Change Management Marks & Spencers in the UK

Executive summary

            Marks and Spencers is the United Kingdom’s leading retail chain company which was founded by Mr Michael Marks in 1894 .He was earlier joined by Mr. Tom Spencer in the 1851 in a partnership agreement. Marks and Spencers later died and left the firm in the hands of marks’ son .To date it is the leading retail company in the United Kingdom with over 300 stores outlets in the home country a lone. It owns over 100 other outlets across Hong Kong, Canada, and Europe as well as over 85 franchise stores in the Middle East, Far East, Australia, and Bahamas European Bermuda.

            According to Oram (1996), the company has been driven and grown through consistent focus on quality, values services, innovation and trust which are the principles upon which the company was founded.

Major contributions to the success of Marks and Spencers

            In the 1920’s the then revolutionary policy of buying directly from the manufacturers thus enabling it to achieve cost leadership strategies and value delivery to customers in the form of competitive pricing .the company introduced a code of practice called Global sourcing in all its outlets to ensure secured conditions of its workers across the world. In the 1999 the company published the code of practice of Global sourcing principles as a minimum standard for all suppliers in a bid to improve the conditions for its workers overseas

            Since its inception Marks and Spencers has been at the forefront of innovation .In the 1934 it became the first retail chain the whole of United Kingdom to establish a research laboratory which was the headed by Dr. Eric Kann. As early back as established the first ever self service trial in the United Kingdom .Online shopping was introduced in the year 1999 at all the shopping outlets through the company’s website and this promoted efficiency of customer service as well as the increasing the revenue growth.

            According to Marcom (1991),the company has been at the forefront of introducing quality products as follows:  In the year 2000, introduced the machine washable suits for men and the Bio form Bra as well as having twelve of its items awarded the Global Millennium  products ,the highest number ever awarded to a single firm

The Present Perspective

            The current trend of growth is not completely satisfactory given the modern turbulences in the business environment like globalisation, and international financial recession that have griped the major world economic powers. Therefore Marks and Spencers require very prudent change mechanisms to enable it stay ahead in business success. The current global recession must make every firm in the United Kingdom like the rest of the world to adapt, learn and practice new better strategies.

            Presently many firms adopt changes in their processes to enable them survive the competitive and volatile market environments of the present world. The main objectives for which Marks and Spencers should make changes are;

Cost of Operations

            The company as per its old tradition of cutting cost on supplies when it established a policy of buying directly from the manufacturers, it should presently try to adopt cost reduction mechanisms. This could be implemented within its change program. Cost of doing business is increasing day by day with continued pressure for better and improved staff welfare as well as increases in the cost of obtaining products from the suppliers due to competition for raw materials between manufacturers.

Revenue Growth

            Marks and Spencers like any other company should steer towards increasing its level of revenues which calls for comprehensive policy change. For example, it should increase the levels of local franchise contracts to widen its market share as well as employing intensive and extensive use of information technology in its marketing, customer service, research and production

Customer Satisfaction and Retention

As the main basis for its operation as well as profitability Marks and Spencers should continue with its research and innovation to ensure that it continually satisfies its customers. Like in the past when it banned dogs from its stores to ensure hygiene in its stores, such strategies should continually be initiated to attract and retain customers for its stores.

Competition.

Bookbinder (1989) argued that many modern companies employ very aggressive competitive strategies in order to fight out for market share as well as customer loyalty which is obviously a vital element to success of any business. The extent of competition and success of any firm depends mainly on whether it identifies the sufficient grounds of customer satisfaction through efficient delivery of value, price, service as well as quality to its customers. Marks and Spencers is well known for its continued efforts towards providing these vital elements to maintain its customers satisfaction

Profitability

Current times call for it to implement creative ideas towards reducing costs of operation and keeping control of the market share and revenue growth levels for high output. The current global economic recession has resulted in reduction of profits of many firms and Marks and Spencers is not spared from a possible fall in its profits both at present and in the future times. It should therefore strive to employ the latest tactical as well as operational changes within its business operations policy frame work. The strategy should address issues of operational cost reduction through the use of latest information technology systems. The most relevant and appropriate change to be undertaken by Marks and Spencers is a complete overhaul of the exiting old systems and replacing these with relevant and current processes.

Business Process Reengineering

            This will involve complete restructuring of the firm’s frameworks of activities from its mission and values. In the light of the current existing modern business environment whereby many new marketing strategies as well as the more aggressive customer services approaches are used by various competitors.

            Marks and Spencers needs to fundamentally redesign and strategically re-evaluate all its procedures by implementing changes in its mission statement, sourcing, service delivery, and quality control, aspects of culture, processes, systems and distribution systems.

