M & S BUSINESS ENVIRONMENT

M & S Business Environment

M & S Business environment

Introduction

One of the big organizations in the retail business is Marks and Spencer (M&S). It is one of the UK's leading retailers of clothing, foods, home ware and financial services, serving 10 million customers a week on over 300 UK stores. M&S is headquartered in London, UK.M&S has been through a lot and faced a lot of struggles. Troubled in recent years and suffering from slipping market share, the company had divested itself of non-core and overseas interests and had begun to show signs of improvement.

By understanding M&S's strategic position, it will help to understand their marketing plan as they are directly connected to each other. Communication strategy has to be planned and several recommendation and solutions will be suggested for M&S. All of that will be introduced and analysed through out the report.

Stakeholders Influence on M & S

In M & S shareholders are in direct contact with managers and are of great importance for the directors of the company. They have the ability to influence the objectives and directions of the organization (Bower, 2004 pp 45-100).

In theory they can exert influence through voting at the annual shareholders meeting but unless individuals group together their votes will have little impact.In any case they are likely to be outvoted by the big institutional investors (e.g. pension funds) who own large blocks of shares.However, shareholders can exert influence through threatening to “vote with their feet” by selling shares. As a result, managers and directors at M & S keep shareholders satisfied.

Determinants of Stakeholder Power

For stakeholders at M & S have power and influence the desire to exert influence must be coupled with the means to exert leverage on the company(Fill 2001, pp 409-425). How much power the stakeholder can exert will reflect the extent to which:

The stakeholder can disrupt the M & S organizational plans.

The stakeholder causes uncertainty in the plans.

M & S needs and relies on the stakeholder.

Internal Analysis

Auditing the Resources of Marks & Spencer

Physical

M&S own 375 UK stores, 155 stores managed under franchise in 28 territories and the US supermarket group, Kings Super Markets (anon, 2004d). This indicates their strength. But all M&S stores were identical in procedures, layout, design and image which lead to limitation of changes according to local changes based on environment, lifestyle and geographical location.

Human

M&S has loyal, friendly, hardworking and experienced staff. Knowledge management was not handled in a right way due to Greenbury's style of top-down management structure. No skills in buying or outsourcing according to consumers needs. No good communication between the head quarter and stores due to M&S bureaucratic culture.

Financial

M&S profits were declining from 1998 until 2000. This indicates that M&S did not have a healthy sign of its level of cash availability which made M&S to stop its expansion (Eagle 2000, pp.667-686) programme in Europe and America. But in general M&S has good financial resources.

Intangible

Customer loyalty decreased due to change of market fashion ...