic approach of the business helps to diversify its product ranges into different
geographical areas. Marks & Spencer focuses over developing new products in the country with
innovative features and benefits driven (McKiernan ed., 2017).

The BCG Matrix is applied in order to derive the balance between business activity in respect of
market share and market growth. The industry in which Marks & Spencer runs is mature and
stable, thus such instances becomes more difficult for the business association to enhance its
market share. The competitors of Marks & Spencer continuously look to grab the market share of
the business. Thus, in order to combat with the intense competitive environment Marks &
Spencer uses tactics for lowering down the prices of the products and services and its competitor
and make huge investment on advertisement in selling activities.
Ansoff Matrix
Market penetration is a strategy, where in the business emphasizes on offering the current
products and services to the current market with the main motive is to enhance the market share
of the existing market offerings which is also supported by conducting other business activities
such as competitive pricing strategies, marketing and advertisement activities and personal
selling. Marks & Spencer delivers the marketing objective of selling high quality goods to the
customers in UK and Europe.
Market development is a strategy, wherein the business focuses on selling the current products
and services into new market with the motive of enhancing its customer base, new users of the
market offerings, new segments of the market, enhancing the geographical areas. Some examples
of market development strategies used by the association is as, in 2007, Marks & Spencer had
introduced for opening the world’s biggest Store outside UK in Dubai festival city. In the year
2008, Marks & Spencer also introduced its physical store in China.
Product development is a strategy where business looks for developing new products into the
current market. In this strategy business focuses on developing new features and competency to
bring modification in existing product and deliver better products and services to existing
market. The examples of new product development strategy are adopted by Marks & Spencer
can be financial service and banking services started by the Association (Siegel and Leih, 2018).
Diversification is a strategy where the business plans to move into new markets. Diversification
strategies are riskier where in the business do not have experience and expertise knowledge
about the new market. Some product diversification strategy adopted by Marks & Spencer is as

increasing its Number of market into 40 countries is the example of diversification strategy
adopted by the association.
CONCLUSION
Thus, in the light of above discussion it can be said that implementing sound
organisational strategy becomes important for business success. For formulating effective
organizational strategy, a business needs to rightly define the purpose, vision and mission to set
the strategic direction. Analysing the macro and micro environment also becomes important in
order to ensure that the business is able to sustain in the market place. Pestle Analysis, porters
five forces model and VRIO analysis helps to define the industry attractiveness and competitive
positioning of the business in the external market environment.

REFERENCES
Books and Journals
Albert, S. and Grzeda, M., 2015. Reflection in strategic management education. Journal of
Management Education. 39(5). pp.650-669.
Alyoubi, B. A., 2015. Decision support system and knowledge-based strategic
management. Procedia Computer Science. 65. pp.278-284.
Amason, A. C. and Ward, A., 2020. Strategic management: From theory to practice. Routledge.
Barca, M., 2017. Economic foundations of strategic management. Routledge.
Bettis, R. A. and et.al., 2015. Qualitative empirical research in strategic management. Strategic
Management Journal. pp.637-639.
Bondarenko, T. G. and et.al., 2017. Optimization of the company strategic management system
in the context of economic instability.
Dagnino, G. B. and Cinici, M. C. eds., 2015. Research methods for strategic management.
Routledge.
Dzwigol, H., 2020. Methodological and empirical platform of triangulation in strategic
management. Academy of Strategic Management Journal. 19(4). pp.1-8.
Gallus, J. and Frey, B. S., 2016. Awards: A strategic management perspective. Strategic
Management Journal. 37(8). pp.1699-1714.
Jenkins, W. and Williamson, D., 2015. Strategic management and business analysis. Routledge.
Johnsen, Å., 2015. Strategic management thinking and practice in the public sector: A strategic
planning for all seasons?. Financial Accountability & Management. 31(3). pp.243-268.
Joyce, P., 2015. Strategic management in the public sector. Routledge.
McKiernan, P. ed., 2017. Historical evolution of strategic management, volumes I and II (Vol.
1). Taylor & Francis.
Siegel, D. S. and Leih, S., 2018. Strategic management theory and universities: An overview of
the Special Issue. Strategic Organization. 16(1). pp.6-11.