Case Study of Business Strategy Of Marks And Spencer

lawsuit Study of Business St gaitgy Of label And Spencertag and Spencer is one of the biggest pot windrs having hereditary pattern of a good deal than one hundred and twenty years. It has to a greater extent(prenominal) than 895 stores in more than 40 regions either over the world. Its head office is in U.K, in the city of Westminster. Michael label from Slonim, Russia and Thomas Spencer a cashier from Yorkshire are the pioneers of this U.Ks biggest retailers. At Leeds (Kirkgate market) in 1884, Michael tag started his own line of descent by opening a penny bazaar stall. Then to breach his business he open(a) a shop at Manchester with the dispelnership of Thomas Spencer.Hst college assingmentsMS assingq no 51201445_ labelSpencerShef celestial sphereHistory.jpgAfter the death of both the pioneers of the community Michael label Simon became the chairman of company while William Chapman took the helm until 1960. During the Era of Michael Simon telephoner touch the hig hest point .The business was floated as a public limited company after 10 years. In 1998 it was the first company of U.K who earned the profit of one billion pounds after tax deduction. mark and Spencer prohibited smoke first judgment of conviction in store that later on became a jural criminal offence to smoke at public places. Marks and Spencer of importly deals in Clothing, shoes Ware, Food, Technology, Beauty, Financial Services, Energy and Hospitality.PLAN AThe Customers are be glide slope more conscious close to subjective and milieual issues, so for this Marks and Spencer launched object A, which consists of 180 commitments to overcome the challenges. Many problems are related with Climate Change, eat up Reduction, Ethical Trading, Sustainable Raw Material and Health. To tackle these metamorphoses Marks and Spencer is doing much effort.CUsersFaisalDesktopimagesCAXD7DW8.jpgIn March 2010 Marks and Spencer expanded plan A introduced 80 more commitments and added t hem up with the existing ones. In these commitments their primary chargesing is on temper changes, run out, natural resources, fair partner, health and well being. These five-spot main pillars are described belowCUsersFaisalPicturesimagesCAV6T6WW.jpgCLIMATE qualifyingDue to an increase in greenhouse gases produced by the human activities the human race is pass waterting warmer day by day causing more damaging consequences. In 2006/07 Marks and Spencer cut their carbon emissions to 8% by reducing the usage of energy. Marks n Spencer as well attached that up to 2015, they will improve their energy efficiency by 35%.CUsersFaisalDesktopimagesCA3FRFRV.jpgWASTEEin truth year the U.K has to throw away 400 tonnes of waste that comes from construction, industry, households and discarded packaging. The waste that is not recycled ends up in landfill sites which take many an(prenominal) a(prenominal) years to decompose. Marks and Spencer claimed that in the year of 2009/10 they be fool straind the cycle level to 88% while reducing the amount of waste to 16%.They dumbfound reduced the forage waste by 29% as compared to the years 2006/07.Marks and Spencer collected 133 million clothes hangers and utilised 76% of them and recycled the rest.CUsersFaisalPicturesimagesCAM1CR39.jpgThey ready to a fault recycled their construction waste up to 89%.Marks and Spencer are committed to do that by 2015 they want to landfill help their customers to recycle or reuse their packaging and products. They will to a fault help their suppliers to reduce the waste and to hold zero rates as well.NATURAL RESORCESIn plan A Marks and Spencer aimed to get as much of their raw material from their natural resources as possible. It is the U.Ks first company who has signed the WWF sea food charter, with 62 % of their wild sea food. Marks Spencer also purchased Green palm surety to cover all the palm oil to use their Marks and Spencer product.CUsersFaisalPicturesimagesCAG3OZ2S.jpgFai r PartnerMarks and Spencer has a vision that they are really muscular in their communities and ensure good on the job(p) conditions. Marks and Spencer has the net employee turnover rate in UK retail i.e. 14%.Marks and Spencer is religious offering hawkish salaries, discount to their employees, bonuses and share save options to their employees. It provides different bringing up programmes to the employees. E truly employee has to set out Marks Spencer Career Path Training and learning programmes .While the managers have to cite the different sprainshops to boost their capabilities. Marks and Spencer is trying to provide the stovepipe wages packages for the employees.CUsersFaisalDesktopimagesCAF15VPV.jpgHealth and WellbeingUnhealthy food is one of the main factors of many health problems. According to the part of the commitment of send off A Marks and Spencer encouraged its customers and employees to get healthy and nutritious food by developing freshly product ranges. Marks and Spencer has launched online diet forums and health newsletters to forfeit active dialogue with the customers on nutrition and health. Marks and Spencer has removed staged flavours and colours from all of its food products and soft drinks. It has also removed 90% of salt in its products. Very few of the products still does not worthy the required standard of health and nutrition but Marks and Spencer is run foring hard to trifle it in line accord to the required standard.CUsersFaisalPicturesimagesCACFVO3Z.jpgAnalysis of the orthogonal environmentAccording to plan A Marks and Spencer has also taken into consideration the external environment of the company. international environment means the factors that directly or indirectly accept the internal depart and perhaps business outline and objectives as well. Most common factors of external environment are political, social, economic and technical. These factors are totally out of soften of the boldness, but the co mpany could be able to take rough step to overcome these challenges. Basically the external environment defines the competitive office staff of an organization and potentially can have both positive and negative tints on businesses. Target analysis has four whatever major categories of external factors that affect the companys adroitness to grow. Based on operation region, external environment is divided into three interactive segments which is remote, industrial and operational environment. External factors produce different influences on the companys productivity. On the other hand approximately influences are inter-linked with each other. For moral information engineering completely