Strategic Management Report: M&S Business Environment Analysis

This report provides a comprehensive analysis of the strategic management of Marks & Spencer (M&S). It begins with an introduction to strategic management, defining key concepts and outlining the objectives of the study. The main body delves into fundamental issues related to strategic management, exploring various approaches such as the industrial organization and sociological approaches. It also discusses different strategies like corporate, business unit, and market-level strategies. The report then examines the strategic management process, including environmental scanning, strategy formulation, implementation, and evaluation. A significant portion of the report is dedicated to analyzing the relationship between M&S and its business environment, utilizing Porter's Five Forces to assess competitive dynamics. The study further explores M&S's corporate strategy, recent failures, and the application of generic strategies like cost leadership and differentiation. The analysis includes an in-depth SWOT analysis, identifying M&S's strengths and weaknesses, as well as an exploration of its intensive growth strategies, such as product development and market penetration. The report concludes with a summary of the key findings and insights into M&S's strategic position within the retail industry.

Strategic Management

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Fundamental issues related to strategic management.................................................................1
Approaches to strategic management..........................................................................................2
Other approaches of forming business strategy..........................................................................2
Strategic management process consists stages which are:..........................................................2
Relationship between M&S and its business environment.........................................................3
Marks & Spencer Corporate strategy..........................................................................................6
Recent failure of M&S:...............................................................................................................7
CONCLUSION................................................................................................................................8
REFERENCES..............................................................................................................................10
Strategic Management Process. 2019. [Online]. Available through :<
https://www.managementstudyguide.com/strategic-management-process.htm>..........................11

INTRODUCTION
Strategic management is the big picture of company mission and vision. In other words,
strategic management is about the identification of the plans set by company managers to
accomplish the better performance goals. This process includes planning, monitoring, analysis
and assessment of all that is necessary for the organization to adopt. Present study based on
strategic management of M&S where study will be presenting the various approaches to strategy
and measure the relationship between the organization and its environment. Study will be
explaining the concept of international or global strategic thinking that helps to refrain the
effective management task. Also, it explains the application of strategy ideas in practice in the
further research.
Marks & Spencer is the leading multinational supermarket retailer that dominating the
market. M&S specialist in clothing, luxury food products, home products. 1998 company
achieved first British retailer to make a pretax profit of over £1 billion. The main focus of the
company is on delivering the great product or services to the customers.
MAIN BODY
Fundamental issues related to strategic management
The concept of strategic issue management is referring to the planning of decision making
process. All the activities and activity of M&S should be according to the set plans at all
departmental level (Tang and et.al., 2017). The main issue or conflict generally faced by the
company is corruption occurs when a manager or another powerful person uses his/her position
in wrongful manner. The impact of this issue can affect the company reputation in the market.
In other words, strategy is the kind of guidelines of an organization or managers. Here
defining the different kinds of strategies built for different level.
Corporate level of strategy: This level of strategy can help Marks & Spencer to develop
fundamental questions to the company that what company want to achieve.
Business unit level strategy: this level of strategy guide who the set strategies are going to
achieve or compete. Will it be completed by customer intimacy or leadership or lowest cost?
Market level strategy: This level of strategy can be more helpful to M&S to make the
decision that how the company will be going to grow in the market. Will it be through market
development, by launching new product development, or through market penetration.
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Approaches to strategic management
The industrial organization Approach: Industrial approach is a field which involves and
dealing with strategic behaviors of firms, regulatory policy and market competition (Okumu and
Hood, 2017). M&S should face the ups and downs of the industry in order to increase
understanding of the market.
The Sociological Approach: This sociological approach which deals with human
behavior. In this strategic management approach M&S needs to deal with human behavior,
satisfying behavior, profit sub optimality etc.
M&S using top down management approach in order to accomplish the company
objectives and goals and objectives.
Other approaches of forming business strategy
Internally driven approach: As per this business strategy approach company set strategies on
their past. This approach follows their past experiences and modify it with future. The limitation
of this approach is that, it never considers the new environment of the business which sometimes
restrict the further opportunities. This affect the long-term goals and affect the long-lasting
business growth (Chepkwei, Wanyoike and Koima, 2017).
