Marks & Spencer_Strategic Management
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Marks & Spencer adopted a business model focused on creating value for customers and employees. It pioneered social services for employees and adopted merchandising practices from Sears. It began directly buying from manufacturers. Over time it expanded globally but faced challenges like high costs, outdated stores, and changing fashion trends. A 1991 reorganization focused on cutting costs in clothing, improving food access, and growing financial services. A later recovery plan segmented offerings, found the right leaders, improved communication, sourced products faster at lower cost, and strengthened customer relationships to rebuild the brand.
Marks & Spencer_Strategic Management
- 1. Marks & Spencer Strategic Management-2 1 Group 7 Anand Kumar 12P127 Ankush Singla 12P129 Bhoomi Ashwin 12P131 Aditya Ram Chadha 12P132 Siddharth Bharadwaj 12P170 Soumyajit Sengupta 12P171 The Phoenix Rises
- 2. Business Model Business was a way of Creating Value for Customers & Employees Pioneered a wide range of Social Services & Benefits for Employees Adopted principles of SEARS including merchandise control by a central organization Began the Revolutionary Policy of Direct Buying from Manufacturers Focused on a “Partnership Model” •2 Retail Chains acquired •Local Resistance •Union Jack was viewed unfavourably in Canada Canada •Paris store met with moderate success in 1975 •Further stores were opened France •Full line stores in Holland, Belgium & Hong Kong •Franchisees in other Countries Global Expansion Major Attack on Costs & Inefficiencies Canadian Business Divested Extension of Core Product Ranges Push into Consumer Financial Services, based on Charge Card & M&S’s reputation Global Expansion 1991 Re-Jig
- 3. Major Challenges & Renewed Focus Clothing •Cost Reduction •Quality Improvement •Sourcing Speed Financial Services • Build up Charge Card Restore Marks & Spencer’s as a Retail Superpower Food •Customer Access Improvement •Square Footage Constant Competing with firms that sourced from offshore partners Maintaining quality while fighting on price Overstocking Lay offs, personnel and communication problems Changing trend leading to reduced spending on apparels Getting stores that are more accessible to people Maintaining quality of prepared and processed food Too much focus on cost efficiencies Less availability of new store space due to U.K. property regulations Recovery Development Expansion
- 4. SWOT Analysis •Women’s clothing •Home décor and furnishing •Understanding customer behavior through charge card data base • Compromise on quality • Unwise acquisition decisions • Onshore sourcing • Inconvenient store locations • Slower time to market • Brand recognition • M&S Charge cards • Size • Real Estate Strengths Weaknesses OpportunitiesThreats
- 5. Tackling Challenges •Valdevelde (Executive Chairman) •Yasmin (Director, Design) •Longdon (Director, Women Clothing) •Davies (Head, Per Una) Finding the Right FIT between Roles & Role Player •CUBE 1 •CUBE 2 Clear Communication of Strategies to all Relevant Stakeholders •ZIP •PER UNA •PERFECT CAMPAIGN •BLUE HARBOUR Proper Segmentation of Offerings •Focus of CUBE 2 •Inculcated a sense of Ownership •Triad Approach Focusing on Speed, Quality & Scale to inhibit Competitors’ growth Adopting measures to Ensure Implementation, Sustainabil ity & Achievement of Objectives
- 6. CUBE 1 Performance outstripped Expectations Regaining Focus on Primary Segments: 3 instead of 11 Faster Time to Market Merchandisi ng Control fully Decentralized Design Control fully Decentralized Launch of “Perfect” Campaign Launch of “Per Una” (One Woman) 10% incentive for Charge Card Users to Revisit Stores Sourcing Pattern had been transformed from 70-30 British to 20-80 British “Better Product, Lower Cost & Faster Time to Market” Other Initiatives Zip: Separate Design & Sourcing Strategy Simply Food: Convenience Format & Focused Selling Home: Offshore sourcing Directly & Large Store Format to serve Customer Needs Financial Services: “MORE” introduced to re-establish a TIGHT relationship with Customers
- 7. Inculcating a sense of individual ownership for collective results Concentrating on speed along with quality and scale to stifle the growth of competitors in the future Getting customer emotionally attached with the products Keeping in direct touch with the customers to better understand needs and trends CUBE 2: Sustainable Future Plan
- 8. Thank You!