Strategic Management Report: Marks and Spencer's Performance Review

This report provides a strategic management analysis of Marks and Spencer (M&S), a British multinational retailer. It examines M&S's market position, competitive strengths, and challenges within the retail industry. The report focuses on key areas such as strategic innovation, corporate social responsibility (CSR), governance, and ethics, assessing their effectiveness in helping M&S gain competitive advantages. It details M&S's initiatives in sustainability, waste management, sustainable sourcing of raw materials, and health-focused product development. The analysis also considers the company's corporate governance structure and ethical conduct, highlighting how these factors contribute to its overall performance and stakeholder relations. The report concludes by summarizing M&S's efforts to adapt to changing customer needs and maintain its position in a competitive market.

Strategic Management

Table of Contents
INTRODUCTION...........................................................................................................................1
Company profile..........................................................................................................................1
Effectiveness and position of Marks and Spencer in strategic innovation, CSR and ethics.......2
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................7
Assessment task 2............................................................................................................................8
PART A (1)......................................................................................................................................8
PART A (2)......................................................................................................................................8
PART B.........................................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Strategic management refers an ongoing planning, monitoring and analysis of all
resources and necessities of company that can help it out in meeting pre determined goals
(Lynch, 2018). This present study is based on Marks and Spencer that is British multinational
retailer. This study is going to show effectiveness of this retailer that can make it able to take
competitive advantages and becoming the market leader. It shows its market position in huge
industry size. Further, it will discuss all those areas in which this retailer is effective and has
engaged itself for taking competitive advantages. Some areas which this study will discuss in
which Marks and Spencer is effective include: innovation, CSR, governance and ethics.
Company profile
Marks and Spencer is a major British multinational retailer having headquartered is in
London, England. It was founded in the year of 1884 by Michael Marks. It is mainly famous and
specializes in selling clothing, home products and food products. Because of its qualitative food
and clothing products in the year of 1998 it became the first British retailer. But slowly it went
into a slump. In the year of 2018 it announced that by the year of 202 it will close around its over
100 stores and recently it announced that due to some environmental factors like climate change
and changing needs of customers and closing down of some stores it will cut around 7000 jobs.
But it is also found that now it is focusing on regaining image and taking its position in the
market that he had before. For taking competitive advantages it identified its own strengths and
found that it has several strengths.
Industry size: It operates in retail industry and as of 2020; there were around 1038 stores located
in the UK and other 481 stores situated around the world. From number of stores it can be said
that it has large market areas. It employs around 75 thousand people from different cultures. It
promotes diversity at workplace that helps it out in attracting and retaining skilled workforce
(Marks and Spencer: Statistics and Facts, 2020)
Competitive strength: There are several strengths that this retailer has and all these strengths
help it out in taking competitive advantages. Some competitive strength of this company
includes:
 Ability of managing brand in an effective manner.
 Closely manage suppliers’ relations.
 It has excellent customers’ services.
1

 It provides excellent working condition to its employees.
 Empowers suppliers and manufacturers with design responsibility.
 It has an effective communication skills that helps it out in performing marketing
functions in an effective manner and attracting customers’ to the great extent.
 Corporate structure and effective culture is other main competitive strength of this retailer
(Marks and Spencer Resources, Capabilities and Competitive Advantages, 2018).
There are several players in this market such as: Aldi, Waitrose, Tesco and others but by making
use of all these skills it makes it able to take competitive advantages and becoming the market
leader as well.
Challenges: Retail industry is facing several challenges and it is found that marks and Spencer
operate globally so, it faces several problems. Customers changing needs as they are shifting to
online shopping, customers of different cultures have different tastes, rising overheads,
competition etc. For solving all these problems it requires focusing on innovation and creativity.
Market position: Marks and Spencer positioned itself as a premium brand in this supermarket
industry. Customers are willing to pay premium price if they get qualitative products and
services. It also helps this retailer in increasing sales and profit margin. It is beneficial for it and
this can make it able to have effective position in the market and also taking advantages of
competition.
At the time of global recession it has done considerably better than other retailers. So, on
the basis of this it can clearly be said that it has growth potential, especially in those areas which
can attract low sales volume.
Effectiveness and position of Marks and Spencer in strategic innovation, CSR and ethics
It can be said that on the basis of above company background that in this huge retailer size,
marks and Spencer has its own effective position. There are several retailers that are increasing
competition as they are also providing same features and qualitative products to customers. It is
putting pressure on Marks and Spencer to focus on some areas that can help it out in providing
competitive advantages. For becoming successful as compared to its competitors it requires
attracting customers to the great extent and retaining them. For that it will require making people
trust in its brand and it is possible when it fulfils its promises.
2

