Strategic Management of Marks & Spencer 1

STRATEGIC MANAGEMENT OF MARKS & SPENCER

by <Name>

Course

Professor

Institution of Learning

City/State

Date
 Strategic Management of Marks & Spencer 2

Table of Contents

Introduction......................................................................................................................................3

Findings...........................................................................................................................................3

Porter's 3 Generic Strategies...............................................................................................4

Company Analysis..............................................................................................................6

Evaluating the Selected Strategy......................................................................................10

Conclusion.....................................................................................................................................15

Recommendations..........................................................................................................................16

Reference List................................................................................................................................17
 Strategic Management of Marks & Spencer 3

Introduction

Management processes in modern globalised markets involves implementing strategies

that promote organisational profitability, competitiveness and continuous growth. To accomplish

strategic goals, managers must concentrate on addressing convolutions and complexities related

to the current industrial world. Today, pursuing strategic goals necessitates adopting effective

strategic management processes to facilitate problem-solving operations in organisations.

Strategic management entails identifying and employing procedures that improve organisational

resilience and competitiveness in current markets (Lynch, 2015; Johnson et al., 2014). The

management procedure helps managers comprehend business situations, create action plans,

deploy business plans and evaluate implemented plans (Hill et al., 2017). Essentially, managers

develop strategic management approaches based on their organisations’ needs in specific

situations and periods, making flexibility essential for this professional role. The strategy also

allows managers to develop strategies that guarantee business survival through the focus on

logical and consistent methods. Therefore, Marks & Spencer (M&S) can utilise the strategic

management procedure to guide its competitive strategy and future growth plan.

Findings

The strategic management process for modern businesses occurs in three distinct stages,

namely strategy formulation (stage 1), strategy implementation (stage 2) and strategy evaluation

(stage 3). Strategy formulation involves utilising adequate knowledge to orient organisational

operations towards various long-term goals. At this stage, the professional team makes important

decisions regarding important project activities, including continuous expansion, resource

allocation, mission and vision development, environmental analysis, goal setting and strategy

selection (Barney & Hesterly, 2015). Management teams can formulate various strategies at
 Strategic Management of Marks & Spencer 4

different organisational levels, including business-level and corporate-level strategies (De Wit &

Meyer, 2010). Strategy implementation entails executing strategic plans to accomplish specific

corporate goals and objectives. At this stage, managers must allocate resources, set objectives,

motivate workers and design policies to facilitate strategy implementation in organisations.

Strategy evaluation involves analysing a specific organisational strategy to determine the

effectiveness of its implementation. Specifically, the report utilises Porter’s (1985) Five Forces

model to demonstrate the formulation and execution of business-level strategies in M&S.

Porter's 3 Generic Strategies

Experts perceive Porter's 3 generic strategies as crucial management tools for businesses

operating in highly competitive markets globally. The model supports strategic management by

guiding organisations’ response to competition pressure existing in specific markets. Specifically,

Porter’s generic strategies emphasize the need for businesses to make tough decisions to enhance

their profitability and competitiveness. Various generic strategies that businesses can utilise to

improve their competitiveness in their markets are focus, differentiation and low-cost strategies.

First, the cost-leadership strategy involves minimising production and operating costs without

reducing product/service quality to attract price-sensitive clients (Islami et al., 2020). Businesses

that intend to minimise production/operating costs usually combine different strategies to

accomplish and maintain the lowest possible operating costs while maintaining customer value.

Nowadays, businesses reduce their production costs using different strategies, including

implementing advanced technologies, maintaining large-scale operations, utilising low-cost

materials and minimising marketing costs (Kunc, 2010). Not only does cost leadership optimise

organisations' competitiveness but also helps to optimise their profit margins. Other benefits

associated with this business-level strategy are optimised market share, increased market share,
 Strategic Management of Marks & Spencer 5

improved efficiency and enhanced customer loyalty. Nonetheless, cost leadership strategy has

several limitations, including quality maximisation challenges and financial allocation dilemmas.

Figure 1: Business-Level Strategies (Hattangadi, 2022)

Second, the differentiation strategy involves creating unique products using different

strategies and resources to meet particular client needs. The business-level strategy aims to

generate unique customer value through unique customer service, innovative marketing

procedures, effective distribution channels and superior production design (Islami et al., 2020).

