LIDL Supermarket: New Virtual Store Service - Designing An Effective Process

LIDL is a German discounted supermarket chain. It began its operations in Germany in the year 1930 as a small independent grocery whole seller. In 1994 the company opened its first store in UK. Today the company is having more than 10000 stores across Europe and US. Company has 600 plus stores only in UK. Began from a small grocery seller the company is now a common name in the Europe and US houses (LIDL 2017). Jesper Hojer is the CEO of the company (Hillen 2017). The company always aims at providing customer satisfaction and value for money. The value pillars of the company revolve around R things that are respect, recognition, responsibility and trust. LIDL also had a good organisational culture and aims to cater the needs of customers as well as the employees. The company pays attention towards employee growth. The company supports various local and nationwide initiatives as a part of CSR. This task includes designing a new service for the company and covers various issues related to operations. The company is amongst the most successful low cost supermarket chain in UK (Kershaw, 2015).

In order to provide more customer satisfaction and sales company can start a new service. It can provide its product catalogue on places such as bus stops, stations, parks etc. These will serve as a virtual store. Customers can use their smartphones to scan QR codes and order the products. This will reduce the need for going to super markets. Similar kind of stores was started by Tesco in South Korea and it helped the company to become market leader (Strother 2011). The service was aimed to target the working class who do not have time to buy groceries. They usually spend time on bus stops or railway stations waiting for the train or bus.  Customers can utilise their waiting time buying groceries if the company’s concept comes into existence.

It’s a kind of new service that is provided by the company to the customer. Service process design is the process of planning and organising people, infrastructure, and finance in order to provide new service or to improve service quality and ensure a better interaction between service provider and customer. Process design is important before providing any product or service. Here also company needs to design an effective process to effectively implement the concept of virtual stores. It is necessary to develop an effective and efficient design because a large portion of company’s budget is incurred on operations.  Therefore process design becomes one of the major decision and task for the operations management team (Rattan 2012).

Objectives for Process Design

 In this case process design is necessary to ensure appropriateness of the process to overall organisational objectives, determine the exact requirements for providing the services, it sets clear goals and deadlines for each step that is being adopted in process and it provides clarity to stake holders a clear image or realistic view of your selected project. The effectiveness of process can be increased in the company pays attention to few points. The company should take into consideration the consumer behaviour of targeted customer segment. The values of the community should be taken into consideration. Environmental sustainability should be maintained and enhanced. Heritage and cultural values needs to consider before designing the process. Company needs to engage community and stakeholders. Also process design should also include necessary consents that are needed to be obtained from various authorities. All of the above stated point ensures an effective process design.

Objectives for process design are as follows-

The process design should ensure that the process take place in the appropriate manner and should accomplish whatever organisation is trying to achieve.

The basic aim or objective of process design is to make an appropriate schedule for various activities. Also this should ensure that goals of organisations are achieve (Slack, Brandon and Johnston 2013). The process design for virtual stores should decide the schedule for opening each store at different places also the process design should ensure the achievement of organisational goals such as customer satisfaction and increase in sales.

The performance objectives of operations directions should be directly related to the service process design objectives.

Operation department has its own goals and strategies, the process design should translate the goals and objectives of the operations department (Krajewski, Ritzman and Malhotra 2013). The process design for virtual stores should translate the goals of operations department of LIDL UK.

Process design deals at operational level thus it must include micro and detailed set of objectives.

The process design is designed for operational level thus it should focus on the micro level details. These details include regarding methods, information technology, people, strategic alignment, governance and culture (Rosemann and Brocke 2015). The process design for virtual stores should focus on the details such as the best suitable areas that are to be targeted, how to effectively use technology in order to provide shopping convenience, how the products will be delivered at various places, number of people needed and the desired skillset etc.

Performance Objectives

The process design should also aim at maintaining and enhancing environment sustainability.

The process design should be environment sensitive. Today the issue of environmental sustainability has gained greater importance thus the process design should take into account various green issues. The process design should make sure that this should not have any hazards to environment (Epstein and Buhovac 2014).

This step involves reviewing vision and mission of the company.  The new service that is to be provided should in compliance with the mission and vision of the company (Armstrong, Kotler, Harker, and Brennan 2015).

This step includes coming up with the new strategy and frame work for new product/ service in terms of markets, profits, workforce, time horizon etc.  Setting up a new formal mechanism may include a new department responsible for developing a new department (Lusch and Vargo 2014). For introducing virtual stores in the market new strategy regarding the service needs to be established.

