Marks & Spencer: Navigating Challenges in a Dynamic Business Context

This report provides a comprehensive analysis of Marks & Spencer's business context, examining the dynamic and changing nature of its operations within the global business environment. It covers the influence of COVID-19 and Brexit on the company, including supply chain disruptions, shifts to online retail, and job cuts. The report also recommends leadership styles for Marks & Spencer and discusses its CSR activities. Through SWOT and PESTLE analyses, the report identifies key strengths, weaknesses, opportunities, and threats, providing insights into the company's strategic challenges and potential pathways for future success. The analysis highlights the importance of adapting to changing customer trends, investing in digital technology, and addressing legal and environmental responsibilities. Desklib provides access to similar solved assignments.

Context of Business

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY ..................................................................................................................................4
Environmental analysis..........................................................................................................4
Influence of COVID-19 and Brexit on Marks and Spencer...................................................7
Recommended leadership styles for Marks and Spencer.......................................................8
CSR activities of Marks and Spencer.....................................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Context of Business helps company to understand the factors that affecting their business
from different perspectives including how to make decision as well as what are effective
practices that help in achieving the target goals. For the following report, selected company is
Marks and Spencer which is a multinational retailing company of UK and specialises in offering
of home, clothing and food products (Boone, and et.al., 2019). The company was founded by
Michael marks and Thomas Spencer in 1884 and its headquarters is in London, England, UK.
The report covers the dynamic and changing nature of business along with the consideration of
the future of organisations within the global business environment along with the need for
individuals and organisation to manage responsibly as well as sustainably and behave ethically in
relation to social, cultural, economic as well as environmental issues. It further includes
leadership, development of people as well as management along with the development of
appropriate policies and strategies within a changing environment in order to meet stakeholder
interests. In addition to this, the design and development of organisation are also included.
MAIN BODY
Environmental analysis
To gain perspective into the detailed elements of the business environment within which
a firm operates, use of strategic management models is necessary which provide a
comprehensive analysis on various dimensions of the business (Haski-Leventhal, 2018).

Analysis of both internal and external surrounding of a business is very important to know the
insights of the current developments that might affect business operations and the style of
leadership and CSR activities are also directly influenced by happenings in the business
environment. The SWOT and PESTLE analysis of Marks and Spencer has been given below
which are both commonly used analytical frameworks which help in identification of
opportunities and threats along with facilitating analysis through separation of the outside
environment in different layers.
SWOT ANALYSIS
Strengths
 Large variety of market offerings with
multiple product lines covering
different retail segments
 The company is well experienced as it
has been in the retail sector for more
than a century and has great brand
recognition
Weaknesses
 Poor supply chain system which has
been prone to disruptions resulting in
product unavailability
 Since the company is quite old and
traditional in most of it's operations, it
uses manual processes costing a lot of
time and money
Opportunities
 Detailed market segmentation in
multiple countries and developing
regional variants of it's most popular
product lines
 Development of online channels of
sales and expanding into new
businesses
Threats
 Marks and Spencer has been caught in
many controversies and it's hard earned
goodwill developed from a century of
hard work has started to erode (M&S in
hot water with furious shoppers over its
new Indian dish, 2022).
 The retail market has been brimming
with tough competition with major
players expanding their operations such

as Tesco and Sainsbury's.
PESTLE ANALYSIS
Political – The company has had a difficult time due to Brexit affecting it's already susceptible
supply chain which has resulted in many products being unavailable and the firm finding it
difficult to optimally manage the inventory levels as many of it's best selling products are not
available to the UK customer base (Hensher, 2020). Marks and Spencer might also get affected
with the upcoming government mandate of curbing unhealthy food promotions which is a move
that has been subjected upon major retailers like M&S, Tesco and Sainsbury's to prevent
childhood and teenage obesity from taking over the country. Marks and Spencer has shifted
towards pushing of green and healthy products to prepare it's operations for the changes that are
bound to occur soon due to political interference in UK.
Economical – The UK economy has been hit badly by a combination of disruptive factors
including the breakup from rest of the European union due to Brexit and the constant economic
restrictions and lock-downs due to the COVID-19 pandemic and Marks and Spencer has felt the
full brunt from both these factors as the company has posted a massive 90% reduction of full
year of operational profits in 2021 resulting in many stores and products lines being shut down
along with cutting off multiple jobs. Things are looking in 2022 as it has regained some lost
ground in terms of sales and profits and has confirmed expansions into new areas such as
Chesterfield.
Social – Although Marks and Spencer has been operating in the retail sector specialising in food
and clothing for over a century, there is a noticeable decline in it's popularity and brand
perception among the general public. There are numerous reasons for this development which
includes the company not paying attention to the changing customer trends along with lack of
quality control in it's clothing and food brands. The company has also been at the centre of
various controversies such as it's messaging over pig meat backfiring and resulting in backlash
from vegans and animal lovers which has resulted in loss of goodwill (Marks and Spencer
slammed after sharing 'vile' and 'disgusting' post about product, 2022).

