...Instructor’s Manual CASE TEACHING NOTES Marks & Spencer Nardine Collier and Gerry Johnson 1. Introduction This case study is about why one of the world’s most famous retails, Marks & Spencer, ran into trouble at the end of the 1990s and how it attempted to manage a programme of change to overcome those problems. It is therefore useful to explore issues concerned with organisational culture, strategic drift, strategic choice and the management of change. The case covers both the history of Marks & Spencer throughout the last century and, in more detail, from 1998 to 2004, the period when it moved from a position of market dominance to one in which it was deemed to be a take-over target. The case charts the attempts by its different chief executives to address the problems during this time and, therefore, the various change initiatives that were mounted. 2. Position of the case The case study relates, in particular, to the problems and means of managing strategic change in Marks & Spencer. So it is particularly related to the coverage of strategic inertia and strategic drift in chapter 1 and programmatic design and change in chapter 10. With this in mind it might be taught at the end of the strategy course. However, it could also be used as a case to require students to analyse the reasons for the problems of Marks & Spencer, not only in terms of organisational culture, but also in terms of the market and competitive position of the firm. In this sense it could be...
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...Marks and Spencer: Plan A Issues There are many companies who are taking different steps as per as the Corporate social responsibility is concern. In this case various steps that the Stuart Rose proposed to company that could be adopt to recognize their customer with their environment friendly existence. These will help to realizing their customers on which basis M&S products are different from the others and what they are doing for them and environment. * Misunderstanding about the direction from the “Plan A” and which pillar from that can be more suitable and sustainable for the M&S in future. * Inconsistency within the sales of M&S during different time periods as it is described in case the business which is working on such large scales have to face various downfalls in their sales i.e. during the 1998 while the company has the recorded sales of 16.2billion but the market share and the profits of company dropped. * Prices that charged by the M&S are not justifiable to providing value to its customers. * Variation among the supply cycle and high costs then competitors. Analysis M&S has various opportunities to get there “plan A” implemented on different directions which involve all those five pillars that described case one by one. Which could be the stage of the climate change in which the company focuses on the reduction of the usages of the carbon dioxide for which the M&S has to do various efforts that are linked with the customers...
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...The latest results from Marks & Spencer and Primark paint a very different picture of the high street. While M&S’s like-for-like sales of general merchandise, which is primarily clothing, have fallen 1.5pc over the last six months, Primark has reported a 5pc increase in like-for-like sales and a 22pc uptick in total sales. Marc Bolland, the chief executive of M&S, says the 129-year-old retailer’s clothing business is on a “journey” after the leadership team and style was revamped. “The most important [factor] is to choose the right direction,” he said on Tuesday. The new-look M&S womenswear collection has won strong reviews from the fashion press. It shows the company has listened to criticism from customers by stepping up the quality and introducing sleeves to dresses, which was a particular sore point. Mr Bolland said there has been a “gradual improvement” in the performance of M&S’s clothing business. The company “sold through” 80pc of the clothing advertised in its high-profile 'Leading Ladies’ campaign within six weeks. However, if M&S is to put its clothing arm on a permanently firmer footing, it could still learn lessons from the extraordinary success of its upstart rival Primark. The discount retailer Primark only arrived in the UK in 1973, 89 years after M&S, but if present trends continue then it will have as many clothing customers as M&S within two years. The first lesson from Primark is that price really matters. This sounds obvious, but...
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...Some investors have warned that Marc Bolland who leads retailer Marks and Spencer (M&S) will face renewed scrutiny if its Christmas and New Year trading figures to be released next week disappoints the market, the Financial Times reported. The report cited the offloading of UK-based Standard Life Investments' share of the retailer during the past six months, presumably due to concerns over the performance of M&S. The shares sold by the Standard Life, one of the largest fund management groups in UK, were substantial: from holding over 2% of the company's shares as the 11th largest shareholder of the retailer, Standard Life Investments now holds an "underweight" position of only 1.43%, the report said. The call of other investors is for M&S to begin delivering, especially in clothing where the past few months placed its overhauled women's wear range under crucial test. One of the investors of M&S was blunt when telling FT about the vulnerability of Bolland's position. The report quoted the investor as saying, "Of all the retail chief executives, Mr Bolland's position is possibly the most vulnerable. We would not start urging his resignation at this stage, but if next week's results are weak and the group fails to tackle its problems on clothing over the next six months, then his position will come under pressure." Another investor told the FT that they have not been pleased with the retailer's performance. The investor added that Bolland had made plenty of promises but...