Customer driven approach: this strategic approach is totally based on customer
satisfaction. In which company only consider the choice of client rather than concern about
suppliers, competitors etc.
Market driven approach: As compare to other two approach, this approach is more
durable and reliable in terms of high performance. Marks & spencer can easily adopt this
strategic approach to formulates its marketing plans or strategic business strategy.
Strategic management process consists stages which are:
Environmental Scanning: This first step of making strategic management process is
measure the external business environment to collecting, scrutinizing and providing information
for strategic purposes. Environmental scanning is useful to identify both internal or external
factors that influence M&S.
Strategy Formulations: this is the next process of deciding the best out of many for
making best decision-making approach (Strategic Management Process, 2019). After scanning the
business environment, manager of M&S can easily prepare the business functional strategies.
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Strategy Implementation: Strategy implementation is the next stage of strategic management
process, in which manager implement the chosen strategy into action. in this process consists
some measure activities such as distribution of raw material, developing decision making
process, arranging proper human resources etc (Gavett and Menon, 2016).
Strategy Evaluation: Strategy evaluation is the last step which evaluate and measure the
implementation process of strategic management. In this process consists some steps such as
organizing strategy, taking remedial action plan, measuring overall performance etc.
Relationship between M&S and its business environment
M&S working with 70 countries of suppliers and with 2 million workers. As per the M&S
its sustainability vision is “supply chain Dependent”. M&S always meet the customer, employee
and stakeholder’s expectations. Also, company adopt the dynamic business environment changes
to find new business possibilities.
Porters five forces
Threats of New entrants
New entrants in retail brings innovation, new ways of performing unique task. Somehow,
this new change put pressure on existing companies. In this situation company should need to
uses low pricing, reducing costs and providing new value propositions to the customers.
Strategies to retained the existing customers. M&S should need to manage all possible threats to
beat the competitive edge.
Bargaining Power of suppliers
Powerful suppliers of consumer services are try to get good profit margins from the
companies. M&S purchase huge raw material from different suppliers. But in terms of retail
market, power of suppliers is lower.
Bargaining Power of Buyers
Buyers are often a demanding lot in retail sector. They buy only the best item providing
by the company at minimum price. Due to high power of customers, M&S could not get the
enough profit margin from the market. Power of buyers in retail market is high for which
company needs to uses some strategic strategies to manage their product cost and earn profit.
Threats of substitutes
Threat of substitute goods sometimes restrict the sell of other competitors. This makes the
company profit more limited (Grayson and Hodges, 2017). In the situation, where the new
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product in the market gaining the attraction level of buyers due to which existing companies
suffers. To maintained the position in the market, M&S needs to uses some other strategies of
customer services in order to meet the company aims and objectives.
Rivalry among existing competitors
This is another way of improving the leading generating goals to ensure the effective
management task. M&S operate it operates new managing successful business growth. M&S
group Plc operates in retail industry. This competition does take toll on the overall long-term
profitability of the organization (Rugman and Verbeke, 2017).
Porter model of generic strategies
Cost Leadership Strategy: This generic strategy suggests to adopt low cost strategy for
a given level of quality. The objective of this strategy is to become a low-cost producer in the
market. This strategy is generally adopted by the big organization’s with relatively having low
differentiation of product or services.
Cost Focus: In cost focus organization’s usually seeking cost advantage for its target
segment.
Differentiation focus: In this differentiation of focus strategy in which company target the
market segments. In other words, in differentiation focus, firms seek differentiation in its target
segment. M&S adopts broad differentiation strategy to attract their target group of customers or
to earn some extra profit margins.
Differentiation leadership: M&S intensive growth strategies, or targets markets and aims
to achieve competitive advantage through differentiation across the world. Overall, this strategy
is generally adopted by the companies who are charging premium prices for superior product
quality.
