Case Study | Marks Spencer

Marks and Spencer (M&S) is a leading retailer of clothing, food, homeware and financial services (Johnston et al, 2003). The company has over 700 stores located throughout the UK and Republic of Ireland. In addition, the company has over 300 stores worldwide, operating in more than 40 territories (Marks and Spencer plc, 2011). The company is a provider of womerswear and lingerie in the UK, as well as menswear, kidswear and home also provided. Since those glory days, M&S has started to experience financial difficulty during the late 1990s because of an inability to meet customer expectations and long lead times on production. The loyalty of its customers was also severely eroded. The company started to make some improvements by carry out some changes in operational plan including major improvements in product design, availability and quality, cheaper and more effectively supply chain as well as better quality and unique market segments which always stick to the principles on which its business was founded, the company values of Quality, Value, Service, Innovation and Trust.

Identify and explain the different customer needs

The customer is the basic reason for the existence of any business since a business cannot operate without customers to sell to. The key to continued profitable existence for any business is meeting the needs of those customers more effectively than competitors. A feeling of satisfaction should leave with each customer who deals with an organisation. Thus, the company has to realize that the only route to achieve long-term sustainable competitive advantage is to sustain the customer satisfaction. Besides, customer service and customer care are also the sources of competitive advantage. Service excellence, in short, is a powerful element to corporate survival and competitive advantage for the organisations of the future. Service excellence is about what it takes to build and sustain a customer-focused organization, it is about everything an organization does to win, satisfy and keep customers. Company with excellent service understands the needs of its customers. Customer needs are the perceived-value that customers seek from the product or service they have purchased. Hence, knowing and understanding customer needs is essential for every successful business. It also leads to increasing of the customer loyalty.

In order to satisfy different customer needs, the three M&S ranges are designed with different aims where the demographic market segmentation is carried out on the basis of age, gender, income and occupation. These three ranges are the Perfect and Classic, the Autograph range and the Per Una range. Each range is to target a different segment of the womenswear market and is sub-brands of M&S’s strategic operations in order to improve their performance and their ability to compete with other competitors.

The Perfect and Classic ranges are aimed at its core customers, who prefer classically stylish clothes, which consists of women aged between 35 and 55 and men (Johnston et al, 2003). They prefer products with quality and value at a reasonable price. The customer with a busy lifestyle is also aimed by providing machine washable, non-iron and tumble-dry friendly items. The Perfect Collection is to serve the whole segment while the Classic Collection is aimed at the more mature customer who is concerned on design, comfort, long-lasting style and versatility items. They are also demanding for clothes which are made from high-quality fabrics at value-for-money prices. However, there is quite limited of design choices for these ranges. In order to ensure that customers are able to find suitable products, these ranges have provided variety of colours to customers.

The Autograph range is targeted at offering fashion items at high street prices, within a designer boutique environment to M&S customers (Johnston et al, 2003). This range belongs to top designer collections, is to create womenswear, menswear and accessories which are more up-market range for M&S’s core market. This range is emphasizing on the brand image and the maintenance of high street pricing.

The Per Una range is aimed at customers who were fashion-conscious women aged between 25 and 35, sizes 8-18 (Johnston et al, 2003). The objective of this range was to provide breathtaking designs at very affordable prices. This range sustains the principles of providing products with the highest quality materials and the latest trends. The products in this range are limited edition which increases the uniqueness of the products compare to the other ranges that still attracting customers to purchase although Per Una was more expensive than the M&S main range. The range is flexible because it reacts to changes in fashion quickly. The M&S website has described the Per Una range as ‘feminine, sophisticated and confident’.

Identify and explain the order winners and qualifiers

Order winners are those competitive characteristics that cause a firm’s customers to choose that firm’s goods and services over those of its competitors. Order winners can be considered to be the competitive advantages for the firm. Order winners usually focus in one rarely more than two of the following strategic initiatives, price and cost, quality, delivery speed, delivery maintain, product design, flexibility, after-market service and image. There will be either more business or improve the chances of gaining more business result by raising performance in an order-winning factor. Order qualifiers are those competitive characteristics that a firm mist show to be a viable competitor in the market place. Order-qualifying factors are important in another way although they may not the major competitive determinants of success (Pycraft, M., 2000). The firm will most probably disqualified from being considered by the customers if the products and services have not reach the qualifying level.

Perfect and Classic ranges

Autograph range

Per Una range

Product range

Classically stylish merchandise and more mature clothes, Limited of designs

Womenswear, menswear and accessories collections, Designer wear

The highest quality, Trendy

Design changes

Standard, ‘Return to basics’

Seasonal fashions, Special design

Design concept coming in every four weeks

Price

Reasonable, Value-for-money

High street

Very affordable, 10 per cent more expensive than main range

Quality

Practical materials, High-quality fabrics

High quality

Excellent quality materials

Sales volumes SKU

Large quantities

Small quantities

Limited editions

Order winners

Dependability

Fashion items, Quality, Exclusive design

Limited editions

Order qualifiers

Reasonable price, Quality

Price

Competitive price, Appropriate quality

Operations priorities

Cost

Quality

Speed, Flexibility

The Perfect and Classic ranges are characterized as their timeless essential and long-lasting style, so they are not the latest fashion items. The Perfect range is aimed for quality and value at a reasonable price items. Unquestionably, the sales volumes under these ranges will highly cover greater diversity of customers. Consequently, the order winner characteristics are the dependability ranges. The suppliers are more low cost producers.

The Autograph range is aimed to extend the M&S appeal to fashion items. This range was created by top designers to offer items at High Street prices. It emphasizes on the unique designs and the shopping experience, which is within the boutique environment. Hence, the order winner characteristics are the fashionable product range, high street pricing and the store layout. The source for this range is the suppliers with strengths in product or material development.

The Per Una range is focused on the highest quality materials, designs inspired by the very latest trends, limited editions, individual cuts for every size, fanatical attention to detail and ease of shopping. Thus, the order winner characteristics are the latest fashion range, quality and speed of delivery for the sake of stick with the very latest trends. The entire supply chain is controlled by George Davies to ensure that goods made it from design concept to shop rails in weeks not months.

Analyse and compare the different operations performance objectives with polar diagram

ISO 8402-1986 standard defines quality as ‘the totality of features and characteristic of a product or service that bears its ability to satisfy stated or implied needs’. The Per Una range is stated as providing the highest quality materials like George Davies said in the brochure (Johnston et al, 2003). Speed, in terms of the supply lead time, is the elapsed time between a customer demands for a product or service and getting it. Thus, the Perfect and Classic ranges can provide the items to the customers without taking long time because their stock keeping units (SKUs) are the highest among these three ranges. Dependability means delivering the goods or services to the customers in time as promised and also after-sales service. The Perfect and Classic ranges have the highest product availability to ensure that the customers are able to find their suitable products. Flexibility refers to the ability of the firm to change accordingly to the customers’ requirements. From the polar diagram, the Perfect and Classic ranges have the highest rate of flexibility as they provide a wide range of products to the customers. In general, the price of a product or service is lower if the production cost is lower. Among the three ranges of clothing, the Autograph range has the highest cost because many top designers are recruited in this range and using high quality materials.

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