Analysis of Innovation and Future Capabilities at Marks & Spencer

This report provides an in-depth analysis of Marks & Spencer's (M&S) innovation strategies, focusing on its position in the retail industry and its efforts to adapt to changing market dynamics. It begins with an executive summary that highlights the report's key findings, followed by an introduction that outlines the historical context of M&S and the significance of innovation in its business model. The report delves into the future of the retail industry in 2020, identifying key trends such as customer-centric approaches, ethical retail practices, the growing focus on R&D, and the rise of brick-and-click models. It then assesses M&S's innovation requirements, addressing technological challenges, human resource inefficiencies, financial constraints, and communication system issues. The core of the report develops a strategic roadmap for building future innovation capabilities for M&S, including a vision, mission, objectives, and strategic focus based on Porter's generic model. The plan includes integrating AI, boosting capital, improving HRM practices, and enhancing communication, ultimately aiming to strengthen M&S's position in the competitive retail market. The report provides a comprehensive understanding of M&S's innovation journey and future strategic direction.

Managing Innovation in
Business

TABLE OF CONTENTS
TABLE OF CONTENTS..............................................................................................................2
Executive Summary.........................................................................................................................3
INTRODUCTION...........................................................................................................................4
The future of the industry 2020...................................................................................................4
Organization Innovation Requirement 2020 and beyond............................................................6
Building the Future Innovation Capabilities for the Organisation..............................................7
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................13

Executive Summary
This report has properly based on the Marks & Spencer’s future innovation in 2020 which is
trying to deal with different weaknesses through which it is unable to gain more advantage in the
retail industry. It has given brief information about new trends in retail industry which will be
going to be adopted by different retail companies in order to improve better experience of
customers. furthermore, it has compared company’s capabilities in respect of industry
requirements. In last it has developed a innovation roadmap plan for building future innovation
capabilities for the M&S so that it can rule out in upcoming year as well.

INTRODUCTION
Marks & Spencer is the retail industry that has established strong brand image in the business
market at domestic and international level within 130 years by introducing different innovative
products to the public. CW1 report helps to give brief information about M&S and it’s
innovation which have implemented in it’s business through which enables to gain good
positioning in the supermarket chain (Tidd and Bessant, 2018). There are some existing
innovative technologies like digital technology etc. practises by M&S in 2016 to give unique
experience to the customer in shopping. Overall CW1 has provided high understanding role of
innovation in the M&S through which it has achieved advanced success in the business. This
CW2 report has more benefits in this report such as in this report has provided overview of M&S
within 130 years so it will be easy to understand needs of innovation in the company accordingly
2020 through which can build the future innovation capabilities for the M&S plc that is one of
the major benefit of the CW2. The main purpose of the report is to highlight significance of
organization’s innovation requirement in 2020 that will support it to sustain in the business
market. Furthermore, it will develop the future innovation capabilities for the M&S which will
improve it’s sustainability in the retail industry.
The future of the industry 2020
In past few decades, retail industry has been entirely changed because it has adopted
various kind of changes in order to improve customer’s shopping experience (Nardelli and
Broumels, 2018). Retail industry is only an industry that always have to face market dynamics
that always change faster than ever, in that state retailers requires to adapt new shifts in
demographics, consumer preferences and attitudes. New trends always shape the retail industry
and a successful retailer always adapts emerging trends as resulted they enable to improve
operational performance and influences sales through customer’s centric approach, emphasizes
on technology & innovation and powering insights for new product development process. There
are various future trends of retail industry in 2020 such as customer-centric approach. According
to this approach, it keeps customers in the centre of the business (Tidd and Bessant, 2018).
However, customized consumer-centrically boosts growth and progress in the business market.
In this approach, company allows customers to get product as per their requirements for example
M&S provides ready-made food services to the customer. But in this state, if M&S offers
customized food services wherein allows individuals to select ingredients and continents