The organisation should cultivate the atmosphere of innovation at the work place. Ideas and opinions of various stake holders should be considered (Kornish and Hutchison?Krupat 2017). Here the idea generated is for providing the new service. The service is providing virtual stores so that it becomes easy for busy people for to shop for their daily needs.

After determining the plan it is necessary to develop various specifications for the product or service. It is also necessary to check the responses of initial customers and employees regarding the product or service (Gatignon, Gotteland and Haon 2016). The concept of virtual stores should be developed it should analyse the target market and the needs of target market. After this the brief about the concept should be communicated to the initial customers and employees to know their reaction.

This step involves checking for the feasibility and potential profit that company can gain. This involves checking for the cost effectiveness of the project (Chang 2016). For the concept of virtual stores all the costs such as cost for technology, workforce, delivery etc. should be calculated and then the ROI should be estimated. Also the company should check for the feasibility of the product in the various markets of UK. The new service ideas should only be passed if it meets the minimum service requirements.

This involves where a detailed blueprint of the service including all the aspects should be included in the layout. A detailed layout for implementation of the virtual store service should be prepared.

Being Environment Sensitive

This involves checking the newly developed product or service on a very small segment to check for the customer segment. This virtual store should initially be tested in one or two locations. This testing can be done with juts the company employees and their families.

This stage involves introduction of the service to the wide target market. This involves monitoring complete service cycle and it is the real action phase. For LIDL commercialisation of virtual store involves setting up these stores at various public places and monitoring effectiveness of the new service.

This involves making the required alterations in the product or service as per the market needs (Brands 2014). After introducing the needs virtual stores to the UK markets the company will need to make changes in the service according to the loopholes and the feedback of the customers.

This involves adopting various sales promotion activities so that more and more customers know about your product or services. LIDL needs to advertise about its new service through various modes such as social media advertising, print media advertising, banners nears various office areas etc.

Performance objectives can be defined as the milestones that are to be achieved at frequent intervals while running on the path to achieve long term organisational goal. These objectives should be developed for all the aspects of the program. These objectives should include risk mitigation, hazard prevention, business continuity etc. In case of LIDL one of the major performance objectives is to increase the market share. This impacted the design of the new service. In order to achieve the objective the service is designed to be implemented at places such as bus stops and offices because the regular office employees usually have to wait at these places so this serves as a potential point to increase the market sales. Another major performance objective is reducing the cost and aiming for higher profits. This objective also impacts the design of the service. The service is designed in such a way that it makes best use of available technology so that the cost can be reduced. Also the cost of setting up a normal physical store is much higher than setting up the virtual store. Next performance objective is to ensure consumer satisfaction. To fulfil this performance objective the company has adopted various ways to take the customer feedback. The company makes alterations in the design to according to the customer demands.

Conclusion

In today’s era environment sustainability has gained so much importance. Every country has its own laws for environmental protection. Every company needs to make sure that it obeys the environmental laws of specific country in which it operates. Non-compliance with the organisational objectives can impose heavy fines on the company and can lead the company to various legal troubles. The company’s new service design does not harm the environment in any manner. It can benefit the environment as it reduces the need to travel to stores thus reduces pollution level and fuel consumption. Also the company doesn’t need to make physical setups at various places which save a lot of energy. Also the company should pay attention to the cleanliness near the walls which serve as the virtual store. The company can do lot more to enhance the environment sensitivity as a part of their CSR activities. It is the morale duty of the organisation as it is utilising resources from the environment.

Conclusion

It can be concluded that for designing any new service or product every company needs to prepare an operation plan known as process design. This serves as a blue print and frames an outline regarding series of activities and their respective schedule (Gmelin and Seuring 2014). The company LIDL is a discounted super market chain and introducing new service of virtual stores in the market. These stores will serve UK markets. Virtual stores will be at the places like bus stops and railway stations, because this is place where working people spend idle time waiting for trains and buses. These stores will reduce the need of going to the traditional grocery stores, people can order from their phones. Process design is required to achieve organisation goals. The company wants to achieve the objectives such as higher profits, more market share and environment sustainability. The process design is prepared in such a way that it helps to achieve all the stated objectives. The company has also checked for the cost effectiveness of the project. The new service will be commercialised in the markets with an adequate blend of promotion mix. The performance objective lays an impact on the service process design. Also this design is environmentally sustainable. 

References

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