Strategic Management Report: Marks & Spencer Strategic Analysis

This report offers a detailed analysis of Marks & Spencer's strategic management, focusing on the importance of clear purpose, vision, mission, and objectives in guiding the organization's direction. It assesses the company's strategy using the VRIO framework, PESTLE analysis, and Porter's Five Forces to evaluate its competitive advantage and external environment. The report examines Marks & Spencer's organizational strategy, including its financial resources, product differentiation, employee training, and adaptation to market changes, such as Brexit and the COVID-19 pandemic. It also considers the company's responses to social, technological, legal, and environmental factors. The analysis evaluates the challenges and opportunities faced by Marks & Spencer in the retail sector and how the company is working towards improving its sales and market position.

STRATEGIC MANAGEMENT

Contents
INTRODUCTION...............................................................................................................................3
Evaluate the value of clear Purpose, Vision, Mission and Objectives in setting the strategic
direction of organisations..................................................................................................................4
VRIO Framework..............................................................................................................................5
Pestle analysis....................................................................................................................................6
Porter’s five forces............................................................................................................................7
Organizational strategy of Marks & Spencer.....................................................................................9
CONCLUSION....................................................................................................................................9
REFERENCES..................................................................................................................................10

INTRODUCTION
Strategic management is the ongoing planning, monitoring, analysis and assessment of all necessities
an organization needs to meet its goals and objectives. Changes in business environments will require
organizations to constantly assess their strategies for success. Marks and Spencer Group plc is a major
British multinational retailer with headquarters in London, England, that specialises in selling
clothing, home products and food products, mostly of its own label. This report highlights issues such
as the value of clear Purpose, Vision, Mission and Objectives in setting the strategic direction of
organisation. VRIO Framework, pestle analysis, porter five force analysis and strategy used by Marks
and Spencer in order to survive in market.
Evaluate the value of clear Purpose, Vision, Mission and Objectives in setting the strategic
direction of organisations
Marks & Spencer has set their mission so that they can serve and define their purpose to their
key audience. They have set their mission to inspire people for their quality and make it available to
everyone. For instance Marks & Spencer is working on products whose quality will be above than
every one of their competitors and they are implementing measures in their culture through which
they can keep the availability of channels open and smooth (Gamble, Thompson Jr and Peteraf, 2019).
Vision-
Marks & Spencer has set their vision in a unique manner on the basis of which they can
define in such a way that they derive their strategy of working as they set their style of decision
making on the basis of predicting the future. Their vision is to be appear standard against what others
call their products a benchmark. Management of company works strategically in order to achieve
goals as per this vision.
Purpose-
Marks & Spencer have kept their purpose always on the basis of values they have set for their
culture. It involves assuring quality products, valuable services, bringing innovation and dealing with
trust in the market. Management of Marks & Spencer believes that with the help of their different
range of products they can prove their purpose.
Objectives-
In order to excel in the market Marks & Spencer has divided their objectives in different
departments such as
Employee orientation-

They have kept high expectations from their staff because they have provided that form of
training and development sessions to them. Apart from that it is necessary for them that they manage
their operations successfully. Recruiters at Marks & Spencer select employees on the basis of their
capabilities to deliver performance that is improved (Kools and George, 2020).
Organizational Objectives-
Aim of Marks & Spencer is to get their position in the market back which is in both sectors
that is clothing as well as food. They believe that by offering superior quality and make a presentable
appeal to customers they can get their position back.
Sales objectives-
In order to achieve their objectives, it is important for them that they make improvement in
their sales as this will help them to achieve their target of key operational aspects (Ylöstalo and
Adkins, 2020).
VRIO Framework
Valuable-
One of the valuable resource of Marks & Spencer is that they have enough and sufficient
amount of financial sources available to them. This helps Marks & Spencer to expand their operations
anytime or to prepare for a threat by forming a countermeasure. Another resource that is considered to
be valuable for Marks & Spencer will be their local food products and the reason behind that is they
are formed in differentiated manner. In return it increases the value of the product in the eyes of final
consumers. Apart from that due to the aspect of differentiation they are given preference and
importance to any other offerings by their competitors (Meyer, Neck and Meeks, 2017).
Rare-
The resources in terms of financial aspects kept by Marks & Spencer are termed to be rare
because not many companies have this power or reserve funds with them. As per the analysis the food
and other local products provided by Marks & Spencer are not rare because there are many other
competitors who deals in the same line of business which means that any change made by them and
preferred by the customers will give them competitive advantage. Apart from this management has
also realized that due to the training and development programs they have provided to their
employees, even they are employees will be counted in resources that are rare. Also employees have
the idea about the work environment of other companies which is not the same as Marks & Spencer
that is why they remain loyal to them (Elbanna, Al Katheeri and Colak, 2020).
Imitable-