From market analysis, some areas have been found that are being considered by customers
while making buying decision from company and for knowing its effectiveness and extent to
which it is engaged in, it requires analysing all areas such as:
Strategic innovation: Innovation is a paradox and in the context of innovation it is found
that the rate of innovation is at least equal to the rate of change in the world surrounding it. It has
developed 2 plans such as plan A and plan B for making itself sustainable. As per its plan A it
focused on investing around £200m over 5 years. Results have surpassed expectations as in the
second year it contributed a net of £105m. It is also found that it has developed new and
innovative ways of performing functions that made it able to reduce energy by 25% and waste by
40% as well as packaging by 50%. All these is having positive impacts as it is making it able to
develop sustainability as it is one of the main factors that is being considered by customers and
this factor can provide it competitive advantages (https://www.the-foundation.com/post/what-
we-can-learn-about-innovation-from-marks-and-spencer-s-plan-a).
In addition, it is also found that it is focusing on opening fewer but better clothing home
stores that are conveniently located. Features of these stores will be digital and inspirational in
stores and supported by multichannel services. It is also striving hard for becoming digital first
retailer as per the needs of customers. It has made an effective partnership with True and this
partnership giving it unparalleled access to the latest innovation as well as technology and by
making use of these technologies and innovation it has changed the way of operating and
running business. So, overall it can be said that it mainly focuses on product and technique
innovation. By making products attractive by adding features and making it as per the needs of
customers it can attract customers and can take advantages of competition. On the other hand, it
is also found that as compared to its competitors like Waitrose, Tesco and others, it is lacking in
this area and other retailers are making use of strategic innovation in an effective manner. It
requires focusing on this area as it is engaged in this areas to only some extent. It can create
several barriers in taking competitive advantages and increasing sales (Wilson, 2016).
CSR: In regards to corporate social responsibility that is also one of the main important factors,
it is stated that this retailer has taken responsibility to its customers, partners, employees,
suppliers and local communities seriously. It believes that for taking advantages and
accomplishing goals there is requirement of satisfying needs of all stakeholders. Stakeholders are
one of the main important resources as they have power to make company able to take
3

advantages and also make their image poor. Customers help company in improving their image
by mouth publicity when companies take their needs and problems seriously as it makes them
feel valued. It is found that Marks and Spencer arduously taking care of every sensitive issues of
the society like issues related to climate change, increasing pollution, industrial waste
management, sustainable raw material management and health of people (Aggarwal and Singh,
2019). By charity and providing donations it tries to solve community related problems and also
help people in getting education opportunities. It also donates returned clothing to the charity
new life, nurse support and awareness campaign.
Waste management: It has developed plan A for reducing waste and making its society
sustainable. Increasing pollution is becoming one of the main issue of the UK and it is affecting
people’s health and several sectors Tourism and other sectors find problems in attracting tourists
due to pollution. So, marks and Spencer promised to reduce carbon footprint to some extent by
making use of effective tools and developing strategy. As per its plan A or 5 year eco plan it
committed to stop sending wastes to landfill from their Irish as well as UK stores. It gas also
reduced using of packaging and carrier bags (Cowan and Guzman, 2018). Rather sending wastes
for landfill, it is making use of them in producing green energy through anaerobic digestion.
There are some steps that have been taken by this retailer for increasing sustainability and CSR:
 It reduced non glass packaging by around 25% and instead of this it is making use of
packaging material that can be recycled easily.
 It reduced using carrier bags by around 33% and makes them from recycled plastic.
 Employees of this retailer also make sure that its customers dispose their clothing
without sending it to landfill.
Sustainable raw material: As per its 5 year eco plan it has made sure that all of raw
materials will come from only sustainable sources. As per this plan A in regards to sustainable
raw materials it wants to:
 Use only wood that can be recycled.
 To make use of fresh whole turkey, geese as well as fresh pork free range.
 Increasing sales of organic food (Marks and Spencer, 2018).
 Making use of recycled plastic for making varieties of polyester clothing as well as home
products.
4

