Q1. What were a) the symptoms and b) the causes of the problems (turnaround situation) at M&S in the late 1990s? How well do these map against those suggested by Slatter / Lovett?
Major indicators of the problem of M&S
Problems triggered by internal causes
Existence of an adverse organizational culture
Virtual inexistence of market effort
Imprudence negligence, and lack of foresight of management
Increasing cost of operations
External Causes
Changing consumer behavior
Increasing costs of supplier
Increasing number of strong competitors
Implementation of a Turnaround Strategy
Changing the focus of the company from internal to a more external perspective
Encouraged stakeholder participation
Made the processes more efficient
Formulating a new centre for the business
Streamlining the company through divestment and reducing idle assets
Outsourcing
Managing the crisis
Finding a turnaround manager
Initiating financial turnaround and financial restructuring
Examination of the Turnaround strategy
Describing a situation where crisis is absent
Creating a practically non-recoverable scenario
Implementing a sustainable survival
Q2. Evaluate the recovery strategies adopted by Vandevelde and later by Rose – how do these compare with those suggested by Slatter / Lovett?
Vandevelde’s recovery strategy fell short because of he wasn’t able to establish an effective change management system that fits the operations of the company. This means that instead of turning the company around, he got stuck in managing change. In this regard, he handpicked Holmes as the main man in the retailing operations in UK. Holmes is said to be one of the more experienced individuals in the business. Vandevelde also handpicked Yusuf to make the products of the company more level with the customers of the market. These courses of action created Per Una, which was one of the more fresh ideas of M&S and consequently well received by the consumers. This is considerably the opposite in the case of Slatter and Lovett as they did not recognize the need for change management. Slatter pointed out the need to sustain the improvements that the company has acquired. In the case of Rose, Mark and Spencer rose from the ashes because of him because he did something different from what the said individuals did: he evaluated the situation. Rose knew what Mark and Spencer is all about and he was aware of the changing environment. In this manner, he was able to find ways to keep the company from the hands of Philip Green.
Analyzing Slatter
Experience is a vital element
There should be a critical condition in the firm to motivate the organization
The problem on the plan made by Rose in the instances where there are no crisis at all
Recovery is imminent
Some changes in the strategy are required
There was an existing crisis and possible insolvency in the condition of the operations of the company
As a result, there was no turnaround that took place. If there were some semblance of such turnaround, it was not sustained.
Q3. Identify the characteristics required in a successful turnaround manager. Why is it so difficult to manage in these circumstances?
The Company employed a veritable turnaround strategy
Requisites for a good turnaround manager
First, the manager must have exceptional experience in the field.
This does not equate to the number of doctorate degrees or where he got his MBA, practical knowledge of what works and what doesn’t is essential.
It also doesn’t hurt that he has a great reputation to back it up with. In the case of Rose, he is already a reputable individual in the retail industry in UK. He has already incurred over 17 years of experience in the field.
Second, a turnaround manager must have professionalism.
This doesn’t only mean that he carries out his work properly. It entails that he operates with integrity and within the realm of ethics.
The turnaround manager will have to possess good social skills in order to persuade both the employees, shareholders, and the customers in favor of the company.
It is also imperative that he have great managerial skills.
The turnaround manager would have to deal with the people internal and external of the company.
He must have the capacity to make these individuals see his vision and comply with the means to achieve these ends.
In the case of M&S, Rose was able to shake the employees to their senses as the bid of Green to acquire the company has given them a sense of urgency to improve on their actions.
A great turnaround manager should have a strong leadership capability.
He should have the ability to learn of these problems, recognize them readily and have the capacity to decide on a particular solution in an opportune manner.
Difficulty in managing such circumstances
It is difficult to manage circumstances where a turnaround is required because of several factors.
First, expectations are high hence the pressure is on the manager to actually turn things around for the downtrodden company.
the manager will be working on a limited time frame and a limited amount of resources compounded with the cynicism of the stakeholders and other members of the company.
On the part of the organization, there is the incessant presence of resistance.
This is seen on the part of the employees, shareholders, and customers.
On the part of the employees, it is understandable that these people do not want to do away with their respective safety zones.
This is perfectly true on the part of the directors of the company.
The shareholders possess these emotional blocks that predominantly criticizes the developmental intention of the company as opposed to helping.
Credit:ivythesis.typepad.com
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