Analysis: Asda, ITV, Coles... can Archie Norman conquer M&S?

Last December we wrote: “His razor-sharp mind, combined with his deep understanding of the difference that company culture can make to business performance, mean he would be able both to challenge and support the executive team.”

Last week, Marks & Spencer named Norman as chair, succeeding incumbent Robert Swannell on September 1.

Norman brings one of the most impressive CVs not just in retail but in business more widely, from companies including broadcaster ITV and experience from a stint in politics as Conservative MP for Tunbridge Wells.

He remains best-known for one stand-out achievement: the turnaround of Asda from basket case to a powerhouse that attracted a £6.7bn price-tag when sold to Walmart.

The approach he took at Asda – inspired partly by the methods pioneered by innovative retail entrepreneur Julian Richer – defined his leadership style.

A style in which open-plan offices, informality and first-name badges are complemented by steely intelligence, hard-headed commercial instincts and a keen eye for executional detail.

M&S’ critical friend

So what will he do at M&S?

He will bring those characteristics to the retailer’s battle to restore its clout in clothing under chief executive Steve Rowe, who took the helm a year ago.

Norman is understood to be excited by the prospect of being involved with such an iconic name as Marks & Spencer, but is under no illusions that there is much work to be done.

“As a ‘critical friend’, he will hope to ensure that M&S faces the candid truth about where it stands and confront any sense of complacency”

One person familiar with his thinking says that Norman will encourage M&S to act rapidly to improve its position in fashion, a position that has been eroded in recent years by the growth of giants such as Inditex and H&M, which have made an impact not just on the UK market but globally – as M&S once had ambitions to do.

As a ‘critical friend’, he will hope to ensure that M&S faces the candid truth about where it stands and confront any sense of complacency which may lead some at the business to assume its position at the top of retail is theirs by right.

He will encourage new thinking and place importance on attracting and nurturing the best talent at all levels.

Some clues to Norman’s general way of thinking can be seen in a video interview he gave on turnarounds some years ago to Boston Consulting Group senior partner Grant Freeland.

In it Norman said: “Most turnarounds don’t turn around. The first tip is make sure you’re going into a situation where the heart is still ticking.”

“Behind all financial failures is an organisational failure. What culturally led it to be in a failed financial situation?”

A resolute focus on people

Crucially at M&S, it is understood that Norman has been impressed by Rowe’s determination to improve the business and his energy to drive necessary change. Had he not been so impressed he would not have accepted the role.

That confidence is vital because Norman will be non-executive chairman of M&S, not the chief executive – a key difference from some of his previous roles such as at Asda.

Headhunter Justin Linger, managing partner of Barracuda Search, worked with Norman to help build the turnaround team at Coles.

“He’s germinated talent at Coles, as at Asda. Above all its talent – people with the right attitude and aptitude”

Justin Linger, Barracuda Search

There, well-known British retailers such as former Asda and Halfords boss Ian McLeod, ex-Safeway and Carphone Warehouse director John Durkan and former Asda man Stuart Machin were brought in to oversee change.

Linger says: “Archie Norman has a resolute focus on people. People and talent make a business in terms of developing and executing.

“He’s germinated talent at Coles, as at Asda. Above all its talent – people with the right attitude and aptitude.

“He will be influencing the direction of M&S. Steve Rowe is doing a pretty good job. He will help facilitate the success of the business with all the experience he brings, alongside Steve who knows M&S and knows the customer.”

Likely to feature on Norman’s agenda is whether M&S has all the right people in place.

Linger says: “M&S was always, like Kingfisher and Dixons, looked at as a place where talent came from. He will facilitate an environment that will be go-to in terms of the talent of the future.”

“Mr Norman is a formidable appointment who, alongside Steve Rowe, means that there are two very strong characters at the helm”

Clive Black, Shore Capital

“Look at M&S in a year’s time from a people perspective and it will probably have changed as it is at moment.

Shore Capital analyst Clive Black welcomed Norman’s appointment at M&S.

He said: “Mr Norman is a formidable appointment who, alongside Steve Rowe, means that there are two very strong characters at the helm of a once great British label that is trying to refind its purpose and relevance to the British shopper to profitable effect.”

“With more time to consider strategic matters in due course, assuming the stabilisation of the clothing home and beauty categories, the combination of Messrs Norman and Rowe should be a force for good for M&S in our view.”

If Norman can turnaround M&S as he has Asda, ITV and Coles, it will go down as his crowning achievement.