Modern firms provide unique customer value through the focus on reducing delivery time, using

high-quality ingredients, creating unique product features and implementing advanced

technology. For instance, a company can achieve competitiveness in the market by offering

durable, innovative and durable products to customers. The strategies allow businesses to

overcome pressure from competitors by attracting new clients and strengthening their brand. The

differentiation strategy offers organisations benefits such as unique product offerings, improved

brand loyalty, increased competitiveness, optimised profit margins and market dominance (De

Wit & Meyer, 2014). However, the business-level strategy creates several problems for

organisations, including increased operating costs, production scale-up challenges, brand dilution

and increased system complexity. Professionals can overcome these challenges by investing in
 Strategic Management of Marks & Spencer 6

an innovative workforce, research and development processes, and effective marketing

processes.

Finally, the focus strategy is a generic strategy that involves narrowing the competitive

scope to effectively serve a specific niche in the market. The generic strategy enables

organisations to operate effectively through the focus on specific consumer populations, product

lines and regional markets (Islami et al., 2020). Professionals understand that the focus tactic

helps companies to serve specific consumer segments in huge markets in situations involving a

limited capital base. The capacity to venture into huge markets using limited capital makes the

focus strategy highly suitable for small companies. Large companies can also utilise the strategy

to support their low-cost and differentiation strategies when penetrating new markets (Furrer,

2016). Basically, the focus strategy allows businesses to integrate diverse activities linked to low

cost and differentiation within a specific market segment, which ensures organisational

competitiveness and survival in extensive markets. Implementing this business-level strategy

allows businesses to enjoy benefits such as differentiation, resource user efficiency, improved

customer loyalty and enhanced competitiveness. Still, the generic strategy exposes businesses to

different challenges, including sensitivity to market dynamics, price sensitivity, risk of focus and

limited growth opportunities.

Company Analysis

M&S is a UK-based multinational retailer that sells quality homecare, clothing, beauty

and food products to numerous clients globally. Spencer and Marks established the company in

1884 to exploit numerous opportunities available in the UK retail industry. The management

later combined different corporate- and business-level strategies to ensure the company’s

continuous growth at international and local levels. In the 1970s, the company started its
 Strategic Management of Marks & Spencer 7

international expansion effort by opening stores in European and Asian nations. Today, M&S

operates around 1,492 stores in over 70 markets with most stores being concentrated within the

European region (Statista Research Department, 2024). The multinational company employs

approximately 65,000 people, generates £672.5m in annual gross profit and boasts £7.49 billion

in market capitalisation (Marks & Spencer, 2024; M&S, 2024). M&S’s success in the current

retail industry can be attributed to its capacity to effectively implement corporate- and business-

level in supporting growth and competitiveness optimisation efforts. In particular, the

multinational company has effectively utilised Porter’s generic strategies in maintaining

competitiveness within the European retail market.

The current management for M&S focuses on utilising business-level strategies that can

improve its competitiveness within the European market. The company bases this initiative on

past undesirable experiences that involved closing stores in different European nations, including

France, Spain, Belgium and Germany. Store closure in these Western European nations followed

intense competition pressure that prevented the multinational company from maintaining

profitability. Top competitors that expose the company to challenges in optimising its

profitability through its operation in this region are Walmart, Crew Clothing, Monsoon

Accessorize, Waitrose, ZARA, H&M, Macy's, Tesco, Primark, M&Co, Amazon and ALDI

(Owler, Inc., 2024). Failure to implement effective expansion strategies also forced the company

to close its 12 stores in five Balkan nations, including Bulgaria, Slovenia, Serbia, Montenegro

and Croatia (Morrison, 2015). Existing statistics indicate that the company’s inefficiency in

overseas markets has increased its dependence on the UK market, which has reduced its

competitiveness in the globalised retail market. Nonetheless, the current management

understands that existing business-level strategies can improve the company’s performance in the

European region.

Formulating a business-level strategy involves generating plans for competitiveness

enhancement and customer value optimisation. The strategies enable businesses to capitalise on

different perspectives in overcoming challenges associated with operating in modern globalised

markets. Two key perspectives on developing an appropriate business system for 21st-century

markets are inside-out and outside-in perspectives. The inside-out perspective stresses the crucial

role internal resources and capabilities play in enhancing organisational competitiveness. The

approach indicates that businesses’ success depends on their capacity to capitalise on their inner

strengths in developing quality products/services (Gilmore & Williams, 2012). Conversely, the

outside-in perspective encourages managers to consider external forces and opportunities when

developing organizational systems. In this regard, outside-in strategists believe that

organisations’ success depends on their capacity to address specific customer preferences and

market demands. Comprehending these business perspectives enables professionals to choose

appropriate approaches for tackling major organisational problems. In this case, M&S’

management can employ Porter’s generic strategies to overcome existing competition pressure in

the European retail market.