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...Political According to "BBC News 30th January 2006" Marks & Spencer would be the first retailer to go down the Fair-trade route on both clothing and food. The fair-trade policy, include cut salt and fat in M&S foods, recycled packaging and animal welfare protection. Marks & Spencer Chief Stuart Rose noted, "Customers want good value, but they care more than ever how food and clothing products are made" (BBC, 2006). Economic: Current economic position of the company is very uncertain. The UK retail market showed a low growth of 1.2%, third lowest in the past 40 years (SAS, 2012) M&S have recently closed a number of stores and have cut the jobs on 2% of their 70,000 staff. M&S have tried to change the way market sees themselves to try and stay ahead of the recession. They had 20% discounts in the run-up to Christmas AND 20% of all Wine and Champagne to keep up with their competitors. Social: "Consumer purchases are influenced by cultural, social, personal and psychological characteristics. Marketers cannot control such factors, but they must take them into account". (Armstrong and Kotler, 2008) In the Guardian (2006), Chief Executive of Marks & Spencer Stuart Rose wanted to stretch the company brand, for example he considered selling food online to become a multi-channel retailer, to keep up with the competitive market such as Asda. Asda and Marks & Spencer appeal to different markets in terms of social class and other demographics; so it influences...
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...About the company M&S is one of the leading retailers in the UK, tracing its history back to 1884 when Michael Marks opened a stall in Leeds market. Thomas Spencer joined him in 1894 and both created Marks and Spencer. M&S has 703 stores in the UK with over 76,000 employees and over 360 wholly-owned, partly-owned, or franchised stores in 42 territories around the globe, which accounts for 10% of the Groups revenue. M&S sells high quality, exceptional value clothes and food products as well as home products such as electronics, furniture. They also added homeware in 2000. Primarily all of M&S goods were British made, however the retailer faced more challenging times, especially in the last decade and found it hard to compete with other supermarkets and retailers, this caused them to outsource to cheaper labour countries in Asia such as China and India. Marks and Spencer is the largest UK clothing retailer with a market share of 11.7% selling high quality, good value clothes for everyone. It also has a market share of 27.1% for lingerie which makes them leaders in womenswear in UK. 51% of their revenue comes from groceries with market share of 3.9%, the remaining 49% of the revenue comes from clothing and homeware. M&S was the first retailer in the UK to produce a pre-tax profit of £1 billion. M&S core values are: quality, value, service, innovation and trust. These values helped M&S to gain and maintain their leadership in the market, as shoppers...
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...Marks and Spencer Report Contents ------------------------------------------------- Page | ------------------------------------------------- | ------------------------------------------------- 3 | ------------------------------------------------- Introduction | ------------------------------------------------- | ------------------------------------------------- | ------------------------------------------------- 3 | ------------------------------------------------- Strategic and Financial analysis- Financial risk | ------------------------------------------------- | ------------------------------------------------- | ------------------------------------------------- 4 | ------------------------------------------------- PESTEL analysis | ------------------------------------------------- | ------------------------------------------------- | ------------------------------------------------- 4-6 | ------------------------------------------------- Evolutionary Forces analysis | ------------------------------------------------- | ------------------------------------------------- | ------------------------------------------------- 6-8 | ------------------------------------------------- Strategic Group Analysis | ------------------------------------------------- | ------------------------------------------------- | ------------------------------------------------- 8 | ------------------------------------------------- Individual...
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...Marks & Spencer PLC Plan A.Introduction.The total value of UK retail sales were £333 billion in 2014 and 9% of all VAT-registered businesses in the UK retailers, with the total number currently at 192,595. A third of consumer spending goes through these shops and the retail sector generates 5% of the gross domestic product of the UK. (retaileconomics.co.uk 2015). Marks & Spencer PLC has been part of the British high street for over 130 years, starting out as a small penny stall in a market in the City of Leeds, to the iconic £10.3 billion retail brand it is today, employing 83,069 people worldwide. The company has always had a strong ethos of fair trade, treating its staff well, building strong long-term relationships with its suppliers and developing new and initiative relations with its customers from the company outset. (D. Grayson, 2011). Marks & Spencer was the first high street retailer to allow customers to enter their shops without paying for the privilege, prior to this, the proviso was that a customer entering a shop had to buy an item, something that is taken for granted today but in 1894 was unheard of. (marksandspencer.com 2015.) In 1997 the company became the first British retailer to make a pre-tax profit of over £1 billion, although subsequently it went into a sudden slump, which took the company, its shareholders, who included hundreds of thousands of small investors, and nearly all retail analysts and business journalists, by surprise. The reasons...
