Strategic Analysis of Marks & Spencer: Corporate Strategy Report

This report provides a comprehensive analysis of Marks & Spencer's corporate strategy. It begins by identifying and explaining three key strategic issues the company faces, including income reduction, the shift to online shopping, business transformation, and changing consumer behavior. The report then delves into an environmental analysis using PESTLE, Porter's Five Forces, and internal situational analysis to understand the external and internal factors influencing the company's performance. It further discusses Marks & Spencer's unique capabilities, such as tangible (physical stores, finances, quality products), intangible (reputation, brand positioning), and human resources, and how these contribute to its competitive advantage. The report applies Porter's generic strategies (cost leadership, differentiation focus, differentiation leadership) to analyze critical success factors. Finally, it explores the application of the SAFe test (Suitability, Acceptability, Feasibility, and Effectiveness) to develop effective strategies for addressing the identified strategic issues. The conclusion summarizes the key findings and their implications for Marks & Spencer's future strategic direction.

Corporate Strategy

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Q.1 three key strategic issues with three environment analysis..................................................1
Q.2 unique capabilities and critical success factors of the company..........................................3
Q.3 three SAFe test by which strategic issues gets solved.........................................................7
CONCLUSION..............................................................................................................................10
REFLECTIVE................................................................................................................................11
REFERENCES..............................................................................................................................13

INTRODUCTION
Corporate strategy is the process of creating the highest strategic plan in organisation to
achieve and meeting future needs and goals within strategic management (Foucault and Frésard,
2018). Chosen organisation in this report is Marks & Spencer. This present report will cover an
explanation of three strategic issues with three environments that is Pestle, five forces and
internal analysis. Further, in this report critical success factor of organisation is to be discussed.
Three safety test to provide strategy address of the organisation is also to be discussed in this
report. Further, a short conclusion of this report is to be addressed in this report.
MAIN BODY
Q.1 three key strategic issues with three environment analysis
Corporate strategy is nothing but the path by which organisation will able to compete
with others in business market. Major three strategic issues which mainly Marks & Spencer is
facing are as follows-
Squeeze in income-
Marks & Spencer new strategic issue is that they are facing reduction in their income. It means
that their debts are increasing which mean that company have high interest and expenses which
they are not able to meet by organisation. A recent fall in their company leads to decrease in their
overall income of the company. They are getting fail in developing new fashion trends of market
by which they are getting lack in attracting new and young customers in organisation (Hickman,
and Silva, 2018). This reduction in their income leads to decrease their brand value also by
which company is loosing with the loyal customers of the organisation.
Shifted to online shopping
Marks & Spencer has recently shifted to online shopping market by which company is facing
tough competition with others in business market. Major competition which company face is that
for customers it extremely becomes easy for them in comparing different prices of the products
and recent survey is that 25% of fashion shopping is done from online market in UK. Major
issues which company facing this management is that company's inventory is not properly
maintained and which mainly lack them in time management in company.
Business transformation
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Marks & Spencer generally has too many stores by which company lack in maintaining proper
availability of goods and services. This major lack in providing sufficient availability of product
develop a negative impact by which company loosing with their loyal customers of the market.
By this issue company faced huge cost involvement and lack with proper management of
profitability of the company.
Changes of consumer behaviour
This is also other strategic issue which affect the profitability of the company. Consumer
behaviour change with many factors which include their purchasing power, group influence,
personal preferences, economic conditions, and also marketing campaigns. Marketing activities
which is done by other competitors of business market will change consumer preference. Other
factor by which change consumer preference is the economic condition in business market. If
there is a positive economic market then customers will be more confident in purchasing
something from market.
To overcome with this strategic issues company will have to analysis different
environments models which include Pestle, five forces and internal situational analysis-
Company will analyse Pestle model in which different factors such as political,
environmental, social, legal, technological and also economical. Marks & Spencer company has
recently shifted to online shopping in which they are lacking in developing effective strategic
management of technological factor. Company also have to face legal and social factor in which
they have to maintain their products with the cultures of the countries in which business
operations are regulating of the company (Anwar and Hasnu, 2017).
Porter's five forces will also analyse by company in measuring threats of company,
threats from substitute products, bargaining power will analyse by the company. Marks &
Spencer recently faces downfall in their income by which other competitor takes this as
advantage and attracting customers in their own organisation. Threat of substitute products
becomes higher by this situation of the company. This also creates threat for bargaining power of
customers where customers will demand more items which is to be in fair range.
Internal situational analysis is also to be measured by company in which overall strength
and weakness of the company analysed. As Marks & Spencer has too many stores therefore they
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are lacking in developing availability of goods and services and its overall impact is that total
capital of the company will get decreases. Company did not have effective time management
strategies by which they are lacking in providing availability of resources to their stores by
which overall performance and profitability of the company gets decrease. This is the major
weakness of the Marks & Spencer and its result is that company loosing with their loyal
customers.
Q.2 unique capabilities and critical success factors of the company
Strategic capabilities and advantage of the retail industries in UK economy is growing
yearly. They are contributing major role for the development of UK economy. Retail industries
of the UK generating total of £358 billion and fashion industries of the UK contributing £28
billions in total in UK's economy (Slack, Corlett and Morris, 2015). Therefore, major issue faced
by this contribution is increasing competitive advantages. Increasing competition is with this
issue is that businesses are providing better and right type of services to right customers of the
markets. Therefore, effective technologies are developing in organisations to provide the right
kind of goods and services to customers. Unique capabilities of Marks and Spencer organisation
is divided with three different types of resources. Three different resources are Tangible,
Intangible and human resources.
Tangible resources will include physical stores, finances, quality and innovative
products. Unique capability of Marks & Spencer is that they have to many stores. This means
that they have more available lands and equipments to develop effective stores in areas of
different countries. Marks & Spencer also have unique capability with their finances. Company
have effective cash reserves which is almost £539.3 million. This effective cash reserves helps
management in developing new and improves products and to develop effective innovation in
company which overall helps them in attracting customers and to improve overall performance
of the company.
With intangible resources Marks & Spencer has unique capability which is their
reputation. Their have global business which is worldwide therefore, it has strong brand
positioning and relationship with customers which makes them different from other
organisations. Marks & Spencer generally selected true to digital innovation agenda (Liu and
Atuahene-Gima, 2018). This creates an effective technical innovation in company which makes
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them different from other market competitors. This innovation makes them different from other
market competitor in which company maintain product availability by effective packaging usage.
Company also reduce wastage of products with recycling for heath well being.
Marks & Spencer also has effective human resource department. This department
develops an effective staff motivation activities. This types of activities will include effective
promotional opportunities by which timely motivation is provided to employees in getting
effective work. Employees needs and expectations also fulfilled by human resource department
to engage them in organisation.
Porter's generic model to analyse critical success factor and capabilities of the organisation.
In order to gain competitive advantage four critical factors has been given by Porter. This
four strategies is adopted by Marks & Spencer organisation in order to gain competitive
advantage of the business. Main motive of this model is to achieve competitive advantage in
business market. Competitive advantage is the process of attracting customers of market by
offering grate value products or by providing fair range of price of products over the other
competitors of business market.
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Cost leadership- according to this strategy main objective of the company is to become the
lowest-cost producers in business market. This strategy is developed by organisation to achieve
competitive advantage from broad range of market. This strategy is developed by organisation to
minimise their cost of products in average market which results in developing higher range of
profits in organisation. To increase market share and to maximise sales in organisation, this little
cost differentiation is developed by management which provide significant cost advantage to
organisation. Benefits of this leadership in organisation is that company will achieve high levels
of productivity, higher capacity of utilisation, also effective use of technologies (Dombrowski,
Krenkel and Wullbrandt, 2018).
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Illustration 1: Porter's Generic Strategies
( source: Porter's Model of Generic Strategies for Competitive Advantage,
2018)