The suggested business processes changes may take many different forms as follows,

Customer service

Modern customers are more exposed to many product offers through different communication media like the internet. Marks and Spencers UK should embrace the use of information technology in all its customer service operations as far as customer feedback, inquiries and complaints handling is concerned. The customer service staff should be continually trained on the modern research findings on the trends of changes in customer behaviour to help equip them with the relevant skills on latest customer needs.

The Managed Change Model

            It is evident that Marks and Spencers has continually been undertaking numerous strategic as well as tactical changes over the past and therefore it needs to adapt to modern business challenges through the complete reengineering across all its operations and proactively dealing with resistance to this change.

            It has demonstrated in the past that it is a company which embraces change and is continually undergoing through continuous learning and adapting to the prevailing market conditions .It has shown this virtues by the introduction of new items and services like wine, self service shopping, introduction of financial services as well as the adoption of the policy of direct sourcing from the manufacturers.

Discussion

            Drucker (2007) outlines that Marks & Spencers provided upper class goods to the middle class workers which were of better quality than the upper class. Their prices were affordable to the lower class group of people. This strategy ensured that more goods were sold increasing the turnover rate hence more profits. People of all class could and are able to purchase these products.

            M&S had seen a major opportunity after the First World War. There was a rapid change in the social structure of people in the United Kingdom which this company capitalized on. During this time in England, dress was a major tool to distinguish between classes of people. There was a high demand of good quality but less expensive clothes which was contributed by the high demand for uniforms during the World War I. However, there were no company that distributed these products largely into the country. Marks & Spencers opened many stores countrywide inorder to satisfy the high demand of the fabrics by the citizens. Within a short period of time the company became the leading distributor of clothing and textile in England a position they hold up to date.

Consequently, after the Second World War British people learnt eating new foods. Marks & Spencers capitalized on this social change and provided food stuff into their stores. According to Drucker (2007) this rational decision attracted many customers which contributed to 1/4 of their total sales by 1972

            There are several change management models that are used by various organisations in imparting change. These include; McKinsey’s 7-S Model, Kotter’s Eight Step Change Model, Lewin’s Change Management Model and others. Marks & Spencer can apply the McKinsey’s 7-S Model in their company since it capitalizes on the shared values which are the bases to which an organization stands for, for instance, the mission of the organization.

            The model also focuses on ‘strategy’ which stands for the plans the company has to react to in cases of changes of their external environment. The company should be prepared to accommodate any change that may arise in the implementation of this model. Structure is also the target of McKinsey’s 7-S Model. This in particular indicates the organizational structure of a specified company.

            Incorporated are the systems which show the procedures, routines and the processes that indicate how work should be carried out. This has the whole guidelines of how to run the various departments of the stores, time plan, etc.

 It largely conceders the staff in the organization who play a very vital role in the success of the company. Proper management of staff  helps in promoting harmony in the work place since every person will be acquainted with what he/she is required to do at a given time and space. Style is another aspect covered in this model. It covers the organizational structures and the styles of management used in the company. Finally, it covers skills which show the capabilities and the competencies of the employees or the company at large.

            McKinsey Model has four major benefits that uplift the performance of an organization. It is one of the best ways to analyze and understand the organization. This is very important in the running of any company because you have all the information you need at your reach. Marks and Spencers can deploy this model inorder to better know their staff, market demands and product knowledge. It also serves as a guide for change of the organization. This is very crucial to the success of the company especially where a positive change is expected. It combines the rational and emotional aspects, that is, in cases of rational decisions that are rapidly made in reaction to a certain problem or issue that arises. Issues that need immediate tackling are addressed by this model and other that arise as a result of ones feelings. Finally it inter relates all the parts of the organization. For instance, the coordination of all the stores in various parts of the country for better output on each.

            Marks and Spencers were unique and successful in the sense that they understood what their business was and also put clear, specific, operationally viable and multiple objectives. They concentrated on the basic strategy objective that would bring into proper managerial practices for the success of their business.

            A specific marketing objective was set up by the concentration decision which enabled it to decide on who its customers were, the kind of store it needed, the pricing policy to be followed and the market penetration to be aimed at.

They also encouraged innovation. The products they required at the time when starting the venture did not exist. Like any other retailer they begun with quality control. They built their own quality control laboratories into research, design and development centres. This is where new fabrics designs and fashions were developed.

Consequently, they consulted manufacturers to implement their designs and fashionable fabrics that they had researched on in their centres. In marketing they applied the same innovative strategy.

