Kensington College: Strategic Management Plan for Business Strategy

This assignment presents a strategic management plan for Marks and Spencer, a British multinational retailer. It begins with an introduction to business strategy and the importance of strategic management plans. The report then delves into a PESTLE analysis, examining political, economic, social, technological, environmental, and legal factors affecting the company. A SWOT analysis follows, outlining Marks and Spencer's strengths, weaknesses, opportunities, and threats. The Porter's Five Forces model is then applied to analyze the competitive forces within the industry. The report also explores strategic directions using the Ansoff matrix and concludes with a strategic management plan, including strategies, tactics, and objectives for the company. The analysis focuses on the company's internal and external environments to ensure operational strength and alignment with organizational goals.

Strategic management plan
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Table of Contents
INTRODUCTION...........................................................................................................................3
P1 Pestle analysis.........................................................................................................................3
P 2 SWOT analysis......................................................................................................................4
P3 Porter five forces model.........................................................................................................6
P4 Strategic management plan.....................................................................................................7
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................11
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INTRODUCTION
Business strategy is a kind of competitive actions, or moves that are used by the
organization to attract more customers, strengthen their performance and achieve organizational
goals. Strategic Management Plan is most important documents that is used by the organization
for ensuring operational strength, set priorities, assure whether workers and other stakeholders
are working towards the common objectives or not. This is extremely important for an
organization to analyse their environmental for strategic planning for overall growth of the
organization (Rothaermel, 2017). This assignment will lay emphasis on Marks and Spencer
organization is a British multinational retailer founded in 1884 whose headquarter is in London.
This assignment will lay emphasis on PESTLE analysis of M&S , SWOT analysis of company,
Analysis of company through Porter’s Five Forces model, different types of strategic directions,
justification of most proper and appropriate opportunity platform and strategies and strategic
management plans with strategies, tactics and objective of the company.
P1 Pestle analysis
Political factors -as the company known as the second largest retailer and also famous for selling
its food and non-food products. Worldwide there are various political factors that influences
such as acts of the legislation, tax rates & also the stability of the country where this operates.
Due to financial crisis of various countries' government encourages to create the jobs and
providing the employment to the people. Company like Tesco play a crucial role to creates the
workers opportunities ,this also assist to increase a demand of their products as well as
diversified within its workplaces.
Economic factors- A main concern of Tesco is its economic condition as the cost, demands,
profits as well as prices . Therefore, the firm must be aware of the change within the policies
regarding the change in the taxation as well as other factors that could affect the finance
accessibility (.Eskerod. and Jepsen, 2016). It is crucial to mention as the business of Tesco grow
internationally as the company is expanding day by day and also it is still dependent within the
United kingdom Market around 30%. Furthermore, Tesco shifted its focus towards the adverting
its brands instead of luxurious items.
Social factors- With the increase of the social changes among the people within the United
kingdom. The customers of the United Kingdom move toward the shopping. Thus, tesco has
also has been increased the non- food for the sale. A product demanded by the customer is
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mostly impacted through their beliefs as well as attitudes as it impact by the social learning. As
nowadays buyers are well aware about their health issues so that they approach food is
changing constantly as tesco adapt as per the demands of the organic products for the customers
as per the increasing demands.
Environmental
Due to the increase pressure to address the companies to deal with the environmental issues,
Tesco committed clearly to reduce their carbon footprint up to the Fifty percent by 2020. they
also minimized the waste products within their stores that would benefit the society.
Technological factors- online shopping with the home delivery facility and self-service
checkouts these two technological advancement brought various new opportunities for the Firm
Tesco. As it provided the facility for the consumers that able to reduced workers cost. Tesco
also invested on the energy efficiency products so that it meet their long term Goals and
objectives as well as to deduct its carbon footprint (Cook, 2015)
Legal factors- Tesco faced legal action against the manager and the basis on gender and age
discrimination. As they are agreed to pay GBP around 13 millions to settle down the legal
action. Firm must conduct as per according to the Food Retailing Commission (FRC) strict code
regarding practice.
