Strategic Management in Marks and Spencer

This report discusses the industry structure, innovation, governance practices, and ethical practices in Marks and Spencer. It analyzes the impact of external factors on the company and its competitive position. The report also explores the role of innovation and strategic innovation in ensuring long-term survival. Additionally, it examines the CSR activities and ethical responsibilities of Marks and Spencer.

Strategic management

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
External environment is completely dynamic as it is affected by many different factors
that is leading to requirement of several internal changes by organisation. Industry structure,
market position and factors of a country are some of the aspects that lead to changes taking place
in a organisation (Ambarwati and Fathurochman, 2019). Present report is based on Marks and
Spencer that is a multinational retail brand having its headquarters in London. They have 959
stores across U.K and dealing in wide range of products such as food, beverages, merchandise
and many more products. Present report is discussion of the industry structure, innovation,
governance practices and ethical practices that are part of this organisation.
MAIN BODY
Company background: Marks and Spencer is a retail brand across UK with 1380 stores
across different parts of world, they are operating in two segment that is international and UK. It
is engaged in clothing, food and home products having presence both offline and online (Chen
and Cheng, 2019). They are also providing wide range of financial services that consist of
current accounts, credit cards, mortgages and insurance. According to data of 2019 there were
1043 stores of M&S across different parts of UK & 444 stores in other locations across different
parts of world.
Marks and Spencer has partnered with True that is innovation and consumer investment
firm where there can be access to high quality products. It is helping M&S to create a network of
2000 enterprise ready technology every year. It is also going to help M&S in transforming their
business to become digital first retailer. Explicit focus of M&S is on getting better ROI with their
partners.
There is use of SWOT analysis to understand the internal factors that posses impact on
the functioning of organisation and their future innovation strategies. Strength: M&S is a brand
that is having strong e commerce infrastructure, focus on enhancement of customer experience
through their products. Use of brand image to enhance their digital marketing position.
Weakness: There is reliance on markets of UK that may lead to vulnerable conditions. There
have been instances of product recalls that can lead to loss of customer confidence.
Opportunities: M&S is planning to enhance their Indian markets by reshaping their merchandise
segment and simplification of operating model is a opportunity. Threats: There is high threat of
sterling after Brexit scenario. Stiff competition and fast changing trends is affecting preset

position of M&S. From SWOT analysis it can be said that strength of M&S can be used for
enhancing innovation.
PESTLE analysis is another framework that is used for analysing the external environmental
factors possessing a impact on functioning of Marks and Spencer:
Political factors affecting M&S consist of free trade policies, Brexit decisions that has
lead to change in years of tariffs and trade regulations. Marks and Spencer is one of major retail
brands that is affected by factors like changing health & safety regulations that lead to
development of policies to ensure high safety regulations for their whole workforce. Economic
factors consist of pricing regulations in retail industry. Competitors are creating high price
based competition to M&S. There is affect on Marks and Spencer because of closing of many
physical outlets. It leads to launching of more discounts and offers to deal with loss of revenue.
Social factors: M&S is willing to move along with caning expectation of customers. There are
many trends that poses a consequence on demographics and social class.
There are certain social, cultural, personal and psychological changes taking place in
external market. Such as with fats changing technology customers are willing to have more
preferences for online shopping as they can access it anytime and from anywhere (Denicolò and
Polo, 2018). So there is equal focus on launching of new collection on online sites. Customers
are attract by offers, discounts that is leading to enhancement of online sales. Technological
factors include the self checkout system that is helping retailers to save their cost by reducing
their workforce. Another technological factor consist of trend of online shipping that has
complete transform the retail industry of UK. Legal factors: Legislations are changing very fast.
M&S is continuously conducting training activities and updating with present legislation, laws so
that there can be timely risk amassment. Acts such as Health & Safety Act 1974 has to be
adopted to ensure safety norms for their workers. Equability act 2010 is also considered in
overall policies and practices of organisation (Rothaermel, 2016). Environmental factors are
those that are part of external business environment such as sustainable production.
Above mentioned are certain factors that can impact functioning of M&S. These factors
actually create demand to enhance some innovation process in order to sustain in the industry for
long term.
Porters five forces analysis is a model that is used for making competitive analysis and
to gain insights of Competitive position. Industrial rivalry: There is presence of high industrial

