Organisational Strategy BM6024: Strategic Report on Marks & Spencer

This report provides a comprehensive analysis of the strategic situation facing Marks and Spencer (M&S) in both the UK and international markets. It identifies key challenges arising from the external environment, including political and economic instability, and assesses the internal business situation and resources of the company using SWOT analysis. The report also examines the competitive landscape using Porter's Five Forces, highlighting the bargaining power of suppliers and buyers, the threat of new entrants and substitutes, and the intensity of competitive rivalry. Furthermore, it explores various strategic options and directions that M&S could pursue for future growth, considering cost leadership, differentiation, and focus strategies. The analysis concludes that M&S needs to adapt its strategic direction to address complex business challenges and enhance its performance in both local and international markets. Desklib provides access to this and many other solved assignments for students.

Organisational Strategy
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Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
Key challenges facing the M&S in the external environment in the UK....................................3
Analyse the internal business situation and resources of the company in the UK......................5
Analyse the competitive environments of the M&S in the UK and International market..........7
What strategic options and directions could the M&S pursue for the future growth both in the
UK and international Market.......................................................................................................8
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10
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INTRODUCTION
An organisational strategy is based on the sum of different actions in the organization which
intends to take a better decision and achieve long term goals. Different actions which make an up
by M&S through effective strategic plan, involving the requirement from all enterprise levels.
This assignment will discuss about the key challenges facing the enterprise because of external
environment factors in United Kingdom. This report will analyse the current internal business
situation, resources of enterprise in UK. Furthermore, it will describe the competitive
environment of business and its international market. However, examined the different kind of
strategic option and directions that could be organisation pursue for future growth in local as
well as international market.
MAIN BODY
Key challenges facing the M&S in the external environment in the UK.
Marks and Spencer is based on the retailer which has been changed dramatically in a few
short weeks. In 2020, retail sales declined for first time on record, with the British Retail
Consortium reporting a 0.1% contraction across because of the instability in political aspect. In
additional, it is also increased the consumer caution.
External environment means that different factors directly or indirectly affects on the internal
function and perhaps the business strategy. In most of external factors that consists of political,
social, economic and technological (Al Maazmi, 2021). These are totally related to the control or
manage the M&S, but company could be able to take an essential steps and overcome these
challenges. As per consider the Pestle analysis in which identify the different common factors as
follows:-
Political Factor-
Nowadays, it has been rapidly increasingly the political instability because of COVID-19
situation or condition. It is not only affect on the investor but also reduce the entire business
profitability as well as productivity in marketplace. Second thing is related to the government
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trade policy, either it is flexible or hard. M&S is basically operates under the government policy
and legal framework. Usually, M&S has been covered the different areas such as tax rate,
employee benefits, trade regulation etc. Due to COVID-19, it has been reduced the level of
business revenue in marketplace. Supplier, consumer and other competitors are also affecting by
political environment.
Economic Factor-
The economic condition is also affect M&S external environment. in regards of economic
factor that is influence entire business because of taxes, inflation, government need or
requirement (Alblooshi, Shamsuzzaman and Haridy, 2020). Due to COVID-19, growth of
economic rate is low and tendency to spend at local as well as international levels.
Social Factor-
In context of social factor, potential consumers are following their tradition and demand of
specific product as well as service. In every transaction product quality which matters a lot. But
it is also easily beaten by putting some good pricing of same brand. As per analysis, it has been
identified that M&S prefer some fashionable style over classic trends. This can be seen by M&S
where they are still struggling to get a bigger market share because of COVID-19.
Technological Factor-
In recent times, a large number of population could use the internet. It means that
increases the demand of e-commerce so that M&S already gained more popularity in
marketplace (Argus and Samson, 2021). Various kind of business operations are majorly
performed by M&S in order to increase the business performance and efficiency.
Nowadays, COVID-19 has been impacting the entire business of M&S but it is also
increasing the importance of online business. during lockdown, potential consumers are used the
online website of M&S to place an order. Thus, it is gaining more competitive advantage.
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Analyse the internal business situation and resources of the company in the UK.