P 2 SWOT analysis
Swot analysis of Tesco
Strength
Tesco company is considered as the European longest private sector as t offers more than 743
jobs all over the world. It is considered as one of the best opportunity creators within the whole
Europe.
Diversified in stores- Tesco has launched different from of stress as its diversified division stores
involves such as Tesco Metro, Tesco express and Tesco superstores.
The company also apply online sales promotions with a more high levels of ratio as it was
among the first retailer that able to implement online sales channels as well as existing revenues
that are generated as according to the digital sales account regarding a solidified share of the all
profit. Especially in 2015 Tesco grocery items sales online sale channel and currently revenues
are generated. Here the growth of the online sales in the lead of the market 21 percent as the firm
posted pre-tax loss. The online sales can decrease the offline sales as there is decline of the
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overall sales as a high ratio of the digital sales tools as there is respectable strength within the
marketplace.
Weaknesses
Weakness are the areas where there is an improvement needed. (Ansoff, .and et.al., 2018)
It is not considered as the successful culture as various integrating firms working with the
different work culture. As it is provided earlier that Tesco has successful at the integrating of the
small companies as it has failure share to merge firms that can work for various work culture.
Net contribution percent and profitability ration of Tesco are considered as the low the industry
average. There is a need of more investment within new technologies as company is planning
into the various geography. Firm needs to put more money within technology to all over the
world to integrate the process. Right now the investment within the technology is not consider
at par with the vision of the firm.
Opportunities
Expanding the business called Jack's businesses
Jacks can be recently introduced by Tesco, it is considered as the new stores with better more
discount that has been showed more growth as it has the opportunity to grow its business as well
as with success complete lower cost contender wit Lidl and Aldi.
Online shopping- Tesco can be gain the opportunity for the company by growing as well as rise
their Digital shopping business and home delivery services.
Developed its strategical alliance with the other competitors- By making strategic partnership
with the famous companies , Tesco offers more products as well as able to attract more
costumers.
Threats
Controversy regarding the Christmas ad- Tesco launched its Christmas and within 2017 as
here people boycott the store As according to them this is consider as the disrespectful act
against the faith of the Christianity. (Morden, 2016.)
Brexit's referendum- With the no longer part of the EU countries, the trade deals as well as
cost matters a lot of processing over the issues within 2017.
Economical crisis as well as credit crunches- Government tax and regulations as well as
economic upheavals ca affects the operational efficiency as well as performance of the firm like
Tesco within the critical regions.
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Fake farm legal threat- Tesco is dishonest with their customers and fake farm brand names a
well as marketing their food product with the fake names of the Wood side farms as it faced a
legal company threat transactions over the issues within 2017.
P3 Porter five forces model
Tesco porter's five forces analyses to determine overall competition in the grocery retail
industry.
Threat
Tesco selling a broad range of the products which are belonging to the various categorize such
as Home electrical,Home appliances clothing, beauty ,Entertainment and books ,yard ,Toys
,baby & toddler .Here the range of the products sold through Tesco is highly comprehensible.
The supermarket chains sells a lot of a broad range o the products as well as majority for the
producers thus This can be argued again and again that the secondary products as well as
services for Tesco is considered to be irrelevant (Ginter, Duncan, and Swayne, 2018).
Tesco bargaining power
This company considered as the no suppliers switch cost for the grocery store chain.
Using its barraging ability to delay payment to the supplier so that the profit amount in the
leadership within 2014.
ENTRY BARRIERS
This barriers are called VAT ,that around twenty five percent on alcohol and 25% on the food
items within Denmark. This could be considered as the problem of the tesco. As various other
nations where Tesco company operate their business. A value added tax that is less . Denmark
who have the highest VAT ,with the Sweden and Norway, A way most of the Dane are shifting t
Germany to create the shopping bigger. This is considered as anther problem that would be
wages within the Denmark as due to the minimum wages is high there as this can be a
disadvantage for the company.
