M&S Management
Literature Review
History and Culture
It was very common to read about Marks and Spencer as ‘one of the best managed and admired businesses in the world’ (Mellahi et al 2002). The company had enjoyed a great success in the retail sector. Marks and Spencer commenced its business activity in Leeds in the late 19th century, as a family-run shop, with strong values. Since then and for many years after, it became popular for its alternative way of business, in comparison to other British retailers (Mellahi et al 2002). It established a good relationship with customers based on loyalty and trust. The firm also gained high respect from the British people; it was considered the biggest corporate charity donor within the UK (Mellahi et al 2002). Not only consumers, but staff and shareholders could share this great success. According to Wallop (2012) the company has been the most important British clothing retailer for decades, and also the first retailer in the UK to publish annual profits of £ 1bn. Lately Marks and Spencer has undergone a difficult period. The latest management changes have once again disrupted stability. In July 2012, M&S announced widespread changes across the company, including a new head of general merchandise, style director and a new head of food. A number of external and internal factors explain these changes.
External Factors
Consumer spending & Competition
External factors can be described as things affecting the company beyond its control. Firstly, the retail industry in which M&S operates has weakened as a result of low consumer spending. Research by Ernst & Young (2012) suggests growth in consumer demand in 2012/2013 will be only half the level expected 12 months ago. According to Iqbal and Sharma (2012), spending power of consumers has resulted in aggressive competition among retailers. Retail expert Nick Bubb (2012) claims ‘it is hard for M&S to keep moving forward, with so many eager rivals, from Primark, to
History and Culture
It was very common to read about Marks and Spencer as ‘one of the best managed and admired businesses in the world’ (Mellahi et al 2002). The company had enjoyed a great success in the retail sector. Marks and Spencer commenced its business activity in Leeds in the late 19th century, as a family-run shop, with strong values. Since then and for many years after, it became popular for its alternative way of business, in comparison to other British retailers (Mellahi et al 2002). It established a good relationship with customers based on loyalty and trust. The firm also gained high respect from the British people; it was considered the biggest corporate charity donor within the UK (Mellahi et al 2002). Not only consumers, but staff and shareholders could share this great success. According to Wallop (2012) the company has been the most important British clothing retailer for decades, and also the first retailer in the UK to publish annual profits of £ 1bn. Lately Marks and Spencer has undergone a difficult period. The latest management changes have once again disrupted stability. In July 2012, M&S announced widespread changes across the company, including a new head of general merchandise, style director and a new head of food. A number of external and internal factors explain these changes.
External Factors
Consumer spending & Competition
External factors can be described as things affecting the company beyond its control. Firstly, the retail industry in which M&S operates has weakened as a result of low consumer spending. Research by Ernst & Young (2012) suggests growth in consumer demand in 2012/2013 will be only half the level expected 12 months ago. According to Iqbal and Sharma (2012), spending power of consumers has resulted in aggressive competition among retailers. Retail expert Nick Bubb (2012) claims ‘it is hard for M&S to keep moving forward, with so many eager rivals, from Primark, to