Marks and Spencer used to be organised under a Practical or U-Form design which usually works by smashing the company into departments like operations, marketing, finance, recruiting, and r and d. This style works well with small companies good results . bigger businesses there is a lot of information for the top manager to handle and deal with. This is exactly what happened to Marks and Spencer.
In 1991, Sir Richard Greenbury took over Represents and Gradzino for several years and structured the organization to fit the Functional design and style. He made the business very aristocratic and rigid where by “Head office knows best (The Economist). This created a great atmosphere where by the company aimed at their products rather than focusing on consumers. Although Represents and Spencer grew to make huge revenue within this period, in 1998 their profits fell very quickly and sharply.
Marks and Spencer shut a chain of stores that they owned in Canada and rumours were spreading that they might also close two restaurants of stores which they owned in the United States. The combination of Markings and Spencer’s quick growth and the aristocratic rule had definite obvious implications in Marks and Spencer’s health. The mixture of Marks and Spencer’s aristocratic rule and structure just couldn’t deal with everything that was going on. Another one of Marks and Spencer’s weak points stemmed from their particular heavy dependence on inside promotions.
The company would hire college students and have these people work all their way in the ladder. Very rarely did the corporation hire exterior candidate pertaining to senior positions. This prevented outside innovative developments from coming into the business.
Over 10 years ago Marks and Spencer required to do something radical because it was losing from its market share and their standing was heading down the tubes.
The company decided it absolutely was time to restructure. The new composition of Marks and Gradzino would be a lot more like the Conglomerate or H-Form design. In this design the organisation is placed basically being a holding organization comprised of unrelated products. The new Marks and Spencer may have seven several business units: could swear, mens wear, nighties, children’s have on, food, natural beauty, and home.
This will allow the company to create a way more versatile structure that could respond to the fast changing environment. This flexible framework would give autonomy to person business units assisting them custom to their customers better. Represents and Bradzino would will no longer operate underneath the “head office knows best principle and would give the shoppers what they urgent needed. Another alter was as well made in the management with the company.
At first, Philip Salsbury took over Marks and Spencer following Sir Richard Greensbury resigned and presently Luc Vandevelde heads the organization. The company’s head management is running under a short term strategy in order to find somebody who can lift Marks and Spencer out the hole. Luc Vandevelde arrived at the company in May 2000 and will stay on for a year unless he can convert the profits around. To help him out, Roger Holmes, an experienced in revenue turnaround and customer-focused organisational change, may also join Markings and Spencer in January of 2001 as professional director.
The only problem facing the 2 is that nor have very much experience in retailing foodstuff or garments so in the event that they can’t turn profits around, the company board will look to acquire a top level manager coming from Wal-Mart, the worlds largest retailer.