Strategic Management Report: Marks and Spencer Analysis and Strategies

This report offers a comprehensive strategic analysis of Marks and Spencer (M&S), a leading British international retailer. It begins with an introduction to strategic management and M&S's background, including its history, current leadership, and employee size. The report then delves into M&S's strategic direction, highlighting their focus on customer needs and market penetration and development strategies. It utilizes frameworks like PESTEL and Porter's Generic Strategies to analyze the external and competitive environments. The analysis further explores strategic drift faced by the company, aligning the marketplace demands with M&S's mission and vision. The report includes recommendations for resource implications and concludes with a summary of key findings and strategies for M&S's future growth and development within the retail sector.

STRATEGIC
MANAGEMENT

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
Strategic direction of Marks and Spencer...................................................................................1
TASK 2............................................................................................................................................3
Use of appropriate frame work...................................................................................................3
TASK 3............................................................................................................................................5
Strategies drift faced by company...............................................................................................5
Demand of marketplace aligned with mission and vision of company......................................6
Strategic capabilities of company...............................................................................................6
Use business canvas model.........................................................................................................7
TASK 4............................................................................................................................................8
Possible strategies of business....................................................................................................8
TASK 5..........................................................................................................................................12
Recommendations of resources implication.............................................................................12
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
Strategic management is a process of continue analysis, planning and monitoring that is
essential for company to achieve their objectives and goals. This process helps in making
innovation and use new technology to fulfil the customers' need and expectations to organization.
It helps leaders to manage their firm in recent situation. Strategic management is also used at the
time of crisis in organization to create new ideas and plans that help to get overcome in it. Marks
and Spencer is private limited company, it is leading British international retailer (Doz, 2017).
There headquarter in London, UK and other states. M&S spread smile on the face of customers
by making their products for men, women and kids such as beauty products, home, food
products, wine, gifts hampers, baby products like shoes, clothes for new born kid etc. Archie
Norman is the chairman and Steve Rowe is chief executive of this company. They both help each
other to run their business successfully by taking help of their staff members, leaders, managers
and other management department of different stages. According to research in 2017 there are
84,939 employees are work inside the firm. In this project strategic consultant play there role by
creating plans and strategies for future and present situations. It explains strategic direction that
has been followed in past and also describe strategic thinking has developed in the past 5 years.
This report discusses possible strategies of company and focused on assets implications that has
recommended in company.
TASK 1
Strategic direction of Marks and Spencer
M&S is very famous for their good services and products. This organization established
in 1884 by Michael marks, Thomas Spencer is their business partner. They want to service their
services through making products according to people needs. They served their services a long
year ago. In 2004 Stuart Rose has appointed as chief executive of this company. At present Steve
Rowe is CE of marks and Spencer after changes in board structure (Werhahn and et.al., 2015).
M&S is a retail industry in UK; their work is to make clothes and beauty products for all human
being. Organization has long history in United Kingdom marketplace. Their aim is to make good
brand name in retail market. The function of this firm is to sell clothes, flowers and luxury
products to people. They make creation and innovation in their products and services according
to client demands. This industry gets interested to work with suppliers and clients of different
values or culture. They take people requirement as challenge and happy to complete it. They
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make changes in production process according to recent trends in economy. Customer behavior
impact on business growth.
Towards the product of Marks and Spencer consumer behavior is positive in way because
they provide good quality products according to demands and requirement of people. Costumer
use their services in good price that is valuable. Client buys some products that might be attached
with their emotions and feeling, thus for this M&S is good choice for purchasing useful things.
Marks and Spencer used market penetration and market development strategy in their
business. They followed both strategy in past of their services.
Source: Marks & Spencer Strategic Analysis, 2018
Market penetration strategy: this function is used by Marks and Spencer to expand their
business in marketplace and all over the world. They follow this strategy in their past business
process. Market penetration carries low level of risk, thus for this every organization used it.
Penetration defines the process of selling products to old customer and to new one (West, Ford,
and Ibrahim, 2015). Company make strategy according to this function that help them to spread
their branches under the economy or society, through making good quality products. Dominate
growth markets, increase or decrease products market shares is the strategy of this function.
Penetration also help to drive out the planning of M&S competitors.