rivalry because of existing competitors such as Sainsbury's, Walmart, Morrisons, Tesco, H&M,
Zara that are offering high competition to Marks and Spencer. Bargaining power of supplier:
M&S has been able to maintain long term relationship with their suppliers. They are able to
determine the proses rather than accepting it it has lead to reduction in bargaining power of
suppliers. Bargaining power of buyers: Marks and Spencer is offering a diverse range of high
quality products that is leading to creation of a differentiation advantage and a loyal customer
base. Threat of substitution: This factor is related to substitution of Marks and Spencer that is
there are many different brands such as Peter Jones, John lewis that are offering high quality
apparel. Asda and Tesco also have presence of alternatives that is leading to high threat of
substitution.
Threat of new entrants: Major entry barriers are the factors that impact the profitability
of existing and potential competitors. There are different diverse firms that can prevent entry of
organisations in industry. Entry barriers are present because of many legal obstacles for entry of
new brands (Ginter, Duncan and Swayne, 2018). These factors include economies of scale.
Entry cost, cost advantages, distribution channels, government legislations and differentiation
identity.
From the above discussed Porters five forces analysis it can be said that Marks and
Spencer has been able to achieve a high Competitive position as they posses low bargaining
power of buyers and low threat of new entrants that can assist them in formation of certain
innovative strategies.
Innovation and strategic innovation is a technique that is used by organisations to
ensure their survival in long run. Innovation is a process that is used for application of creativity
to design some new products, solutions and services. Strategic innovation is regarded as a
system approach that can be used for optimization of innovation portfolio to assist a organisation
for achievement of competitive advantage and high transformational growth (Hitt Ireland, and
Hoskisson, 2016). Marks and Spencer complete transformed their existing process by
enhancing their profitability by use of moderations approach. In this there was digital
transformational that took place for enhancing shopping experience of their customers. There
was a 62 percent enhancement in their annual profits that lead to restoring of basic plans.
As per views of Danielle wightman stone, 2018 Marks and Spencer is willing to move
forward to adopt a strategy to be “digital first” retail by creation of partnership with specialist

retail & consumer investment so that there can be access to latest specific innovations to create
“digital innovation”. There is access to deep rooted consumer expertise, proprietary research,
emerging technologies and sector based international networks that is helping in creation of
investable opportunities (Hitt Ireland, and Hoskisson, 2016). Marks and Spencer is willing to
adopt True's business model and a live network so that there are 2000 enterprise ready
technologies & consumer products every year. It helps retailers to access latest technologies &
expertise in sector to support digital ambitions. Marks and Spencer is also willing to use their
five year transformation programme since November 2017 to restore basic and shape the future.
Where as
Zara being most closest Competitive brand of M&S is focussing on their innovation in
designs. Their change starts with design, developers, technologists, logistics, merchandise and
last is store, Zara is willing to launch some innovative deigns. Another innovative approach that
is used by Zara is delivering of new collection in juts a period of 5 days. They can cut theory cost
by making rapid changes in their stocks and new product lines. Zara is changing fast according
to prevailing change and they focus on maintaining uniqueness of brand.
M&S started CSR activities since year 2003 by focussing on aspects of “doing the right
thing” by showing improvements in values, prices, standards and product prices. CSR activities
by Marks and Spencer is classified as Plan A that consist of climate change achievements, raw
material sustainability. M&S posses lowest turnover rates that is 27 percent in customer
assassinates & 12 percent for the management (Kumbara, 2020). They focus on having a right
balance between sourcing of product like sugar, coffee and cotton from developing countries in
fair trade policies and sourcing of meat and dairy products from local producers. In case of M&S
there is use of Carroll's model that consist of four stages that is
Economic responsibility: It includes employees having interest for having high return on
investment and job security. This responsibility is to fulfil interest of employees by
organisations. Ethical activities are those in which M&S is administering welfare and
environment groups to help suppliers in cutting cost, enhancement of efficiency. Legal
responsibilities is the one which organisation have to follow all the regulatory and legal rules
regulations that have been formed by concerned authorities in country. Philanthropic
responsibilities is to perform all activities without any allegation on brand. Marks and Spencer in
UK is using a unitary board system. In this there is use of good corporate governance that is split

