Marks and Spencer 2011 Annual Report Download - page 49

Risk description Mitigating activities
People and change Our people are fundamental to the long-term success and growth of this business.
Our people
Reduced motivation and retention of key employees impacts our
ability to deliver business plans
As we go through a period of economic uncertainty as well as a
number of internal change initiatives, it is ever more important to
ensure that M&S remains a great place to work.
– A monthly briefing is cascaded toourtop managers and a quarterly
results broadcast is held forallemployees to communicate the growth
ambitions and underlying plans of the business.
– Development of talent for the future remains a key priority. We are
rolling out our development programme ‘Lead to Succeed’ to more
ofour managers, helping them to realise their full potential.
– Alongside the recruitment of a number of new directors across the
business, the development of strong succession plans is a key area
offocus for the Board.
Programme and workstream management
Benefits from our major business programmes and workstreams
are not realised
Implementation of our major programmes and strategic
workstreams is now underway which underpin the achievement
of our three-year plan and ambition to become aleading
multi-channel international retailer by 2015. Critical totheir
success will be the achievement of our forecastedbenefits.
– Our Strategic Programme Office centrally governs the strategic
initiatives across the Group and provides regular reviews and updates
on their status, tracking of costs and realisation of benefits to the
Executive Board.
– All major programmes possess their own governance structures,
supported by robust project management discipline.
Brand and reputation Our founding principles of Quality, Value, Service, Innovation and Trust continue to influence
how we do business and our reputation for being one of the UK’s most trusted brands.
Corporate reputation
External expectations relating to our Plan A, ethical or corporate
governance commitments are not adequately managed
Our brand continues to be trusted in the marketplace with Plan A
being an integral component of the M&S brand. With such a
strong brand comes high expectations and the need to
consistently deliver quality and value to our wide stakeholder base.
– Our commitment to Plan A and becoming the world’s most sustainable
major retailer by 2015 continues to be a priority for the Group with one
of our key objectives being for all M&S products to have at least one
Plan A attribute by 2020.
– We have recently launched ‘Only at Your M&S’ emphasising to
customers that they will find exclusive and innovative products that are
unique to M&S.
– We are ensuring that adequate policies and procedures are in place to
meet the requirements of the Bribery Act 2010 which comes into force
in July this year.
Our customers
Loss of engagement with our core clothing customer
As we seek to enhance the M&S brand and make our sub brands
more distinctive, it is important that we continue to address our
core customers’ specific needs.
– To maintain our market-leading position for clothing, we continue to
respond to our customers through focus groups, online reviews and
our in-house Customer Insight Unit.
– Our marketing campaigns continue to be an important way of
communicating with our customers, in order to keep the M&S brand
fresh and at the forefront of their minds.
Food safety
A food safety related incident occurs or is not effectively managed
As the leading retailer of fine quality fresh food in the UK, it is
paramount that the food products we sell to our customers are safe.
– We have a dedicated team in place responsible for ensuring that all
M&S food products are safe for consumption through rigorous controls
and processes, with a continuous focus on quality.
– We maintain robust governance of the food supply base through our
long established supplier audit programme and reporting process.
Day-to-day operation We are a customer-centric business and strive to deliver an efficient and effective operation.
The Group faces a number of operational risks on an ongoing basis, including: Stock management; Supply chain management;
Key supplier failure; and IT security, each of which were disclosed in last year’s Annual Report. We recognise that these are important
and still subject to regular review, however this year we have sought to focus our disclosure onthose that have been assessed as more
significant to the Group.
The risks listed do not comprise all those associated with M&S and are not set out in any order of priority. Additional risks and
uncertainties not presently known to management, or currently deemed to be less material, may also have an adverse effect
on thebusiness.
Further information on the financial risks we face and how they are managed is provided on pages 97 to 100.
Strategy Performance & Marketplace Operating review Financial review
Financial statements & other informationGovernanceOverview
To find out more visit marksandspencer.com/annualreport2011 Directors’ report
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