M&S Strategic Management: Evaluating Purpose, Vision, and Environment

This report provides a comprehensive analysis of strategic management principles, focusing on the significance of a clear purpose, vision, mission, and objectives in guiding an organization's strategic direction. Using Marks & Spencer as a case study, the report evaluates the company's external environment through the VRIO and PESTEL frameworks. The VRIO analysis identifies valuable, rare, inimitable, and organized resources that contribute to Marks & Spencer's competitive advantage, while the PESTEL analysis explores the political, economic, social, technological, environmental, and legal factors impacting the company. The report concludes by emphasizing the importance of continuous environmental analysis and strategic adaptation for sustained success in a dynamic business landscape.

Strategic Management

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Value of clear Purpose, Vision, Mission and Objectives in setting the strategic
direction of organisations....................................................................................................3
VRIO Framework...................................................................................................................4
PESTEL Framework..............................................................................................................6
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Strategic management can be defined as a constant process that involves planning,
monitoring as well as analysing the needs of an organization in order to meet its goals as well as
objectives. Effective strategic management provides a direction to the company and helps it in
achieving its goals as well as objectives in an effective manner (Choudhury, Starr and Agarwal,
2020). There are different changes that take place within the business environment of an
organization and thus, strategic management allows the company to assess its existing strategies
and attain success. Organization chosen for this report is Marks and Spencer, which is a
multinational retail organization based in London, United Kingdom. The company was founded
by Michael Marks and Thomas Spencer in the year 1884. the report critically evaluates the value
of clear Purpose, Vision, Mission and Objectives in setting the strategic direction of
organisations and analyses the external environment of the business you selected.
MAIN BODY
Value of clear Purpose, Vision, Mission and Objectives in setting the strategic direction
of organisations
Strategic direction refers to the actions that are taken by an organization in order to
achieve nits goals as well as objectives in an effective manner. It includes the plans as well. As
actions that have to be implemented to work towards achieving the vision and mission of the
firm (Ecem Yildiz, Dikmen and Talat Birgonul, 2020). Purpose is a very important aspect and it
is the reason why an organization exists. Businesses or organizations that have a strong purpose,
are able to work in a much more efficient manner and at the same time, address the needs of the
different stakeholders effectively. A business environment that is not certain does not provide
any stability to the operations of the firm. Employees within the workplace are more likely to
work for the company and give in their best efforts to work for the same. Apart from this, having
a clear purpose or mission allows the organization to be more innovative and develop unique
products. On the other hand, a clear vision is also an important aspect within the firm that has a
positive impact on the effectiveness of the organization. Apart from this, a clear vision
contributes to the overall motivation of the employees in the firm. As a result, the employees
work more efficiently and more committed towards their respective jobs. Employees who work
for organizations that have a clear and solid vision, have a proper clarity about their roles as well

as responsibilities in the workplace. Apart from this, a well formed vision statement of an
organization, allows it to develop plans, set goals as well as make informed decisions.
Many leading organizations have a clearly defined vision statement as well as purpose
and hence, they are able to attract qualified as well as experienced employees to work from them.
Apart from this, a vision helps in keeping the workforce of the company competitive as well as
focussed at the same time (Elliott, 2020). On the other hand, a mission statement can be defined
as a short statement that defines the reason why an organization exists and its overall goal.
Mission statement is very important for the organization because it contributes to the overall
success of the firm. The company is able to better understand the goals as well as objectives of
the firm and they contribute effectively to the overall success of the same. A clearly defined
mission gives the employees a clarity, direction as well as focus and it also helps the
organizations in delivering value to their stakeholders such as employees, customers as well a s
shareholders. Not only this, it also sets a strategic direction for the firm ensuring that the
employees within the company are aware of the purpose of the organization. Clearly defined
objectives also have a great value for the firm and this is because the transform the visions into
targets that are not only clear, but also measurable (Garud and et.al., 2020). Organizations that
are successful have goals as well as objectives that are clearly defined. This helps them
communicating with their stakeholders in an efficient manner. Clearly defined objectives ensure
that the strategy of the firm is described in an effective manner. Therefore, this is the value of
clearly defined objectives, purpose, vision as well as mission.
VRIO Framework
VRIO framework can be referred to as a strategic analysis tool that is primarily
designed in order to help the organizations utilize their resources in an efficient manner
and ensure a competitive advantage for long-term. The framework is primarily used by
organizations in order to categorize their resources to identify the ones that can help in
gaining a competitive advantage. The framework is important for a company because it
helps the managers in understanding the activities that are important for the growth or the
company and the ones that are not. The VRIO analysis for Marks and Spencer, which is a
market leader in the clothing retail industry is explained as follows.