changed the way of work, customer behaviour and liveliness style as well. Based on PEST analysis four major factors are going to be discussed in detail.Political environmentPolitical stability in a land attracts the investors to do investiture and that is a very key factor to grow busi ness. Secondly, governance trade policy, is either flexible or hard. Every transcription operates under the politics policy most trade and within the legal frame work. The legal frame work covers many areas like tax rates, employees benefits, wage legislation, trade regulation and tariff. Suppliers, customers and competitors are also affected by the political environment. frugal purlieuEconomic conditions also affect organisations external environment. In this view some factors that influence business are tax rates, inflation, money supply, government need, economic growth rate and the tendency to spend at planetary and national level.sociable EnvironmentIn social context, normally Britain customers ladder towards a specific product. In every transaction product type matters a lot, but it could easily be beaten by offering lower pricing of the same brand. Some fresh analysis about Britains customers is that they prefer some fashionable styles over classic trends. This can b e seen in Marks Spencers case because they are still struggling to get a bigger market share. This indicates that British buyers are very subtile about their wealth.Technological EnvironmentNow a eld a large number of the population is able to use the internet. It means that by using e-commerce many organisations can widen their horizons and do many more operations. This can be seen in foremost companies like Sainsbury, Tesco and ASDA as well. These days most of the trading and purchasing is done through the internet, and it has also issuance a competitive service of Marks and Spencer.Analysis of External Environment of MSThe U.K retail market is very eye-catching. The company has full erect from the government. Because Marks Spencer has rich historic values and has become a very powerful organisation in the business world, new competitors are conclusion it very challenging to keep up with the quality of products and services that Marks Spencer provide.Analysis of the orga nisations internal environment and identificationIn Plan A Marks and Spencer has taken internal analysis, which is also called mill analysis. This is a very important part of business development. SWOT analysis is a unbiased structure for generating strategical alternative from a situation analysis. SWOT is an abridgment for Strengths, Weaknesses, Opportunities and Threats. In late 1960, Edmund defined SWOT structure. Learned, C. Roland, Christiansen, Kenneth Andrews and William d Goth in Business Policy, Text and Cases (Homewood, IL Irwin 1969).In the 1980s General Electric product Council used this form of analysis. Basically, it throws light on thecompanys strengths weaknesses. The strengths highlight the different aspects that bring firmnesss in market value and the weaknesses draw the attention to those areas which need improvements. SWOT analysis is fruitful where you have to tackle a complex situation in a limited time frame.Organisation of an returnive strategy is ba sed on a clear definition of the disposals mission. For the success of an organization it requires some necessary ingredients which are listed belowStrategy must be carefully verbalized, applied, manageable and accomplished. inwrought analysis of the organisation is an essential part in the strategic planning process. During 2005-06 Marks and Spencer had seventy thousand employees globally. The Company changed the employees structure fit to the nature of the customers that used the products and services of Marks Spencer. Marks and Spencer also pledge to promoting equal opportunities regardless of age, disability,race, views about politics, working hours and religion.Marks and Spencer arrange flexible working schedules for fatherhood, adoption and IVF treatment, child and career injure to boost their employees uniformity. Marks and Spencer also runs Business Involvement Group (BIG), which is a work demonstration forum in all their stores and offices that inspire their work force to share information and develop discussion about the companys business. If we intercourse about salary and welfare, the company has some incentive packages that include key fixed pay. As for training, in 2005-06 more than 102,000 days were fixed for training manipulation in which Marks and Spencer try to develop inner aptitude and skill of their workers. Marks and Spencer proved that they have great concern about health and safety of their employees by providing a wide range of work related health services.The companys code of ethics is also developing to fuddle guideline to their member concerning their responsibilities towards customers, workers, stockholders, dealers, societies, government and the environment.Identification of the major issues challenging Marks SpencerMarks and Spencer is one of the UKs biggest traders, giving different services to their customers in the field of food, clothing, and house hold products. They tried at their best level to relieve oneself go od customer service at an affordable set, but it is not always very easy. Marks and Spencer are losing their trend towards the youngstersand their other opponents in the market are pickings advantage of this weak point. This is the biggest challenge that Marks and Spencer is facing nowadays. To overcome this weak point Marks and Spencer is also taking steps to provide cheaper products to their customer, but for this they have to import their raw materials, which also lessen the Marks and Spencers image of British Goods Seller. Cards and cash methods have been used for payment since 2001.Marks and Spencer have seen very tough propagation during the period of recession, but now it seems as though everything is going stick out to normal. The companys thirteen weeks before the start of OCT (2010) was very hope full. Homeware made an awful growth in sales up to 7% and food hug which was last year 3.6%, this year it increases up to 3.7%.The clothing section is also growing and is the most rapidly expanding sales item of Marks and Spencer. During the tumble the women shoes sales touched a record, which Marks and Spencer claims that it was because of their strong advertisement.External environment and the impact on the strategic direction of the organisation strategical direction means those incentives that a company adopts for the achievement of its target i.e. how to produce, develop and sell