of roles of chief executive and chairman (Maye, 2019). The main agenda of corporate
governance is to split chief executive to mitigate the corporate governance risks.
Marks and Spencer is a brand that posses responsibility towards employees, customers,
partners, suppliers, local communities so that business can be done in a more responsible
together can lead to underpinning of values innovation, trust, services and quality of products
(Michael, Storey and Thomas, 2017). Some of the ethical responsibilities that are undertaken by
M&S is discussed below:
Plan-A of Marks and Spencer:
It is a five year plan that is developed to help employees and customer to choose a
healthy lifestyle: There are 1500 healthy eating advisers. Replacing of artificial colours with
natural colours. Adoption of food standards agency traffic lights and Guideline Daily amounts
(GDA) in labelling of products. Community funding decisions: There are donations made to
charitable organisations by M&S local stores.
Recommendations:
There are several recommendations for M&S such as there is a requirement to make
timely innovations in product by analysing the current market trends. Marks and Spencer is
willing to make a difference by use of approach related to innovation and continuous
improvement. They believe in providing value in their products “making every moment
special” through their products & services. There is need to ensure higher product safety &
integrity to deal with issues that can impact food sector of M&S, there is need to be protected
from social, environmental and economic challenges that can affect supply chin resilience or
suppliers.

CONCLUSION
From above discussed points it is being concluded that there are internal strength &
weaknesses that have to be considered by organisations to form certain innovation strategies that
can help in achievement of long run sustainable advantage. There is requirement to focus on
product integrity and safety to deal with emerging issues. Driving of well-being and health lead
to improve diet enrichment of their customers. Solutions to protect business from economic,
social and environmental challenges is also very important to deal with supply chain resilience.

REFERENCES
Books & Journal
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Chen, Y.G. and Cheng, J.N., 2019. A STUDY INVESTIGATING
TEACHERS'COMPETITIVENESS-MICHAEL PORTER'S FIVE FORCES MODEL AS
THEORETICAL BASIS. Academy of Educational Leadership Journal, 23(2), pp.1-18.
Denicolò, V. and Polo, M., 2018. The innovation theory of harm: an appraisal. Available at
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Ginter, P.M., Duncan, W.J. and Swayne, L.E., 2018. The strategic management of health care
organizations. John Wiley & Sons.
Hitt, M.A., Ireland, R.D. and Hoskisson, R.E., 2016. Strategic management: Concepts and
cases: Competitiveness and globalization. Cengage Learning.
Kumbara, A., 2020. THE ANALYSIS OF PORTER'S FIVE FORCES IN LUCKY TEXTILE
GROUP IN FACING THE COMPETITION OF TEXTILE INDUSTRY. Dinasti
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Maye, D., 2019. ‘Smart food city’: conceptual relations between smart city planning, urban food
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Michael, S., Storey, D. and Thomas, H., 2017. Discovery and coordination in strategic
management and entrepreneurship. Strategic entrepreneurship: Creating a new mindset,
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Rothaermel, F.T., 2016. Strategic management: concepts (Vol. 2). McGraw-Hill Education.
Online
Marks and Spencer, 2020 [online], Available
through<http://fashiongear.fibre2fashion.com/brand-story/mands/corporate.asp>
Marks and Spencer partners with true to drive “digital innovation”, [online], Available
through<https://fashionunited.uk/news/retail/marks-and-spencer-partners-with-true-to-drive-
digital-innovation/2018080731135>