            Opening new stores contributed highly to the expansion of Marks & Spencers as early as late twenties. Their stores were small in comparison to the supermarkets but each store was more productive since they raised sales per square foot of selling space. The stores were many times successful than any other bigger stores in other companies. This was because of the continuous upgrading of volume per store.

Identification of and choice of change

            It is advisable that the organization carry out Business process reengineering as its change strategy if it should keep in its leadership positioning provision of quality, value, service, innovation as well as maintain the brand loyalty by its customers. The growing and changing competition structure and ever varying trends in customer expectations.             The desired change aspect which in this case is the business process reengineering should be identified with by the whole of the company’s management, staff as well as other stakeholders like suppliers, customers, and consultants. The cause for business process reengineering should be adequately communicated throughout the entire company body and the benefits of changes associated with it be publicised across to every stakeholder with the aim of gaining the full support for its implementation. The management should take the position of change agents and lead from the front in the planning implementation and control of this change strategy. The change strategy should be fully and efficiently integrated with all other activities of Marks and Spencer’s strategic business plans. Some aspects of the Business Process Reengineering change factors to be considered;

Increase Employee Cost sharing of Healthcare Benefits

            According to Brigs (1984), the company management  should improve its relationships with its employees because this will enhance their levels of motivation which in turn reflect on their contribution towards the implementation of the company’s change activities as well as increase the level at which they handle customer problems.

To achieve these aspects of employee commitment, improve its public relations, as well as increasing its reputation the firm should therefore intervene in the health benefit of its employees through the cost sharing of the health care benefits with its staff.

Change in the Headquarters

            The company headquarters should undergo complete change whereby much emphasis should be placed on the development of the management teams which clearly identifies and are completely committed to the values and the founding principles of the firm by driving it towards prosperity and excellence. There should be a strong culture of adaptability, flexibility as well as forward thinking developed among the individual managers at the firm’s head quarters.

Implementing a World class Service Centre

            The total reengineering process of the firm’s operations as stated by Benham (1989) should also focus on the creation of a world class service policy whereby the service levels of this company would continually be looked at and the necessary reviews be implemented to meet the current needs of modern customer service and regulations? By establishing such policy of being a leader in the service provision Marks and Spencers will greatly benefit through a favourable customer perception, brand loyalty, increased revenue as well as achieving its general growth ambitions. More over the benefits of maintaining an exceptional service culture should quickly outweigh the costs because this activity guarantees better return on investment as well as increase in the company’s financial stability and competitiveness.

Business Process Integration

            The company will achieve great efficiency in its service delivery, cost reduction, value as well as greater economy if it integrates its processes and work under a common mission, values and objectives. This will prove successful because the combined devoted efforts of all its activities, operations, capital as well as human resources will result in the creation of synergy hence improving its general out put and growth as argued by Bookbinder (1989).  .Apart from this Marks and Spencers will be better able to dominate its competitors. Several aspects of the firms accounting, management, research, marketing should be integrated through the latest systems of information technology to improve quality of decisions making.

Integration of managed change into the information systems

            The managed change approach will help the company to reduce the cost undertaking the change by lowering the extents of disruption of its operations during change implementation process.

Organisational Culture

            There should be a consistent focus of the change strategy on implementing the most relevant business culture towards its all operations. Therefore within the organisation, culture change should be fully addressed within the business process reengineering plan. The culture change should be embraced to reflect the current practices and customer habits and general cultural trends .The reason is that culture plays a very significant result on the general success of any firm and therefore Marks and Spencers should carry out a research on the latest culture trends to help it match with the latest market happenings.

Current Situation

            The current situation analysis according to Fallon (1998) shows that Marks and Spencers faces major challenges and competition from various firms which provide similar services to the market. Many competitor firms too have been adopting current techniques and latest strategies in business activities. The competitive strengths of Marks and Spencers basically lie in the fact that it has always maintained the reputation of leadership in the provision of quality, service, value, and weaknesses should be critically looked at to ensure that the correct and practical outlook of the firm’s status is comprehended and appreciated.

Desired Goals

            At the present the present case the company has the goal of achieving growth in its revenue and profits despite the current challenges like globalization, rapid changes in customer service standards as well as the need to increase it market share. It also seeks to maintain the leading role as the company of choice for customers who are looking for high quality products and services packaged with innovation and new technology.

Marks and Spencers should therefore prepare to meet these requirements by adopting changes in its approach to business in order to particularly understand and profitably serve the current customer.

            Marks and Spencers management should take the first responsibility in supporting the requisite changes in its operations by through the provision of the necessary facilities which might be required in implementing the change.