Market development strategy: Marks and Spencer developed their business through using
market development strategy. This will help them in past and in recent business activity.
Company need to established their existing business and products within new marketplace or
state. They need to spread their businesses by supplying products such as clothes, home furniture
and shoes for men and women.
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Illustration 1: Market Penetration

Marketing development strategic is followed within 5 years ago in Marks and Spencer
business. Organization used this process through market research, this is the first step of this
strategy. Firm need to divide customer on the base of segmentation, it helps to distribute
products according to people needs and demands. Thus, the effect of this development process
increase business growth and success.
TASK 2
Use of appropriate frame work
PESTEL Analysis:
M&S adopt pestle analysis for determining external environmental factors that are
affected on company's strategies, policies and procedures, operations and other activities. There
are many elements includes such as political, economic, social, environmental, technological,
environmental in macro environment factors.
Political Factors: Government has regulated many policies regrading trade policy,
taxation, exchanges rates etc. Due to fair trade path, on clothing and food segment. By this
policy, M&s reduce their sourcing costs. The policy involves decrease of fat and salt in
company's foods recycled packaging and animal well-being protection. There are some
modification in taxation policy and government that are affected on retailers.
Economic Factors: There are many elements such as interest rate, inflation rate,
population, economic conditions etc. included in this factor. M&S affects by discounted pricing
of their challengers(Chapman, J.W. and et.al., 2016). If inflation rate is highly increased that
directly affected operations of company. Customer confidence was hold by company's efforts to
push through increased quality.
Social Factors: It includes customers needs, culture, traditions, taste and preferences,
current trends etc. There are different people leaving in society, their taste have different with
each other. Therefore, these social factors directly affects on operations of M&S. Company
needs to make sure that giving the best product and services to customer satisfaction.
Technological Factors: Nowadays, consumers prefer to buy products through online
stores. So that, M&S make sure that increasing strong online presences that capitalized on this
avenue. Therefore, M&S focus on their online presence for increasing number of customer.
M&S has come in partnership with Sure Cloud. With the help of it, they are integrated high tech
platform into its existing substructure that utilize across number of departments and functions.
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Environmental Factors: It is necessary to M&S that following strictly regulations on
environmental. Consumers pressures on ethical green pattern that need to stricter standards at
company. Therefore, M&S has established new menswear range that utilizes less power,
chemical and water in production process(Kimosop, Korir and White, 2016).
Legal Factor: There are many legal rules and regulations such as consumer protection,
health and safety, labour laws etc. Therefore, M&S make sure that follow all legislation carefully
in the workplace for effective operations of the business. Company also make sure that giving
the best products and services to customer.
Porter's Generic Strategy:
Company's relative positions within sector defines whether business profits is above or
below the average of business. The key basis of higher average profits in the long run is
sustainable competitive advantage. There are two primary kinds of competitive advantage such
as low cost and differentiation. In order to that, there are three generic strategies like cost
leadership, differentiation and focus.
Cost Leadership: Company sets out to become low cost manufacturer in its business in
cost leadership. The sources of cost advantage are variegated and depend on structure of
business. This involves pursuit of economies of scale, technology, access to raw material and
other elements. Low cost manufacturer find and expand all sources of cost advantages. M&S
apply this strategy successfully have significant investment capital at their disposal, efficient
provision and low costs while it comes to material and labour.
Differentiation: M&S search to be specific along similar concepts that are broadly
valued by purchaser in differentiation strategy. It chooses one or more attributes that various
purchaser in business understand as essential(Porter's Generic Competitive Strategies, 2016). It
specifically positions itself to meet those wants. It rewarded for its singularity with premium
price. Effective utilizing this strategy needs good research and development, invention and
power to present high quality. It is essential to be flexible and to be able to adjust quickly in
modifying marketplace for fighting competitions on risk.
Focus: The generic strategy of focus portion on the choice of thin competitive range
within the business. The focuser choose segment or unit of segment in the firms and adapt its
strategy to provide them to the exclusion of others. There are two variables such as cost and
differentiation focus involved in this strategy. In order to that, company search cost advantage in
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it target market in the cost focus. Organization try differentiation in their target segment in
distinction focus. Both are variables of focus approach part on difference between focuser target
segment and other segments in the sector.