accordingly their desire that will bring good experience in consumers and they will become
ready to pay extra over such services. Customer centricity is not about to provide to great user’s
services, it means provide great experience to the customer from awareness stage, buying
process, simplifying the buy process with new initiatives like users offer, consumer finance and
post purchase process as well. Another trend is socially conscious driving ethical retail through
retail industry can boost sales and build brand loyalty in customers (Zaabi, Singh and Ajmal,
2017). A new generation of consumers are highly health and environment concerns,
knowledgeable whenever they come for buying purpose and makes purchasing decisions on the
basis of various factors beyond the cost as well. Environment and social concerns have brought
advanced change in consumer’ shopping habits (7 Amazing Trends to Watch In Retail Industry
in 2020. 2020). In fact, consumers are becoming more concern and aware of what are their
lifestyle choices, they are demanding such brands and businesses which reacts accordingly. So, it
is essential for the retail industry to incorporate all ethical, social, economic and environmental
consideration into their different business practices and matches user’s changing value and
global views. Growing focus on R&D is another industry trend of 2020 because future of the
retail market is properly based on rigorous research and development. While customers only like
to prefer only those brands which have established image as trusted brand (Trends that will shape
the retail industry in 2020). So, it is essential for such brands like M&S plc to invest high capital
in research and development department and come with innovative retail service or products, by
bringing changes through the way to the market strategy which can rule in 2020 too. Brick and
click retailers is another trend of 2020 for the retail industry. According to this, new age
purchasers are influencing seeking shopping which has been customized in order to fulfil
individual’s preferences and delivers directly to their houses ((Azis and et.al., 2017). It can be
seen that buying is highly increasing picking up on e-commerce platforms. In past few years it
has been observed that people like to do shopping from e-commerce platform instead of
traditional shopping. Digital shopping has become first impression for eventual point of sale. The
rapidly changing consumer’s habit, fast changing existing technologies and tools, and
challenging competitive dynamics can drive the retailer to sustain in the retail industry at both
level i.e. domestic and international level. Shoppable video & voice technology is another
alternative emerging trend that will grow in retail industry through which retail companies can
create awareness in customers about new product and services.

Organization Innovation Requirement 2020 and beyond
Mark and Spencer is one of well know retail firm in Britain. However, changing
technology, taste and trend create various kind of challenges for the firm. BREXIT and COVID
again become reason for fall of its market share in the country.
Technology
Organisation is facing problems related to technology for example company unable to
adopt proper social media technology which was necessary for gaining large number of
customers in Britain (Yun and et.al., 2020). Artificial Intelligences is also not implemented in the
firm which will improve performance of the firm and it decreases, quality, efficiency and
productivity of work. Many competitors of the M&S has introduced new technological system
which help in gaining market and increase production. Supply chain management system of the
firm also very poor and not changed yet and it decreases customer satisfaction level.
Retail Industry is continuously changing and for that Artificial Intelligence and Supply
chain management must be implemented. COVID protection technology also needed at
workplace to ensure safety of customers and employees in organization.
Permit
Mark and Spencer have various kind of licence but still it needs permit of organic food
and other products which is necessary for changing market.
Customer is focusing towards organic product and hence present requirement must be of
its permit and sales.
Human Resources
Human resource of the firm is not efficient and hence less number of talented workers are
employed. Software related to department still not adopted by the firm which again effecting on
its performance. Company is more focused towards media advertisement and less emphasizes on
hiring from online platform which again decrease chances of selecting talented and skilled
workforce at workplace. Employment relation is also very poor and hence unable to create
friendly atmosphere in the firm.
There are multiple changes that must be implemented in firm such as Software up
gradation and adoption. Maintaining good relation with workers by introducing various programs
and also motivate them for working efficiently. Firm need friendly atmosphere for achieving

