The retail industry in the country of Australia is one of the most developed marketing chains around the multiple companies that are under operation in the wide market of business. The retail market features the characteristics of the oligopoly market. Over the last 50 years, the country has been enjoying fine environment of the business with increasing population and development of shopping centers that are renowned in the world. The evolution of the existing range of the supermarkets came with a very big impact over the landscape of Australia. By effectively riding on the strength of the retailing of the supermarket, Woolworth utilized the opportunity to become one of the leading and the biggest retailers. Woolworth limited ranks among one of the few and renowned companies that are operating in the sector of retail. It has one of the biggest supermarket chains in the country of Australia. Established in the year 1924, the first store of Woolworth opened at the imperial arcade of Sydney. The company was founded by Stanley Edward Chatterton, Ernest Robert Williams, Harold Percival Christmas, Cecil Scott Waine and George William Percival Creed (news.com.au 2018). In the current share of the market Woolworth has more than 31 percent of the market share in the sector of retail and is generally considered to be one of the main contributors towards the economy and the rising GDP of the Australian economy (Keller, Pham and Warren 2017,p.5319). From the very initial stage, the company grew towards the concept of innovation which is one of the main reasons behind its growth in the market of business. Woolworth became the very first store in the entire world that initiated printing of the receipts by the registration of the cash by the consumers in the retail super markets. With the help of series of acquisitions, Woolworth managed to expand its empire rapidly after taking entrance in the foreign markets. The assignment focuses on the analytical and the critical perspective of the theoretical models of the change interventions in the business with proper recommendations for more effective system and strategies for the change management and for the simplification of the identified risks and the problems in the business.
Woolworth is one of the proud domestic company of the country of Australia that originated in the year 1924 with the principle that each and every man, woman and the children requires a handy place or a region where the good things comes cheap (Woolworths Group 2018). These words of the principle of the company are still as important as it was year back. The company offers the best values that is possible furthermore providing easy and equitable access and range of offers that the customers and the shoppers can ever find. Woolworth takes the ultimate pride in working closely with the suppliers for bringing the best products at the best offer price to the millions of customers that the company serves every day. Apart from this, the company is one of the Australia’s major employers that employees over 180,000 Australian that includes persons both from the rural and the urban areas (Devin and Richards 2018, p.201). The company has more than 42 thousand shareholders, the vast majority among which belongs from the Australia. The company is furthermore committed towards the partnership of business to many of the local farmers, manufacturers and the producers (Goetsch and Davis 2014). In the current date, Woolworth has over 3 thousand stores located in the entire country of Australia and New Zealand with the entire span of the food, general merchandise, liquid, home improvements and petrol. The company exist to provide its customers with the best values, access and the range of offers. Woolworth significantly furthermore contributes to the economy and the jobs being proudly the part of the local market communities where the main operation takes place. Woolworth are the leaders in case of the innovation and the multi option retailing with the online super market sales growing about 50 percent in the year 2013 and the facility of the home delivery over 90 percent of the households in the Australia (Grimmer 2018,p. 5). The company is furthermore one of the preferred and the best choice of the customers in case of the fresh foods. These days, Woolworth has just a single solid contender, Coles Ltd., and it was conceded that because of serious rivalry between them, it turned out to be relatively difficult to enter retail market for a newcomer.
Woolworth has an unrivalled record of tracks of the employment and training of the hard working Australians. This portion of the assignment focuses on the glossary of the key management concepts together with the intervention and the diagnostic model of change.
Successful management is the key for the success of any organization. The change management is an important tool towards the making of the better changes. Woolworths has recently faced structural changes. These include the leaving of the company by many of the senior employees, the fight for survival for many of the subsidiaries. The majority of the issue in the organization inducing the need of the process of change management is for the failed SAP structure (Wu et al. 2015, p.449). Woolworths is struggling and failing to deliver the specific requirements of the customer resulting in the loss of faith in the structure of the management. The company has furthermore faced a continuous down fall of morale together with the loosing of the customer relations, loyalty and marketing.
