Strategic Analysis and Planning for Morrison's Supermarket (SMCH6061)

This report presents a strategic analysis of Morrison's supermarket, examining its internal and external environments. It begins with an executive summary outlining the report's objectives, which is to conduct strategic planning for Morrison's. The analysis incorporates various management tools, including PESTLE and Porter's Five Forces for external factors, and 7S and VRIO for internal analysis. The report identifies key issues, such as the impact of micro drivers of change (e.g., technology and regulations) and industry forces (e.g., competition). Recommendations are provided based on environmental analysis, utilizing the Ansoff matrix for long-term and short-term strategies. The report also applies the ADKAR change management theory to illustrate how employees can be managed through strategic changes. The report includes a company background, the role of strategic planning and environmental analysis, and detailed analyses using PESTLE, Porter's Five Forces, SWOT, 7S, VRIO, Ansoff matrix and change management theory. The report concludes with recommendations for the future direction of the firm.

Strategic Management and Change
1 2 / 1 2 / 2 0 1 8

Strategic Management 1
Executive Summary
In the present era, the competition in the industries is booming due to which every company plan
for the strategy that they can apply in the market. The aim of the report is to conduct the strategic
planning for the Morrison’s company. The analysis in the report includes the organisation
environment with competitive strategies with the support of the different management tools. The
findings of the report include the opportunities and threat that are present in the UK. The analysis
related to the company is supported with the different marketing tools which include PESTLE,
Porter’s five forces, 7S, and VRIO analysis. In this, the PESTLE and Porter’s five forces are
used to analyse the external factors that can affect the company. In addition to this, the 7s and
VRIO model is used to explain the internal factors.
The findings show the key issues which are discussed below: -
 The micro drivers of change majorly include the change in rules and regulation with up-
gradation in technology can affect the working of company and many others.
 Contrasting this, the industry forces that affect the company include the rise in the
competition, reducing in cost and many other factors.
The recommendations that are suggested to company is based on environmental analysis and
based on long-term as well as on short term which is supported with the help of Ansoff matrix.
The opportunities majorly include expansion of business at numerous places, forming tie ups
with suppliers and many others.
ADKAR Change management theory is applied in the manner to show the way employees can
be managed through the strategic change and commitment.

Strategic Management 2
Contents
Company background......................................................................................................................3
Role of strategic planning for Morrison’s.......................................................................................4
Role of environmental analysis.......................................................................................................5
Environmental analysis of Morrison’s.............................................................................................5
Macro (Pestle)..............................................................................................................................5
Micro (Porter's five forces)..........................................................................................................7
A SWOT analysis of Morrison’s.....................................................................................................8
7S.................................................................................................................................................9
Strategy..................................................................................................................................11
Structure.................................................................................................................................11
Staff........................................................................................................................................12
Skills......................................................................................................................................12
VRIO..........................................................................................................................................12
Recommendations on the future direction of the firm...................................................................13
Ansoff matrix.............................................................................................................................13
Change management theory..........................................................................................................15
Conclusion.....................................................................................................................................17
References......................................................................................................................................18

Strategic Management 3
Company background
Morrison's supermarket is well Kwon supermarket in the UK with the headquarters in Bradford,
West Yorkshire England. The company was founded by William Morrison in the year 1899 and
the stores of the company are majorly located at North of England. The market share of the
company in August 2017 was 10.4% down 0.86% from 2015 that is behind the Tesco with
27.8%, Sainsbury's with 15.8% and Asda with 15.3% and many others (Morrison’s, 2018). Thus,
the company need to make effective planning for strategies that help them to take the correct
step.
The aim of the report is to produce a professional strategy plan to present the same to the senior
management of the company. The report is undertaken by the person who performs the role of
the strategy team for a company. The report includes the analysis related to the strategic planning
can help the company in performing the operations.