Technological – The firm has been committed for a long time towards it's traditional and archaic
way of conducting routine business operations in the field of retail which is no longer working
for the company in the age of digital technology and e-commerce. In order to build a better scope
and legacy in the future, Marks and Spencer has been investing in massive build-up of online
retail channels which will be used exclusively for supply and delivery of locally sourced food
ingredients and ready made dishes. M&S is also working on strengthening it's supply chain by
building special networks which are fully integrated with artificial intelligence technologies
which will be helpful in preventing disruptions in the future.
Legal – When it comers to legal compliances and adhering to set guidelines and be legally
upright, Marks and Spencer has had a troubled history full of operational hiccups as the firm has
been accused of multiple wrongdoings including mistreatment of employees, low levels of pay
which has even escalated to the point where the firm had legal action taken against it which led
to out of court settling on numerous occasions. The company should also pick it's battles wisely
as it recently got into a legal dispute with ALDI over a cake design which was also settled
privately.
Environmental – Marks and Spencer has been a major presence in UK's retail market for over a
decade and it has been a pioneer in multiple market segments which is why the responsibility to
be environmentally friendly and green in it's operations on it's shoulders is immense. The firm
has made various commitments towards it's surroundings such as change in it's packaging,
locally sourcing products and attaining carbon neutrality in the long run by controlling
emissions. In the light of the ongoing pandemic, the firm has also made hygienic changes in it's
stores and retail channels such as compulsory distancing and masking the staff at all times along
with changing the overall business model of the company and taking it's majority of products to
the digital marketplace.
Influence of COVID-19 and Brexit on Marks and Spencer
There has been several major disruptions that have shook the economy of UK along with
the majority of businesses that operate within the country ranging from small firms all the way to
century old retail giants like Marks and Spencer. Out of all of these elements, two have been
devastating in particular, Brexit and the COVID-19 pandemic which have both resulted in many
problems for retailers and the latter has completely changed the way businesses share their

operations and business models. Some of the major effects that Brexit and Coronavirus had on
Marks and Spencer have been given below.
 Opting out of major territories – One of the most frustrating things about Brexit is that
the rules and regulations put in place by the government of UK has added lost of
additional costs to trading with the rest of the EU instead of building solid trade relations.
This has rendered Marks and Spencer unable to function properly in major locations such
as France where it has had to close multiple stores due to supply chain shortages
prompting a severe lack of products needed to manufacture and provide food items which
were popular within the French community (Marks & Spencer blames Brexit as it closes
11 French stores, 2022). M&S has also stopped supply of fresh and chilled foods in
territories like Czech Republic to cope up with the growing costs due to Brexit.
 Establishment of online retail channels – The COVID-19 pandemic has been very hard
on traditional retailers like Marks and Spencer who have depended on their physical
outlets and showrooms as drivers of sales and revenue as social distancing restrictions
and public fear have forced businesses to go digital (McCauley and Palus, 2021). Marks
and Spencer has changed it's business model completely and has engaged most of it's
resources towards spearheading e-commerce growth with crucial steps such as building
it's own retail and shopping apps, use of content marketing and SEO to boost online
traffic and sales along with building new websites and portals for delivery of food and
clothing.
 Job slashing – One of the most devastating ill effects of both Brexit and the pandemic
has been the changes which have been made to the overall job security in the retail sector
as Marks and Spencer has decided to cut off a lot of it's workforce in a bid to recover
from huge losses, reportedly more than 90 million dollars in 2021 which has also forced
it to withdraw from markets and close down all shops which are not generating a
substantial revenue. There has been an increase and urgency seen in the way M&S is
changing it's business model and although online channels might benefit them in the long
run, the cutting of jobs on a mass scale is not a worthy ethical compromise.
The strengths and weaknesses of Marks and Spencer which were identified with the help of the
SWOT analysis has been paving the way and posing challenges for the firm in the post pandemic

