BTEC Business Strategy Report: Analysis of Marks & Spencer

This report provides a comprehensive analysis of Marks & Spencer's (M&S) business strategy. It begins with an introduction to business strategy, defining its importance and objectives. The report then delves into M&S's vision, mission, and objectives, followed by an examination of strategic planning techniques like benchmarking and business analysis. The core of the report includes detailed analyses of the macro-environment using frameworks such as PESTLE, stakeholder analysis, and Ansoff's matrix. It also applies SWOT analysis to assess M&S's internal and external factors. Furthermore, the report explores strategic capabilities, including resource-based view and the McKinsey 7S model, and the VRIO framework to understand the company's competitive advantages. The report concludes with a discussion of strategic recommendations for M&S, based on the analyses presented.

Business Strategy

INTRODUCTION
Business strategy is defined as sum of business decisions in which benefits to the
business is rendered by using different tactics and approaches in order to achieve overall
objectives. This is known as the master plan in which competitive edge can be attained by
organisation by involving their working personnel. This report is prepared so as to understand
various concepts of business and their propounded strategy in the background of M&S. M&S is a
multinational company which is a UK based retailer dealing in cloths, fashionable home ware,
food items and accessories. Within this report discussion of macro environment is drawn and
their impact over business strategies are enumerated. Some of the analytical framework has also
been included in this report so as to examine their influence over the business. Along with this
internal and external competencies of M&S with the help of applying various approaches such as
porter's five forces, SWOT analysis etc.
TASK 1
P1
Vision: The major vision of M&S is to enhance their global identity and to enhance their
performance as well so that national and international standards can be set b y them in prominent
manner.
Mission: M&S is mainly focused on achieving high end quality in their offerings so that
customer base and quality can be improvised in significant manner.
Objective: In the background of M&S they are willing to prominent market position
within food and clothing sector. This is helping the company to become striking brand in order to
deal with rivals in effective manner.
Strategy is categorised as the plan of action in which numerous actions can be taken by
manager in order to provide proficiency to the business of attaining organisational goals. This is
a basic path which is being precede by the company so that to intensify their performance and to
achieve high end results. By making robust strategy within business advantage over rival can be
received by which profits and market image can be improvised.

Various strategic planning techniques
 Benchmarking: This is defined as comparison between metrics of two rivals existing in
the same industry in order to recognise position and standard of the business within
marketplace (Hileman and Rauchs, 2017). As by this M&S can examine their market
position in respect of their performance in market. This is helpful for them in making
robust strategy in which broad profits can be attained by them.
 Business analysis: By examining business and internal activities in sufficient manner,
within this M&S is acknowledging their capabilities and weaknesses in which
appropriate decisions are taken by them in order to expand outcomes.
Different analytical framework to acknowledge macro environment
Stakeholder analysis
stakeholder analysis is defined as the process in which those persons are recognised those
are having direct implications from performance of the business. This analysis is helpful for
M&S in summing their stakeholders as in relation to their interest hold in the company. The
various steps of stakeholders analysis is explained as under:
Step 1: Identifying various stakeholders by making list of potential stakeholders. in the
background of Marks & Spencer their major stakeholders are customer, suppliers, employees,
government and shareholders.
Step 2: After listing them now M&S is required to prioritise them on the basis of their
interest and standard of participation as well.
 High power, high interest: These type of stakeholders are most significant for M&S and
helping them in promoting business actions in prominent manner.
 High power, low interest: These stakeholders are keeping low interest in the business
and their running projects (Eskerod and Larsen, 2018).
 Low power, high interest: Within this stakeholders are needed to be notified regarding
projects running within M&S so that they do not face any prominent problem.
 Low power, low interest: These type of stakeholders do not have high interest in the
business and they do not hold low power due to which their working get impacted.
Step 3: Within this step manager of M&S is communicating with various stakeholders as
according to the precedence so that objective can be attained in prominent manner.

