Publicly Traded Corporation: Woolworths - Case Study Example

? Publicly Traded Corporation al Affiliation) Woolworths Impact of Woolworth’s mission, vision and stakeholders on its overall success Woolworth’s mission is “to deliver to customers the right shopping experience each and every time.” This being the mission of Woolworth, it has guided the organization to success and put it on the map as a world class company recognized for its excellent customer service. With excellent customer service, comes brand loyalty. Woolworth has thrived to ensure that customers get satisfied by providing quality products at affordable prices; the organization has also trained all its employees on customer care irrespective of their positions in the organization. By doing so, when customers go for shopping, they get quality products and quality assistance from the attendants thereby making the customers feel delighted and satisfied (Karen, 2001). With this vision, Woolworth ensures that the customers make repeat sales. The organizations vision is “to continue to drive its retail business, bring to customers greater convenience, quality, lower prices and better value, range, freshness and service.” The whole reason for an organization to have a vision is to remain relevant in the industry and to ensure its sustainability in the future. With this vision, Woolworth has embarked on industry and market research in order to ensure its survival in the industry. Its survival depends on the growth of the company, the growth of its employees, satisfaction of its customer base, quality and durable products, affordable and competitive prices, innovation, creativity and better customer service. (Comyns, 2000). The stakeholders also have an impact on the success of any organization. Stakeholders are people who have interests in an organization. Stake holders in an organization include investors, shareholders, staff suppliers, customers, governing bodies and suppliers, business partners, trade associations and the community that surrounds the organization. All these stakeholders have to be satisfied by the company, thus Woolworth as an organization with stakeholders has to work hard towards the satisfaction of its stakeholders, and when they are satisfied, it means that the business is successful. Stakeholders play an important role in the success of the company, thus Woolworth aims at appreciating the importance of the stakeholders in the organization. Apart from this, the organization involves the stakeholders in the development, implementation and managing of business goals and objectives. Woolworth also informs the stake holders of culture associated with the company. Furthermore, Woolworth ensures a good relationship with the stake holders to avoid any disruption of the business. When a section of the stakeholders demand a resource, the company plans for the particular resource, ensures the particular stake holder is satisfied and that the business continues with its smooth operation. Woolworth also ensures flow of communication between the company and the stakeholders at all times when something happens. Lastly, Woolworth arranges for community development projects, medical camps and educational sessions for the stakeholders (Anderson, 2005). All these are done to satisfy the stakeholders as they are important to the success of the company. Five forces of competition to determine how they impact the company Rivalry in the industry Woolworth faces competition from four major competitors namely Sears, Wal-Mart, Kmart and Kholac Corporation. These are the main players in the industry each with a large customer base. Since these five companies are the main players, the industry has been slow in growth because the market has been dominated by these retail giants. Woolworth has to compete with these other equally successful organizations. It therefore has to up its game in terms of employee satisfaction and motivation, customer delight and satisfaction and innovation (Institution, 2011). Woolworth has to ensure that the products it holds in its shelves are of quality offered at affordable prices. It must also ensure that the goods are friendly to the environment in their production, consumption and disposal. Since these other competitors offer the same products, Woolworths, has to ensure that it has a wide range of assorted products and services, the customer can purchase everything in one Woolworth outlet. It has adopted the “all under one roof” policy. Woolworth has adopted building warehouses next to each of its outlet to ensure availability of its products to the stores. Over and above, it has also engaged in building outlets next to consumers to bring them closer to the products and services and avoid travelling. Woolworths has also introduced promotions whereby the customers pay cheaper for large volumes of products purchased. Threat of entrants Woolworth faces the threat of new entrants into the industry. Though Woolworth is a force to reckon with in the industry, it still faces this threat. Everyday new retail businesses are registered and Woolworth does not know the strategies these new entrants want to use in order to gain market share. These small businesses gain advantage in terms of location. Many are situated in close proximity to the customers as opposed to Woolworth and other big retail outlets. These new entrants also offer lower prices as compared to the big retail stores because they are mostly family businesses. They also offer home cooked meals which