M&S Intensive growth strategies are
Product development: This is the strategy that helps company to invent some new
strategies and new product development. By this way of doing business can help M&S to capture
the new market or high range of customer attraction (Mayer and et.al., 2017). In order to fulfill
the effective management task in order to enhance the company productivity.
Market Penetration: This is the second most aggressive growth strategy of M&S that
helps company to expand its business growth. For example: this strategy is reflected in the
selling of grocery product or services. It tries to do more sales by selling its right to sell the new
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managing goals. For example: this strategy is reflected in the selling purpose and effective
growth.
SWOT Analysis:
Internal analysis is the another most important and generic level of system that connects
with the new goals and advantages. In other words, internal analysis helps to determine the
company strength or weaknesses to make the high advanced market growth. M&S having large
number of strengths that presents new emerging market growth. In order to measure internal
growth, M&S needs to uses SWOT analysis tool to identify the internal position of the company.
Strength
High Recognition of the brand: M&s is the most popular and leading company across the
world, which is known for its high-quality product or services. Number of clients are preferring
to buy from M&S as they are more trustworthy (Reynolds and Yetton, 2015).
Wide range of products: in present days, client is more attracted towards those brands
who deal with high range of product or services at different prices. This is another advantage of
M&S to adopt best range of client satisfaction growth. M&S even deal with vegetables and sell
fruits from over 40 years. M&S are focused and adopt most unique concept for their buyers. For
example: M&S spent more than three years to find the best taste of strawberries before
introducing Jubilee Strawberry in summer 2003.
Large number of stores and company outlets: M&S has around 900 stores in all over the
world with 600 stores in the UK market. Number of stores and outlets can reach high range of
customer reach and their attention in across the several places. As number of stores of the
company increase the company capabilities day by day.
Popular designer brands: this is the most significant advantage of M&S that it has
luxurious brand identity which is enough to attract number of buyers in the market. For example:
M&S having men’s high-quality brand such as autograph, big tall, Blue harbor, North coast etc.
Weaknesses
Incur cost in manual processing: M&S had a drawback of traditional techniques rather than
adopting new advanced techniques to perform a particular task. M&S needs to invest in high
range of advanced technology in order to reduce the unnecessary cost of manual processing. In
other words, in present days big organizations has invest high amount on the new technologies to
make the speed more fast and effective (Wicker and et.al., 2015). Companies now focusing on
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new technologies for the efficiency of the work done, this type of technologies are more
advanced and productive. Most of the technologies are gives good result such as M&S can use
digital system while customer perform the payment system or checking goods by electronic
manner. So that, such systems will help to reduce the role of employees. This will help to
continue the long-term goal and objectives to perform the effective way of doing work.
Bad publicity as non-trendy store: As per the sources it has been analyzed that M&S has
adopt non-trendy products due to which company faced challenges of bad publicity. Some
people have wrong mindset up that M&S offer old aged people clothes not for the youngsters.
This will give wrong impact on the customer minds that affect the company reputation. Due to
bad publicity of the company, M&S could not reach to their potential customer. This is the
weakness of the brand that brings profit issues and reputation in the market as long term manner.
Opportunities
The main opportunity for the organisation is internationalization which was stabilized in UK and
even it also started new stores across the world. Another opportunity for the company is adopt
advanced technology development areas in order to beat the level of competition. M&S deals
with fashion industry which is totally dynamic in nature. Company having opportunity to acquire
some new trend and product concept to attract the number of international buyers (Belton, 2017).
This process presents some new technological facts and development for the company into more
appropriate manner.
Threat
Due to increasing level of competition, pressure on companies has been increased day by
day. This is the biggest threat for the companies, M&S having threat of losing customers due to
heavy competition in the market. Competitors of M&S are Tesco, H&M, Sainsbury, Asda etc.
Marks & Spencer Corporate strategy
Corporate strategy of the company fails to meet out the best different opportunity and goals. It is
the long-term goals. This is the long-lasting workplace element that affect the effective
management target goals. M&S partnership will see the two organization’s work together to
explore how technologies such as artificial intelligence (Pulaj, Kum and Cipi, 2015). A team of
world, customer is get more effective and leading that affect the new range of activities.
