Marks and Spencer 2013 Annual Report Download - page 48

Download and view the complete annual report

Please find page 48 of the 2013 Marks and Spencer annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 120

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120

Governance Marks and Spencer Group plc Annual report and financial statements 2013 46
Accountability continued
Description Mitigating activities
Finance: We continue to focus on maintaining a strong financial position that supports improvements to our business
Economic outlook
Economic conditions worsen or do not improve,
impacting our ability to deliver the plan
As consumers’ disposable incomes come under pressure
from price inflation and government austerity measures,
trading conditions continue to remain a challenge for our
business.
–Proactive management of costs
–Regular review of customer feedback and marketplace
positioning
–Continued focus on value proposition in the context of a
balanced product offer, including market leading innovation
–Ongoing monitoring of pricing and promotional strategies
–Regular commercial review of product performance
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
GM product
Continued loss of engagement with our core customer
As we seek to enhance the M&S brand, it is important that
we address our core customers’ specific needs in an
increasingly competitive market where economic uncertainty
continues to be an influencing factor.
–New senior management team appointed with clear focus on
quality and style
–Prioritisation of core customer in both General Merchandise
and Marketing objectives
–Regular review of customer reaction to product and in store
experience through focus groups and in-house Customer
Insight Unit presentations
–Ongoing product and store improvements addressing specific
customer feedback
–Targeted marketing and promotional activity using customer
loyalty data
Food safety and integrity
A food safety or integrity related incident occurs or is
not effectively managed
As a leading retailer of fine quality fresh food, it is of
paramount importance that we manage the safety and
integrity of our products and supply chain, especially in light
of the business’ greater operational complexity and the
heightened risk of fraudulent behaviour in the supply chain.
–Dedicated team responsible for ensuring that all products are
safe for consumption through rigorous controls and processes
–Continuous focus on quality
–Proactive horizon scanning including focus on fraud and
adulteration
–Established supplier and depot auditing programme
People and change: Our people are fundamental to the long term success and growth of this business
Our people
Our organisational culture and structure limit our
ability to adapt to market changes with pace
As the business strives to become a leading international,
multi-channel retailer, it is essential that our organisational
set-up allows us to respond to market changes with pace.
–External hires recruited into a number of senior roles bringing
an alternative perspective
–Robust employee engagement process for effective
communication
–Alignment of development programmes with business strategy
Programme and workstream management
Benefits from our major business programmes and
workstreams are not realised
We continue to undertake a number of major strategic
programmes to underpin the achievement of our plan; the
delivery of forecasted benefits is critical to this.
–Strategic Programme Office centrally governs the Group’s
initiatives providing regular status and benefits realisation
updates to the Executive Board
–Proactive management of programme portfolio and associated
benefits in the context of current market conditions and the
Group’s three year plan
–Programme governance structures in place for all major
programmes, supported by robust project management
discipline
–Proactive identification and management of major cross
programme interdependencies
Distribution centre restructure
We fail to effectively deliver our new national
e-commerce distribution centre
Our new national distribution centre will also service all
customer orders placed through Shop Your Way. The
implementation of this distribution centre relies on the
opening of a new facility and new business processes and
systems.
–Robust programme governance in place with clear
identification of interdependencies with other Group initiatives
–Phased approach to implementation
–Ongoing review of trajectory for achievement of agreed
operational and financial objectives
–Ongoing review of contingency requirement during facility
transition
–Engagement with external experts (as appropriate) to ensure
successful delivery of the in-house operation