Particularly, Porter’s generic strategies that can offer Marks & Spencer a sustainable

competitive advantage in the European market are focus, differentiation and low-cost strategies.

First, the current management recognises differentiation as an effective strategy that M&S can

employ to overcome competition pressure in the European retail market. Existing evidence links

the company’s past failures to its general ignorance of the differentiation tactic’s relevance to

current management roles. The management inefficiency explains its general inability to expand
 Strategic Management of Marks & Spencer 9

successfully at regional and global levels, which is explained by its over-dependence on the UK

retail market. The situation implies that the company should aim to differentiate its products

based on features, quality, production operation, packaging materials, presentation strategy and

delivery tactics (Brinkman et al., 2014). Various tactics the multinational retailer should adopt to

accomplish its differentiation goal are embracing online selling, sourcing high-quality

ingredients, improving R&D programs and acquiring advanced technology. For instance, an

improvement in the R&D (research and development) program can enable M&S to create quality

products and discover innovative service delivery tactics. The quality maximisation tactic would

also demand an investment in quality ingredients from its different products to optimise customer

value.

Marks & Spencer experiences intense competition pressure from local and multinational

firms in different retail subsectors. The management understands that venturing into these retail

subsectors exposes the company to price wars of different magnitudes. For instance, the food

sector features intense price wars between small and multinational grocery retailers that aim to

accomplish market dominance (Li et al., 2023). These price wars expose M&S to a challenge in

maintaining loyal customers, penetrating new markets and maximising profitability. In the past,

pressure from convenience stores and household discounters has forced the UK-based company

to close stores in Western Europe and Balkan nations. Today, the company’s management aims to

employ the cost leadership tactic to re-enter and maintain dominance in markets across Europe

and other regions globally. M&S can accomplish market dominance by lowering its operating

costs without lowering the overall quality of its broad product portfolio. In essence, the

multinational retailer can create competitive prices for its products through investment in cost
 Strategic Management of Marks & Spencer 10

reduction measures such as inexpensive low materials, cost-efficient logistics and advanced

technology.

Finally, M&S can adopt the focus strategy to minimise risks associated with penetrating

new markets within the European region. The business-level strategy offers the company an

opportunity to narrow its competition scope in various retail subsectors. The process would

involve focusing on specific regional markets, product lines and consumer populations to

minimise the overall costs of penetrating new markets (Furrer, 2016). Although M&S still enjoys

economies of scale, the company can employ the strategy to support its cost leadership and

differentiation operations when entering new markets. In this case, focus differentiation would

involve offering products with huge demand among particular consumer groups. In this regard,

the management team must understand that increasing diversity in European markets exposes

businesses to challenges in satisfying different customer segments within larger markets.

Similarly, the cost-focus tactic would feature efforts aimed at creating low-cost products for

price-sensitive clients in extensive markets. The strategy can enable the company to exploit

revenue optimisation opportunities associated with variations in cost behaviours in particular

retail segments.

Evaluating the Selected Strategy

Strategy evaluation is an essential step in the strategic management process that seeks to

determine a strategy’s effectiveness in addressing specific goals. Specifically, the evaluation

procedure aims to gauge a strategy’s capacity to satisfy various conditions for strategy

implementation in organisations. First, the procedure determines whether the project

implementation team fully comprehends specific goals, which helps in eradicating incompatible

objectives. Professionals develop these goals through proper consideration of different factors
 Strategic Management of Marks & Spencer 11

affecting an organisation in the market. Second, professionals must explore adjustments required

to address external environmental forces affecting an organisation (Sekhon et al., 2017). Third,

professionals consider strategies and resources that managers can utilise to optimise an

organisation’s competitiveness within specific market segments. Finally, the management

focuses on addressing various factors hindering organisations from reaching their maximum

potential. In this scenario, the SAF (Suitability-Acceptability-Feasibility) framework provides

information about the effectiveness of Porter’s generic strategies in optimising M&S’

competitiveness based on the four conditions.

