Competitive Strategies Based on Morrisons Limited - Case Study Example

?Morrison’s Limited Morrison’s Limited The grocery market in the UK has grown quite a lot in the last 10 years, and continues to expand, develop and grow further. Larger firms have been observed to be increasing their floor space as a result of competition and need to acquire and edge to succeed, while due to the same tough market competition, smaller firms have been forced to pack up shop. Morrison’s was founded over a century ago as a small stall. In the half decade up to 2008, when Sir Ken Morrison retired, this stall grew steadily and impressively into the superstore chain that we see today. Morrison’s now has about 450 superstores and is UK’s fourth largest grocery retailer. As of the end of 2006, Morrison’s Limited has 11.3% of the UK grocery market share, with Tesco in the lead with 30.6% and Asda in second place by market share with 16.3%. Morrison’s has grown quite impressively in the last decade. In 2004, they reported a large and healthy increase in sales and operating profits. However, it faced some problem areas as well in the form of the acquisition of Safeway which has been dragging down Morrison’s overall profit levels. There have been some solutions suggested to the problems Morrison’s currently faces. To increase the currently low performance of acquired stores like Safeway, Morrison’s needs to put in a little extra investment in the stores while increasing the rate of conversion simultaneously. Also the converted stores need to be revamped according to Morrison’s clientele and demographic. In the UK grocery market, Morrison’s has an image of a trust worthy place to buy grocery from that will offer its clients down-to-earth prices for quality products. The brand has never let frills become more important than the core needs of the business and thus added benefits have not been at the expense of the core functions. The management at Morrison’s targets controlling and cutting costs, making a lean operating profit, making its supply chain process more efficient and trying to revamp and bring up to the level expected by the Morrison’s brand, stores like Safeway. There is nothing glamorous or glittery about Morrison’s however, this may be a plus point for the brand as a reason why customers are loyal to it. The biggest challenge it thus faces is to evolve in response to its diversified customer base as it expands with time. At this point in time, Morrison needs to explore every possible avenue that it can exploit to gain a competitive advantage in a growingly competitive market. Thus, numerous company-wide initiatives were launched to be implemented so that the company could improve its self and thus gain an edge over its competitors. Some key variable the firm was working with were increasing sustainability, improving working across the organization by making it more efficient, increasing savings and adjusting and adapting well to the fast moving dynamic modern market. Some solutions that were put forward were targeted towards increasing leverage in a specific area of expertise. The main idea also incorporated improvements in the form of process specialists, consumer relationship management, improving procurement technology and supply chain and enhancing change management capability of the company. Efficiency and effectiveness were to be increased substantially and it was expected that these measure would in turn improve the levels of capability and experience in the workforce. The approach to be implemented had to be collaborative and operational across the organization at all levels. Employees were to be motivated and trained to the effect of increasing the business’s overall efficiency, level of savings, and improving to cultural and behavioral change in modern times and markets while making sure that none of these measures caused any substantial operational setbacks for the company. (Proxima, Case Study). Morrison’s has used several growth strategies to expand as it did over the years, some have been innovative initiatives while others have been the requirement of changing times and a need to survive and excel in the competitive market in which Morrison’s functions. It has differentiated its business which has given it an edge over its competitors by making it stand out in the market. At one time, Morrison’s endorsed a ‘fresh approach’ which entailed gearing up for sustainability, showing concern for the environment and letting its customer base know how Morrison’s operations and products were ‘green’, sustainable and environmentally friendly. Another clever trick by Morrison is to ensure greater control over its supply chain process; this ensures that Morrison has more control over the quality and value of its products. Such measures have made sure that Morrison’s has a competitive advantage in the market. Fresh products are locally procured and later processed in Morrison’s own manufacturing plants. From here they are shipped to state of the art warehouses which Morrison’s owns and to packaging centers. After this, the products are transported to all over the UK. Due to this method that Morrison’s operates with it is able to prove beneficial to the environment, and to local producers and farmers as well as being able to make it profitable for itself and making its customer base happier by making fresh and green products available to them all over the UK. Another way in which Morrison’s has achieved competitive advantage is by employing a specialist and trained workforce. Due to the wide range of its activities, Morrison’s offers employment in very varied sectors, for example logistics, manufacturing, IT, finance and marketing etc. The firm is exceptionally proud of itself because of the career advancement opportunities it provides. It places extreme and diligent focus on its employees and makes sure they provide exceptional customer