higher goals on time and increase productivity. Large number of customer are attracted by social
media platform and hence company has to opt for digital marketing.
Capital:
M&S facing various kind of financial challenges after BREXIT and COVID. Inflation
and unemployment rate in country increases which impact on purchasing capacity of the
customer (Yin, Ming and Zhang, 2020). Loyal customer of the firm are breaking day by day
because of not giving proper discount and offers. Strategy of the firm was also not good related
to it and hence large number consumer purchasing from another firm.
It is necessary that firm become one of first choice for the customer but for it need
changes in finical strategy. Company has to give discount and offers and also start various kind
of gift card programs which helps in attracting customers for firm's product.
Communication System:
Communication of the firm is one way which effect on connectivity to customers and
employees which is necessary for changing business. Survey, feedback are very less analysed by
the firm and hence unable to understand the market and implement proper strategy according to
it.
Industry requirement of the company is two-way communication and analyse customer
and make strategy according to it.
Building the Future Innovation Capabilities for the Organisation
Develop a plan of action for the M&S plc
This roadmap plan is going to conduct for improving future innovation capabilities of
M&S due to these it is lacking behind like out dated technology, ineffective communication
system, poor performance of human resources, lack of capital. In this plan improve effectiveness
of existing company’s capabilities i.e. integrations of Artificial Intelligence in existing
technology, increase number of financial sources, improve two-way communication system,
leads effectiveness in HRM practices etc. that will support M&S to achieve high profitability in
business and enables to match customer’s preferences (Zeng, Hu and Ouyang, 2017). Vision
The vision statement of the M&S plc is “to build strong future capabilities for staying long
period in retail industry”. In other word, organization has goal to overcome it’s weaknesses

through which it unable to achieve maximum opportunity currently. By developing future
innovation capabilities, company wants to attract all customers towards organization’s services
and it’s products so that it can capture large market share and enables to gain good brand image
as “world’s best trustable brand” in the retail industry (Zaabi, Singhand Ajmal, 2017). Mission
The mission statement of M&S is “to increase all type customer’s experience and become all-
rounder in the retail industry”. In other word, company has goal win battle in the retail industry
by coming up with innovative services and product which rule out in upcoming years too
through which it can gain sustainable profit.
Objectives
 To integrate AI with all existing technology by the end year of 2023.
 To boost capital of the M&S between 2021 to 2023.
 To increase effectiveness of HRM practices till the year of 2021.
 To increase effectiveness of two-way communication system by the end year of 2022.
Strategic focus: M&S has strategic focus on integration of AI with existing technologies in order
to rule out in the retail industry in current and upcoming years too.
Porter’s generic model
Porter’s generic is the framework that are useful for the company to gain competitive
advantage in the business market. This model comprises four generic business level strategies i.e.
cost leadership, differentiation and focus strategy. M&S follows differentiation business strategy.
It is an approach that is undertakes by companies to offer unique product and services to the
customers. The main objective of the differentiation strategy is to improve competitive
advantage. With this strategy, M&S has plan to offer such products and services which attracts
customers towards them for buying purpose (Janjić and Rađenović, 2019).
Targets Customers
Company targets all new generation customers as targeted audience because they are
becoming highly concern for health, social and economic perspective. This targeted audience
will support M&S to undertake all ethical and social consideration which can help it to rule out
in the business market in upcoming years as well.
Strategies
Improve effectiveness of HRM practices

 Training and development program
M&S Will conduct training and development program for the human resources so that they can
easily learn how lead effectiveness in different HRM practices like recruitment and selection,
cross-cultural communication process, developing different innovation strategy etc. through
which company can receive number of benefits like maintains diversity of employee in the
workplace, matches all customer’s preferences, increase company’s commitment capability etc.
Thus, this training program will develop increase effectiveness of HRM practices in the
company.
Improving communication system
 Encourages 360-degree feedback strategy
It is one of the best strategy for improving communication system because it offers all around
communication system. For example, company can improve customer’s satisfaction by gathering
and analysing reviews of customers which they ask for given. Thus, company can easily analyse
their staff performance in the workplace which they offer to the customer (Ying and et.al., 2020).
To maintain wellbeing of individuals in the company this strategy plays effective role too such as
with the support of this strategy, HR can gather feedbacks from employees about strategy,
company’s working culture and salary issues that will maintain their wellbeing and will
encourages them to put more efforts in the workplace.
 Shoppable video & voice technology
It is another strategy that can improve effectiveness of communication system. For example,
company can use this strategy and shows video tutorial about customer’s shopping experience
while voice technology can use to communicate directly to the customer that put impression on
sales of point. With these technologies, company can improve its two-way communication in
precise manner (Jin and Shin, 2020).
 Increase customer’s subscription commerce & establishing customer’s loyalty for growth
Company can offer customer’s subscription commerce service to the customer that is another
effective strategy through which organization will establish customer’s loyalty for growth
purpose.
Increasing capital
 Better inventory management

