Strategic Management- Marks and Spencer's 2011

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BSP028 Strategic Management|
Paul Ioannides A764027|
Describe and evaluate the main strategic changes of Marks and Spencer since the beginning of Stuart Rose’s Chairmanship.| |

Marks and Spencer3
Strategy Definition4
Strategic Change 15
Plan A: Aim of becoming the most sustainable retailer5
Description of Strategy5
Reasoning of Strategy5
The Strategy 2010-20115
Theoretical Foundations of Strategy6
Corporate Governance6
Business/Corporate Level Strategy7
Vertical Integration7
Scope of ‘Plan A’ Strategy8
Strategic Change 2:12
Multi Channel Strategy: The Internet and Mobile12
Description of Strategy12
Reasoning of the Strategy12
Theoretical Foundations of Strategy12
Business/Corporate Level Strategy12
Ansoff Matrix13

The aim of this report is to outline the chosen strategic changes that Marks and Spencer have incurred since the beginning of Stuart Rose’s chairmanship. The first section of the report will focus on outlining the specific strategic changes that were implemented, including a description of them whilst relating them to theoretical concepts studied. A brief explanation will then be included to explain the reasoning behind the strategic change. The latter half evaluates each of the strategic changes in accordance with the evaluation criteria. For the purpose of this report, Marks and Spencer (M&S) will be considered as a single unit as opposed to treating each constituent of its business as a single entity e.g. clothing, home, food. However, if necessary, the report will explicitly state when appropriate details in relation to individual parts of the business. In order to contextualise the importance of examining the strategic changes of Marks and Spencer, the UK supermarket industry is forecasted to increase by 17.9% from 2009 to 2014 to give a total market value of $219.3 billion (DataMonitor, 2011). To gain maximum market share from the resulting increases, it is crucial for Marks and Spencer to continually monitor and adapt their strategies in accordance with the dynamic conditions it operates within. Marks and Spencer

As this report is solely based on M&S plc, it is initially necessary to provide a brief background to the organisation to set a basis for the strategic changes. M&S became the first British retailer in 1997 to make a pre-tax profit of over £1 billion (BBC News Website, 1998). However, from this hugely successful period, the company plunged into crisis for numerous years. The company had long suffered due to incremental change as CEO’s prior to Sir Stuart Rose were ignorant to changing external environments that required more ‘Big-Bang’ changes. Beer et al (2000) acknowledged this threat to organisations through their theory of ‘change or die’ attitude. However, due to a number of successful strategic frame-breaking changes in more recent years from Sir Stuart Rose, they have once again established their formerly successful brand name. In 2004 his first job was to fight a takeover bid from Sir Phillip Green. He managed to bring full-year profits back to £1bn, not witnessed since 1997 levels. The organisation is one of the UK leading retailers, with approximately 21 million people visiting their stores weekly. The business plan includes products in clothing range, home range and food range, supplied from 2,000 sources globally. The large retailer generated £9.7 billion of revenue in 2011 with a resultant underlying group operating profit of £824.9 million (M&S Corporate Website, 2011). £8.7 billion of the revenue was generated in the UK alone, demonstrating Marks and Spencer’s focus on the domestic market. However, the retailer is an international operator also and this will be discussed more in depth later in...
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