Health: It is found that this retailer wants to improve health and living standard of people by
providing them effective and qualitative products. As per the 5 years of plan A of CSR, it is
focusing on:
 Increasing eat well range from around 30% to 50% of organic food.
 It has employed around 1500 healthy eating advisers that help it out in producing organic
and healthy food only.
 Focusing on reducing salt and fats.
 It avoids using artificial colours and instead of this it uses natural colours in kids’ sweets
as well as cakes.
 It implements and follows all rules and regulations of food standards agency traffic light
and guideline daily account (Ramboarisata and Gendron, 2019).
So, on the basis of above discussed CSR policy of Marks and Spencer it can be said that it takes
responsibility of society and environment seriously and help environment in becoming
sustainable.
Governance and ethics: In regards to ethics and codes of conduct it is found that Marks and
Spencer sets a floor of minimum commitments for business. As per these commitments it
focuses on key policy areas that can affect it and it makes sure that it follows all rues and is in
line with relevant laws, industry standards and expectations of stakeholders. It performs all of its
activities with honesty, integrity and maintains confidentiality by implementing all rules of data
protection and others (Müller and et.al., 2016).
In the context of corporate governance it can be said that, board of directors take
responsibility of taking decisions, setting strategic aims, making use of effective leadership and
reporting about all information to stakeholders. It gives rights to employees and stakeholders in
governance by taking decisions or suggesting board of directors. So, according to this corporate
governance of this retailer can be regarded as what the board of company does and how its sets
the value of the company. Kit provides great value to customers by providing qualitative
products and also solves problems of them in a timely and effective manner (Floridi, 2018).
Overall it can be said that company requires focusing on strategic management among all of
these factors for taking competitive advantages and accomplishing goals.
5

CONCLUSION
From the above study it has been summarized that corporate governance ethic, CSR or
sustainability plays a vital role. It makes companies able to take competitive advantages by
attracting customers and following all acts and legislations. Further, it has discussed
effectiveness of having competitive strength for making an effective position in the market.
6

REFERENCES
Books and Journals
Aggarwal, P. and Singh, A.K., 2019. CSR and sustainability reporting practices in India: an in-
depth content analysis of top-listed companies. Social Responsibility Journal.
Cowan, K. and Guzman, F., 2018. How CSR reputation, sustainability signals, and country-of-
origin sustainability reputation contribute to corporate brand performance: An
exploratory study. Journal of Business Research.
Floridi, L., 2018. Soft ethics and the governance of the digital. Philosophy & Technology. 31(1).
pp.1-8.
Lynch, R., 2018. Strategic management. Pearson UK.
Müller, R. and et.al., 2016. Governance and ethics in temporary organizations: the mediating
role of corporate governance. Project Management Journal. 47(6). pp.7-23.
Ramboarisata, L. and Gendron, C., 2019. Beyond moral righteousness: The challenges of non-
utilitarian ethics, CSR, and sustainability education. The International Journal of
Management Education. 17(3). p.100321.
Wilson, D., 2016. Marks & Spencer: the quest to master the new millennium. The Business &
Management Collection.
Online
Marks and Spencer: Statistics and Facts. 2020. [Online]. Available through <
https://www.statista.com/topics/3707/marks-and-spencer/>
Marks and Spencer Resources, Capabilities and Competitive Advantages. 2018. [Online].
Available through < https://www.bartleby.com/essay/Marks-Spencer-Resources-
Capabilities-Competitive-Advantage-FKJXSCCE36ZYS>
Marks and Spencer.. 2018. [Online]. Available through <
http://fashiongear.fibre2fashion.com/brand-story/mands/corporate.asp>
7