Figure 2: The SAF (Suitability-Acceptability-Feasibility) Framework (FourWeekMBA, 2024)

The SAF framework enables professionals to evaluate the execution process for business-

level and corporate-level strategies for companies. The framework provides an effective,

structured and simple process for informing strategy selection processes (Ivory & Macdonald,

2024). The tool allows managers to choose strategies that best suit their corporate interests,

including competitiveness enhancement and profit maximisation. The process makes SAF a
 Strategic Management of Marks & Spencer 12

reliable framework for evaluating the capability of Porter’s generic strategies to improve M&S’

performance in the highly competitive European market. Three assessments that the management

can perform to determine the strategies’ suitability for the competitiveness enhancement role are

suitability (S), acceptability (A) and feasibility (F) (Støttrup et al., 2019). In this context, the

suitability (S) assessment provides details on generic strategies’ suitability for the company’s

competitiveness optimisation objective. The acceptability (A) assessment provides information

on the generic strategies’ capability to create sustainable improvement in the company’s

performance. The feasibility (F) assessment provides details on the generic strategies’ feasibility

in the competitiveness enhancement project.

SAF Assessments

Generic Strategy Suitability Acceptability Feasibility Reject/Accept

1. Differentiation The differentiation The generic strategy The differentiation Accept

strategy can enable creates a sustainable strategy can allow

M&S to utilise its process for the company to

resources and improving the maintain

capability to company’s competitiveness in

enhance its competitiveness in the European

competitiveness in the European retail market in the long

the European market. run. The strategy

market. The can enable the

company can company to grow its

effectively consumer base by

differentiate its effectively

products based on addressing the

quality, pricing, specific needs of

packaging and diverse consumer

presentation. groups in the

market.

2. Cost The cost leadership Cost leadership is an Cost leadership can Accept

leadership strategy offers effective strategy for support the

M&S an enhancing company in

opportunity to organisations’ maintaining a long-

implement competitiveness in term competitive

competitive pricing modern markets. The advantage in the

to win existing strategy can enable European market.

price wars in the M&S to reduce The company can

European retail prices for its products achieve this goal

market (Ali & without reducing through effective

Anwar, 2021). their quality. procurement,

Implementing the logistics redesign

generic strategy can and technological

support the business upgrades.

in addressing the

desires of price-

sensitive clients in
 Strategic Management of Marks & Spencer 14

the market.

3. Focus strategy The focus strategy The acceptability can The focus strategy’s Accept

helps Marks & enable M&S to feasibility lies in the

Spencer avoid huge effectively penetrate general need to

financial and highly competitive customise business

competition risks European markets strategies for highly

associated with without risking a diverse markets of

penetrating new huge proportion of its the current century.

markets within the available capital. The company can

European region. use the strategy to

The risk reduction penetrate other

approach involves retail markets

enabling the outside the

company to focus European region in

on specific the future.

consumer segments

instead of entire

markets.

Table 1: SAF Assessments

Conclusion

Marks & Spencer can capitalise on the strategic management process in improving its

performance in the entire European market. The management can employ the process to address

its past performance inefficiencies outside the UK retail market, which has hindered its global

expansion. Particularly, M&S can employ Porter’s 3 generic strategies to overcome the existing

competition pressure in the European retail market. The strategic management features a design

that prepares multinational companies for existing challenges in highly competitive markets.

Various generic strategies that a company can implement to improve its competitiveness in the

European retail market are focus, differentiation and cost leadership strategies. For instance,

M&S can gain a competitive advantage by differentiating its products based on features, delivery

tactics, quality, packaging materials, presentation strategy and production operation. The

multinational company can win existing price wars in the European retail market using the cost

leadership strategy. The focus strategy can further enable M&S to concentrate on specific

consumer groups within the larger retail market in the UK.

The SAF framework proves that Porter's 3 generic strategies are an effective strategic

management tool for businesses operating in modern markets. The framework evaluates the

framework’s effectiveness for the strategic management role through three assessments, namely

suitability (S), acceptability (A) and feasibility (F). For instance, these assessments prove that

cost leadership, differentiation and focus strategies can effectively enhance the company’s

competitiveness in the European market. The framework showcases the generic strategies as

effective business-level strategies that effectively suit inside-out perspectives on business system

development. The assessment tools suggest that the company can implement these strategies to

cope with competition dynamics in the European retail market. The framework indicates that
 Strategic Management of Marks & Spencer 16

these generic strategies are feasible business-level strategies for the company’s long-term

operation in these markets. The evidence implies that M&S can rely on these strategies in

maintaining a long-term competitive advantage within this market in the long run.

