Business process and operations management is a holistic approach that aims at aligning the business processes of an organization in order to line them with the needs and requirements of its different customers. This move boosts the efficiency and effectiveness of the business through incorporation of high quality and beneficial innovation, which is integrated with the latest technology and also enhancing flexibility of the business to meet the current demands and market conditions. This model helps the organizations to be more effective and efficient and be flexible enough for change (Hammer & Champy 1993). This model is of great importance to any business, company, or organization in realizing their goals. If well incorporated, it can significantly help an organization to generate more revenue and encounter a significant reduction of the operational cost. This managerial approach is a strategic asset to any organization and efforts should be put in ensuring that it is understood and handled in the best way possible. This is to ensure the delivery of desired quality outcomes, which in this case could be quality products and services to the esteemed customers.
Marks and Spencer is one of the companies that were forced to opt to this model owing to the many challenges that it faced in its operations. This organization was founded around 1884 and used to deal groceries, food stuffs, and clothing (The history of Marks and Spencer 2011). In its early days, the organization was able to do very well owing to their brand label, which was able to market the organization very well. It commanded a great market share and did very well in the face of its competitors. Following its success, it became a firmly established British organization and was able to operate several stores across all the major towns in the UK. This saw M&S become a household name across the United Kingdom. It operated around 700 stores in the United Kingdom and over 300 stores in other more than forty countries worldwide. This could be attributed to the high quality products that they offered to their customers including clothing, groceries, and home products at relatively reasonable prices. It was a move that had created a pool of very loyal customers of the business. This saw the business become the leading retailer of ladies clothing across the UK. One of their strengths that they enjoyed above their competitors was that they relied on United Kingdom suppliers and this gave them a favour in the eyes of their customers. Their competitors depended on cheaper foreign suppliers. All these advantages gave M&S a very preferential market share and had a huge customer base, which saw it receive about 21 million customers per week (Marks and Spencer – a Great British institution 2012).
However, things started falling apart in this organization around 1988 when the plans for expanding the organization failed and faced a lot of competition with the suppliers making them a source for low cost products from other suppliers. The organization faced stiff challenges managing both their finances and struggling to remain relevant to their customers by offering them quality products for reasonable prices (Wood & Finch 2009). Eventually, the organization lost a good number of their customers to their competitors who offered their products at lower prices. Their operating profits dropped from 1.1 billion pounds to 145 million pounds and also their revenues dropped from 8.2 billion pounds to 8 billion pounds in the 2000/2001 financial year (Wood & Finch 2009).
It is from all these challenges that M&S was prompted to act in order to save the organization from crumbling down. This organization adopted the business and operations management model whereby they started by restructuring their management team. They undertook a management change in 2004 bringing on Stuart Rose who was a former business associate of one of the organization’s tough competitors. He wanted to take over M&S Phillip Green. The organization moved from their traditional model of internal promotions to outside sourcing for new and more experienced executives (Peele 2011). This was a tough decision to make because it was a sensitive issue in the eyes of the public and came under scrutiny by the press. It not only renewed the credibility of the organization’s management team, but also saw Green drop his bid of overtaking M&S. He lacked the control of the organization and also did not have the sufficient finances to overtake M&S. This went a long way in guaranteeing the survival of Marks and Spencer in the market. The new chairman was a very experienced business executive who had worked with most of the organization’s competitors and her position in the business brought a new face of the company. This saw the organization undergo many strategic changes aimed at reclaiming their market share through delivery of better and high quality products to their customers with reasonable prices. They ensured that their operations favoured both the organization and their customers. From this move, there is a clear indication that some situations that are possible threats to an organization demand tough decisions (Wood & Finch 2009). The decisions made might not necessary please everyone or bear immediate results, but will effectively work for the business in the long run.
The organization operated with value for money products, which were able to satisfy their clients and also deliver the target revenues to the organization. They reviewed their customer services to make sure that they were customer friendly (Shewhart 1990). This was in a bid to retain their loyal customers with optimum satisfaction and also attract more customers following their improved services. Rose emphasized on restructuring their stores environment in order to make them friendlier. This was achieved through renovations, which saw their stores become modern and fashionable. They embarked on massive marketing and advertising campaigns in a bid to sell the organization to the customers and the world at large. M&S incorporated the environmental and ethical issues in their sources production methods in order to bring out their CSR to the customers (Shewhart 1990).