Resources Valuable Rare Inimitable Organised
Products ✓
Financial Resources ✓ ✓
Employees ✓ ✓ ✓
Patents ✓ ✓ ✓ ✓
Valuable
There are different resources that are required by an organization in order to conduct its
business operations in an efficient manner. In context to the respective organization, Marks and
Spencer, the valuable resource are products of the company, financial resources, employees as
well as patents. Products are valuable for the organization because they are highly differentiated
and hence, their perceived value among the customers is high (Krause and Miller, 2020). On the
other hand, financial resources are valuable for the organization because they help the company
in investing into the external opportunities that arise within the firm. Apart from this, patents are
valuable because they allow the firm to sell the products in the market without any interference
from the competitors. Employees on the other hand, are also valuable resource because they help
the company to attain its goals as well as objectives in an effective manner.
Rare
Rare resources are those resources that can only be acquired by very few competitors in
the market. The rare resources for the respective company Marks and Spencer are financial
resources, employees as well as patents. It can be said that financial resources are rare because
they are only possessed by the very few companies within the industry (Kryscynski, Coff and
Campbell, 2021). Patents are also a rare resource because they are not easily available and hence,
cannot be possessed by competitors. Employees of Marks and Spencer are also a rare resource
for the company because they are highly trained as well as skilled and this is not the case with
the competitors of the company. Also, the company offers various growth as well as
development opportunities to the employees and hence, they do not leave the company for
competitors. The products of the company are not rare because the competitors or new entrants
in the market can offer the same to the customers.
Inimitable

There are also some resources that are inimitable within an organization because the
process of imitation is costly. This is also because the resources that are offered by Marks and
Spencer are rare and valuable. Employees are an inimitable resource for the organisation because
the skills as well as knowledge possessed by them, might not be the same with the employees of
other companies (Kumbure and et.al., 2020). Apart from this, patents are also an inimitable
resource because they are not easy to copy by the competitors. The products and financial
resources are imitable because the competitors can imitate the products of the firm. Thus, it can
be stated that these are the various resources that are inimitable.
Organized
There are also certain resources that have to be organized from time to time in order to
realize the potential of the rare, valuable as well as inimitable resources. In context to Marks and
Spencer, patents are an organized resource because they have to be organized from time to time
in order to ensure that they are not imitated by the competitors. On the other hand, resources
such as employees, financial resources as well as products do not have to be organized as
frequently and hence, these are not organized resource.
PESTEL Framework
PESTEL is an important framework that is commonly used by organizations in order to
identify as well as analyse the various external factors in the business environment that can
impact the overall operations of the firm as well as its position in the industry. The results of
PESTEL analysis are used by organizations to make informed decisions as well as develop
effective strategies to stand out in the market and gain a competitive advantage. The PESTEL
framework for Marks and Spencer is explained below -
Political Factors – There are different political factors that can affect the overall
business operations as well as the profitability of the firm to a great extent. The United Kingdom
is a politically stable country with different policies in place (Lovallo and et.al., 2020). One of
the positive aspects of the politics of the respective country is that it has established free trade
with various countries and hence, this is beneficial for the respective firm because it can conduct
its business operations across different countries in an effective manner.
Economic Factors – Economic factors can also affect the overall performance as well as
productivity of the firm. The different economic factors include inflation rates, tax rates, GDP of
the country etc. It is important for Marks and Spencer to take into account the same. This is