To be successful the change process should be well planned in advance and the necessary resources be set aside to assist the implementation of the intended relevant culture .To be successfully achieved the firm should involve all its staff and management in the culture change management process. The management should take the roles of change agent by providing the necessary environment for the change to be achieved.

            Marks and Spencers UK ‘s management should  clearly and consistently communicate these desired change approaches to all its staff and try as much as possible to  win their support for the changes which they should  help in implementing. To achieve their support the firm should communicate the benefits which these changes will bring to the company.

            The implementation of the chosen change strategy should involve the whole of the organisations staff management, suppliers and all other publics with which Marks and Spencer’s deals with. The suppliers may be trained on the latest efficient and modern supply policies and programs which are geared in creating business synergies for the benefit of both trade partners and the company.

It is important that Marks and Spencers should sustain the change elements within its ranks and file and look forward to gaining a better business standing from the benefits from the change. This can be obtained through proper stewardship of the whole process by the management .They should assts the staff in comprehending as well as appreciating the change.

Recommendations

            Moody (1997) pointed out that  Marks and Spencers has always excelled in the past through its endless concern and continued relevance to the existing and prevailing market conditions and business environment. For example it abolished Dogs from all its stores in the earlier parts of the previous decades to ensure that proper hygiene is maintained for its display shelves .It was a creative decision which shows just how much concern it played for the delivery of quality and service to its customers. It is therefore important that the company maintains high levels of technical as well s management innovations towards adaptability to customer and market trends in order to benefit from the existing opportunities in the market place. This is the main reason why Marks and Spencers UK should implement the change in form of business process reengineering in all its operations to help it achieve utmost relevance with the modern environment of trade. The benefits of this change are manifold if properly implemented.

            It will enable the company to identify its key areas of competencies to enable it to adopt and develop on its strengths towards competitive superiority as it can then easily distance itself from the negative effects of stiff and fierce competition. It can therefore as well survive the existing unstable trade situations. The business process engineering would also make Marks and Spencers to critically address its weaknesses in operations (Economist, April 30, 1994, p.527) and it can strategically make out opportunities from these weaknesses and thereby improving its relevance to the customer expectations and market changes.

Conclusion

            Modern times as stated by Marcom (1991) demand that the company inputs new systems and changes in its strategies to help it adopt, learn, and develop its systems to enable it to meet the changing requirement of the market and its customers. Marks and Spencers should therefore sustain its efforts of adopting latest research techniques as well as carefully integrating its activities through use of information technology in order  maximize on the benefits of reduced operational costs, efficiency ,quality ,service, and values.

The present global recession calls for the company to review its old strategies to achieve relevance and excellence in its trade. This is the reason why it is important for the company to steer fore ward with implementation of a drastic and complete re evaluation and reengineering of all its way of doing business in the light of existing trends in customer attitudes and competitive trends .The benefit of such an activity well clearly reflect in its short term as well as long term growth projections.  Another benefit which the firm will gain from carrying out reengineering as model of change within its operations according to Lewis (1995) is that it will be able to clearly identify its key unexploited growth potentials as well as getting the chance to know which of its strengths require more attention in order to advance the company’s profitability and growth strategies. More so it will gain greatly if it can keep and apply the latest information technology  innovations in its customer services as well as in its other general lines of business .This will enable it to keep on track with the latest changes in customer and the competition environment as well as cutting on its wage bill and the general cost of doing business .It is therefore  realistic and obvious that  the changes covered by the business process reengineering well add more benefits to the growth and profitability of the UK’s leading retail chain stores of Marks and Spencers.

         References;

Bookbinder, Paul, (1989): Marks & Spencer: The War Years, 1939-1945, London:          Century Benham.
Briggs, Asa, (1984): Marks and Spence, London: Octopus Books
Fallon, James, “UK-Based Marks & Spencer Says the World’s Its Oyster,” Daily             News   Record, January 5, 1998, pp. 20.
Lewis, William, and Martin Dickson, “M&S Asks Greenbury to Stay As Chairman,”       Financial Times, December 18, 1995, p. 19.
Marcom, John, Jr., “Blue Blazers and Guacamole,” Forbes, November 25, 1991, pp.       64&plus.
Moody, Andrew, “Fighting Force,” Super Marketing, August 15, 1997, pp. 14+
“Of Pies and Pensions,” Economist, April 30, 1994, p. S27.

Oram, Roderick, “Marks and Spencers Sells Canadian Chain,” Financial Times, March   6, 1996, p. 20.

www.marksaandspencers.co.uk

Drucker P. F. (2007,); Management: Tasks, Responsibilities, Practices, Transaction          Publishers, pg 95-98