service and that they make it possible that, ‘fresh’ products may be supplied all over the country in Morrison’s stores. Customer service is one of Morrison’s core strengths and of extreme importance to the current state of running of the business. Their ideology regarding this matter is simple, they aim to provide the best possible customer service and they do this by recruiting talented, skilled and motivated people who will help them achieve this aim. Highly skilled employees ensure that customers get personalized professional attention and this builds higher levels of customer satisfaction and in the long term contributes towards customer retention and loyalty. Furthermore, Morrison’s retains and expands its customer base by offering specialized products that are often not available from its competitors. The company has also allocated large sums of money for the training and development programs for its employees. Morrison’s efforts are not to waste for financial reports have shown that customers prefer Morrison’s to other stores to the superior customer service it provides and the quality and freshness of its product range. Sales staff provides complete assistance in the store and also provide after-sales service. Another aspect of Morrison’s strategy to improve its customer service is the issue of convenience. Stores are located in convenient locations that aren’t too out of the way and there is adequate parking space with special space allotted for drivers with any disabilities. They have also implemented more convenient payment options, and the customer can choose the one more convenient for him/her at their own discretion. Moreover, Morrison’s emphasizes on a customer driven approach and behavior by making sure that their employees and staff become a more active part of the whole process of delivering superior customer service. The firm won the ‘Employer of the Year’ award in 2011 and encourages its employees to take part in its training and development programs so that they become more trained and better skilled. They have a philosophy of ‘learn while you earn’ which means that new and old employees alike can gain more experience and knowledge while on the job, which of course is beneficial for the company’s operational efficiency as well as for the employees. Morrison’s offers apprenticeships, in-house degrees and training for fresh graduates who have been employed by the firm. There is no distinction made when imparting knowledge and training among the level or seniority of the job designation. Their academy provides training to fresh graduates as well as people in senior and more important posts, and as a result, roughly 70% of Morrison’s managers are currently people who gained their expertise and knowledge through their job and through training courses in the in-house academy. The Morrison’s management focuses on three main aspects when dealing with this area. They ensure that all employees have the skills and training made available to them so that they can give their best possible performance on the job, they coach their employees so that they are confident and committed and remain motivated and also that the level of in-house communication remains high so that all employees engaged in their job and with the overall mission of the company. Morrison’s operates under a ‘one team’ strategy which enhances unity within the organization by giving the employees the sense that they are all working for the same collective cause. This also eliminates negative feelings and rivalries between departments which can be detrimental to overall growth in the long run. Motivation levels are kept high by rewarding the employees justly for work well performed. If the performance of the business is exceptionally well one year, the employees are rewarded with bonuses in relation to their constant wage as a way to appreciate their effort in that success. Practices by Morrison have lead to higher levels of sales and even higher repeat sales as the firm is better able to retain its customers. It is approximated that 10.5-11 million customers visit Morrison’s every week for grocery shopping. The level and quality of customer service provided, has a direct relation with how the firm operates financially. As a result of the implementation of above mentioned strategies, it has been seen that Morrison’s has achieved an increasing rate of business development, performance and growth. The employees are highly skilled, motivated and geared towards a unitary purpose. This results in them providing superior customer service. As a result of this, Morrison’s customers are more than satisfied by the brand and are more likely to make repeated purchases at Morrison’s stores. Hence, the improvement of customer service has created a value addition in terms of increased sales. (Developing Competitive Advantage Through Customer Service, A Morrison’s Case Study). Bibliography 1. Developing Competitive Advantage Through Customer Service, A Morrison’s Case Study. 2012. The Times 100 Business Case Studies < http://businesscasestudies.co.uk/morrisons/developing-competitive-advantage-through-customer-service/introduction.html> 2. Case Study-Morrison’s. 2012. Belgravium Technologies plc. < http://www.belgravium-technologies.com/case-study-petrol-deliveries.asp> 3. Jackson, M. 2005. Acquisition Dangers. < http://www.growthbusiness.co.uk/growing-a-business/merger-and-acquisition/2304/part_2/acquisition-dangers.thtml> 4. Proxima. Case Study, WM Morrison Supermarkets PLC. < https://docs.google.com/viewer?a=v&q=cache:DNRoHqN4cf8J:www.proximagroup.com/sites/default/files/file/case%2520studies/Proxima%2520Case%2520Study%2520-%2520Morrisons.pdf+&hl=en&gl=pk&pid=bl&srcid=ADGEESg058Cfi5U8UW4_m5Sq6TMuNz28JQF-M2Rei3NSUY-Pqb2W04BvEndCXNv5ndPQgeiWZlmuawB-uPAYk3a8sZUx3s8qQx3EoujFslQ39Oq8Ic5Id3d2_HMENQSG6kqA4qQK4lLw&sig=AHIEtbR083I9z18k2ns_adzYMWCmMM5lXQ&pli=1> Read More