because any changes in the economic factors of the country can have a direct impact on its
overall performance as well as productivity. The United Kingdom is one of the popular places
for foreign direct investment and this is beneficial for the respective company.
Social Factors – Social factors are important factors in the external environment of any
organization. This is because if these factors are not taken into account, the company would not
be able to, attract more customers or satisfy the needs of existing customers as well (Mitchell,
2021). The different social factors include age, income level, education level, gender etc. This is
important and can help the business in conducting its business operations in an effective manner
as well as make sure that the needs of customers are satisfied.
Technological Factors – The United Kingdom is a technologically advanced country
with latest technology being implemented by different organizations across various industries.
This technologically advanced environment is great for businesses because they can conduct
their business operations in an effective manner without any issues related to the technology.
Environmental Factors – Customers in the UK are increasingly becoming conscious
about the environment as well as the harm that is caused to it. As a result, the customers now
prefer buying products that are not harmful for the environment and are sustainable (Morici and
Zander, 2020). Marks and Spencer is focussed towards manufacturing as well as offering
sustainable products so as to attract a greater number of customers as well as satisfy the needs of
existing customers as well.
Legal Factors – Organizations operating within a country have to comply to different
legislations as well as regulations. Failing to do so, the company has to face various negative
consequences such as there is a decline in the productivity of the firm as well as its profitability
is also affected.
Thus, these are the different external environment factors that can impact the business
operations as well as the performance of the firm to a great extent. These factors should be
analysed from time to time in order to make sure that their impact is minimized and hence, the
performance of them firm is also not affected.
Porter’s Five Forces Model
It can be defined as a model that identifies as well as analyse the five different
competitive forces that can help an organization in identifying the impact of the different forces
in the business environment. This is an important tool because it helps organizations in

developing an understanding about the different forces that shape the competition within the
industry. The Porter’s Five Forces Model for Marks and Spencer is explained below –
Threat of New Entrants - New entrants in Retail brings innovation, new approaches of
doing matters and put pressure on Marks and Spencer Group Plc through lower pricing approach,
lowering prices, and supplying new price propositions to the customers (Pel and Kemp, 2020).
Marks And Spencer Group Plc has to manipulate most of these challenges and build powerful
limitations to shield its competitive side. There are different ways in which the respective
company, Marks and Spencer can overcome this force because this is a moderate force. For
instance, the company can innovate its products as well as services. This is because it can help in
brining in new customers so that
Bargaining Power of Suppliers – There are numerous suppliers in the industry and just
like the respective company, Marks and Spencer, there are other retail organizations that buy
their raw materials from the different suppliers. Therefore, it can be said that this force is a weak
force. In order to ensure that the company continues working with its already existing suppliers,
it should work on maintaining a long-lasting relationship with them. Apart from this, the
company should also focus on developing dedicated suppliers for obtaining its raw materials so
that the operations are carried out smoothly.
Bargaining Power of Buyers - Buyers are frequently a disturbing lot. They want to shop
for the excellent offerings to be had with the aid of paying the minimum charge as viable. This
positioned strain on Marks and Spencer Group Plc profitability in the end (Pillai, Goldfarb and
Kirsch, 2020). The smaller and greater powerful the purchaser base is of Marks and Spencer
Group Plc the higher the bargaining power of the customers and higher their ability to are trying
to find growing discounts and gives. By building a new base of customers, the company can
reduce their bargaining power as this is a strong force. Apart from this, the company will also be
able to attract a greater number of customers.
Threat of Substitutes – This is a strong force because when a new service or product
meets a comparable customer needs in exceptional approaches, enterprise profitability suffers.
For example services like Dropbox and Google Drive are replacement to storage hardware
drives. The threat of a alternative products or services is high if it offers a price proposition that
is uniquely specific from present services of the enterprise.

Rivalry among Competitors – There is intense competition in the retail industry and
hence if this competition continues to exist between the rivals, there will be an impact on the
overall profitability as well as performance of the firms. Hence, in order to overcome this, Marks
and Spencer should work on building a sustainable differentiation among its products. Apart
from this, it should work on collaborating with the competitors as this would help in increasing
the overall market size of the company.
Organizational Strategy of Marks and Spencer
Organizational strategy can be defined as a plan that outlines how a business will allocate
the resources available with it in order to carry out the business operations in an effective
manner. Marks and Spencer is a market leader in the retail industry and hence it is focused on
developing its organizational strategy by taking into account the business environment (Samimi
and et.al., 2020). Mostly it is offering high price goods and provider. It have to reduce the fee
due to recession customers need to buy goods in low fee. The strategy applied via Marks &
Spencer is masking wider market share most effective most of the wealthy human beings so it
must observe low fee aggressive approach. Marks and Spencer’ s bosses are decided to discover
a way to benefit customers again who they've lost. At the flip of the year, the impression score
has fallen from fifty-two to 45 now, what indicates that the modern strategy of the employer is
useless in maintaining everyday customers and gaining folks who are new for the enterprise. The
truth is that the buying pattern has changed, therefore the Marks and Spencer’s reputation
towards the upward push of different shops along with H&M or Zara and on-line competitive
commercial enterprise including ASOS have become irreversible. There is an underlying issue
that appears to be unsolved through the trade of the brand, advertisement or style range
(Schröder and et.al., 2020). The enterprise struggles with the quandary if it ought to take a hazard
to alienate its traditional marketplace with modern strategy or awareness on production only
basics that enabled to benefit wider variety of clients in the 70’s. Another possibility which could
assist to remedy the difficulty, is pouring resources into meals sector that brings fantastic facts
and shows upward fashion.
Marks and Spencer is one in all the most important buyers having inheritance of multiple
hundred and two decades. It has more than 895 shops in extra than forty regions everywhere in
the international. Its head office is in U.K, within the metropolis of Westminster. Michael Marks
from Slonim, Russia and Thomas Spencer a cashier from Yorkshire are the pioneers of this