Cost focus- it is the narrow market concept used by organisation in developing lower cost of
products. In this, management will compare their similar products with other market competitors
to develop effective price of the goods and services. This comparison is generally created to
decide lower price of product from competitors products. This strategy mainly done by
organisation to capture business market and also to capture customers of the organisation. To
become a market leader, cost focus is the effective management strategy.
Differentiation Focus- with this strategy, aim of organisation is to differentiate products within
just one or small number of target market segments. To attract customer in organisation,
management develop special customer needs which is totally different from the competitors.
This strategy is needs to developed when customer do not have different expectation and other
businesses are not providing those needs and wants of the customers. To enjoy profits, this
differentiation strategy is used by organisation to develop market segments with this strategy.
Differentiation leadership- this strategy used by organisation to target large market and also to
achieve competitive advantage from others in business market. Under this strategy company will
first decide target market and then do positioning of that product in meeting needs and goals of
the business (Ocasio, Laamanen and Vaara, 2018). Main motive to develop this strategy is to
offer premium price of product with extra value- added features so that customer easily get
attracted. To achieve clear response from customers, several ways are developed by
organisations in attracting more customers of the business market. To become the effective
leader in the market company have to provide goods and services which has unique feature. By
this strategy company will able to produce product which is more attractive and which is more
attractive than comparable product.
Methods to develop sustainable growth is by providing superior brand quality in which
products are to be offered with strong features, benefits, durability and with strong reliability.
Further, by proving strong brand loyalty is also an effective method to recognise desires of the
customers. Strong supply chain is also proved effective, under which industry- wide distribution
is to be developed by organisation. Effective advertising strategies also helps organisation in
attracting customers and to develop their position in business market.
This is the overview of the Marks & Spencer company which provide us their unique features
and critical success factors in business environment of the organisation. Their business is
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worldwide, and to effectively run that business company have to develop strong market
strategies which overall helps them in improving performance of the company (Wheelen and
et.al., 2017).
Q.3 three SAFe test by which strategic issues gets solved
To develop effective strategies in organisation it is the most challenging situation for the
management of the company. To select right strategy which is useful and effective is the difficult
challenge for the management of the company. Marks & Spencer will develop this SAF strategy
model by which useful approach is to be developed in solving issues of the organisation. This
model mainly focuses on the four factors which are suitability, acceptability, feasibility and also
acceptability. To improve the issues of the company this model is the most effective model by
which issues get resolved.
Suitability- this is the most important factor of the SAF strategy model. This is the factor
by which company will able to develop effective suitability which is specifically important for
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Illustration 2: SAF model
( source: Evaluating Strategic Options using SAF strategy Model, 2018)