PESTLE analysis
THis is the framework which is used as a strategic tool and used by businesses in order to
understand external market competencies so that these can be used to attain overall business
objectives. In the context of M&S PESTLE analysis is explained as under:
 Political factors: These factors are associated with tariff rates, tax regulations,
government stability (Perera, 2017). In the context of UK country is facing political
instability due to Brexit and this is coming up as challenge for the company by which
flexible policies are required to be made by M&S.
 Economic factors: These factors are associated with GDP rate, inflation rate and
purchasing power of people inherited in UK. UK is having high growth rate in which
disposable income of people is high due to which expensive products can be bought by
population. This is giving high opportunity to M&S and they are able to place their
products within each segment people.
 Social factors: These factors are associated with attitude, opinion, belief and adaptation
of people living in UK. In UK people have open mindset and they are prone to adapt new
technology and this is providing high opportunities to M&S in earning high revenues.
 Technological factors: These factors are associated with usage of technological
advancements in business so that to stay updated with latest technology. in the light of
Marks & Spencer the company is using latest technology for advertise and market their
product and this is rendering high opportunities for them to meet customer's requirement
in prominent manner.
 Legal factors: These factors are associated with legal implications and rules which are
undertaken by government of UK. In this context various laws are to be implemented by
M&S such as employment law, so as to avoid any penalty in non obedience.
 Environmental factors: These factors are associated with using those techniques in
business so that hazard to eco system can be minimised. In the context of M&S the
company is using sustainable business practices due to which they are able to earn high
profits as well.

Ansoff's matrix
Ansoff growth matrix is defined as a strategic tool in which manager is planning to adopt
a strategy in order to expand their business . in case of Marks & Spencer this framework is
explained as under:
 Product development: Within this strategy a new product is introduced by the company
in order to catch up more customer and to motivate them in buying in large quantity. This
is helping M&S in making high revenues and to build up new customers.
 Market development: In this growth strategy new customers are offered with existing
products for the major purpose to enhance market prominence. in case of Marks &
Spencer this strategy could be advantageous for them in making high profits and sale.
 Market penetration: Within this strategy company put their efforts in intensifying their
market share and explore existing market with existing products (Gurcaylilar-Yenidogan
and Aksoy, 2018). Under this strategy prices of the products are decreased by the
company in order to unleash other market segments.
 Diversification: This is known as the most risky strategy in which new products are
undertaken within new market place. If this new product segment company is not making
profit then this may impact overall image of the company in negative manner. By using
this expansion strategy M&S can enhance their profit and power within various market
segments.
In the context of above strategy the most suitable business strategy for M&S can be
market penetration as by this they can provide offers and discounts to their customer in order to
attain distinct identity within marketplace.
SWOT framework
SWOT analysis is the strategic tool which is helpful in recognise strengths and
weaknesses of the business so that opportunities can be recognised by therm and threats can be
eliminated. in background of Marks & Spencer SWOT framework is explained as under:
 Strengths  Weaknesses
 M&S is having high brand recognition
because of prominence in their quality
(Bell and Rochford, 2016)).
 M&S has categorised as non trendy
brand in which the company is facing
difficulty to survive.

 M&S is having diversified product line
such as women, men,kids which
provide benefits to the customer in
meeting their needs in proper manner.
 Manufacturing process of M&S is
associated with old methods and this
makes their products costly as in
comparison of other brands.
 Opportunities  Threats
 In Africa and other Asian countries the
company is having high opportunity to
expand.
 M&S can invest in marketing activities
so that awareness regarding their
products can be exhibited to their
customer within marketplace.
 Fluctuations in political environment
which is giving hindrance to efficacy of
the business.
 Company is having high rivals such as
H&M, ZARA and many more.
TASK 2
P2
Strategic capabilities and their key components
Strategic-capabilities are defined as the process in which various strategies are prepared
so as to take actions regarding rivals in order to attain distinct position in marketplace. This
strategy is having six dimensions such as key goals, action plan, tools for analysis, value, vision
and purpose (Parnell, 2018). These components are rendering high benefits to the company by
utilising implemented strategy in effective manner.
Resource based view strategy
This is defined as those managerial framework which is utilised by business in order to
understand strategic point of the business and exploit them in such a manner in which distinct
competitive edge can be attained. In the context of this strategy a business is up keeping
basically two types of resources such as intangible and tangibles. Tangible resources include
machine, land, fixtures etc. intangible resources includes patents, copyrights, goodwill etc.
McKinsey's 7S model
This framework is the tool which is helpful in examining organisational design by
undertaking seven internal competencies. These components are required to be aligned in

