Topics: Supermarket, Strategic management, Grocery store Pages: 17 (4942 words) Published: May 29, 2010
Case ANALYSIS of Morrisons Grocery Retailer

Course: MBA Full-Time
Module: MBA 4059 Strategic Management and Marketing
Tutor: Tom Patilo
Student No.: 0810354
The University of Bolton, RAK
Submission Date: 31. 05. 2009.

The Outline

I. Introduction

II. Morrisons Analysis

A. Morrissons Structure, Culture, Leadership and Performance
B. SWOT, Core Competencies and Competitive Advantage

C. Marketing Mix
III. Conclusion
IV. Bibliography

I. Introduction
“The greater the risk, the bigger the win!” is a well known rule practiced by exceptional leaders in the world of business. Morrisons chairman, Sir Ken Morrison, did just that when strategically deciding to acquire Safeway. After a period of trials and tribulations, as expected with any acquisition, Morrisons rose to become successful as the UK’s fourth largest grocery retailer. Benefitting from UK grocery-retail trends including space expansion and increasing sales and market size, the “Big Four”, Tesco, Asda, Sainsbury’s and Morrisons, held a significant 75% share of the total grocery retail market in the UK. What Morrisons had not taken advantage of was format development and sales growth of non-food sectors; instead, they remained a single format superstore offering food lines only. Apparent change of consumer trends from value to quality was noted. However, price continued to be a consumption priority as the UK sank into a recession.

Through a series of management and marketing theories and frameworks, this essay will analyze: Morrisons structure, culture and leadership as these factors affected their business performance pre and post acquisition; their strengths and weaknesses applied to the external environment with existing and potential opportunities and threats, core competencies and competitive advantage; as well as their marketing mix.

II. Morrisons Analysis
A. Morrisons Structure, Culture, Leadership and Performance
Structure, culture and leadership significantly impact and ultimately dictate a company’s performance. The following paragraphs will distinguish the extent to which each factor positively or negatively affected Morrisons in years prior and post acquisition.

Morrisons structure can be described as corporate governance, managed by a board of executive and non executive directors (Tricker, 1994; De Wit and Meyer, 2004) including the company’s Chairman, Sir Ken Morrison and later Sir Ian Gibson, CEO-Marc Bolland, Group Retail Director, Trading Director, Finance Director and four other non-executive directors (1).

Another way of explaining Morrisons corporate structure is through a concept developed by Mason (2003), the “leader-driven” structure that entails the explicit selection of a proactive directional strategy by the company’s leader, in this case Sir Ken Morrison’s strategy of growth by acquisition.

Following their acquisition of Safeway, Morrisons went through re-structuring in their Finance Department. In the wake of the unexpected profit warnings, their Finance Director, Ackroyed, plus two others had resigned or were forced to resign, as implied by information given in the case. The company struggled with Safeway’s accounting system, failing to retain the majority of Safeway’s head office employees and the effect on their performance was considerable.

The second contributing factor to their lower than expected performance (in relation to structure) was the poor performance of the acquired Safeway Compact Stores. Being a single format superstore, Morrisons simply had no experience and know-how of managing this type of store.

Culture, as the foundation of an organization, is the key to successful performance. Similarly, pre-acquisition, Morrisons’ hospitality, great value for money and tradition resulted in a positive perception by their customers as a trustworthy and honest grocer. Change by acquisition caused inconsistence, as not enough attention was...