its products. Basically strategic direction is the planning that an organisation follows for the trade of its products.Marks and Spencer introduced a plan that they named as PLAN A the purpose behind which is to become worlds most sustainable retailer. For the success of any organisation it is very necessary to keep an eye on the environmental changes that occurs impertinent the organisation. As these changes affect the strategy of any organisation, it has to alter its rules and regulations according to the environmental changes.There are four main external environmenta l factors that effect the strategic direction of any organisation.a) Politicalb) Economicc) Technologicald) SocialThe political condition plays a vital role to put an impact on the strategy of an organisation as it refers to the government policies. If the government introduces new laws and the organisation has some policies or rules and regulations that conflicts with the existing government laws, it has to alter its rules and regulations and annoy them according to the governments policy. The change in the political condition can affects the strategic direction of the organisation as every government has its own policies and the organisation cannot work against the laws of the country.Economic condition has also a deep effect on the strategic direction of an organisation. The economic condition of any country has a deep rooted effect. It includes taxation rates, economic growth rate and capability to invest at national and international levels.The rapid change in technology is an other factor that can affect the strategic direction of an organisation .With the passage of time new techniques and machines are coming up and it is very important to adopt new techniques for the development of a business.In the social environment the consumer plays a vital role to affect on the strategic direction of the organisation. The organisation has to provide the products and services according to the requirements of the consumer. The lifestyle trends, ethical issues, media views, law changes, buying access, brand, religion beliefs, demographics and fashion are the social factors that can affect the strategy of the organisation.What should the organisation do to achieve or maintain competitive advantage in its industries?Competitive advantageA companys competitive advantages are the features that give permission to do best even in average industry extensive performance and giving entry into the industry as a whole.Every company has some definite abilities which make it dif ferent from other companies in the same industries. It has some unique competences that cannot be replicated by the opponents. Many companies complete their management price by using effective use of skills to organise their jobs. One example of such a company is Marks and Spencer. This company use technology to locate their goods. The company also use technology to coordinate amidst different departments. It brings more proficiency and less expenditure, and as a result production cost is low. On -the-counter payment was also introduced by Marks Spencer. It was very beneficial for the company as they need only a small amount of employees, so as a result task cost was minimized and profit margin were increased.Marks and Spencer with more than degree centigrade years of experience have a competitive advantage over most of their counter parts, because the company earn the trust and reputation among the customers, their workers and suppliers. Their customers have an extensive collec tion and are fully confident about the companys products and services.They also get value for money as well. Marks and Spencer demonstrates a dual-lane sense of doing things, with their strong inner structure that moves around permanent battle relationships and strong organisational routines. In the external environment Marks and Spencer fully focus on product specification and design to continue their relationship with the customer, which lasts for many years. As part of their business accountability the company has strong conservational and common responsibilities. TSE Stated that Marks and Spencer use modern methods of management like consumer research, planning, individualised management, product innovation, staff training and many more and has proved itself as a founder and outshined among all other companies (1985).Marks Spencer maintain a strong organisational structure that is run by comparatively normal employees who get magnificent results over many years, although m any changes have occured in the economic environment (1995).Although, over the recent years, due to the big recession the company has had to nerve downfalls in some of their retailing areas, but they have managed to overcome all their uncertain hurdles through flexibility, that their opponents view as unnerving.According to an psychoanalyst Terhi Halme (2008) ,Even though Marks and Spencer has carried out extensive reformation over the ancient years, the companys competitive advantage has not been fully revived, so the firm could be able to answerable to the current down turn in British retail market. The decline rate during the past few months has been increased in their food unit and as a result revenue has dropped. Because of this, the food sector is also losing its market share. The management have to step up marketing and promotional spending to protect the market share. Additionally the team up confidence is also diminish because of changed management, and therefore not bee n able to begin sustainable improvements. It is possible that Asian and Middle East companies that are in search of western products will take a look at the market shares of Marks and Spencer as presenting buying opportunities at the present price, specially during this recession.ConclusionMarks and Spencers main aim is to become the worlds most sustainable retailer by 2015. To achieve this target Marks and Spencer introduce Plan A in which it has highlighted five factors to achieve their business goal that is climate change, waste, sustainable raw material, fair partnership and health. There are some internal and external environmental factors that affect the business strategy of the organisation. Internal factors are under the control of the organisation that deals with the strengths and weaknesses. But the external environmental factors are beyond the control of the organisation. Marks and Spencer has also taken inaugural to maintain and improve its position. It provides good customer services, using modern techniques, and provides products according to the demand of the customers.