With the help of all the models, M&S chose strategies and fight competition in retail
industry. This model assists in implementing appropriate strategies for increasing profits and
competitive advantages in the sector. In order to that, company make sure that implementing
effective strategies for overcoming of threats and determining bargaining power of purchaser as
well as suppliers in the marketplace. Through it, firm identify weakness and threats for creating
opportunities for future growth and development in retail sector. With the help of it, M&S focus
on costs and differentiation strategies for competitive advantages. These models help in sustain
firm position in the overall industry and know about number of competitors in the marketplace.
This also assists in increasing productivity, profitability and knowing about possible strategies of
firm.
TASK 3
Strategies drift faced by company
Strategies Drift:
Strategies drift occur while the strategy of company is no longer applicable to outside
situation facing it. It is arising from collection of elements that involving failing of firm to adapt
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Illustration
2: Porter's Generic Competitive Strategies
Source:(Porter's Generic Competitive Strategies, 2016)

to change outside situation, finding out competition, frequently built on previous success that
management assume to continue and negate by top management regrading problems faced with
evidence. There are four stages of strategic drifts that is incremental change, strategies drift, flux
and transformational changes or death. In the incremental phase, there is small significantly
modification in outside environment and it enables M&S to remain in touch with external
situations. The rate of modification in the outside environment is fast and small. By this step,
company will lose their competitive advantages. In the flux phase, there is no important gap
between market expects and delivering by company. Administration have constituted this gap
and begun to change strategy still there is no conclusive improvement. Either administration
appreciated want for transformational modification in direction of strategies or failing of
business in the last phase of strategic drift.
Demand of marketplace aligned with mission and vision of company
The Mission and vision statement of Mark and Spencer is aligned with demand of the
marketplace. Therefore, company make sure that their mission and vision are flexible by demand
of marketplace. The mission statement of M&S is to make plan quality accessible to all and
clearly defines company objectives and goals to be aimed for within business(Kimosop, Korir,
and White, 2016). The vision of Mark and Spencer is to increase employees oriented and satisfy
customer demand in the marketplace. For achieving mission and vision, M&S adopt and
implement different strategies in the business.
With the help of it, give sense of future, guides decision making and strategy. The vision
of M&S is to measure of standards and process in the marketplace. The mission statement is to
make inspirational quality accessible to others. The objectives of M&S is employees oriented
that is higher expectation to the company. It is part of M&S to attract, motivate and retain high
workforce to help the transformation of business and deliver improve execution. Company is to
regain their leadership in clothing and speciality food.
Strategic capabilities of company
A strategic capability means bridging strategy and impact of the company’s competitive
position that are enabled by its ability to perform at high level of differentiated modes. In other
word, it is strategic success is facilitated by distinguishing company capabilities(West, Ford and
Ibrahim, 2015). In order to that, M&S need to determine and enhance new capabilities to respond
to modify customers demand or threats of organization. The procedure of sharing strategies and
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putting them into activity is the duty of company’s leadership. It refers to company’s ability to
successfully utilize competitive strategies that permit it to survive and enhance its value over
time.
M&S strategic capability is the primary element in remaining financially viable and
increasing despite the presence of challengers in free market. Various groups of interested
parties’ effort to measure and way strategic capability (Werhahn and et.al., 2015). Financial
analysis and authority regulatory agencies have interests in strategic ability since it plays role in
the value and monitor businesses.
Use business canvas model
The business canvas model is finding detailed explanation and reflects consistently on
business model. This creates difference between world-leading success and depressing failure.
Business canvas model is graphical template describing various important elements such as
customer segments, value propositions, channels, consumer relationship, revenue streams,
resources functions, partnership and costs. It helps in think and compare many variations and
thoughts for business model invention.
Key Partners Key activities Value
proposition
Customers
relationship
Customer
Segment
Subsidiaries
(M&S pension
trust Ltd., M&S
Scm Ltd., M&S
finance Ltd.)
Manufacturing
and distributors
Major brands
Suppliers at
regional and
global level
Contract
manufacturer
Pricing
Marketing
Diversification
Purchasing and
selling of
consumer goods
Evaluate
consumer demand
Warehousing and
logistics
Good price
Wide presence
Wide selection
Safety
Online
purchasing
Business
diversification
(finance, trust
etc.)