It is another inventory management strategy in which company can practice different tools i.e.
just in time (JIT) and ABC analysis that will support M&S to reduce risk of overselling and cost
effective. With strategy company will able to make more profitable business decisions (Nardelli
and Broumels, 2018).
 Reduce Debt. Serving Expenses
It is another effective strategy to improve capital of the business. HR managers of M&S can keep
attention on debt. Serving expenses and loopholes through which they can easily minimize debt
expenses.
 Integrate AI with existing technology
It is another effective strategy that can support to improve existing technology. For example,
company uses various digital channels like internet, social media for the digital marketing
purpose and sells products on them. But when company will integrate these technologies with AI
that will bring advancement in existing digital technologies through which company can improve
shopping experience of customers and it will make supply chain planning more effective as well.
It will also support to accurate demand forecasting that will drive higher margin on existing
products.
Planning and implementing
Upper management of M&S conducts training and development program for human resources so
that they can overcome their weaknesses from which they are lacking behind. Well skilled and
talented trainers will direct human resources how to improve HRM practices like recruitment and
selection strategy (Satell, 2017). It is one of the prime practices of HRM through which company
can get those talented staff who can bring large profitability in the business. M&S needs to have
diversified staff in the workplace because it operates in multiple sectors so these staff will help in
understanding preferences of customers. Upper management implements different
communication system strategy such as 360-degree communication strategy, increase customer’s
subscription commerce & establishing customer’s loyalty that improve communication systems.
In the context of increasing capital, inventory management of M&S implements better inventory
management strategy in the workplace and oversees all inventory functions like receive and
record new stocks i.e. delivers and ships out etc. perform by employees as resulted declines
overselling of product that saves money of the M&S which it can invest on other business
activities for improving profitability. Integration of AI with existing technology is another

effective strategy that implements by human resources with the support of R&D department and
IT department which brings innovative ideas and implements them in leading advanced change
in existing technology such as cart abandonment emails and personalized curation, automated
management of inventory and geofencing etc. these are probably gamer changer AI technology
in the e-commerce market through which M&S plc can be rule out for upcoming years and can
improve customer’s experience. Thus, HR, upper management is working together to build
strong capabilities which will support it to increase brand leverage and stay innovative brand in
the retail sector.
Key risks and barriers
The major risk of above-mentioned strategies is that these are quite time-consuming, risk
containing and money investing for example conduction of training and development program
for the HR department is not easier tasks because upper management have to give full
involvement to encourages HR professionals to leave their comfort zones and learns new skills
which brings beneficial impact on their HRM practices (Semuel, Siagian and Octavia, 2017). So,
it is time-consuming strategy and employee’s resistance is also barrier that takes place when
upper management of M&S conducts training and development session. While integration AI
with existing technology posses key risks and barriers such as skills shortage and requires high
availability of technical staff because all technologies will be automated so, it will essential for
the company to conduct training session for the technical staff so they learn how to operate
automated technology. Thus, this technology also will be quite time-consuming and expensive as
well.
Measurements
Performance management system will use by the upper management of the company to
measure quantifiable performance i.e. revenue and profit growth and this technology also
supports to measure complementation of project on defined time deadline. Thus, these two
milestones will help company to measure plan success in precise manner.
CONCLUSION
In this report has been summarized about innovation is considered one of the key success
factors for every business, so most of the company are putting more efforts in R&D department
and AI integration in order to become highly success in it’s sector. However, M&S plc also has
planned to become highly competent in upcoming years. This report has been concluded new

trends of retail industry in 2020 like customer’s centric approach, socially conscious driving
ethical retail, growing focus on R&D, brick and click retailers, digital shopping, shoppable video
& voice technology etc. that can be used by M&S plc to stay competent in the retail sector. Then
this report has been concluded about organization innovation requirements in 2020 in which
have discussed about M&S’s capabilities i.e. HR, technology, permit, communication system
etc. in respect of retail industry requirements. Furthermore, it has been summarized roadmap
innovation plan in which included vision, mission, objectives, porter’s generic model, target
customers, strategies, strategic focus, planning and implementing, key risks and barriers and
measurements that have used by M&S plc to build future innovation capabilities.