Marks and Spencers Corporate Identity - Case Study Example

Corporate identity – Marks and Spencer, UK Words: 1915 Table of Contents Reviewing the mission ment of Marks and Spencer, UK – personal views 3 2. Potential application of management theories on Marks and Spencer with regard to the firm’s mission statement 5 3. Own learning from reviewing the dependency of the firm’s policies on management theories 8 References 10 Appendix 11 1. Reviewing the mission statement of Marks and Spencer, UK – personal views One of the main priorities when reviewing Marks and Spencer’s corporate identity has been the identification of the firm’s core values. These values are clearly stated in the firm’s mission. In accordance with the corporate website the firm’s 125th anniversary is a good chance to highlight on the firm’s success in regard to the following values: ‘Quality, Value, Service, Innovation and Trust’ (Marks and Spencer, corporate website, 2010) which are characterized by the firm’s managers as the Core Values of the Organization. After studying the explanations included in the specific section of the corporate website I came to the conclusion that the success of the firm is based on specific policies: the continuous update of the firm’s products and services, i.e. the enforcement of innovation throughout the organization, the development of the firm’s presence in the global market and the increase of the firm’s property portfolio (Marks and Spencer, corporate website, 2010). As for the performance of the firm’s strategic plans, this seems to be satisfactory leading to the further development of the firm’s activities – my view on this issue is based on the relevant statements of the firm’s managers. Indeed, in the corporate website – section referring to the firm’s - it is clearly mentioned that the firm’s current strategic plans focus on the following targets: ‘Increasing the pace of change and operational execution in the business; leveraging M&S Direct by building more channels to market; building our international portfolio to grow our global customer base; and reinvigorating our brand communications’ (Marks and Spencer, corporate website, 2010). Using the firm’s financial results and the reports that have been published regarding the performance of Marks and Spencer in the British and the international market I’ve came to the conclusion that the firm has managed to achieve the targets set in its mission statement applying its Core Values (as included in its mission statement but also its Code of Ethics). However, I’ve noticed that there is no specific provision for the global recession; Despite the fact that a series of plans are presented for the development of the firm’s performance in general, it is not explained whether the firm’s policies have been affected by the current financial crisis or whether they are going to be alternated in the near future in order for the firm’s resistance to the global recession to be increased. I would like to refer – briefly – to the reports and the figures on which my views in regard to the firm’s mission statement are based: a) the figures published by the firm regarding its performance for the years 2008 and 2009 – the firm’s profits have been increased from £9,022.0 (in millions pounds) – in 2008 – to £ 9,062.1 in 2009 (despite the global recession), see Table 1, Appendix, b) the performance of the firm’s stock for the months March and April – up to now – has been positive despite the strong turbulences due to the continuation of the recession in the international market, Graph 1, Appendix, c) the performance of the firm’s share price for the last 10 days – from 31/3 up to 8/4 – has been positive, offering further support to the view that the firm’s strategic plans are effective and d) the firm has an important position in the international market – see Table 2 in the Appendix section – being considered as one of the most powerful global merchandisers. Furthermore, in a recent report published in the Guardian it is noted that ‘Staff at Marks & Spencer will share an £80m bonus pot after the company beat its targets for 2009 despite the recession; the bumper payout is the second highest ever paid by M&S, and is larger than forecast’ (The Guardian, 8/4/2010). The specific initiative is important showing the success of the firm’s current strategic plans but also the firm’s prospects in the future. 2. Potential application of management theories on Marks and Spencer with regard to the firm’s mission statement The values and the targets included in the firm’s mission statement can be related to specific management theories; in fact, I’ve noticed that the interaction between the firm’s mission statement and a series of management theories can explain the effectiveness of the firm’s strategic options. In order for this interaction to be clearer I’ll refer primarily to certain management theories – describing their general characteristics; at the next level, I’ll explain the relationship between these theories and the firm’s mission statement. The specific relationship is further analyzed in the next section – where the dependency of the firm’s policies on management theories is critically evaluated. In accordance with