Mark&Spencer
covers all the
segment of the
marketplace.
Customer loyalty
Free deliveries for
month
Trust
Online shopping
Internet retailing
Discount clubs
Long term
relationship
Customer service
Self services
Community
Mass market
Segmentation-low
middle income
Housewife
Older people
Student
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Key Resources Channels
M&S is one of the largest retailers
with 979 stores across UK.
Stores and logistics resources
Warehousing
Supply contract
Power of negotiation
IT infrastructure
M&S has expanded its stores outside
the UK in the world.
Super store
Online shop
M&S websites
Gift card
Social media
Events
Trust
Affiliates
Mobile application
Cost Structure Revenue Stream
Advertising
Cost of goods
Logistics infrastructure
Presence
Staff
Capital expenditure
Warehousing and logistics
International Operations
Taxes
IT capabilities development and maintenance
Retail store
Online selling
Advertising
financial income
Commission on affiliates sales
With the help of business canvas model, company makes sure that adopt various
strategies for higher competition in the marketplace and increasing competitive advantages.
Through it, M&S build relationship with customers, gaining revenue, value proposition in
business for expanding their business in the retail industry.
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TASK 4
Possible strategies of business
Strategic choice move strategic analysis and is based upon three components such as time
period of strategic options that is development, acquisition, variegation or concentration.
Secondly evaluation of option to measure their relative worth and practicability. Lastly choosing
of strategy or option that company pursue. Mark&Spencer utilizes porter's sustainable
competitive advantage model and porter's five force analysis for sustainable competitive
positions in the marketplace.
Porter's sustainable competitive advantage model:
Mark&Spencer(M&S) preserves that expand average for its business. Company posses’
competitive advantage over its challengers. The objectives of business strategies are to
accomplish sustainable competitions. There are two primary kinds of competitive advantage such
as cost and differentiation advantage. Cost and differentiation advantages are called as positional
advantage since company depict position of their firm in the sector as leader in either cost or
differentiation. There are different views in model of competitive advantage.
Resource and Capabilities: In the concept of competitive advantage, resource and
capabilities are included for developing competitive advantage to firm. Resources are the
company particular assets helpful for making cost or differentiation advantage and easily acquire
challengers(Porter's sustainable competitive advantage model, 2018). For example, patents,
trademarks, image of company, brand equity etc. are assets of firm.
Cost and differentiation advantage: Competitive advantage is making by utilizing of
assets and capabilities to accomplish either lower cost structure or distinguished good. Through
Doz, Y.L., 2017it, choice of low cost and differentiation for positions for M&S. This judgement
is focus element of competitive strategy of company.
Value creation: Through performing ordering of activities, company makes value. Value
system of vertical actions involving those of upriver suppliers and downstream channel
members. Therefore, M&S perform one or more value creating activities in mode of that makes
overall value for accomplishing competitive advantage.
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Porter's Five Force Analysis:
M&S adopt Porter's five forces analysis for identify and gain competitive advantage in
the industry. There are five forces includes such as rivalry among existing, threats of substitute
and new entrants, bargaining power of suppliers and buyers.
Rivalry among existing competitors: There are many challengers in the marketplace.
They are serving different products and services for decrease market attraction. In order to that,
M&S faces challenges in terms of competitors such as ASDA, Aldi, Tesco etc. in the retail
industry. Company manage this force through building sustainable differentiation, increasing
scale and competing for small market instead of collaborating with challengers.
Threats of new entrants: New entrants are threatening for firm in terms of profitability.
Profitable markets attract new entries that decay profits. For instance, patents, economies of
scale, capital requirement etc. that decrease competitive rate(Porter’s Five Forces of Competitive
Position Analysis, 2013). M&S handle this force with the help of innovative product and
services, increasing economic scale, enhancing capabilities and spending large amount of money
on research and development.
Bargaining power of suppliers: All retail firms purchase their raw material form
number of suppliers. Strong suppliers in customers services sector utilize their discuss power to
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Illustration 3: Porter's sustainable competitive advantage model
Source: (Porter's sustainable competitive advantage model, 2018)