Testing the Theory in Practice

Our perceptions of the external environment, mission, and key competencies must align with reality. Our perceptions of the external environment, mission, and key competencies must align with reality. When four poor young Englishmen from Manchester – Simon Marks and three of his relatives – decided in the early 1920s that the market for simple, cheap goods should drive social transformation, World War I had already shaken the class structure of their country to its core. As a result, many buyers emerged looking for quality, stylish, and affordable items such as women's underwear, blouses, and stockings – the first product groups to bring success to Marks and Spencer. After this, the partners focused on developing entirely new key competencies. Until then, a seller's key competency was considered the ability to buy profitably. Marks and Spencer decided that a seller who knows the customer better than the manufacturer should create the necessary products themselves and find a producer capable of making goods of the required quality and cost. It took another 5-8 years for traditional suppliers, who had always seen themselves as "manufacturers" rather than "subcontractors," to understand and accept this new vision of the seller's role. TIP OF THE DAY: What new assumptions about the external environment, mission, and key competencies did Marks and Spencer make?