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...Marks and Spencer IB209 Marketing Analysis Anshul Maini 1036526 Marks and spencer also called as M&S and Marks and Sparks was found in the year 1884 by two people Michael Marks and Tom spencer (Bevan, 2007). Ever since then marks and spencer has delivered goods of the best quality and now to day it stands as one of the best retail chains in the UK. They primarily deal in Clothing and food. The company is headquartered in London, UK and is the one of the biggest companies in the world. It’s ranked #725 in the Forbes 2000 list (Marks and Spencer on Forbes 2000 list, 2011) and is amongst the top 5 retail firms in the country. Currently the chairman of the company is Robert Swanell and the Chief Executive is Marc Bolland. (Annual Report, 2011). Over the years Marks and Spencer has gone through ups and downs. It is the first British Retail firm to make a Profit before tax of over £1 Billion which was in the year 1998.After that the company had hit rock-bottom which was due to heavy competition and the company’s inability to satisfy its customers, it went into heavy losses in its turnover. After amending a few policies and the change of the Chief executive, the company looked more closely at the customer’s needs, wants and demands and modelled their strategies around it, thus rising it from the ashes. However again in 2008, the company went into a credit crunch which was mainly because of the recession. (M&S shares dive on gloomy outlook, 2008) (Bevan, 2007).Although M&S has...
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...Introduction Marks and Spencer (M&S) is a leading British based multinational retailer specializes in selling clothing ,home and food products. This essay would be discussing and examining the operation strategy of the company through studying the case “New supply chain strategies at old M&S”. Product ranges and market segmentations M&S classified its products by establishing a number of brands for attracting different customers who has different lifestyles. They are: The perfection collection, The classic collection, The Autograph range and per una. Each of the brands has been segmented carefully in order to highlight the features and design philosophy of the brand and satisfy particular needs for customer. The perfection collection and The classic collection essentially serve for customers who are mature and have high loyalty to M&S products. The products of two collections shared lots of similarities and the chief aims is to provide wide-range of ‘timeless essentials’ clothes to customers who focus on its own clothing style and finesse. The core principle of The Autograph range is to incorporate cutting-edge design to products under the brand. Product categories encompass womenswear, menswear and related accessories. It features supreme design by industry top tier designers with a very pricy price tag. It targets customer who values product design is first and foremost. The per una feature products with high-end designs and acceptably priced. The brand...
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...Marks and Spencer: Summary Report of the Case Study Introduction Marks and Spencer (M&S) is a leading UK retailer selling clothing, food, and housewares. In 2007, the company put sustainability at the heart of its business. In order to succeed, it would have to change the attitudes and the behavior of its shoppers. As a result, it launched Plan A which set out a five year plan involving 100 social and environmental commitments that were expected to shape the future of the company. Plan A would allow the company to resolve some of the big issues facing their business. They called it Plan A because there is “no B when it comes to conserving the earth’s finite resources” (Marks & Spencer Website). Brief Background on Company In 1884, Michael Marks started the company by selling an assortment of goods in an open-air stall in Leeds, UK. In the 1920’s, the company went public and expanded into general merchandise and ready-to-wear clothing. By the 1970’s, the company had become a British icon and a household name. However, from the 1980’s to 1993 came the troubled years. Despite the expansion of its operations in the 1980’s, the retailer had failed to keep current with its shopper’s preferences and this led to financial woes. From 1994 to 2006, it was back to the basics for the company. By 1996, it had rebounded to become the UK’s most profitable retailer. However, this recovery was short lived, and M&S experienced a significant slump in business in 1999 which continued into the...