Recommendations

The analysis indicates that the management team should implement focus, differentiation

and low-cost strategies to improve M&S’ competitiveness in the European retail market.

Therefore, the management should explore multiple options for facilitating these strategies

implementation in the company’s competitiveness enhancement agenda. For instance, increasing

financial allocation to the M&S’ research program can facilitate the discovery of innovative

product differentiation tactics. Proper research can enable the management team to discover

unique strategies for addressing the different needs of specific consumer groups in the larger

retail market. The management can employ the workforce development tactic to improve its

capacity to develop innovative ideas for price reduction and focus differentiation. Additionally,

the management should concentrate on acquiring advanced technologies to effectively

implement cost reduction and differentiation strategies in the future.

Reference List

Ali, B. J. and Anwar, G. (2021). Porter’s Generic Competitive Strategies and its influence on the

Competitive Advantage. International Journal of Advanced Engineering, Management

and Science, 7(6), 42-51.

Barney, J. B. and Hesterly, W. S. (2015). Strategic management and competitive advantage:

Concepts and cases. 5 ed. Essex: Pearson Education Limited.

Brinkman, J., Navarro, I. and Harper, D. (2014). Unlocking the business environment. Abingdon:

Routledge.

De Wit, B. & Meyer, R. (2010). Strategy: Process, content, context: An international

perspective. Boston: South-Western Cengage Learning.

De Wit, B. & Meyer, R. (2014). Strategy an international perspective. Boston: Cengage

Learning.

Furrer, O. (2016). Corporate level strategy: Theory and applications. Abingdon: Routledge.

Gilmore, S. and Williams, S. (Eds.). (2012). Human resource management. Oxford: Oxford

University Press, USA.

Hill, C. W. L., Schilling, M. A. and Jones, G. R. (2017). Strategic management theory. 12 ed.

Boston: Cengage Learning.

Islami, X., Mustafa, N., & Topuzovska Latkovikj, M. (2020). Linking Porter’s generic strategies

to firm performance. Future Business Journal, 6, 1-15.

Ivory, S. B. and Macdonald, E. (Eds.). (2024). Introduction to management: Functions and

challenges. Oxford: Oxford University Press.

Johnson,G., Scholes, K.,Whittington, R., Angwin, D. and Regner P. (2014). Exploring strategy:

Text and cases. London: Pearson Education Limited.

Kunc, M. (2010). Revisiting porter’s generic strategies for competitive environments using

system dynamics. In Computational Analysis of Firms' Organization and Strategic

Behaviour (pp. 173-191). Routledge.

Li, L., Wang, Y. and Zhang, Y. Y. (2023). A critical examination of M&S's current strategic and

marketing position, as well as potential sustainable competitive marketing strategies.

International Journal of Science and Business, 18(1), 108-117.

Lynch, R. (2015). Strategic management. 7 ed. Harlow: Pearson Education Limited.

M&S. (2024). M&S: Sustainability. M&S. [Link]

Marks & Spencer. (2024). Market capitalization of Marks & Spencer (MKS.L). M&S.

[Link]

Morrison, C. (2015). Marks & Spencer to close 12 stores in five Eastern European countries.

City AM Limited. [Link]

eastern-european-countries/

Owler, Inc. (2024). Marks and Spencer competitors or alternatives. Owler.

[Link]
 Strategic Management of Marks & Spencer 19

Sekhon, M., Cartwright, M. and Francis, J. J. (2017). Acceptability of healthcare interventions:

an overview of reviews and development of a theoretical framework. BMC Health

Services Research, 17(1), 1-13.

Statista Research Department. (2024). Number of Marks & Spencer stores from 2010 to 2024, by

region. Statista. [Link]

of-outlets-by-region/

Støttrup, J. G., Dinesen, G. E., Schumacher, J., Gillgren, C., Inácio, M. and Schernewski, G.

(2019). The systems approach framework for collaborative, science-based management

of complex systems. Journal of Coastal Conservation, 23, 881-898.