All these changes were very strategic in seeing the performance of the organization arise once more. Their services and processes increased significantly and the organization was able to perform well and realise its goals while at the same time providing valuable products to their customers without any form of exploitation. The organization introduces a five year eco-ethical Plan eventually named as Plan A, which was aimed at increasing the organization’s environmental sustainability. The plan was formed on five essential pillars, which included climate change, sustainable materials, waste health, and partnership. They aimed at reviewing and transforming practices of the company in order to ensure a healthy lifestyle for both their customers and employees. This move was also done to see the improvement of the lives of their employees involved in the supply chain through better wages and improving their working conditions and hours. There was also an effort made in a bid to reduce pollution either through carbon or waste disposal (Wood & Finch 2009). The idea of protecting the environment went a long way in impressing the customers who saw that the organization had their interests in mind. This transformed into ensuring them increased loyalty and cooperation from the customers and public. The plan was able to ensure the organization its stability once again and gave a direction on the way forward.
For an organization to be successful, there is a need to ensure that they have a strong and established brand label. A brand label should be well-enhanced and protected since it sells the organization’s products and services to the public and to their customers. The brand label is also a company’s competing strength in the market, especially when facing very strong competitors in the market. This was one of the outcomes of Plan A in the M&S whereby they were able to enhance the protection of their products brands. Following the many changes the organization was also able to obtain operational efficiency making sure that their process runs smoothly and removing any room for breakdowns (Wortmann 1983). Also, motivating their staff was a very strategic move in ensuring that the daily operations of the business are conducted properly and satisfactorily, thus guaranteeing them possible desirable outcomes. Through these efforts, M&S was able to gain its grip and came up with reliable innovations, which gave the company a future assurance and ability to face future crisis in terms of rise in prices, scarcity of resources, and many other fields.
In addition, Marks and Spencer capitalized on working very closely with all of their stakeholders, which included their customers, suppliers, and employees in improving their situation while still focusing on the improvement of a continuous productivity of the process. They encouraged their suppliers to use energy saving strategies in their operations, reduce the level of their water usage, and also work with and manage the available resources. This saw the organization and suppliers come up with a performance assessment strategy that ensured that suppliers worked within the set standards during their operations and processes. They also went ahead to help their suppliers financially whenever they could in order to ensure that all their plans worked out for the overall benefit of the organization. Working with suppliers led to the establishment of green factories, which were partly funded by the company. It was another strategy that saw their products sold to M&S by wholesale prices. Introduction of lighting, insulation, and heating controls in these factories led to the reduction of energy by 10%, which was an indication of the success of this plan. This not only benefited the company, but also saw their suppliers become proud to be associated with the organization.
In order to see the plan successful, it was very clearly communicated internally inside the company to all the employees to make sure that they were equally engaged in the implementation of the same and make sure they worked towards its success (Marks and Spencer – a Great British institution 2012). They started by encouraging the employees to observe good health habits like their diets, sleeping habits, and reducing stress. This led to the establishment of a program that was geared towards the personal development of employees whereby they granted a paid leave in order to participate in a charity of their choice outside their working environment. This employee initiative was aimed at engaging both the employees and customers in the operations of the company in order to make the company a great shopping and successful working place for them (Marks and Spencer – a Great British institution 2012). They capitalized on offering their customers healthier foods and making the information on the same available to the customer for scrutiny. To ensure a good external reception of their plan, they came up with environmentally friendly initiative, which put into consideration the traditional brand uniqueness. One such initiative was “Oxfam Clothing Exchange”, which saw the customers bring their old M&S clothing to the company stores in return for shopping discounts. This was one of the company’s most successful plans, which received an overwhelming reception by the customers’ success (Marks and Spencer – a Great British institution 2012).
Marks and Spencer financial position have greatly improved since the implementation of the plan, which brought a lot of changes in the company. From the company’s financial rations, there is an increased profitability in the company between 1998 standing at 7.4 in 2011, although this profit has fluctuated between the years going as low as 3.7 in the financial year 2000 (Bournemouth University 2012). Their revenues have risen to 9,740.3 in 2011 with the gross profit standing at 3,622.9 in the same year. This has seen the net income rise to 612.0 rising from as low as 372.1 in 1999. If the success continues, the company is likely to experience revenues as years go by, especially if their long-term goals succeed. They have worked on a plan of investing a huge part of their revenue in projects that are either short-term or long-term with the short-term goals producing substantial incomes success (Marks and Spencer – a Great British institution 2012). For example two years after the implementation of the plan, the company attained return benefits of 50 million pounds in 2009/2010 financial year rising to 70 million pounds in 2010/2011 financial year. This was a return of almost half of the total costs of implementing the plan within the five year period. It is good to note that the received returns were ploughed back into the company’s operations (Bournemouth University 2012). This is an indication that the organization is likely to experience financial growth if they capitalize on improving their operations and also working with all the stakeholders involved in order to make the correct decisions on the way forward. Also, the fact that eventually the organization had limited their operations to 100 aspects, but ended up achieving more than 180 goals shows that the plan has been so far successful and it is likely to source a high financial growth in the coming years of the company. The only requirement is for their management to keep track of its operations in order to prevent any shortfalls that are likely to stagnant the growth or lead to losses (Marks and Spencer – a Great British institution 2012). Operations that are likely to deliver high returns that are able to cover the costs of its implementation should be adopted in a bid to increase their returns for the lowest costs possible.