To summarize the facts there are numerous of reasons for the need of the change management of Woolworths. Increase in the market pressure together with the pressure from the competitors has enabled Woolworths to take initiative for the change management (Chang 2016). Furthermore, failing to satisfy the expectations of the customers together with the rapid switching to other brands is causing a decline in the profit margin of Woolworths.
The intervention and the approach of diagnostic aims towards bringing the needed changes and alteration in Woolworths. The company needs a change and must recently go through restructuring (Pulker et al. 2018,p. 202). The interventions are mainly defined as the strategies of the business that targets to make difference and changes in the organization. The following two interventions have been identified as the key factors of the change management process of Woolworths.
- Banning of the single use plastic bags
- The super market giant. The Woolworth bans the single use plastic bags at all the stores across the countries. Effected from July 1, 2018 the use of the plastic bags less than 35 microns in the thickness are banned by the retail chain. The plastic bags end up causing environmental pollution, land fillings, polluting the rivers and the oceans in Australia. For this reason, the light weight plastic bags are not allowed anymore (Cameron et al. 2015,p.119). Bags that will not be banned includes garbage bags, the bin liners, the bags for the fruit and the vegetables, the nappy bags, the dog poo bags and the departmental store plastic material bags. Woolworth have introduced thicker plastic bags at their super market chains. These bags are foldable and freezer type bags that are reusable in nature and generally mad of thick cloth which is biodegradable in nature.
- Intervention Typologies 2: On the basis of the above specified focal issues, the strategic intervention is generally focused on the structural intervention. The context can be furthermore seen as the continuing improvement towards the products and the services though the innovation for saving the environment. The introduction of the thicker bio degradable bags by the super market chain in the country of Australia is a smart move towards the nature.
- The cutting down of the product range for increasing the market for the Woolworth brand products
- Woolworth aims to have private labelled products even at the cost of the reduced range of the products in the super market shelves. The private labelling is taking over the super market as a storm. According the reports and the claims by the Woolworth this increase in the private labelling will apply across the multiple tiers of the range of the products focusing of the quality, the range of innovation and the new strategic global relationships (ABC News 2018). More supermarket brand will mean low price for the consumers and a great deal of price for the retailers. Thou the wide variety of the product range of the Woolworth will diminish and people coming to the super market will have to dump the selected product range of Woolworth and join the home brand product range for increasing the value for the price and the quality.
- MMH356 intervention typology 2 – strategic intervention – As Woolworth tries to reduce and cut down the prices together with the increase in the brand image for the products, this change force can be categorized as one of the strategic interventions that target towards generating more sales for the home brand product range (Wang 2015). This will be a competitive move with the Aldi and Colas who are the main competitors of the Woolworth.
Organizational behavior is a theoretical framework of the behavioral science that are mainly focused for the understanding, predicting and managing the human behavior in the organization for the achievement of the goals of the organization. The concept of organizational behavior consists of three level of analysis. These are individual, group level and the behavior of the organization itself. The five main evaluation model is the abstraction of the reality (Lewis and Phillipov 2016, p.122). These models represent the simplified version of the real-world phenomenon. Models are generally the replica of something representing the idea for the pattern for being scientifically practiced for the achievement of something.
While some of the models of the organizational behavior tends to change or update as per the time schedule, one of the most persistent model is the McKinsey 7-S framework model. The model is useful for the evaluation of the strategies and the intervention of the Woolworths as stated above (Bejinariu et al. 2017,p.322). The McKinsey model is useful for Woolworths for the examination of the issues and examination of the changes and the factors contributing to the process of change management in the organization.
Strategy - The first intervention of Woolworths illustrates the ban of the plastic bag for the customers The employees of the organization needs to have focused approach together with the development and implementation of innovative measures like use of bio degradable bags for building competitive advantages in the competitive retail market chain. The second intervention illustrates the expansion of the market of the Woolworths brand product (Cameron and Green 2015). The organization needs to expand its product range together with formation of reduced priced structure of its products to attract new customers towards the Woolworths brand products.