effective manner so that long term benefits can be attained. in background of Marks & Spencer
these components are elaborated as under:
 Strategy: This is a plan of action which is executed by the company in order to attain
distinct competitive edge within marketplace so that effective control can be enumerated
to rivals (Shaqrah, 2018). In the context of M&S if they are not focused in making robust
strategy then resultantly they will have to sacrifice market share.
 Structure: This is described as the manner in which internal structure of the business is
divided. In the context of M&S they are required to build up appropriate internal
structure so that conflicts can be eliminated and competitive advantage can be attained.
 Systems: This is termed as process of the company through which working of them is
finished. By properly maintaining systems manager of M&S find ease in implementing
any prominent change in effective manner.
 Skills: This is associated with skills and competencies held by the employee which are
working in M&S in order to achieve organisational task in prominent manner. Staff of the
business allows them to solve any complex situation in efficient manner.
 Style: This is associated with management of the business which is exhibited by top level
authority and their way in which communication is obtained within organisation. in
background of Marks & Spencer participative leadership style is adopted by their leader
in which employees are included in the process of decision making.
 Staff: This is associated with number of worker which are employed with M&S. This
includes the manner in which employees are recruited, rewarded and motivated
(Rabbanikhah, Mousa Gholizadeh and Alirezaei, 2017).
 Shared values: This aspect is connected with standards, value and belief of the company
which leads M&S to carry out their operations in effective manner.
VRIO framework
THis is defined as value, rarity, imitation and organisation. This is a strategic tool which
is used by businesses in order to recognise their inner capabilities. in background of Marks &
Spencer VRIO is explained as under:
 Valuable: This is necessary for the manager of M&S that they utilise procured resources
in effective mode so that competition can be given to rivals in prominent manner. By

keeping high valuable resources profits can be set higher. in reference of Marks &
Spencer their valuable resources are employees and supply chain management.
 Rareness: This aspect is providing benefits to the company if rareness is held by their
product. These are helping M&S in enhancing sales and revenue in prominent manner so.
Rare resources for M&S are their machines, processes which are providing them
innovations and rarity within marketplace (Rockwell, 2019).
 Imitable: M&S is requisite to offer their products with distinct identity so that it cannot
be copied or imitated by others. This will help the company to attain distinct position
within marketplace. in reference of Marks & Spencer food items, raw material are their
imitable resource.
 Organisation: This is significant for the business that their external resources get
managed in effective manner so that systematic working can be exhibited in the business.
Organisation is the sum of various factors and for M&S this is associated with suppliers,
customers, shareholders etc.
TASK 3
P3
Porters five force is the framework through which industry competencies can be
examined by businesses in order to recognise their position within market.
 Threat of new entrants: This threat is not high in the context of M&S as they are
operating their business at global level which makes their existence prominent. On the
other side the industry of retailing needs heavy investments so this becomes hard for the
new entrants that they invest huge amount (Lewis, 2017). This is the reason that new
businesses are not able to compete with M&S and this is giving additional benefits of
survival to the company.
 Bargaining power of suppliers: This power is associated with power hold by suppliers
in context of price fluctuations. In this context M&S is giving less power to their
suppliers as they are having large suppliers and which makes them capable to switch
suppliers. This aspect is providing benefits to the company as in rendering high business
advantages.

 Bargaining power of buyers: This aspect is associated with power hold by buyer in
context of any price change or any other alterations. In this context M&S is having high
competitors due to which buyer hold high power. On the other hand preferences and taste
of customers are dynamic so this is making the customer to switch brands in frequent
manner. So this threat is creating problems for M&S in their survival.
 Threat of substitutes: M&S is having high rivals and substitutions within marketplace
due to which M&S is facing high threat of substitution. In order to deal with this factor
M&S is required to mould their product in such a manner that it may remain distinct
within marketplace (Wellner and Lakotta, 2020).
 Rivalry among existing competitors: In the retail industry there are so many
competitors who are operating their business in successful manner such as zara, H&M
and many more. M&S is dealing this by using competitive pricing method so as to boost
up their customer base.
TASK 4
P4
Porter's generic strategies
porter generic strategies are defined as recognition of the method in which competitive
edge can be attained by the business. For M&S these strategies are elaborated as under:
 Cost leadership: With the help of this strategy price sensitive customer can be traced in
easy manner so the organisation can target them only by making flexible strategy
(Vlados, 2019). For M&S they are targetting on procuring high customer base and for
this they are offering products at lower cost in order to intensify sales ad revenue as well
and to become market leader as well.
 Differentiation: Within this strategy new and innovative products are offered in order to
attain market differentiation and to compete with rivals working in the same industry. in
reference of Marks & Spencer they are offering distinct eatable and clothing product to
their customer so that distinct competitive edge can be attained by the company along
with prominent position in the marketplace.
 Focus: This strategy is associated with two aspects such as focus and differentiation
focus. In reference to cost focus companies try to lessen their prices so that to deliver