An Internal analysis is defined as exploration of M&S competency, price or cost position
and competitive viability in the marketplace. Generally, it has been conducted the internal
analysis which often incorporate measures in which provide the all essential information
regarding strength, weakness, threat and opportunities.
SWOT analysis is based on the framework or tool for analysis the internal environment
of enterprise. For M&S, it has been generated the strategic alternative from a situation analysis.
SWOT analysis can light on the M&S strength or weakness (Nienaber and Martins, 2020).
Marks and spencer is used the effective strategy that supports for representing the clear definition
of enterprise mission, accurate assessment of internal analysis.
Strength-
The strength of M&S is to maintain the excellent and quality of product as well as
service. Sometimes, it has been developed the effective relationship with staff members. M&S
has been treated as employee and also paid more than its actual sales assistant in other enterprise.
M&S is a leading brand in which always maintain a strong reputation with quality of product as
well as service.
Weakness-
In context of weakness, M&S was completely reliant on the particular British Suppliers
and also compare with other competitors. Sometimes, it can use different suppliers for lower the
cost or price of products. The biggest weakness of M&S is a lack of marketing strategy (Tripathi
and Kumar, 2020). A poor advertisement concept which means that M&S neither has offered the
sales to its potential consumers, especially at the time of Christmas and Easter occasion. Poor
consumer service is also affecting on the entire business profitability as well as productivity in
marketplace.
Threat-
A major threat of M&S is intense high completion because there are already major
competitors such as ZARA, Sainsbury, ASDA and TESCO. The clothing industry is consider as
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mature and market which are not saturated and indicate that consumer always looking for new
fashionable cloths. Internet related technology is always enabled potential consumer to shop
from home. in order to focus on the expansion into international marketplace. Through this way,
it has proved that M&S become less successful in marketplace.
Opportunities-
Whenever, keep in the line with potential competitors, M&S is always tried to enter into
e-business which means that targeting the different consumers. Sometimes, M&S has been
offering the potential client as option from shopping through online website. in this way, It
become easier for M&S to handle the problem of operating store in term of high price or cost
localities.
Nowadays, it has been rapidly increasingly the demand of modern technology, which is
always supports for enterprise to keep ahead of its competitors. Sometimes, it is also focused on
the cloths market segmentation according to the age wise such as women’s, men’s and other
children clothing. M&S has been gained the more opportunities to diversify their business and
achieve desirable goal or objective.
Resource of Marks and Spencer-
Physical stores- M&S has been owned 375 UK stores, 155 physical stores managed under
specific franchise in 28 different territories. Through this way, M&S has been identified the
suitable identical procedures, design, layout and image (Zulkifli, Nurhayatie Widodo and
Junaidi, 2020). In this way, it help for increasing the change in the physical existence according
to the need or requirement.
Human- M&S has always tried to maintain the loyalty, friendly environment, hardworking
and other experienced staff members. Company will support for improving the knowledge
management process. Afterwards, it would be adopted the green environment or style.
Sometimes, it has been developed a poor good communication between head quarter because of
enterprise bureaucratic culture or tradition.
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Financial- M&S has been declined the profitable rate. In this way, it indicate that M&S do
not have handle the healthy sign of cash flow availability. At certain level, M&S has been
stopped the expansion programme in Europe, America. But M&S has acquired the proper
financial resources.
Intangible- the potential consumer loyalty has been decreased because of change of
market fashion and other product price. M&S brand as consider as high quality of standards
which are undervalued. M&S does not have knowledge of management system such as consumer
and other supplier database.
Analyse the competitive environments of the M&S in the UK and International market.
A porter’s five force is based on the framework for analysing the enterprise competitive
environment or culture. There are large number and power of enterprise company competitive
rivals and new market entrants. These are influencing the overall business profitable rate in
marketplace. Porter five force model is basically used to determine the essential source of
competition in M&S.
Bargaining power of Supplier-
In M&S, this company has been directly affect on the UK supplier which perform the
significant roles in their stock or supply chain management. Whenever, it has been created the
tough situation where supplier was consider the reliant on M&S. As per consider the problem of
particular approach in order to overseas suppliers produced the item on low price or cost.