Structure- For the first intervention the organization and the employees of Woolworths needs to initiate a change inside the organization and propagate the motto to follow the greens and support the biodegradable products to support environmental safety and ban against the pollution of the environment (Safa, Von Solms and Furnell 2016, p.75). In case of the second intervention, the organization needs to restructure the retail stores, develop new manufacturing units for the introduction of new product range and cut down the range of products from the other brands it sells in its retail super markets.
Systems- In case of the first intervention the organization must introduce some environment friendly carry bag for the customers who come to buy in the super market. Furthermore awareness regarding the environmental pollution, water clogging and the land filling due to the use of the plastic bags must be made to the customers to encourage them use the reusable clothing and fiber bags (Mitchell, Fredendall and Cantrell 2015, p.21). In case of the second intervention, the organization must develop a new team that will suggest the organization to maximize its range of branded products with the Woolworths labeling in the competitive retail market.
Shared Values- The organization and the employees of the organization must has super ordinate goals in case of the development of the model. In case of both the first and the second intervention, the employees of the organization must have core corporate cultures and values related to general work ethics to help Woolworths stand out in the crowd of retail market (www.forbes.com. 2018).
Style – In case of the first intervention, Woolworths must adopt the leadership skills to introduce the use of the bio degradable range of bags and stick to its decision of banning of the plastic bags. The company should serve itself as an example and an inspiration for the other retail marketing chain towards the ensuring of the environment safety (Jie, Parton and Chan 2015, p.130).In case of second intervention, the organization must develop strategic goals prior introducing their own brand range of products for increasing its profit margin.
Staff- The employees and their general capabilities are one of the key ingredients of the Woolworths to succeed in the market of retail and expand its empire through out the world.
Skills – The skills of the employees and the competencies of the companies regarding both of the above stated intervention is required for Woolworths to succeed in expanding its range of business in the both the local and the international market.
To summarize, the McKinsey 7-S framework model has been used for the diagnosis of the framework of the Woolworths for the proper identification of what required to be realigned and focused for the improvement of the performance of Woolworths in respect to the two interventions namely the ban of the plastic bags and the expansion of the brand image for increasing the market range for the brad product of Woolworths.
Planning and implementation
The goals and the planning of the Woolworths supermarket are to put the customers in the 1st priority. Effective planning is thus required even with the help of the change management process for aiming the above stated interventions of Woolworths (Wallace et al. 2016,p.840). The process of the planning in respect to the interventions includes the development of objectives for use of bio degradable bags for the product range, introduction of new strategies to expand the brand of Woolworths product, determination of the resources for the implementation of the tasks, creation of an effective time line, determination of the assessment and the tracking method and finally the distribution of all the involved measures in the process.
The implementation of the strategy for the expansion of the business of Woolworths includes the development of one string team base, reduction of the cost and improvement of the process, refreshing the stores (Wallace et al. 2016, p.840). Besides this, Updating of the offerings of the products and the development of the brand image are some of the ways the company can initiate implementation of the goals and the targets by effective planning.
One of the best models that can be used for the analysis of the process of implementation in case of Woolworths is the Kotter’s 8 step change model. The 8 vital steps can be illustrated with the implementation of the factors of diagnosis that are required for the process of change management in Woolworths for the above stated interventions.
The model illustrates the process of the implementation of the changes in Woolworths that need to be initiated for the application of the interventions stated above. The employees and the customer’s needs to be awared abut the urgency to shift their preferences from using cheap plastic bags to high quality re –usable bio degradable bags. The employees needs to be cautious about the change that is initiated by Woolworth which will furthermore create the recognition of the brand among the entire retail market of the Australia for taking a step towards wellness of the environment. From convincing the employees regarding the necessary changes for the expansion of the business market of Woolworth towards cutting of the product range from other brands and introduction of the Woolworths brand products to the creation of a vision for the change management required for the diminishing market value and the level of customer dissatisfaction rate, the model illustrates the process of implementation. Furthermore effective communication among the employees and the customers towards the awareness of the green products and the newly introduced product range of Woolworths brand needs to be done for attracting new customer base (Wu et al. 2015, p.449). Continual change of the barriers and anchoring changes in the corporate sector, the process of implementation of the strategies for the change management in Woolworths is thus best illustrated by the above stated model.