their offering to customer in less pricing (Sikora and Baranowska-Prokop, 2018). In
differentiation products are offered by introducing innovation so as to get distinct edge
and to cater those customer who are not price sensitive and prone to use new adoptions.
Bowman's strategic clock
This is a tool which is used in businesses in order to explore specific position within
marketplace by adopting various strategies and dealing up rivals in prominent manner. Aspects
associated with this are elaborated as under:
 Low price and low value added: This is known as less competitive place for M&S as
their products are not distinct which enable the customer not to perceive lesser value for
their product even in price fluctuations.
 Low price: Within this context M&S can make their market position as cost leader and
by lowering their costs so that sales and profits can be improvised.
 Hybrid: Within this strategy low price and product differentiation both are included and
this is very effective strategy for M&S to provide distinct position to their products
within marketplace.
 Differentiation: Within this strategy M&S is making innovative alterations in their
products in order to give specific identity to their product in the marketplace and to boost
up sales ratio as well.
 Focused differentiation: Within this context at high price products are placed by the
company in order to add more value to their company. In the context of luxurious section
this strategy is used by M&S.
 Risky high margins: Within this strategy high risk is faced by the company in which
results can lead to failure. Within this M&S can set their prices at higher level without
willing to earn any additional value.
 Monopoly pricing: In this strategy business is not focused on lowering prices and
implementing innovations. For M&S within this strategy they are keeping high prices of
their products when products are highly demanded by them.
 Loss of market shares: This position is highly adverse within competitory market as
mediocre prices are set by the company due to which overall profitability of the company
get tarnished.

For example M&S they can adopt differentiation strategy so as to provide distinct edge to
their product and to enhance interest of their customer in buying their products.
Strategic management plan that includes strategic priorities and objective
Strategic planning is helpful in determining objectives of the company by fixing
priorities, resources and many factors (Rothaermel, 2016). The strategic plan for M&S is enlisted
below.
 Vision: The major vision of M&S is to enhance their global identity and to enhance their
performance as well so that national and international standards can be set by them in
prominent manner.
 Mission: M&S is mainly focused on achieving high end quality in their offerings so that
customer base and quality can be improvised in significant manner.
 Strategies: M&S is using market penetration strategy in order to use their resources and
capabilities so as to expand their business and capture more customers.
 Objectives: The objective of M&S is to gain clientele by 17% by penetrating their
products which will enhance their profit by 10% within 12 months.
Marketing mix:
 Product M&S is dealing in fashionable clothing, stylish home ware, quality
wooden furniture, healthy eatable products and various decorative items.
They are known for their fashionable clothing.
 Price M&S is having robust brand image and this is the reason that they are
following premium pricing as the company is already have high customer
base due to which they are able to enhance their sale in effective manner.
 Place M&S is having global presence and they have open store which creates
proximity for their customer to visit their stores. (Wu and Li, 2018)
 Promotion The major promotional method used by M&S is direct marketing. With the
help of TV commercials and newspaper advertisements they are promoting
their products.

 Implementation : This is required by M&S that their formulated plans get executed in
such a manner that all the resources get utilised in fuller manner. With the help of budget
M&S can allocate funds to various activities and departments so that performance of each
and every department can be measured in appropriate manner.
 Evaluation : In order to evaluate performance various measures and indices are used by
M&S such as benchmarking and KPI. These are helpful for them in meeting level of
desired performance.
CONCLUSION
Form the above detailed report this can be summarised that formation of business
strategy is highly essential for the business to meet their goals in appropriate manner. With the
help of PESTLE and SWOT external and internal capacities can be examined which are making
the company aware about their market situation. With the help of ansoff matrix most suitable
growth strategies can be decided so that to make the business earn high profits. By using VRIO
framework organisational capabilities can be observed and used in most profitable manner.

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