Mullins (2007) it is important for leaders (and managers) of modern organizations to know the key points of management theory because in this way they are able to understand the ‘nature of management and organizational behaviour and reasons for the attention given to specific topic areas’ (Mullins, 2007, p.40); from another point of view, it is noted that organizational culture is a factor that should be taken into consideration by managers working on the design of the strategic plans of modern organizations. This view is based on the fact that organizational culture can ‘provide members with a sense of organizational identity and generate in them a commitment to beliefs and values that are larger than themselves’ (Daft, 2007, 361). A similar approach has been adopted by Miner (2005); the above researcher notes that the achievement of organizational plans is strongly depended on the participation of employees; leaders in modern organizations are responsible for introducing strategic plans that motivate employees to participate in such initiatives (Miner, 2005, 46). It is not explained though whether employees should be given the chance to state their view on these plans’ structure and content; it is supposed that leaders have a decisive role in the development of organizational strategies and that the role of employees in the planning of these strategies is limited. The above view ignores the fact that employees have an important role in the success of organizational strategies; it also ignores the fact that when managers attempt to introduce plans that do not satisfy the employees – or do not appropriately address employees’ needs – then it is quite possible that a strong resistance is developed against the attempted changes. Andriani et al. (2004) note that the potentials of a firm to increase its performance is depended on the ability of its managers to incorporate appropriate knowledge systems; these systems will provide the information required for the development of effective strategic plans. Andriani et al. (2004) describe the specific initiative as follows: ‘activating learning strategies and learning processes based on knowledge management processes related to the knowledge-creating company paradigms’ (Andriani et al., 2004, 58). It is not made clear whether these knowledge management processes need to have specific characteristics or if they are depended on the firm’s values and strategic targets – i.e. if these processes are likely to be influenced by the characteristics and the objectives of each particular organization; a view similar with that of Mullins (2008, 37). If these processes have common format for all organizations, then their effectiveness could be doubted. The above assumption is supported by the views of Longino (2009) who noted that the needs of organizations that operate in the retail industry can be differentiated from those of firms that operate in other industry sectors; for this reason, it is suggested that managers in firms operating in the retail industry need to set the ‘selling’ ability of their firms as a priority (Longino, 2009, 17). Cokins (2009) supports that the effectiveness of business plans is strongly depended on the ability of leaders to execute these plans – the planning of business policies seems to be considered as not being quite important for the success of these policies, a view which is in opposition with that of Koontz et al. (2006) who emphasizes on the importance of planning procedure for the development of effective business plans. Other factors that are expected to influence the effectiveness of business plans are: the identification and the evaluation of risk, the methodology adopted and the participation of employees (Cokins, 2009, 63). On the other hand, Clarke (2004, 1857) notes that the management theories applied on modern organizations can be divided into two categories: those used in the pre-Enron era and those used in the post-Enron era; in the second period theories like the corporate governance theory had to be alternated in order to meet the new ethical standards set by the relevant authorities – aiming to reduce the chances for the appearance of similar cases. On the other hand, Meckl (2008) highlights the need for adapting the organizational plans to the local culture and ethics – a view that could lead to the differentiation of a firm’s strategic plan in accordance with the social and cultural characteristics of each particular region; challenges would be set for multinational firms around the world. However, this issue, i.e. the differentiation of a firm’s policies in accordance with a country’s social and cultural background is also highlighted in the study of Haberberg et al. (2008); Hitt et al. (2007) also refer to the need for alteration of a firm’s existing strategies when the entrance in a foreign market is attempted (Hitt et al., 2007, 19). The issues highlighted in the literature presented above are related with the firm’s mission statement – more or less. Issues like culture, employee motivation and leadership are highlighted in the firm’s mission statement; perhaps additional explanations would be included in the firm’s mission statement in order for these issues to be clearer. 