economy as it is slowly getting back on it's feet. The company has vast amount of resources and
goodwill remaining which has resulted in regaining of customers that went away before the
pandemic and their experienced directors and top executives have been making excellent policies
to combat the losses being posted due to Brexit and the coronavirus. Product diversification is
being used actively to change the way people view the company as M&S is focusing much more
proactively on food retailing and fresh food offerings by partnering with popular food order
applications. The COVID-19 pandemic has indeed squandered some opportunities for the
company as the restrictions ad strict guidelines that are in place are deterring it's global
expansion plans and the after effects of the pandemic do not look like they are going away soon
as the virus continues to mutate itself resulting in new variants popping up every now and then.
Both Brexit and COVID-19 have posed many threats for the company overall as it has suffered
from devastating losses, the weaknesses in it's supply chain have been exposed badly over the
past two years and customers no not trust the company with taking care of them in the pandemic
like they do with it's competitors such as Tesco (M&S warns of supply chain challenges as food
sales increase, 2021).
Recommended leadership styles for Marks and Spencer
In order to establish a successful business in the retail sector of UK which is brimming
with competition and disruption from elements such as Brexit and COVID-19, the existence of
strong sense and style of leadership is very crucial. Marks and Spencer has managed to survive
and prosper in this segment for over a century which is an achievement in itself but it should
make the following leadership styles get integrated in the way the business works to fight the
slumping sales and popularity of the company in the UK.
 Bureaucratic – This style of leadership is very traditional and is found in highly
established firms which have been operating for a long time such as Marks and Spencer
and the defining trait of this style includes following of a fixed template which provides
the basis upon which leaders act and take decisions in the company (Mourik, and et.al.,
2020). M&S is overhauling a lot of operations but some areas of the business must
remain and operate traditionally such as it's premium range of clothing
 Coaching – M&S leaders have been operating and overseeing developments and
challenges in the retail sector for decades and this knowledge base must be shared with
all the other managers and front-line workers as personal experiences are the best way to

train people to increase their efficiency. The new online channels that M&S is building
will need trained and experienced workers to operate efficiently.
 Transformational – This style of leadership will be the best path forward for Marks and
Spencer when it comes to internal improvement as many of it's current existing
operations need constant optimization to boost their efficiency on the level of their
competitors such as online food delivery, supply chain management and designing
employee compensation. Transformational leaders push other members of the workforce
and help in attainment of goals in an efficient manner and this style of leadership is
needed in M&S as it has recently changed it's vision towards food focused services and is
building digital infrastructure from scratch which needs the supervision of
transformational leaders to ensure all activities are in sync and effective.
CSR activities of Marks and Spencer
Marks and Spencer has a big commitment and responsibility to fulfil towards it's
stakeholder and the millions of people it serves in UK along with the communities they reside.
The company has strong brand perception, popularity and is directly influencing the health and
lifestyle habits of a considerable size of the population (Szydlowska, 2020). The corporate social
responsibility efforts that M&S takes reflect it's values which are based upon quality, innovation,
service and trust and involves various deeds and donations of various goods such as packaged
food packets, clothes to marginalized communities, poor community members and societies
along with orphanages and social schemes.
When to comes to environmental commitments and undertaking green responsibilities,
Marks and Spencer has made various strategic plans which involve ethical sourcing systems and
promotion of animal welfare along with detailed policies to properly manage the emissions that
occur from their facilities to obtain carbon neutrality in the long run by 2040 which are all great
steps with many benefits.
CONCLUSION
The above report went into detail regarding the various facets that are involved in
conducting business in the UK's retail industry which is suffering from constant operational

disruptions such as Brexit and COVID-19 pandemic along with severe competition with major
players involved. There was discussion on the external and internal environments of retail firms
with the help of strategic tools such as SWOT and PESTLE analysis along with detailed
introspection on the effects of Brexit and COVID-19 pandemic on the business affairs of these
firms. The report was concluded with various leadership style recommendations which can help
these firms survive volatile market conditions and an analysis of their efforts towards corporate
social responsibility.

REFERENCES
Books and Journals
Boone, T., and et.al., 2019. Forecasting sales in the supply chain: Consumer analytics in the big
data era. International Journal of Forecasting, 35(1), pp.170-180.
Haski-Leventhal, D., 2018. Strategic corporate social responsibility: Tools and theories for
responsible management. Sage.
Hensher, M., 2020. Covid-19, unemployment, and health: time for deeper solutions?. Bmj, 371.
McCauley, C.D. and Palus, C.J., 2021. Developing the theory and practice of leadership
development: A relational view. The Leadership Quarterly, 32(5), p.101456.
Mourik, R.M., and et.al., 2020. The impact of the institutional context on the potential
contribution of new business models to democratising the energy system. In Energy and
Behaviour (pp. 209-235). Academic Press.
Szydlowska, K., 2020. The future business strategy of Marks and Spencer. GRIN Verlag.
Online Referencing
M&S in hot water with furious shoppers over its new Indian dish, 2022 [online] available
through <https://www.manchestereveningnews.co.uk/news/uk-news/marks-spencer-slammed-
recipe-post-20959963>
Marks and Spencer slammed after sharing 'vile' and 'disgusting' post about product, 2022 [online]
available through <https://www.mylondon.news/whats-on/shopping/marks-spencer-slammed-
after-sharing-20931060>
M&S warns of supply chain challenges as food sales increase, 2021 [online] available through
<https://meatmanagement.com/ms-warns-of-supply-chain-challenges-as-food-sales-increase/>
Marks & Spencer blames Brexit as it closes 11 French stores, 2022 [online] available through
<https://www.bbc.com/news/business-58582860>