MARKS & SPENCER

Marks & Spencer Strategic Analysis

Marks & Spencer

Introduction

The present report analyze the problems of Marks & Spencer faced by the two CEOs Roger Holmes and Stuart Rose and their different approaches to reach business' success. Marks & Spencer was very successful in its early years, followed to a severe tradition involving its processes and trading practices; however in the latter part of the 1990's its success was ending (Collier, 2007).

The report will focus in the Marks & Spencer internal environment, identifying resources and capabilities in the form of value, finding competences and determining what competitive advantage the firm has; however, it will take some external environment analysis' considerations. Furthermore, applying the financial analysis that is an important part of the procedure of developing business strategies which helps to diagnostic the problem extents and prospects within a company (Collier, 2007). Thus, the document will be structured into the following parts:

Value Chain analysis (internal analysis), examining the development of competitive advantage.

The micro environment alongside the macro evaluation will deliver all figures needed for the final SWOT Analysis.

Financial analysis focusing in 4 financial ratios from 2004 to 2006

Return on Assets

Return on equity

Current Ratio

Debt to equity ratio

Value Chain Analysis

The framework above describes the range of different activities created by Porter in 1985, to develop a maintainable competitive advantage for a business in form of value. These activities are divided in a primary activities and support activities where they are going to be analyzed below in the Marks & Spencer's case.

Primary activities

Inbound logistics: In order to ensure good quality control and good service, Marks & Spencer works with supplies, however at first time its management held exclusively in the use of British supplies.

Operations: is involved in the direct selling of apparel, foodstuff, and even home furnishings.

Outbound logistics: Marks Spencer has its direct distribution rather than utilizing third parties service.

Marketing & sales: due to competition can be observed that in the primary activities, marketing and sales are the activities that Marks and Spencer give more priority worked through in the construction of a strong brand. The result is a consistent image and assurance of standards (offering consumers high quality).

Services: the customer service activities of Marks and Spencer are designed to serve customers in a way that they will come back, with the purpose of customer loyalty.

Support activities

Procurement: it is crucial activity of the company, thus, Marks and Spencer value its suppliers to build strong relationship.

Technology development: Marks and Spencer use latest technologies for conducting it business activities.

Human Resource Management (HRM): Marks and Spencer treats employees equally so that they get motivated and help the company in meeting its objectives (John, 1996).

Firm infrastructure: the infrastructure management of Marks and Spencer is designed to facilitate the customers so that customers find their products easily.

SWOT

Strength

For the strategic performance management strengths are the key forces for a company as it identifies and help the organizations to move towards the goals and objectives that were previously set by the management which ultimately affect the overall efficiency of ...