U.K’s largest retailers. At Leeds (Kirkgate market) in 1884, Michael Marks started his personal
enterprise by starting a penny bazaar stall. Then to expand his commercial enterprise he opened a
shop at Manchester with the partnership of Thomas Spencer. After the demise of both the
pioneers of the organization Michael Marks Simon became the chairman of agency whilst
William Chapman took the helm until 1960 (Shet, 2020). During the Era of Michael Simon
Company touch the very best point. The enterprise changed into floated as a public restrained
organization after 10 years. In 1998 it became the primary enterprise of U.K who earned the
earnings of one billion pounds after tax deduction. Marks and Spencer prohibited smoke first
time in save that in a while became a criminal offence to smoke at public locations. Marks and
Spencer specially deals in Clothing, Home Ware, Food, Technology, Beauty, Financial Services,
Energy and Hospitality.
Due to an increase in greenhouse gases produced by the human activities the earth is
getting hotter daily & causing many unfavorable outcomes. In 2006/07 Marks and Spencer
reduce their carbon emissions to 8% by using lowering the usage of power. Marks n Spencer also
dedicated that as much as 2015, they may improve their strength efficiency by using 35%. The
Customers are getting more aware of natural and environmental issues, so for this Marks and
Spencer launched plan A, which consists of a hundred and eighty commitments to conquer the
demanding situations. Many problems are associated with Climate Change, Waste Reduction,
Ethical Trading, Sustainable Raw Material and Health. To tackle those modifications Marks and
Spencer is doing a great deal attempt (Shet, 2020). Every year the U.K has to throw away four
hundred tonnes of waste that comes from production, enterprise, households and discarded
packaging. The waste that isn't always recycled ends up in landfill websites which take many
years to decompose. Marks and Spencer claimed that inside the 12 months of 2009/10 they've
carried out the recycling stage to 88% whilst lowering the quantity of waste to sixteen%.They
have reduced the food waste by 29% as compared to the years 2006/07.Marks and Spencer
collected 133 million garments hangers and reused seventy six% of them and recycled the rest.
They have additionally recycled their creation waste up to 89%. Marks and Spencer are
dedicated to do this by using 2015 they need to landfill assist their clients to recycle or reuse
their packaging and products (Business Strategy Of Marks And Spencer Commerce Essay, 2020).
They may also assist their suppliers to reduce the waste and to advantage 0 quotes as properly.
Marks and Spencer has a vision that they're very strong of their groups and make certain accurate

operating situations. Marks and Spencer has the lowest employee turnover fee in UK retail i.e.
14%. Marks and Spencer is imparting aggressive salaries, discount to their employees, bonuses
and percentage shop alternatives to their personnel. It offers unique training programmes to the
employees. Every employee has to adopt Marks & Spencer Career Path Training and mastering
programmes. While the managers should attend the distinctive workshops to boost their
competencies. Marks and Spencer is trying to provide the best salary programs for the
employees. Therefore, it can be said that the company takes into account various factors while
developing its organizational strategy and hence this has helped it in staying relevant as well as
competitive in the industry.
CONCLUSION
From the above report, it can be concluded that strategic management is an important
component for the overall success of an organization. This is because it helps the company in
making informed decisions as well as effective strategies. Apart from this, there are different
factors in the external environment that can affect the business operations as well as productivity
of the firm to a great extent. Porter’s Five Forces Model is a tool that is used by various
companies in order to develop an understanding about the different forces that can impact the
organization. Therefore, all organizations should include strategic management in their
workplace in order to ensure that they are able to develop effective strategies for the future.

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