are preferred in this day and age due to the numerous diseases that come with junk food that is mostly retailed in outlets such as Woolworth (Institution, 2011). With the close proximity to customers, low prices and healthy meals, Woolworth loses part of its customer base to these new entrants in the industry and this is a call for concern because even one customer lost is a loss. Woolworth has to change with the changing times and adapt to the prevailing market tastes and preferences so as to remain relevant and maintain its customer base. In that note, it should engage in aggressive market research as no competitor can be too small to be considered a viable competitor. Buyers Buyers form a critical part of the forces of competition. What a competitor needs to do is to convince a buyer that his/her product is better than yours and the buyer will immediately switch brands. Buyers want something that is good, something that will make a positive change in their lives. Therefore, for this reason, Woolworth has to take care of its customers. By this, Woolworth has identified the products that are mostly purchased by customers and has made them readily available to the customers at all its outlets. These products are always available and to maximize the sale of these products while minimize costs; Woolworths had to purchase the goods rather than produce them. This also proved that it was cheaper to buy the products than produce them and also ensured that the products are always on the shelves therefore delighting the customers at all times. From this project, Woolworth also identified the projects that were lowly purchased. For these products, they had to reposition them on the shelves, creating a distance from the counters and these products such that the regularly purchased products were nearer to the counter and were more visible to the customers (Institution, 2011). All these had to be done so that the customers get satisfied and remain loyal to the Woolworth brand. Suppliers Suppliers are part of the stakeholders; they hold special interests in organizations as they stand to benefit from the income they get from supplying goods and services. Suppliers get offers from different companies and more often than not they go for the higher and bigger offer. It is in very rare situations that suppliers go for companies because of their values. Woolworth has been known to have relatively low and affordable prices; meaning that the amount of cash they purchase their products from the suppliers has to be quite low. Woolworth has engaged its suppliers in educational seminars to keep them abreast with the changing times in the world of supplies, this way the suppliers don’t have to benefit only from monetary relationship with Woolworth but also get more knowledge and information in their field of service. Moreover, Woolworth involves its suppliers in its activities like community development, company activities and events. This way, Woolworths creates a good working relationship with its suppliers which ensure that the suppliers don’t go with the competition. Substitutes The main substitute for physical retail shopping is internet shopping. This substitute not only gives competition to Woolworth but to all other retail organizations. The internet is a much easier medium for shopping as the customer has to sit in front of a computer, check out the products, choose one that suits his preference and make a purchase. The only problem with internet shopping is they are mostly run by con artists and the products are not of quality. To counter this, Woolworth has had to adapt to the changes in the world and introduce a website where customers are able to log in and make purchases; it is after the purchase that the customers are offered after sale service of being given free delivery of the purchased products to their doorsteps. This has helped Woolworths a great deal especially in attracting a new brand of mostly youthful techno-savvy customers who use the internet a lot. Other stake holders Apart from the stake holders who benefit directly from Woolworth, there are other stakeholders who watch the working of Woolworth and especially the products that they sell. These, other stakeholders include trade unions, consumer groups, human rights watch groups, animal rights groups and gender rights groups. These groups are sometimes sponsored by the competitors to organize campaigns and demonstrations against Woolworths and the products it sells. Trade unions come into place when there is a complaint about poor treatment of employees; hence they try to protect the rights of the employees and may even threaten go-slows or strikes. Consumer groups are seen when the products are not of quality or when the organization exploits customers by reducing the quantity of its products, or when the retail outlets increase the prices with no reason. When employees face poor working conditions, human rights organizations step in to convince the employers to improve the working conditions of the employers. When organizations are perceived to be selling products that are made from animal skin and fur, especially clothing, animal rights groups will definitely intervene to protect the rights of the animals. Finally, gender rights group come into play when one gender is abused sexually. This mainly affects the female employees and customers. With all these indirect stakeholders, Woolworth has tried to provide a relationship with them and to do good and just business so as not form any