UK: Heller on management - Lesson of the sparks at Marks. (1 of 2)

UK: Heller on management - Lesson of the sparks at Marks. (1 of 2) - Do the recent redundancies at Marks and Spencer signal an era of new, tough policies? Robert Heller analyses the retailer's corporate culture.

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Last Updated: 31 Aug 2010

Do the recent redundancies at Marks and Spencer signal an era of new, tough policies? Robert Heller analyses the retailer's corporate culture.

Marks and Spencer, with its 850 redundancies, has shattered the image of a benevolent, cradle-to-grave management system more abruptly than any company since Shell Petroleum swung a similar axe in the 1960s. But Shell has since sailed on imperturbably through the stormiest seas in the history of world oil. Will the status quo at M and S survive its shock?

Not if today's management has its way - judging by the talk about a "new regime" and the "very hard and very commercial" character of the brand-new chief executive, Rick Greenbury; this suggests that the leading Marksists want a clean break with the past. The break cannot be clean, though, because the corporate culture is indivisible from the chain's extraordinary hold over the British shopper.

An ad hoc poll along Oxford Street one Saturday, for example, found an overwhelming preference among shoppers of all social and age groups and both sexes for the retail design of the great firm. It was really a massive vote of confidence in the consistency, quality, user friendliness and value for money which the M and S culture embodies - and was created to achieve.

The Marks-Sieff partnership explicitly believed in the principles now headlined under such titles as "Putting People First": excellently treated employees would in turn treat customers well and respond to the constant stimulus of a management which believed passionately in another principle: "kaizen". That is the Japanese word for continuous improvement, in small matters as in large. Some westerners working for Japan's offshore empire believe, in fact, that the pyramiding of small advances is the key to the boundless productivity of the Japanese workplace.

Kaizen makes work for busy hands to do, and no doubt explains the long-evident overmanning at Michael House. The not-so-small army of managers was swollen in 1990 by 360 of the graduate trainees who have provided the company's regular blood transfusion. Given its admirable practice of providing early and large responsibilities to its young, the father-figure management inevitably built up supervisory layers. And the tradition of lifetime employment further increased the pressure of numbers.

The pressure has been little relieved by departures at director level. The issue is whether the redundancies reflect awareness that a basically sound system has been mismanaged, or whether M and S is moving into a new era with policies that would have horrified Simon Marks and Israel Sieff. Hardness, toughness and commercialism, though, were not strange to Marks, who was once called "a Stalin of the retail trade".

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