Marks and Spencers are making great progress on Plan A. What can learn from the fourth anniversary event last week? Marc Bolland is committed and wants Plan A to part of how M&S grow globally. The next phase will be about engaging the consumer and getting emotional traction. And, to get a return you must take risk.
Last Thursday 7 July I was one of 150 plus sustainability folk at the Plan A Progress Event. (Full disclosure: I was there because Forum for the Future works closely with M&S. This post contains insights based on what was said in public session.) All the way back in 2007 M&S launched Plan A “because there is no Plan B”. Originally there were 100 commitments, organised by 5 themes: Climate Change; Waste; Raw Materials; Fair Partner; Health. The headline targets were ambitious, being carbon neutral and no waste to landfill by 2012. When launched, M&S didn’t know how they would deliver 30 or so of the commitments, and thought it would cost £200m over 5 years. In 2010, Plan A was revised with more commitments and an ambition to be “the world’s most sustainable major retailers”.
The combination of broad range and ambition makes Plan A part of M&S’s brand positioning with customers “you can trust the quality and value of everything in our shops”. Many other supermarkets have a different positioning with customers – “everything you want is here” – and so tend to have a strategy based on ‘hero products’.
So, what did we learn at the progress event?
Well, at a basic level Plan A is being delivered. They have already achieved 95 commitments, are on-track with 77 and are behind on 7. (More detail in their How We Do Business report 2011.) The presentation from the Head of General Merchandise (I didn’t note his name – oops!) was particularly good. Some 70m items sold last year with at least on Plan A improvement. Increases in wool price because Australian farmers are now breeding sheep for meat for the Asian markets. The use of recycled materials decouples M&S from the volatility and risk of commodity market prices – a big thing as we enter a decade of increasingly constrained resources. Also, Plan A is added £70m to the bottom line last year (which is a bit less than 10% of underlying profits before tax), mainly through energy efficiency savings. So, lots of nuggets.
More fundamental for me was Marc Bolland. He became CEO in May 2010. He could easily have seen Plan A as Sir Stuart Rose’s thing and have quietly killed it. But he’s done the opposite (although he did joke that “Stuart did the plan, now I have to deliver it”). His presentation at the start mapped out his vision for M&S: an increasingly global multi-channel retailer that is trusted. He positioned Plan A as vital to that growth, especially in why consumers can trust M&S but there were also hints about Plan A creating a resilient supply chain. An audience question asked how could M&S take Plan A global when each market has quite different customer expectations. Bolland was clear that Plan A was part of going global, yes it would need to flex. But he saw it as an opportunity.
What he kept coming back to was the need to engage, especially with the consumer. He made it clear that there were a number of plans to get emotional traction with customers. So, I guess we can expect some ‘above the line’ advertising or marketing. As M&S raises its game, I guess others will have to follow.
The other thing we can learn from Plan A is that to get a return you must take risk. M&S launched Plan A without knowing all the answers, and thinking it would cost them. If they had waited until there were definitive answers and a proven business case, well, we’d still be waiting. Many of the companies I work tell me that they find the business case by trying stuff out, and also that the rewards are far greater than they had thought. This matches with MIT / BCG findings that the ‘embracers’ seize advantage. This is a central difficulty for many sustainability change agents: how to get permission to do stuff when you can only prove the business case by doing stuff. For some thoughts on how to overcome this see the Better Decisions, Real Value toolkit.