The approach of the Woolworth includes the formation of a solid foundation, leading by the customer range, putting the people in the first priority, development of the relationship of trust, the freedom towards free speech and meeting customer satisfactions.
The supermarket of the country of Australia is highly competitive and concentrated in nature. Despite of the fact of the intense competition and the potential for the vulnerable profit margin, Woolworths is one of the best examples and a clear indication of the superior business model in the Australia. Woolworths looks forward to serve the customers of both the Australia and the world in a continuous basis in the upcoming future. The company aims to find new ways for the satisfaction of the needs or the requirements of the retail and the empowerment and the employment of more number of Australians across the regional and the metropolitan country of Australia. The company furthermore welcomes the rigorous opportunities for the provision of the value, the convenience and the choice of the customers irrespective of their living. The key determinant and the factor as to if Woolworths will succeed in its objective is partially dependable on the government of Australia for the effective addressing of the significant regulatory factors and the burdens that is generally faced by the retailers of the country. As the company broadens its range of products, offerings and in the new markets, it is likely to get benefited and a hike in the profit margin together with preserving the notion of sustainability in the field of its competitive edges.
One of the leading retail market chains of Australia, Woolworth requires some of the strategic recommendation that will furthermore help in the expansion of its business. It is recommended that the company should enable adoption of the strategies of social media for taking the advantage of the low cost activities of promotion. Woolworths should offer organic and GM-free foods to its customer base and also should participate in the CSR activities that will have the tendency to improve the firm’s goodwill. These include the recommendations in the short term for the Woolworths. In case of the long term strategies it is recommended that Woolworths should increase the manufacturing and the investment finance for the research regarding the diseases related to alcohol for the protection from the introduction of the new regulations of the government that may put further ban or restrictions on the sale of alcohol. Woolworths should furthermore diversify in new business where the growth in the sales structure is projected towards the rise over the long term as the profitability attractiveness in the category of the supermarket of Australia. Some of the basic framework for the protection and the improvement of the framework of the competition for Woolworths include the following.
Recommendation for the first intervention- The first intervention of Woolworths includes the ban of the cheap plastic bags and the introduction of re usable and biodegradable carry bags in the super market. The three recommendations for the intervention is as follows.
- Woolworths should promote environment friendly bags, make the customer and the employees of the organization aware about the negative effects of the use of the plastic bags
- Since the plastic bags are harmful to the environment but at the same time easy and cheap for use and carrying of the products Woolworths should make a biodegradable reusable carry bag made out of premium fibers that the customer can buy from the shop and use number of times.
- In case of vegetables and perishable items, Woolworths must introduce two layered packaging system of the product before displaying it on the retail stores.
Recommendations for the second intervention – The second intervention of Woolworths is to cut down the range of the products for increasing the market share of the products from the Woolworths brand. The three recommendations for the intervention is as follows.
- Formation of new retail outlets in different parts of the country so that the people can get more aware of the new range of Woolworths product
- Woolworths must do brand promotions of their products and also provide high range of discounts, and decreased price range for its products to attract new customers towards the newly introduced brand products in the retail stores
- Innovative measures and introduction of new and variety of product ranges must be done so that Woolworth can stand out in the crowd among the competitive market of retails.
It is thus recommended for the Woolworths to rely on the capacity to comprehend and react towards the changing environment of the market. Being the leader in the retail market, Woolworths must comprehend towards the maturity towards the unit of the business, take sufficient risk for the uncertainty of the environment and generate sources of further opportunities.
ABC News. 2018. Retail giants like Coles and Woolworths are shrinking supermarkets to maximise profits - ABC News (Australian Broadcasting Corporation). [ONLINE] Available at: https://www.abc.net.au/news/2018-06-18/coles-woolworths-woolies-australian-supermarkets-getting-smaller/9879300. [Accessed 18 September 2018].