Suppliers power in bargaining
Suppliers of the Tesco company operates more as compared to the buyers .Thus, it means that
Tesco suppliers have very less Rights and control regarding the cost as well as. It makes the
bargaining power of a less power force of the supplier.
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The suppliers do not cope up with the another product of industry this means no other
alternatives for the product rather than the one provided by the suppliers. Thus this can make the
suppliers power in the bargaining within industry a strong force. (Stark, 2015)
Here the industry in which the Tesco operates is considered as a crucial customer regarding the
suppliers. A profits of this industry are more closely bound to each other through the company
suppliers. Reasonable prices can be provided to these suppliers as this can make the barging
power of the supplier weaker force in the industry.
Bargaining power of the Buyers
Here the differentiation of the product is to much higher that means that are customers are not
eligible to find the substitutes firms producing the specified product.
Here quality products are crucial for the buyers and these are the buyers which makes the
frequent purchases as they are less price sensitive.
Threats of the new entrants
Here the requirement of the investment within the industry is high and also it is problematic for
the new entrants to set up the experience that required to be incurred. Here the requirement of
capital is also very high thus a high research as well as development costs. These all the factors
can makes the new entrants a weaker force in the provided industry.
P4 Strategic management plan
Ansoff matrix
The outcomes of the Ansoff matrix helps to determine a channels of the suggested for the growth
of strategies that set the direction regarding the business strategy. Which are describes as
follows.
Market penetration
As the name suggests that it focuses on the selling the current products into the current markets.
There are four major objectives of the Market penetration (Desmidt, and Meyfroodt, 2018)
Increase or maintain the market share of the existing product as it can accomplish with the
combination of pricing strategies, promotion of sales and also in large amount resource are
provided for individual selling, Tesco increased the usage through current customers, It also
secures dominance of markets.
Market development
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Market development strategies taken up by the Tesco seeks to sells its existing products into the
new markets There are various possible ways such as dimension of the new products ,new
geographical markets which are outsourcing the products to the nations, various pricing policies
to attract various consumers as well as create new market section. It is considered as the most
risky strategy of tesco as here company has to target of new markets.
Product development
As the name suggest product development provided to the growth strategy where the goal of
tesco is to introduce new products' into the current markets.
Diversification – Here Tesco offer the clients when they book online products (Uhl, and
Gollenia, 2016)
Henry Mintzberg
As per the Henry Mintzberg ,has developed the stratgic tool in the for the change in the
roles and responsibilities as well as organizing the workplaces to simply the concept that are
complex. As per the Mintzberg skills cannot be learned by experience as well as cannot simply
taught within the class room.
Mention below are some basics of the management that can be recognized by the Mintzberg.
Simple structure(entrepreneurial organization)- This kind of firm consists of a less
executives or managers as well as multiple subordinates.
Professional Bureaucracy – Here each and every professional of Tesco works independently as
according to the skills and the mindset developed for the betterment of the country.
Divisional ( diversified)- Here the work can be divided among the various sectors of Tesco.
Each and every sector keeps the focus on the work as well as functions carried out for the
development of the firm.
Adhocracy- In adhocracy there is no formal layout, here highly, mature and qualified staff
members from teams and also complete task as well as adjust to the changes within industry
regarding Tesco.
McKinsey 7s model
It refers to the functions that evaluates organization design by looking at the 7 key internal
elements such as strategy, shared values, style and skills. In order to recognize they are
considered as the effectively aligned as well as enable firms to accomplish objectives.
(Hladchenko, 2015)
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Skills - They are considered as the abilities of that staff members to perform very well as it
involves daily activities as well as how business can be done. During the change of the firm the
question arises that what kinds of skills the firm really required for the development of the new
strategies ans structures.
System - During the organization change Tesco focuses on the managers. Here the process as
well as procedures of the firm .
Staff- It is concerned that what kind and how many staff members of a firm that need to be
recruited, trained , rewarded as well as motivated.