business operations. This specific criteria of the company are environment suitability,
expectation suitability and capability suitability. To meet specific needs of the company, this
individual categories of suitability then will merge in solving strategic issues of the company
(Cassidy, 2016). Marks & Spencer will also develop specific suitability in solving their specific
issues of the company.
Acceptability- this is the point where the company will measure capabilities of the
strategies in solving particular issues of the organisation. With this point company will measure
specific risk, returns and also stakeholder reaction from that particular strategy of the business.
Return will measure on the facts that whether this will provide an effective benefit to share
holders or not. This development of strategies will be decide by that shareholders of the
company. Methods which applied to measure the return will include cost- benefit analysis,
profitability analysis, real option analysis and also shareholder value analysis. Risk in the
company will measure with its impacts. Such impacts will be on liquidity, sensitivity and with
stakeholder reaction.
Feasibility- it is the point which measured the impact of strategies on the organisation.
Feasibility is the point by which management will analyse availability of resources for business
performance, its ability to solve the issues of strategic management, cash- flow analysis, break-
even analysis and also other financial tests of the company (Haines, 2016.). Further, feasibility
will also analyse resources which needs to develop in organisation for performing strategies.
Such resources would be manpower, equipment, management power and materials of the
company by which effective strategies implemented in organisation.
This the SAF model by which Marks & Spencer will able to solve the strategic issues of
the organisation. Issues like online shopping business, business transformation, change of
consumer behaviour and squeeze of income will get solved with this strategic model.
Development of this strategies help company in developing effective strategies which is in
accordance with the suitability, feasibility and with acceptability.
Strategic issues of the organisation which gets solved by this model of the strategic
management.
Change of consumer behaviour strategic issue-
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To solve the issue that is change of consumer behaviour, management will decide
effective factors for suitability under which management will to research on environment that
whether that environment is suitable in developing business operations of the company or not.
To develop interest of consumers in organisation management develop effective quality of
products by which customer get attracted (Brewster, 2017) Focus of the company is to provide
low cost products which is to be in comparison with similar products of different companies.
Development of effective technology helps organisation to innovate new products. By offering
that new products company will able to attract new customer and will able to develop products
which is in accordance with the expectations of the customers.
Customer will only able to accept products when that product is of some unique feature
and is capable from other products of business market. Lastly when company will offer product
to customer measurement of feasibility is to be done by management. This feasibility ability of
strategy in solving issue that change of consumer behaviour.
Business transformation
To solve this issue, Marks & Spencer will use SAF model. Company's main issue is that they
many stores which is worldwide. Therefore, they are lacking in providing availability of
resources to each and every stores. Company did not have effective time management strategies
which impact is that company is loosing their loyal customers from business market. To improve
effective time management skill, management will develop SAF model under which they will
analyse resources and factors which needs to develop in providing availability of resources in the
stores.
To overcome with this issue suitability factors with analysis of environment model done
by organisation (Grant, 2016). Company will develop wide range of investment decision, with
proper allocation of resources with the proper measurement of SAF test so that return will
effectively generated by organisation. By allocating resources feasibility applied to measure
whether applied strategies providing effective return or not.
Squeeze in income
By the use of SAF test Marks & Spence will able to improve total income of the company.
Opportunities by which income will improve is judged by the management of the company.
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Company will have to reduce their unprofitable products and services so that extra cost which
involve in producing that goods and services will get saved. Other opportunities by which
income arise is by finding new customers from business market which helps company in
generating profitability. By analysing strength and weaknesses of this opportunities company
will able to accept new strategic plan which overall helps them in improving profits of the
company.
Shifted to online shopping
Business of Marks & Spencer is worldwide because of this company will not able to provide
sufficient availability of resources on their online platform. To overcome with this issue,
company will firstly develop opportunities in which management will develop effective human
resource management, use of technologies, keep customer updated with products and will work
on to develop quality services (Elmes and Barry, 2017). This opportunities will then measured
with feasibility under which amount of return which develop with these opportunities will accept
by the company.
This is the importance of SAF model by which management of Marks & Spencer will
able to meet their needs and wants. This model also helps in solving strategic issues of the
company so that performance of the company gets improved with profitability as well.
CONCLUSION
From the above study it can be concluded that strategies' management in corporate plays
an important role to sustain in business market. This report is about the strategic issues and
planning which is done by management in improving their overall performance. In this report,
strategic planning of Marks & Spencer organisation is created to analyse strategic issues of the
organisation. To meet strategic issue and to solve them in organisation certain model is explained
like Porter's five forces, situation analysis is created so that effective strategies will get develop
in solving issues of the company. Therefore, it can be concluded that to meet needs and wants of
the customers and to sustain them in organisation effective strategic planing needs to develop in
an organisation.
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