When Marks & Spencer announced Marc Bolland was leaving last year, the City breathed a sigh of relief.
The former Morrisons man had done good things for the retailer’s food business, but there was no getting away from the year-on-year-on-year declines in clothing.
It was hoped Steve Rowe’s tenure would usher in a period of change and – ultimately – improvement. But some analysts worried whether he had it in him to be a real harbinger of change.
The shop-floor boy-turned-chief executive has undeniably made some progress, but yesterday’s results underscored just how much he has to do. Yes, some stores have been shut, promotions reduced and new blood is being brought into the business.
In hiring Halfords boss Jill McDonald, it seems Rowe recognises the work needed in clothing is not about winning over high fashion press with one-off items but winning back the woman who used to buy her entire wardrobe from Marks.
Either way, it is not enough. M&S’ clothing division is still in a woeful state, the store portfolio in desperate need of improvement. Its level of customer service, according to a new index, now lags behind budget grocer Aldi.
Radical decisions will have to be made. If Rowe is serious about not running a two-tier business, he must plough investment into clothing to bring it up to the standards of M&S’ aspirational food division.
If not, he must decide whether to hive it off, either to be run in separate stores, or jettisoned outright to make M&S, as it were, simply food.
Lifers are rarely true reformers for the simple reason that it is more difficult to identify the flaws of a business when you have the blind spots of familiarity or sentimentality.
Rowe might be able to deliver small margins of improvement by tinkering around the edges, but it seems unlikely that he will have the perspective to make fundamental changes necessary to turn M&S into a business fit for the future.
Shares are 20 per cent lower than when he took over at the start of April last year.
The need for radical change is more pressing than ever before. At yesterday’s AGM, Rowe warned that times were becoming increasingly uncertain. If M&S has managed to notch up just two quarters of growth in clothing over six years during the good times, the future will be very bleak indeed if nothing changes now.
Read more: Pressures mount for M&S CEO Rowe