Strategic Management 4
Role of strategic planning for Morrison’s
Strategic planning plays a vital role for the companies like Morrison in the competitive industry.
The ways through which they benefit the organisation are given below: -
 It allows the organisation to be proactive rather than reactive
 Enhance operations efficiency
 Enhance market share and profitability
Further, the strategic planning is important for the company because this is the only way through
which they can deal with the competitors and can resolve issues.
 The strategic planning for the resources and operations help the company to prepare to
foresee their future and to make the planning according to that. The strong strategic
planning is followed by Morrison which helps them to take the proactive decisions rather
wait and react to the situation (Wheelen, et al, 2017). Though there is some
uncontrollable situation that might arise and some situation occurs in which proactive
decisions don’t work.
 Strategic plan offers the management of the roadmap to get align with the functional
activities to meet the goals of the company. Strategic planning supports the Morrison’s
company to make the decisions related in identifying the resource and budget which are
must to accomplish the set objective.
 Strategic plan offers the organisation a valuable insight related to the trends and customer
segments with the products and service that might affect the success of the business
(Baker, 2014). The strategic planning is done by the Morrison’s with the motive to

Strategic Management 5
enhance the market share and profitability (David, 2011). Though, sometimes the high
competitive advantage can affect the market share and profitability of the company.
Role of environmental analysis
Environment analysis plays a vital role in the strategic planning process. Environment analysis
includes both internal and external analysis which shows the opportunities and threats that might
be faced by the company in the market for which the company need strategic planning (Chernev,
2018). The strategic planning helps the company in grabbing the opportunities and to conduct the
planning to deal with the threats that might be faced by the company. Though, this strategic
planning changes with a slight change in the environmental factors that influence the working of
the company. This shows that an analysis of the environment doesn’t reflect the accurate results
because the changes take place in the environment (Dawson, 2014).
Environmental analysis of Morrison’s
Macro (Pestle)
A PESTLE analysis is a framework which is used to evaluate the external factors that can affect
the working of the Morrison supermarket company (Kotler, 2015).
Political factors: - The political factors include external factors like change in the rules and
regulations that can affect the working of the company (Ho, 2014).
Economic: - The economic factors that affect the working include the GDP, purchasing power of
customers and many others that can offer opportunity or threat to companies.

Strategic Management 6
Socio-cultural: - The social-cultural factors include the change in the social preference of
customers that can affect the company.
Technological: - Technological up gradation is one of the biggest threats which are faced by the
companies (Kumar, Rahman, Kazmi, and Goyal, 2012).
Environmental: - The environmental factors are essential to be taken care of by the company
which include global warning, atmosphere and nay other factor.
Legal factors: - The legal factor includes the rules and regulations that can affect the working of
the company as they need to abide by all legal factors (Grant, 2016).
Morrison’s company is recently getting affected by 3 factors which include political, economic
and technological factors that are essential to consider because all these factors can affect the
profitability of company which is one of the goal and vision of Morrison’s. These factors remain
uncontrollable sometimes due to which it becomes essential for company to identify these
factors. All these factors are discussed below: -
Political: - The stability in the UK market is one of the major factors because the government
has indirect effects on the taxation policies which might lead to the rise in the extreme
competition (Kumar, Rahman, Kazmi, and Goyal, 2012). The rise in the competition leads to a
reduction in the profit margins of the company. Currently, the new government in the UK is a
threat for the company as it has cut the several benefits for the customers which lead to the
reduction in spending by the customers in the supermarkets. This leads to the direct effect on the
sales of the company with the impact on their profits.

Strategic Management 7
Economic: - GDP of the country was 2622.43 billion US dollars in the year 2017; this has been
found that GDP has decreased from 2650.85 to 2622.43 (Trading Economics, 2018). This will
create an impact on the purchasing power of the customers and affect the sales of Morrison's
supermarket. The company has got their own local suppliers who offer the fresh products which
offer an opportunity to the company to offer the product at a low cost which increases the sales
of products and deliver the products on time.
Technology: - After take-over from Safeway Morrison’s has gone through the downgrade of the
technology with the motive to reduce the excess of the expenditure which was required for the
expansion of the business (Frynas and Mellahi, 2015). Though, technology also offers the
opportunity which is evident when the company plan for launching Pegasus very advance
technology which majorly includes the automated product ordering system. This technology is
used to integrate till system to offer excellent and quicker services to customers.
Micro (Porter's five forces)
Porter’s five forces framework is a tool which is used for analysing the competition of business.
These factors are explained below: -
Bargaining power of customers- The buyers of the company have the power to demand the
lower price or higher quality of product from the suppliers of industry (Wheelen, et al, 2017).
Bargaining power to suppliers- The bargaining power off the supplier allows selling the higher
price or low quality products to the companies which affect the buying profit.
Threats of substitutes- The force is especially threatening the buyers can easily find the
substitute of products with the attractive price with better quality of work (Kotler, 2015).