3. Own learning from reviewing the dependency of the firm’s policies on management theories The theories and the views presented in the previous section can be used in order to understand the values and the targets of Marks and Spencer (UK) as these elements are included in the firm’s mission statement. However, I’ve noticed that not all these management theories have been used by the firm’s managers when developing the firm’s mission statement; however, the specific failure of the firm’s managers can be justified using the following thinking: each management theory is more related to specific organizational conditions – even if there are theories that can be applied on a high number of organizations, like the Porter’s Five Forces model on industry competition. I assumed that the firm’s managers have used a specific theoretical framework – in relation to management – and have tried to adapt the relevant theories to the firm’s needs – as they are influenced by the conditions in the internal and external organizational environment. I would notice that the dependency of the firm’s policies on the management theories helps to the achievement of the following targets: a) increase of the effectiveness of firm’s plans, b) address of issues that could be possibly considered as of secondary importance when the firm’s mission statement was developed – like the quality of service, c) increase of the firm’s presence in its market – by adopting the values and the priorities suggested by academic researchers the firm’s managers would have more chances to respond to the market trends (the views stated in the literature are usually based on analytical research methods ensuring the credibility of the suggestions made). However, I would also like to highlight the fact that the firm’s managers avoid to refer to the potential needs of the firm in terms of global recession; I would suggest that appropriate measures are taken in order to increase the firm’s resistance to the global financial crisis. References Andriani, P., Passiante, G., 2004. Complexity theory and the management of networks: proceedings of the Workshop on Organisational Networks as Distributed Systems of Knowledge, University of Lecce, Italy 2001. Imperial College Press Clarke, T., 2004. Theories of corporate governance: the philosophical foundations of corporate governance. Routledge Cokins, G., 2009. Performance Management: Integrating Strategy Execution, Methodologies, Risk, and Analytics. John Wiley and Sons Daft, R., 2007. Organization theory and design. Cengage Learning Haberberg, A., Rieple, A., 2008. Strategic Management: Theory and Application. Oxford University Press Hitt, M., Ireland, D., Hoskisson, R., 2007. Strategic management: competitiveness and globalization. Cengage Learning Koontz, H., Weihrich, H., 2006. Essentials Of Management. Tata McGraw-Hill Longino, E., 2009. Sales Management Control, Territory Design, Sales Force Performance, and Sales Organizational Effectiveness in the Pharmaceutical Industry. Universal-Publishers Meckl, R., 2008. Technology and Innovation Management: Theories, Methods and Practices from Germany and China. Oldenbourg Wissenschaftsverlag Miner, J., 2005. Organizational behavior: Essential theories of motivation and leadership. M.E. Sharpe Mullins, L., 2008. Essentials of Organisational Behaviour. Pearson Education Mullins, L., 2007. Management and organisational behaviour. Pearson Education Penrose, E., Pitelis, C., 2009. The Theory of the Growth of the Firm.Oxford University Press Online resources Marks and Spencer, 2010, corporate website, available at http://corporate.marksandspencer.com/home [last accessed at 7/4/2010] Marks and Spencer, 2010, corporate website, Code of Ethics, available at http://corporate.marksandspencer.com/documents/specific/investors/governance/code_of_ethics.pdf [last accessed at 7/4/2010] The Guardian, Marks & Spencer staff to share £80m bonus pot, 8/4/2010, available at http://www.guardian.co.uk/business/2010/apr/08/marks-and-spencer-staff-bonus Appendix Marks and Spencer – Financial Highlights 28 March 2009 £m 29 March 2008 £m % Total revenue 9,062.1 9,022.0 + 0.4 UK 8,164.3 8,309.1 - 1.7 International 897.8 712.9 + 25.9 Profit before tax 706.2 1,129.1 - 37.5 Adjusted EPS 28.0p 43.6p - 35.8 Dividend per share 17.8p 22.5p - 20.9 (declared) Table 1 – Marks and Spencer, financial highlights for 2008, 2009 (source: Marks and Spencer, corporate website, investors) Graph 1 – marks and Spencer – stock chart (source: The Guardian, 8/4/2010, available at http://www.guardian.co.uk/business/marksspencer) Graph 2 – Marks and Spencer, share price for the period 31/3 up to 8/4 (source: Financial Times, 8/4/2010, available at http://markets.ft.com/tearsheets/performance.asp?s=uk:MKS) Industry: General Merchandisers Rank Company 500 rank Revenues ($ millions) 1 Wal-Mart Stores 1 351,139.0 2 Target 96 59,490.0 3 Sears Holdings 114 53,012.0 4 Foncière Euris 204 32,237.0 5 Macys 227 28,711.0 6 PPR 296 23,191.6 7 J.C. Penney 352 19,903.0 8 Marks & Spencer 458 16,267.5 9 Kohls 487 15,544.2 Table 2 – General Merchandisers, for 2007 (source: CNN Money, available at http://money.cnn.com/magazines/fortune/global500/2007/snapshots/7914.html) Read More