Bibliography: Adams, M. (2009) The Seniors market will grow in importance. Datamonitor, 3rd April [Online]. Available from: [Accessed 10 April 2009].
Bem, D.J. (1967) Self –perception: an alternative interpretation of cognitive dissonance phenomena. Psychological Review [Online] 74 pp.183-200.
Big and small, UK retailers suffer: Grocer Sainsbury could buck the gloom as more people eat at home (2009) Gulf News, 21st March, pp.31.
Chattaraman, V. and Lennon, S.J. (2008) Ethnic identity, consumption of cultural apparel, and self-perceptions of ethnic consumers. Journal of Fashion Marketing and Management [Online]. 12(4) pp.518-31. Available from: [Accessed 11 April 2009].
Clutterbuck, D. and Goldsmith, W. (1998) Customer care versus customer count. Managing Service Quality [Online]. 8(5) pp.327-38. Available from: [Accessed 11 April 2009].
Competition intensifies in the battle for grocery market share (2008) Datamonitor, 22nd February [Online]. Available from: [Accessed 10 April 2009].
Cox, T.H
De Chernatony, L. and Cottam, S. (2008) Interactions between organizational culture and corporate brands. Journal of Product and Brand Management [Online]. 17(1) pp.13-24. Available from: [Accessed 11 April 2009].
DeFeo, J. A. and Janssen, A. (2001) The economic driver for twenty first century: quality. The TQM Magazine [Online]. 13(2) pp.91-94. Available from: [Accessed 11 April 2009].
De Wit, B. and Meyer, R. (2004) Strategy: Process, Content and Context an International Perspective. 3rd ed. London: Thomas Learning.
E-retail continues to defy consumer downturn (2008) Datamonitor, 3rd June [Online]. Available from: [Accessed 29 April 2009].
Gladwell, M. (2008) Outliers: The Story of Success. USA: Hachette Book Group Inc.
Grant, R. M. (2005) Contemporary Strategy Analysis. 5th ed. Oxford: Blackwell Publishing.
Kanungo, R.P
Kanter, R.M. (2009) Confidence drives success. Gulf News, 29th March, pp.40.
Kotler, P. et al. (1999) Principles of Marketing 2nd ed. London: Prentice-Hall.
Macdonald, J C. (1995) Customer care is not good enough. The TQM Magazine [Online]. 7(4) pp.5-8. Available from: [Accessed 11 April 2009].
Mason, D. (2003) Tailoring scenario planning to the company culture. Strategy and Leadership [Online]. 31(2) pp.25-28. Available from: [Accessed 11 April 2009].
Michel, J. (2005) Aqusition Dangers, 25th April.
Morrisons: Bridging the north-south divide (2006) Marketing Week, 17th August
Morrisons merger takes its tool (2006) City News, 10th April.
Morrisons tipped to win market share from rivals (2009) Western Mail, 18th Jan.
Panagiotou, G. (2007) Reference theory: strategic groups and competitive benchmarking. Management Decisions [Online]. 45(10) pp.1595-621. Available from: [Accessed 11 April 2009].
Pfeffer, J. and Sutton, R.I. (2006) Profiting from evidence-based management. Strategy and Leadership [Online]. 34(2) pp.35-42. Available from: [Accessed 11 April 2009].
Porter, M. E. (1998) Competitive Strategy: Techniques for Analyzing Industries and Competitors. New York: The Free Press.
Rigby, A
Robert, M. (1998) Strategy Pure & Simple II: How Winning Companies Dominate Their Competitors. USA: McGraw-Hill.
Rogers, D. (2004) A recent history of Morrisons. Marketing London, 10th November.
Saleem, N
Supermarket Nation – Supermarkets more popular than ever with British consumers (2008) Datamonitor, 14th March [Online]. Available from: [Accessed 10 April 2009].
Tesco shows resilience with profit topping £3b (2009) Gulf News, 22nd April, pp.32.
UK economy ‘already in recession’ (2008) BBC News [Online]. Available from: [Accessed 12 April 2009].
Wal-Mart, Tesco and Carrefour do battle in the east: International retailers find mixed fortunes in their expansion strategies
Wirtz, J. et al. (2008) The high-performance organization: making good decisions and making them happen. Handbook of Business Strategy [Online]. 7(1) pp.133-42. Available from: [Accessed 11 April 2009].
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • Costco Strategy Essay
  • Costco Strategy Essay
  • Tesco's Issues & Strategies Essay
  • Crafting and Executing Strategy Essay
  • Marketing Communications Strategy Essay
  • A New Strategy for Kodak Essay
  • Business Strategies
  • Chapter 1 Market Driven Strategy Essay

Become a StudyMode Member

Sign Up - It's Free