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...Evaluate the extent to which Marks and Spencer has benefited from its marketing planning Marks & Spencer’s are a company that have been that suffered a bad year in 2003/04 as they suffered a 10% fall in sales of their clothing. Their additional priority was to kick-start the autograph range in which they received good reviews but unfortunately they were too expensive being mostly over £100. With regards to their products, products of Marks and Spencer are designed according to the demands, needs and preferences of customers. To identify the demands, needs and preferences of customers, Marks and Spencer focuses on the core customers which they knew but then decided to take a risk and merge into a new market with Per Una and Per Una Due range. Company serves its core customers as well as its new customers by providing them distinguishing products. Per Una is a successful brand of the company which has satisfied the needs of customers. This brand has produced remarkable profits for the company. It was launched in 2001 but unfortunately the market of 2003/04 showed a drop in demand because of their prices. If more market research was carried out it could be seen that the customers will not be willing to pay £100 or more for an item of clothing. In regards to benefitting from marketing planning, they could have possibly gained if they were able to produce a product that could be sold which they did with the Men’s range in which its market share increased from 10.3% to 10.5%...
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...【Essay Draft】 How effective has the strategy of expanding its food range turned Marks and Spencer into success since 2000. * Introduction In the late 1990s, Marks and Spencer had a sudden decline in its sales. Since then, M&S has devoted itself to expanding their customer base by a range of strategies. In this essay, the strategy of expanding its food section will be focused since 2000. * In the first section: I will focus on what food sector strategy after M&S losing its billions. * Basing on its core values: Quality, Freshness, Value, Standards of innovation, Ethical Sourcing and Healthy eating. * Branded food: reduce the non-M&S branded lines, and introduce another 100 exclusive international food brands. * Plan A sustainability strategy: Since 2007, M&S launched Plan A to inspire their customers and to improve things for the better and act with integrity. * E-Business: encouraging people to buy their products online by developing knowledge and confidence in them. * In the following section: I am going to analyse how these strategies work to M&S. * SWOT analysis: I will operate this analysis to find out the following points of the organization in the market: Strength, Weaknesses, Opportunities, Threat. * Stakeholders, Board of Directors, suppliers, customers, employees * Conclusion * Reference 1. Plan A Report 2014 http://corporate.marksandspencer.com/plan-a/b6867fa1340d482da1ebde62c099dd69 2...
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...Marks & Spencer Marks & Spencer was founded on 1884 as a market stall by Marks. It became Marks & Spencer in 1894 as a partnership with Spencer. From that humble beginning Marks & Spencer became leader in the industry. And for more than half a century M & Spencer was the epitome of enlightened capitalism. It dominated the British high streets and provided shoppers with quality and value clothing unrivalled by competitors. It was one of Britain’s largest high profile retailers selling variety of goods and services such as clothes, food, furniture and loan services. But its glory has started to crumble when it profits began to fall since 1998. M & S has been facing their worst times ever. Their problems began at the start of financial year April 1999. They suffered almost from financial ruins. Since the event of its failure, M & S has been taking more than several attempts to recover their losses. Extensive studies and researches have been conducted to find out the root causes so as to come up with appropriate strategies for development. Most of the studies started with the company’s profile. Below is an analysis of the company’s profile and the validity of one strategic management models to Marks & Spencer’ experiences. Marks & Spencer’s organization culture is characterized as a reflection of “taken for granted fashion” that is an attitude shared by members of the organization. The beliefs and basic assumptions operate unconsciously among the members and also exist at the organizational...
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...Marks & Spencer (A) Nardine Collier The M&S formula for success Michael Marks began his penny bazaars in the late 1880s. He soon decided he needed a partner to help run the growing firm and Tom Spencer, a cashier of Marks’ supplier, was recommended. From this partnership Marks & Spencer (M&S) steadily grew. Simon Marks took over the running of M&S from his father, turning the penny bazaars into stores, establishing a simple pricing policy and introducing the “St Michael” logo as a sign of quality. There was a feeling of camaraderie and a close-knit family atmosphere within the stores, with staff employed whom the managers believed would “fit in” and become part of that family. The staff were also treated better and paid more than in other companies. The family nature of this firm dominated top management too: until the late 1970s the board was made up of family members only. Marks was renowned for his personal, top-down autocratic management style and his attention to detail. This also manifested itself in the way he dealt with suppliers and meticulously ensured that goods were exactly to specification, a relationship designed to build reliance of the suppliers and ensure high and consistent quality. Until the late 1990s M&S was hugely successful in terms of profit and market share, running its operations according to a set of fundamental principles; namely to: Offer customers high-quality, well designed and attractive merchandise at reasonable prices under the brand name St Michael;...
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