Financial resources obtained by Marks & Spencer are difficult to gather and imitate because it
took years to their management to achieve this position. Any other company who had started their
place in market will have to wait for a long period of time due to high competition and achievements
made over time. Apart from that even if the competitors want to imitate their products then they will
have to bear huge amount of costs involved in it. But if they are capable of investing then they can do
some research and imitate their products which puts their food products into the category of
temporary competitive advantage gained which in the long run can be critical for them. They have
another resources which are their patents and it is difficult for anyone to imitate it.
Organization-
Resources in the area of financial aspects obtained by Marks & Spencer are organized which
has helped them to capture their value. These resources are used in a strategical manner to overcome
and stay ahead of the treats or unpredictable events that can affect the operations of business. This
way they can keep this resource of financial aspect sustained for a long time as competitive
advantage. Apart from this patents of Marks & Spencer are not organized in the right manner. This
also states that Marks & Spencer is not using them in the right manner which is taking their benefits
away. If they use it to their full extent, then they can sustain it as competitive advantage. Network of
distribution set by Marks and Spencer is highly and perfectly organized so that they can reach and
deliver their products to high end customers at time. This is why they consider it to be advantage over
others and all the efforts are put down in order to sustain these resources.
Pestle analysis
Political Factors-
Marks & Spencer has been able to manage to take their brands on the platform that they
expected which is on high grounds. As currently they have more than 1300 stores over the world and
they manage their operations from UK. After the impose and decision of Brexit they have lost their
benefit of getting decrease sourcing cost, apart from that they have to pay rate of taxes on higher
grounds. They keep interactions with government on a high level due to which they get to know about
the insights of market and they are able to prepare for the upcoming changes that will be imposed by
the government. This helps them to keep their flow of business stable. They have to work as per their
rules and regulations any negative decision such as increase in tax add cost to their products
(Moutinho and Vargas-Sanchez, 2018).
Economic Factors-
These factors are concerned with the rate of inflation, rate of taxes, level of employment,
growth rate of GDP on the basis of which management of Marks & Spencer makes their decision to
expand or keep working in the same flow of order. It is because on the basis of these aspects

purchasing power of customers is assessed and that determines the growth rate of business. But due to
pandemic market has been highly facing downfall which has affected their business and many of the
businesses are not properly opened yet which is also affecting their chain of supply. Due to this they
have to take out many of their employees (Hitt, Arregle and Holmes Jr, 2020).
Social Factors-
These factors are concerned with differences in culture, beliefs and religious backgrounds on
the basis of these things management of Marks & Spencer have to understand different perspective,
cultures and background so that they can work on the basis of that. They have analysed that
consumers are shifting to cheap clothes as now they don’t want status they want variety which will be
difficult to get from Marks & Spencer. This measure and change is affecting the business of company
as they have been losing many of their customers to their competitors. Apart from that Marks &
Spencer needs to offer their range of clothing as per the market they are dealing in.
Technological Factors-
With the help of these factors they have been able to make changes which has helped Marks
& Spencer to become more advanced and increase the experience for their customers. They are the
ones who have successfully converted their business on digital platform to be more diversified and
meet the needs of their customers. They believe that with the help of that they can achieve growth.
Apart from that they are working on new models through which they believe they will be able to form
up new methods that will be agile for industry. Main focus of Marks & Spencer is to simplify their
base of technological aspects.
Legal factors-
In order to work with the support of government and local parties it is important for Marks &
Spencer to work under legal measures and guidelines. This is why they have been training their
employees constantly to be aware of these guidelines in different countries so they don’t have to go
against this measure. They have already face some cases against these measures due to which they
had to pay hefty fines and that affected their reputation.
Environmental Factors-
These factors demand that company works for the benefit and sustainment of environment as
in order to maximize their production they affect and harm the environment. This is why Marks &
Spencer has come up with an initiative which is for go green initiative referred as plan A. they believe
that with this they can have a positive impact on the environment, communities and their wellbeing.
They have enrolled sustainable practices in their work procedures so that they can bring a change and
reduce the disparities that are among the society. Apart from that they have removed trans fat from

