Can Marks & Spencer Regain its Lost Ground?
Case Code: BSTR550
Case Length: 13 Pages
Pub Date: 2018
Teaching Note: Available
Organization: Marks and Spencer plc
Themes: Turnaround Strategy
Abstract Case Intro 1 Case Intro 2 Excerpts
The case discusses the problems faced by UK-based iconic retailer Marks and Spencer plc (M&S) and its revival. M&S was experiencing unprecedented troubles with its sales stagnating, profits collapsing, and market share falling. The retailer had been offering high quality clothing, home products, and its own outstanding food brands for 125 years. After being the leading retailer in the UK for decades, M&S started to lose its edge in clothing as well as food with the advent of e-commerce and changing consumer preferences. In May 2016, CEO Steve Rowe (Rowe) outlined a five-year turnaround plan to address the problems, to position M&S to deliver profitable sales growth, and revive its dwindling fortunes.
The case discusses the turnaround at M&S and how Rowe was committed to leading a radical shake-up of the business. As part of his turnaround strategy, Rowe planned to close underperforming clothing stores, opt for relocations as more trade shifted to the internet, reduce discounting, and accelerate the expansion of its food business. The company planned to keep itself in line with customer requirements and changing fashion trends. In May 2017, Archie Norman (Norman), former CEO of retail chain Asda, was appointed as the chairman of M&S. He joined Rowe in the battle to reverse fortunes at M&S.
Can Rowe and Norman together revive the fortunes of the 133-year-old retailer whose profits have taken a nosedive? Can M&S regain its lost glory? If so, how?
The case is structured to achieve the following teaching objectives:
- Understand the problems at M&S
- Understand the need to continuously reinvent the business model of a company amidst rising competition and changes in the business environment
- Examine the strategic measures taken by a leader to turn around a loss-making company
- Understand the revival strategies of M&S
- Appreciate the importance of focus and a clear recognition of strengths for a company
Organizational crisis, Turnaround strategy, Organizational failure, Revival Strategy, Brand Revival, Organizational Decline
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