Bejinariu, A.C., Jitarel, A., Sarca, I. and Mocan, A., 2017. Organizational Change Management–Concepts Definitions and Approaches Inventory. In Management Challenges in a Network Economy: Proceedings of the MakeLearn and TIIM International Conference 2017 (pp. 321-330). ToKnowPress.
Cameron, A.J., Sayers, S.J., Sacks, G. and Thornton, L.E., 2015. Do the foods advertised in Australian supermarket catalogues reflect national dietary guidelines?. Health promotion international, 32(1), pp.113-121.
Cameron, E. and Green, M., 2015. Making sense of change management: A complete guide to the models, tools and techniques of organizational change. Kogan Page Publishers.
Chang, J.F., 2016. Business process management systems: strategy and implementation. Auerbach Publications.
Devin, B. and Richards, C., 2018. Food waste, power, and corporate social responsibility in the Australian food supply chain. Journal of Business Ethics, 150(1), pp.199-210.
Goetsch, D.L. and Davis, S.B., 2014. Quality management for organizational excellence. Upper Saddle River, NJ: pearson.
Grimmer, L., 2018. The diminished stakeholder: Examining the relationship between suppliers and supermarkets in the Australian grocery industry. Journal of Consumer Behaviour, 17(1), pp.e13-e20.
Jie, F., Parton, K. and Chan, C., 2015. Australian beef supply chain integration: case studies of the two largest Australian supermarkets. International Journal of Supply Chain and Operations Resilience, 1(2), pp.121-138.
Keller, A., Pham, J. and Warren, H., 2017. Conducting hydrogels for edible electrodes. Journal of Materials Chemistry B, 5(27), pp.5318-5328.
Lewis, T. and Phillipov, M., 2016. A pinch of ethics and a soupçon of home cooking: Soft-selling supermarkets on food television. In Food, Media and Contemporary Culture (pp. 105-124). Palgrave Macmillan, London.
Mitchell, B.C., Fredendall, L.D. and Cantrell, R.S., 2015. Using McKinsey’s 7 S Model to Empirically Examine Organizational Effectiveness among the NBA Teams. International Journal of Management & Human Resources, 3(1).
news.com.au. 2018. Coles, Woolworths: Supermarkets fundraising for drought relief. [ONLINE] Available at: https://www.news.com.au/finance/business/retail/coles-to-match-dollarfordollar-customer-donations-to-drought-relief/news-story/88d7841cac724b0a00a67a7c44bebf09. [Accessed 18 September 2018]
Pulker, C.E., Trapp, G.S.A., Scott, J.A. and Pollard, C.M., 2018. What are the position and power of supermarkets in the Australian food system, and the implications for public health? A systematic scoping review. Obesity Reviews, 19(2), pp.198-218.
Safa, N.S., Von Solms, R. and Furnell, S., 2016. Information security policy compliance model in organizations. Computers & Security, 56, pp.70-82.
Sullivan, R. and Gouldson, A., 2017. The governance of corporate responses to climate change: An international comparison. Business Strategy and the Environment, 26(4), pp.413-425.
Wallace, J.C., Edwards, B.D., Paul, J., Burke, M., Christian, M. and Eissa, G., 2016. Change the referent? A meta-analytic investigation of direct and referent-shift consensus models for organizational climate. Journal of Management, 42(4), pp.838-861.
Wang, Z., 2015. Supermarkets and gasoline: An empirical study of bundled discounts.
Woolworths Group: Quality Brands and Trusted Retailing. 2018. Woolworths Group: Quality Brands and Trusted Retailing. [ONLINE] Available at: https://www.woolworthsgroup.com.au/. [Accessed 18 September 2018].
Wu, J.H., Neal, B., Trevena, H., Crino, M., Stuart-Smith, W., Faulkner-Hogg, K., Louie, J.C.Y. and Dunford, E., 2015. Are gluten-free foods healthier than non-gluten-free foods? An evaluation of supermarket products in Australia. British Journal of Nutrition, 114(3), pp.448-454.
www.forbes.com. 2018. #486 Woolworths. [ONLINE] Available at: https://www.forbes.com/companies/woolworths/#6c7613c95854. [Accessed 18 September 2018]