food which is essentially beneficial for people and they have been promoting it with fair and effective
practices (Demir, Wennberg and McKelvie, 2017).
Porter’s five forces
Threat of new entrants-
Marks & Spencer deals in the line of retail sector and in order to enter for anyone in this
sector would have to invest a huge capital. Also attaining the position of companies such as Marks &
Spencer in the market is not an easy task. Still when Marks & Spencer were providing quality
products to everyone many of the branded companies improved themselves to give them a
competition and improve their business by taking their loyal customers. Apart from that new entrants
won’t be able to match the efficiency of channels which have been attained by Marks & Spencer.
Company is managing their products and flow of services on the basis of quality they provide but
competitors are trying to steal it on the basis of offering discounted rates (Tonelli and Cristoni, 2018).
Threat of substitute products-
Marks & Spencer has to invest a lot in order to keep innovation alive so that they can prove
that their brand is positioned in a better way through which they are able to meet the needs of their
target audience. The risk of substitutes in the line of clothing business is very high as anyone can offer
similar design by imitating it at less price. Their other line of business that is food products is also at
risk as there is high level of competition involved because of many giants such as Tesco, Sainsbury,
Asda etc. they still have some private label line of products. They are making some changes so that
they can gain advantage over their competitors.
Bargaining power of Buyers-
Although the bargaining power of customers is low but they can switch to any brand they
want because cost of switching is low and in that they can get as much options they want. In order to
get back they need to offer more value than their competitors and keep them loyal. Competitors of
Marks & Spencer are focusing on developing and forming relationship with customers. They have
high share in departmental stores but it is making them weak because they have more stock and due to
unpredictable conditions of market their value got decreased (Vitolla, Rubino and Garzoni, 2017).
Bargaining power of suppliers-
Earlier Marks & Spencer only used to deal with suppliers who were British but due to
availability of more suppliers and higher competition Marks & Spencer had to reduce their cost as
they had the opportunity to do it. They started outsourcing which helped them to gain power over
suppliers. Apart from that Marks & Spencer had the option to switch between any of them at low
costs because they even deal with suppliers who they outsource with (Baum and Auerbach, 2017).

Competitive rivalry-
Competition is strong in the sector of retail as there are many companies who deal in
supermarkets and provide clothing, home wear and fashionable designs in clothing. Apart from this
Marks & Spencer have to even face high level of competition in online platforms because many of the
users are liking that sort of experience better than in store experience. They have the option to
increase their sales if they provide loyalty cards to their customers. Management of Marks & Spencer
have to keep in mind that any strategy used by them can be used by any of their competitor. Marks &
Spencer is earning really well from the initiative of loyalty programs and they are targeting females
who are old in age by using low price strategy instead of discounted one. With the help of low cost
strategy, they have been able to notice better results. Apart from that they have announced plans so
that they can open outlets for food and local products with better positioning in the market (Meresa,
2019).
Organizational strategy of Marks & Spencer
Marks & Spencer have taken the use of different strategies in their culture in order to make a
change and increase their market share. Earlier it used to be selling high quality products at high
prices but due to change in the behaviour and buying pattern of customers they have to change their
strategy from charging high prices to low. It is because many of the customers wanted more variety
and clothes and being expensive they could not get it at Marks & Spencer. Apart from that after the
pandemic purchasing power of many people have been reduced which has affected their business and
it was getting difficult for management to keep up their operations due to that. That is why they have
to make a change in their policy and methods of conducting sales. It is necessary for them that they
keep working with these techniques in order to increase their share. Strategy of using low cost
measure will help them to beat competition and get ahead of their competitors as they have lost many
of their loyal customers due to high prices they charge from the. Apart from this they have taken up
another initiative and that is known as Plan A. this strategy was introduced because many of their
customers were concerned about the well being of natural conditions. They committed around 180
things through this initiative so that they can overcome those challenges. Problems that were focused
to improve with this measure was to reduce waste, focus on change in climate, trading with measures
that are ethical, sustainable raw materials so that they can tackle these changes by putting all of their
efforts. They believe that with these strategies such as plan A and low cost initiative they believe that
they can attain and get the customers back which they lost due to high level of competition (Barney,
2017).
CONCLUSION
From the above studies it has been concluded that purpose and vision of Marks and Spencer is
to provide high quality products and in order to achieve their objectives they have divided them in

different departments. This is done so that work is done with more focus and efficiency so that they
can achieve their goals and objectives. They have been facing many external threats in the market
from other companies and due to change in pattern of buying of customers as with time their trends
have changed and they have gotten over expensive products now they demand feasible products due
to less power of purchasing. Marks and Spencer are trying to understand their patterns so that they can
work on the basis of that. It is necessary for them as the current condition and share of market is
decreasing and taking these sort of actions will help them to get back on track. It will help them to
make sure that they have a chance to survive in market for a long period of time. They have
recognized their resources that are valuable and imitable on the basis of which they will use them on
their full potential so that they can excel their performance.

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