The bargaining power of supplier is low and in 2020, it has been declined the sales, and
also reduce the price or cost of product. As a result, the bargaining power of supplier can be
reduce.
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Bargaining power of Buyer-
The bargaining power of buyer is high. The potential consumers are seeking the
traditional or classical clothing. It became consider the suitable price or cost of particular
products. M&S has focused on the competitors in order to provide the best product quality of
their consumers. In additional, UK consumers are not willing to pay more money on premium
items because of COVID-19. Therefore, potential consumer can easily switch from one brand to
another.
Threat of new entrants-
In M&S, it has been faced the high competition level and lower the end of its current
market. ASDA with established own brand but it offers the high quality of clothing at low price
or cost (Zulkifli, Nurhayatie Widodo and Junaidi, 2020). The competitors of M&S such as Zara,
Gap, Next BHS, these are offering high quality of clothes in which attract young consumers. In
this way, it has been identified that threat of entrants is higher.
Threat of Substitutes-
In M&S, threat of substitute is high. Nowadays, it is mainly increasing the operational
cost of enterprise with foreign imports. Usually, many potential consumers are prepared to pay a
premium for label. In this way, it is always tried to purchase the items with low price or cost.
Competitive Rivalry-
M&S has been operated their business in competitive environment. in this way, it is
important to identify the specific need or requirement for enterprise. In UK. There are no exit as
well as entry barriers but market is mature. At certain level, it is not easily identified the bounce
for new enterprise. M&S has been already experienced of exit barriers.
What strategic options and directions could the M&S pursue for the future growth both in the
UK and international Market
M&S is based on the leading retailer in UK, which is always tried to use as innovative idea in
their business growth and development. In context of strategic options and direction. M&S has
been used the generic model for strategic plan.
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This type of strategic generic model can be divided into different ways:- Cost leadership,
Differentiation, Focus.
M&S is basically fascinating the case of enterprise which has been lost its strategic focus.
Due to Covid-19, M&S has lost the way in term of growth and development. This can possible
when potential consumer avoid to purchase items. Another way, it is also increased the
competitive pressure due to existing or new players (Zulkifli, Nurhayatie Widodo and Junaidi,
2020). M&S has changes its own strategic direction to handle the complex business situation in
proper manner.
In general, M&S has been used the cost leadership, differentiation and focused strategies in
their business to improve entire business performance from local to international marketplace.
CONCLUSION
From above discussion, it has concluded that n organisational strategy is based on the sum
of different actions in the organization which intends to take a better decision and achieve long
term goals. Different actions which make an up by M&S through effective strategic plan,
involving the requirement from all enterprise levels.
In this report, it has been discussed about the key challenges facing the enterprise because of
external environment factors in United Kingdom. Analysis the current internal business situation,
resources of enterprise in UK. Furthermore, it can be identified the competitive environment of
business and its international market. However, examined the different kind of strategic option
and directions that could be organisation pursue for future growth in local as well as international
market.
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REFERENCES
Book and Journals
Al Maazmi, J., 2021. The impact of strategy diffusion on organisational performance of project-
based organisations (Doctoral dissertation, The British University in Dubai (BUiD)).
Alblooshi, M., Shamsuzzaman, M. and Haridy, S., 2020. The relationship between leadership
styles and organisational innovation. European Journal of Innovation Management.
Argus, D. and Samson, D., 2021. Organisational (Business) Strategy. In Strategic Leadership for
Business Value Creation (pp. 47-88). Palgrave Macmillan, Singapore.
Book and Journals
Nienaber, H. and Martins, N., 2020. Exploratory study: determine which dimensions enhance the
levels of employee engagement to improve organisational effectiveness. The TQM
Journal, 32(3), pp.475-495.
Tripathi, R. and Kumar, A., 2020. Humanistic leadership in the Tata group: the synergy in
personal values, organisational strategy and national cultural ethos. Cross Cultural &
Strategic Management.
Zulkifli, Nurhayatie, T., Widodo and Junaidi, M., 2020. Improving organisational learning,
strategic quality, organisational performance: energising intellectual
approach. International Journal of Learning and Intellectual Capital. 17(3). pp.297-308.
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