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Retail Business Environment

Notes company did not develop their capabilities to follow the changes. It is no surprise that M&S lost
market share. Now the main problem for the management is how to utilize and combine all the
resources and competences to develop new competitive advantages.

Recommendations for Future Strategies

So far the report has highlighted M&S major areas of concern. Having done that, we will now
take our analysis one step further and provide a list of recommendations for M&S management
which we think are important to recognize in order to regain sustained competitive advantage:
 Macro and micro environment change have great impact on the performance of companies.
Sticking to previous stubborn strategies and ignoring rapid environment change will
only disadvantage the company. An open-minded and flexible management, with capability
of reacting swiftly to the environment and competitors’ strategy change, is crucial for the
survive and success of the company.
 Strategy development takes place in a political organizational environment that is
influenced by a series of stakeholders, each of them with different levels of interest and
power. In the past, strategy making was done by the top management which paid little
attention to the potential impact of stakeholders. It is highly likely that this contributed to
the poor performance of the company. In the future, stakeholder mapping should assist
the strategy developing process leading to a more transparent picture of potential
influences.

 The importance of culture has to be considered when changes are planned in restructuring
the organization or when new strategies are considered due to their interrelation. The
challenge of the new top management is to achieve a ‘fit’ between these forces. This can
only be done gradually over the long-term because rapid changes might lead to resistance
among M&S employees.

 The resources and competences of companies are the primary determinants of their
strategies. M&S should hold core competences to form their competitive advantages in
the industry. Accordingly, M&S should build its own core competence by utilizing and
combining its resources and competences, especially unique resources, such as brand
name and image. Flatter organization structure and customer-closeness will help M&S to
react quickly and to serve customers better.

 Lastly, M & S should consider the following suggestions:
 To conduct market research to find what really current customers want.
 To segment the markets scientifically.
 Understand and treat each store as individual SBU.
 To separate the food and clothing divisions into separate stores.

 Find cheaper suppliers for the clothing range.
 To introduce a new loyalty card for its customers.
 To have more women in its top management who understands customers well.

Task Study the retail chance of a particular retail industry of your choice and make a
project report on it?

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