Companies should always make sure that their products are near to their customers wherever they are located. If a company aims at trading and selling internationally, they should make sure that their products are available to their current and potential customers across the globe. This will ensure that their products are available whenever required and that the supply is continuous. Also, an appropriate location is strategic in reducing costs and improving sales leading to increased profits (Wortmann 1983). Marks and Spencer has made a very great move in establishing their stores across the whole of United Kingdom and in many other countries. This is a good strategy in capturing a bigger market value through increased awareness and availability of the company’s products. Proper location ensures that the products are always available to the customers whenever they require them, thus ensuring that they are not given a chance to seek for the products from competitors. M&S should establish more of their factories near the locations of their stores (Wortmann 1983). They should decentralise their factories and try to convince their suppliers to locate their operations near their stores across the different parts of the world where they are located. One way of convincing their suppliers to move near their stores is by funding them and also partnering with them to establish the factories. This will not only ensure a smooth supply of the products to all their customers, but also reduce various costs such as the transport and warehousing cost (Wortmann 1983).
Marks and Spencer should incorporate the latest technology in its operations, mostly in the production department in a move to reduce the costs of production and increase their sales. Modern technology has come with many benefits with one being that it saves losses that are brought about by breakdowns (Altstiel & Grow 2006). They are also able to produce quality output as compared to the earlier methods of production. Time is an important resource in any company and should be greatly saved. All these benefits lead to the production of quality services, which earn more favour in the eyes of the customers. Through the reduction of production costs, the company will also be able to decrease the prices of their products in the market and this reduction integrated with the improved quality will most likely lead to a larger volume of sales and greatly reduced costs (Altstiel & Grow 2006).
Marks and Spencer should embark on a massive market research. This research should be geared towards determining the market situations in terms of their most preferred products and also their market share. A key point in this research is to determine the production strategies that their competitors use. This will help them to come up with a production method that is able to utilize the least production and increase their sales volume (Altstiel & Grow 2006). This will be possible through capitalizing on the available opportunities in the market and also taking advantage of the competitors’ information to produce better quality products. This research should be followed by a massive advertisement which will market the products to the whole of the possible market. It would be noted that an expensive advertisement that is well implemented will turn out successful and realise an increased sales volume (Altstiel & Grow 2006). The returns from these sales will in return cater for the total cost of production and advertisement.
Recycling of the company’s waste products is also a big move towards the reduction of the total production costs and maximising the company’s profits. It is obvious that the organization that deals with a range of different products will produce a lot of waste from their production processes (McDonald & Pearce 2010). Through proper handling and well-implemented process, this waste can be used by the organization to produce more products with minimal costs. These reduced costs will come in through the already available raw materials, hence the organization does not need to buy any more. For example, waste materials from the production of clothes can be recycled and be used in the production of another type of clothing. The organization will be able to produce more products, which will reap financial benefits through increased sales without necessarily increasing the production cost in the company. Recycling is one of the most effective ways of reducing costs in a production company (McDonald & Pearce 2010). Other methods of reducing costs include investing more resources in the production and marketing of the products because the benefits attained from increased sale and a larger market value will compensate for the resources used in the process. Also, the employees involved in the operations of the company should be more motivated to ensure they produce high quality output, hence preventing the cost that comes as a result of employees’ mistakes and work frustrations. High quality products will always make a lot of sales in the market and attain great returns to the company.
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In order to improve the operational performance of the company, Marks and Spencer needs to undergo certain internal changes in order to come out with the best returns and see the overall growth of the company rise significantly. The company needs to undertake a massive review of its policies and procedures within its operations in order to ensure the efficiency, completeness, and accuracy of their policies for attaining their goals. Review of the policies is necessary in helping them keep up with the increasing competition across the world. Also, policy review is very necessary since there are changes that have brought in the new technology within the changing business environment caused by globalization (McDonald & Pearce 2010). Reviewing policies will help them attain flexibility and make speedy and reasonable decisions concerning different situations as they come by. This review will see the organization come up-to-date with current issues in the market and enable them take the right steps. M&S has over the years been using their historical methods in their operations. This is a major threat that is likely to lead them to losses, especially to the loss of market share since the methods do not match the current times (Hammer & Champy 1993). They need to come up with flexible policies that are up-to-date and that give the company an opportunity to rise to the occasion and act before it is too late. The review of policies will see the organization restructure some of its management constructs by creating more departments headed by the most qualified personnel. This will help in decentralising decision making powers from the top management to the department heads whenever the situation demands. This will go a long way in ensuring that every department takes charge of its operations and takes necessary actions for the best interests of the company. Policy review is necessary and will help Marks and Spencer shun off some of its operations that are not beneficial to them.