Assessment task 2
Part- A (1)
Performance of the company
Marks & Spencer Top lending company having a huge reputation in all over the world because
of their quality of product and services. Recently COVID-19 situation affected the business of
the company and in result And recently they're thinking to cut down 7000 jobsCOVID-19 effect:
Marks & Spencer to slash 7,000 jobs (2020). Bringing home training and their stores remained
well below last year through the online and home delivery we're strong. the 136 years old Marks
& Spencer Is seeking to reinvent itself after decades of failed attempts. according to the superiors
of Marks & Spencer set that we covered crisis had shown it could work more flexibly and
productively with more employees multitasking and switching between the clothing and food
and home divisions. Last month this company has shed more than 950 stores management jobs.
its latest cuts will impact on their headquarters reasonable management an UK store over the
next three months. According to the CEO of the company Steve sad that Marks & Spencershare
was down around 2.8% at GMT, extending 2020 losses to 48%. The companies home and
clothing sales were down around 29.9% and it was for around 8 weeks since the store was
reopened after the lockdown. store sales were down 47.9% while online sales were up 39.2%.
food store. Which was treated throughout the lockdown., Shows the increase in the sales of food
around 2.5% in the last 8 weeks And this is how all the segment of the Marks & Spencer affect.
Competitive strength
Product sale by the Marks & Spencer are highly quality with affordable prices which isn’t
competitive strength of the company (Kim And et.al., 2018). This company has good relation
with their suppliers that enable them to get discount and company can able to reduce their
product prices and provide quality product to the customers in affordable prices. Company
strength is their food stores which is rapidly showing a higher growth within the market and
during the COVID-19 situation, their online sales of food products were around 39.2% This
shows that it is helping them to take competitive advantages and grow their business.
Market position
Marks & SpencerHave strong position on markets like United Kingdom and India. this company
has they're sharing shares around 3.1 Within the UK grocery market but it was decrease by 0.2%
in year 2017. On the other side India is second largest market after the United Kingdom and this
8

company has around 76 stores across the 32 cities and they are having more planning to expand
their business in India.
Improvement Across value chain
Value change management of theMarks & Spencer Weak as compared to the other retail
companies. Lack of availability of product and services in stores of Marks & Spencer, it is
creating threat upon them (Lee and et.al., 2018). it is necessary for the company to improve their
value chain management to take competitive advantages. To improve our companies value chain
it is necessary for the team to identify each part of its production process where they need to
improve, they can also take help of Value change management facility provider agencies to
improve their value chain.
PART A (2)
It is necessary for Marks and Spencer to develop a proper and an effective strategic plan so
that they are able to gain competitive advantage in the market. Customers changing needs as
they are shifting to online shopping, customers of different cultures have different tastes, rising
overheads, competition etc. For solving all these problems it requires focusing on innovation and
creativity. Also, the plan will provide a framework that how to achieve goals and objectives.
Moreover, plan will give insight to company that what strategy can be followed and in which
market. With help of plan Marks and Spencer will improve their performance in market and able
to sustain for long term in it. Thus, the plan is defined as below (Bolland, 2020)
Mission - to provide aspiration quality to all
Vision – standard against which all other are compared
Goals and objectives
 To gain 4% market share in UK market in 2021
 To increase revenue by 10%.
Strategic tools – there are several strategic models and tools which can be used by company to
achieve goals and gain competitive advantage. The tools are as follows:
9

McKinsey- this model helps in analysing organisation effectiveness and how internal factor is
aligned. With that it becomes easy for firm to improve their performance. So, it is explained as
below:
Strategy – here, Marks and Spencer strategy is defined as different products. They develop
innovative products and sell it at high cost. usually, firm focus on clothing and groceries. They
are acquiring other firms to expand market share.
Structure- It can be evaluated that Marks and Spencer structure is flat having division. There are
limited levels of management between top and lower level. So, it becomes easy to take effective
decisions. It enables in increasing employee skills and giving them more authority (Cescon,
Costantini, and Grassetti, 2019).
System – In this there are different system which is necessary. They include TPS, CRM, etc.
that is integrated in organisation. The CEO focus on reducing bureaucracy within firm. This is
done in order to adopt flexible business environment.
Shared value- It includes core value of company. Marks and Spencer value is honesty, integrity
and openness. They focus on continuous improvement of employees. So, it has enabled in
creating positive culture in it.
Style- This S refer to the leadership style being adopted by firm. So, in company participative
style is followed. The top management work with employees to bring in change and follow
vision. He inspires other staff and encourages them. This has enabled in shaping culture of
company and its growth.
Staff- It refers to staff working in organisation and their skills and knowledge. Thus, in Marks
and Spencer diversified staff is working and they possess advance and high level knowledge.
Furthermore, staff is highly talented and experienced as well (Dvorský, and et.al., 2020).
Skills - the skills of employees is creative. They staff is highly talented and experienced.
Moreover, competency level of employees is high.
Porter generic model- this is a model through which Marks and Spencer can gain competitive
advantage. In this there are 3 strategies that can be applied. With that business can also attain
goals and objectives. so, strategies are defined as
Cost leadership- it is a strategy where business reduced its price. They provide products and
services at low price within industry and becoming cost leader in market. Here, main purpose is
10