Strategic Management 8
Industry competitors- The force determine the competitive and profitability of an industry.
Threat of new entrants- This force determines the possibility of entry of new companies in the
industry.
The major porter’s factors that affect the operations of Morrison’s company are discussed below.
These factors are considered as important factors because suppliers and customers are the major
support of the company which contribute in smooth operations. Moreover, the analyses of the
competitors are must to be analysed because they can shape the strategy of companies.
Porter’s five forces Description
Bargaining power of
customers- High
Customers in the UK are their own kind and always have the right to
attain the best value of their money. The market has high bargaining
power because the customers visit the supermarket for the shopping and
they can choose any one of them (Hollensen, 2015). The major reason
for switching is the availability of similar products at low prices.
Bargaining power to
suppliers- High
The bargaining power of the suppliers remains low because they give
the opportunity to attain the maximum profit. This has been found that
the bargaining power is low because there is the presence of a large
number of suppliers who want to supply their products to the
supermarket like Morrison’s. Thus, the suppliers allow the company to
maintain the high balance of the economy and to keep low expenses
which leads to low prices (Armstrong, Adam, Denize and Kotler, 2014).

Strategic Management 9
Industry
competitors- High
The market of UK is highly competitive for the Morrison’s supermarket
because the presence of players like Tesco, Asda, Sainsburys and others
make the market difficult to deal for Morrison’s company.
A SWOT analysis of Morrison’s
This section of the report includes the analysis of the SWOT which stands for the strengths,
weakness, opportunities and threats which are majorly faced by the company. A SWOT analysis
is majorly determined with the help of the frameworks like VRIO analysis, 7s, a summary of the
porters and pestle analysis that has been included in the environment analysis of the Morrison’s
supermarket (Luca and Suggs, 2010).
Strengths
 Food manufacturing skills with the
effective distribution network.
 High oriented customer with the More
Card and MyView programme
(Morrison’s, 2018)
 Wide range of the product portfolio and
customization
Weaknesses
 Limited presence of the geographic
 Low customer recall of the product
Opportunities
 Opportunity of expanding the business
in global market.
Threats
 Changes in rules and regulations
 Emerging completion

Strategic Management 10
 Move into the non-food retailing in UK
 Opportunities for new launch of the
products.
 Rise in technological risks
7S
McKinsey 7s model is a useful framework that is used by the company for reviewing the
marketing capabilities from the various viewpoints. Thus, it is essential for Morrison's company
to analyse the capabilities of the company with the help of the 7s model.
Strategy: - The strategy includes the key approaches of an organisation which is used with the
motive to achieve the goals (Rothaermel, 2015).
Structure: - This dimension includes the resources of organisation within the company that are
involved in the business groups and teams.
Style: - The culture of the company is discussed in this dimension in terms of leadership and
interactions among the staff and other stakeholders.
Staff: - These sections include the personnel present in companies and contribute in performing
the work.
Skills: - The skills that are majorly maintained by the Company include capabilities that help
them to achieve the different activities (Lovelock and Patterson, 2015).
Systems: - The system includes the business processes and the technology platforms which are
used to support the operations of the company.

Strategic Management 11
Shared values: - These shared values include the summary of the vision and mission which
define the company.
(Source: Lovelock and Patterson, 2015)
Some of the important factors are discussed below in context of Morrsion’s company. These
factors are essential because they can directly affect the working and operations of the company.
Moreover, all the factors are essential to be considered by the company for improving the
operations. These factors are discussed below: -
Strategy
The company make use of different corporate strategy and a major aim of the company is to
maintain the things trouble-free. The vision of the company is to be the food specialist for every
customer. Morrison’s company regular spotlight with the motive of the freshness, great worth
and excellent services that is alluring to a maximum number of people (Fresh Plaza, 2013). The
company make use of the cost leadership business strategy which is formed for offering the