Marks and Spencers.

Management & Strategy Report

Assignment 2

Case Study on Marks and Spencer's

word Count 2732

Executive Summary

1. Key changes in market4

Clothing4

Food4

Financial Services5

Home-wares5

International5

2. Generic Strategies7

Decline in profits cause concern7

What strategy did they follow?7

Blind ignorance?8

Vandevelde arrives in 20008

Differentiation strategy8

Cost-leadership elements9

Possible distraction from M&S's new strategy9

3. Ansoff's Matrix10

Strategic direction followed under Peter Salsbury11

Withdrawal from markets11

Acquiring Littlewoods chain11

Large-scale promotional campaign11

Severing links with UK suppliers11

Financial services, International markets and Home & Internet shopping11

January 2000 to March 2002 - Arrival of Luc Vandevelde12

Strategic direction followed under Vandevelde12

Main areas of Vandevelde's Market Penetration Strategy12

New clothing ranges12

4. Organisational Culture13

Cultural Web13

Changes in organisational culture14

Overhaul helped change culture15

1. Key changes in market

Over the past decade M&S's competitive advantage seems to have eroded. The following aims to determine the key changes in the market that contributed to this decline.

English: Logo of Marks & Spencer

Marks & Spencer Store in Central Tower, Hong Kong

tesco slough

It is important to first of all state that M&S were not just in one market but several. The main markets, in no particular order, being:

1.Clothing

2.Food

3.Financial services

4.Home-Wares

5.International

Clothing

M&S built up its competitive advantage here through stocking 'generic clothing' that was 'built on basics' (Document A, p.1045). However, they did not at any time assess the market or research customer trends and this left a gap which competitors quickly filled.

People change. Fashions change, and to ignore this fact is silly. With the onset of the recession in the early 1990's customer's needs had changed and this was reflected in their spending patterns. They main changes being

1.More fashion conscious especially in younger age group

2.Customers had less disposable income therefore needed cheaper clothes

M&S failed to...