Partnerships way is more helpful and effective to make the work more easily and growthfull.
The partnership with Microsoft builds on M&S new technology approach to define the leading
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challenging growth. Working together with Microsoft is the new opportunity for M&S to explore
the new services air accuracy for their development areas. This new venture or partnership also
solve the issue of customer services by providing the quick solution of the customer problems. In
order to collect new form of developing results and growth.
Recent failure of M&S:
M&s profit has been diminishing in rapid manner due to heavy competition level. This can
affect the overall company structure and also reduce the customer attraction level. Another
drawback that company facing is online shopping due to which they lose their potential
customers. Now, customer can easily buy anything online without wasting time in stores.
M&S closed its third of its 300 stores in high street which offering some cloth items,
homewares and food. Another lacking point in M&S is poor stores, due to which company fails
to attract number of customers. It has been analyzed that, as per the customers M&S stores are
more dated and shabby which attract less (Flouris and Oswald, 2016). It affects overall, position
and ineffective way of working the overall growth performance of the company in the market.
Another issue that customer faced with M&S stores is very difficult to navigate. A lot work has
been done to improve matter.
Fashion faux pas is another major concern by buyers. As per the women buyers M&S
fails to reach the satisfaction level of women section. Due to which M&S losing their Women
buyers from the product or services. In present days, clothing companies has been given high
range of cost effective growth that attract new fashion trend. This is another issue that company
faced these days.
Business culture of M&S is very poor and also criticized by people that it is very
bureaucratic. For that, company should use good and positive working environment to make
surrounding more good and optimistic. Due to failure and high work pressure company does not
fulfill the requirement of employees due to which M&S facing troubles in organizational
behavior.
Conclusion:
M&S is the excellent company which deals with retail market. But on the same side, due
to some failures they also facing issues in working in the market as well. The product
differentiation generic strategy helped company to bring some new market opportunity or it also
helps to retained the long-lasting goals and objective. Its corporate strategy is effective as it has
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result in the cost efficiency by utilising the same materials and competencies for producing new
products. Its CSR policy can help company to maintained the good position in the market and in
front of the customers as well. Besides, digital technology can also help company to focused on
the customer services and manage different opportunity and goals.
Recommendation:
M&S can modify some changes in their business as well as corporate strategy to
improvise the current position and performance of the company. This strategic level can also
help to improve the customer level towards the company product or services. New strategies can
help company to retain potential client and also stabilized the profit revenue. The biggest issue
that faced by the company is long lasting growth channel (Gander, 2017). Company also need to
acquire new changes in the environment and make new trendy products for their potential
clients. This changes or modification can be very helpful to the company to minimize the
company issues.
Other recommendation for the company is to focus on the differentiation of product that
can help company to beat the level of competition in the fashion clothing industry. overall, it
brings high pressure on the company in which they need to take step which is unique and
different from existing competitors. Organisation also need to adopt some productive business
strategies’ which fruitful for the overall business performance. In order to maintained the
position in the market, company also need to make good relation with other other stakeholders in
the market. Good connections and behavior will help a lot to make international networks.
Besides, M&S also can adopt different offers in summers or winters to make client
happier. They can also promote their brand with some promotional activities to enhance the
product awareness (Gander, 2017). More innovative ideas can make more buyers attraction
towards the company sells.
CONCLUSION
From the above summing report, it has been concluded that, strategic management play a
most crucial role in the business development process. They can improve the company reputation
and also enhance the level in the market. Strategic management also is very vital to make
planning, defining, organizing the strategies. Overall, it brings more opportunity for the comp-
any to grow. Study explained evaluation of strategic management that helps to enhance the
business growth. Also, report explained the strategies to the company that can help in
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differentiation strategy for building competitive edge. The corporate strategy based on the
constrained diversifications in which it enter only those business areas.
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Online
Strategic Management Process. 2019. [Online]. Available through :<
https://www.managementstudyguide.com/strategic-management-process.htm>.
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