Style- It refers to the way through which the organization can be managed through the upper
class of managers. It is known as the management style of the firm's leaders. (Rothaermel, 2017)
it is very crucial to evaluation and the controlling strategies that needs to be developed as
it helps in acquiring the targets and objectives which are set up by the officials for a entire range
of time. These strategies are explained below for the evaluation and development of the key
objectives which are stated below:-
Suitability- Suitability refers to the strategies which must be suitable for the development of the
task at TESCO which can help in the achieving the goals. Suitability also refers to development
of the strategies by evaluating various risks and benefits which are suitable for the development
of the TESCO. Developing the market which can be suitable which can be beneficial for the
expansion of business at the global context. As TESCO has a bigger brand images which can
help in the development. For the implementation of the strategies for the better development of
the market acquiring. It will help the development of the brand image at the global level.
Acceptability- It refers to the development of the strategies which must be accepted by the
worldwide organizations. TESCO should work in strategic development of the which can help in
the development of the brands which must be accepted by the stakeholders for the development
and the market generation of the firm. Stakeholder provides a suggestion which can help in the
development of the strategies which can provide a beneficial standards to the firm which ca n
help in achieving the better objectives which can help in the development of the firm. Changes in
the strategies which can help in the development of the firm. Strong brand image can help in the
proving the better sales and growth opportunities. Acceptance from stakeholders can be gained
by providing the benefits to TESCO(Cook, 2015)
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Feasibility – It refers to the implementation of the strategies as there must be resources which
are made available. Some the resources which increases the feasibility are financial, human
resources etc. this is made to develop the market with the improvement in the strategies and
increase the workforce. TESCO has large workers who are skilled and have ample pf knowledge.
Feasibility of the TESCO can be increased with the wide workforce and skilled leaders.
Financial status is strong within which are a strong hand for TESCO. These strategies will
increase customer base for the TESCO which can improve the results and improve the profits.
CONCLUSION
From the above assignment it has been summarized that there are various kinds of macro
environmental factors that can influence the overall operations of an organization. It has also
been analysed that organization need to assess their internal environment and capabilities in
order to identify their strengths, weaknesses, opportunities and threats. By applying models like
porter’s five force model Marks and Spencer can analyse their competition, factors that they
need to focused. This analysis also helps the organization like Marks and Spencer to identify
factors that are threat to marks and Spencer and what level of risk those factors can create for the
organization. Based on these models or factors it becomes easy for the organization to Produce a
strategic management plan that would provide an strategic direction to the organization.
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REFERENCES
Books and journals
.Stark, J., 2015. Product lifecycle management. In Product lifecycle management (Volume 1) (pp.
1-29). Springer, Cham.
Ansoff, H.I.and et.al.,2018. Implanting strategic management. Springer.
Cook, N.D., 2015. Crisis management strategy: Competition and change in modern enterprises.
Routledge
Desmidt, S. and Meyfroodt, K., 2018. Debate: Unravelling strategic planning effectiveness—
what about strategic consensus?. Public Money & Management. 38(4).pp.255-256.
Eskerod, P. and Jepsen, A.L., 2016. Project stakeholder management. Routledge.
Ginter, P.M., Duncan, W.J. and Swayne, L.E., 2018. The strategic management of health care
organizations. John Wiley & Sons
Hladchenko, M., 2015. Balanced Scorecard–a strategic management system of the higher
education institution. International Journal of Educational Management.29(2).pp.167-
176.
Kerzner, H., 2019. Using the project management maturity model: strategic planning for project
management. Wiley.
Morden, T., 2016. Principles of strategic management. Routledge.
Rothaermel, F.T., 2017. Strategic management. New York, NY: McGraw-Hill Education.
Trigeorgis, L. and Reuer, J.J., 2017. Real options theory in strategic management. Strategic
Management Journal.38(1).pp.42-63.
Uhl, A. and Gollenia, L.A. eds., 2016. A handbook of business transformation management
methodology. Routledge.
Kerzner, H., 2019. Trigeorgis, L. and Reuer, J.J., 2017.
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