UK retailer Marks & Spencer has over 1,000 stores in Britain and Europe. Its financial performance is

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UK retailer Marks & Spencer has over 1,000 stores in Britain and Europe. Its financial performance is basically sound, but city analysts see it as declining.

Recent performance is disappointing despite a series of efforts to revitalize it. Several top management teams have tried but with only partial success. After another round of disappointing results, bookmakers took bets on when the new(ish) chief executive would be replaced.

This is a company in which a great strength may have become a problematic weakness. For a long time, M&S was, and in many respects still is, a highstreet stalwart: dependable, reliable and offering good value. At its peak performance in the 1990s, it became one of the most profitable retailers in the world and one of the UK’s largest listed companies. Following this peak position there was a battle for control of the company and several changes of personnel at the top.

The biggest challenge has been to have a clothing range that appeals to a young audience while not putting off the loyal older customers. Other, more general, challenges are how to deal with the increasing number of customers who shop on the Internet, and stiffening competition from Waitrose for its food lines and from John Lewis, a more diversified department store chain.

Food sales have held up well, but the biggest problem was customers turning away from clothing and general merchandise. New appointments were made to oversee strategy and purchasing in the problem areas.

Off the record, company directors were reported as saying that the once highly successful business model of combining food and clothing is now broken. On top of that, the international stores are not performing particularly well, along with the Internet arm of the business. In mitigation, the depressed state of the UK economy since 2008 needs to be taken into account; several other retail chains have closed down completely.


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Consider the complexity of making changes in a company of this size and structure. What might the company be risking in trying to raise financial performance?

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Related Book For  book-img-for-question

Organizational Change

ISBN: 9781292243436

6th Edition

Authors: Barbara Senior, Stephen Swailes, Colin Carnall

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