kind of friction with the stakeholders (Ethics, 2011). Woolworth’s SWOT Woolworth has a good reputation in regards to quality and affordable products. It is also known for its international expansion program. It also has a very effective information communication and technology system that monitors its activities and product performance globally. Woolworth also invests in its employees through training and a recognition and reward project for performance. It also engages in giving back to the community through community development. These are the strengths of Woolworth. The weaknesses include its huge operation globally and its wide range of products. This makes it not have the flexibility its competitors have in managing the affairs of their outlets. The opportunity Woolworth has is forming ventures with other retailers globally in specific markets. The opening of outlets in new locations is also an opportunity. Woolworth faces the threat of global and local competition. Political instability is also a threat to Woolworth global project of expansion. Lastly, price completion is part of the threat that Woolworth faces. To capitalize on its strength and opportunities and minimize its weaknesses and threats, Woolworth has to do extensive market research and use its global presence to form ventures with equally strong and experienced retail outlets and enter politically stable environments and position their products with competitive prices of the new markets. Levels and types of strategies Woolworth may use to competitiveness and profitability The first strategy Woolworth should use to ensure competitiveness and profitability is to invest in its employees since courtesy begins at home. Once employees are satisfied, customers will be delighted. Secondly, it is customer satisfaction through quality products and customer survey to know their ever changing tastes and preferences. The third is the review of prices occasionally and introduction of promotions to attract more sales. Woolworth should also open more outlets to bring products nearer to the consumers saving them time to travel. Lastly, they should form business ventures with other retail companies in new markets rather than entering new markets o their own (Anderson, 2005). Communication plan to make the strategies known to stakeholders The communication plan to make the above strategies known to the stake holders is to always update new strategies in their website so that they may be able to know. When updating the website, Woolworth should also advertise general meeting of stake holders so that the managements explains to the stakeholders verbally the strategies and how they plan to implement them. Corporate governance mechanism The first corporate governance mechanism is integrity. Through integrity, managers are able to maintain proper work ethics and good morals. Integrity controls managerial actions in that there is no favoritism in employees’ recognition or employment and procurement procedures. The other corporate governance is recognition. Managers should recognize hard working employees and reward them for job well done. This will boost their moral and improve on employee productivity (Anderson, 2005). Effectiveness of leadership in Woolworth Woolworth is a global organization and leadership in such an organization is important because with such a large number of employees, leadership should be felt by all employees. The leadership should be able to communicate effectively to all employees irrespective of the different geographical areas. All policies and decisions made by management should also be communicated effectively so that all employees know what is going on in the organization. The only way to improve on leadership is to ensure smooth flow of communication from the top organs to the lowest organs. Woolworth’s corporate social responsibility Corporate social responsibilities help organizations position themselves as good citizens and earn the trust of its customers. Woolworth does this by getting involved in activities that affect the community in general. Corporate social responsibilities are meant to help the community positively. In 2010, Woolworth embarked on a project known as “ The Fresh Food Rescue Programme” where the organization had to provide ways of preserving fresh food so as not to go bad and have them delivered to the consumers before they went bad (Woolworth, 2010). This initiative also involved donating fresh food to the masses especially the disadvantaged in the society and not necessarily consumers. Consumers were happy with this because the retail outlet had fresh produce all through its 24 hrs working shift. Because of this, customers were always assured of getting fresh produce even at night and there was no rush to buy fresh products especially vegetables during the day as they available round the clock. This initiative did not go unnoticed as Woolworth received Food bank’s inaugural Patron’s Award. References Anderson, G. C. (2005). Managing Woolworth. Washington: St. Martin's Press. Comyns, B. (2000). Our Spoons Came From Woolworths. New York: Virago; New Ed edition. Ethics, E. B. (2011). Are all stakeholders equally important? European Business Ethics Network (12) 1. Institution, B. S. (2011). Business Competition. Business Continuity journal., 1. Karen, P. P. (2001). Remembering Woolworth. New York: St. Martin's Griffin. Woolworth. (2010). Woolworths Limited 2009-2010 Corporate. Retrievd on 7th november 2012. From http://www.woolworths.com.au/wps/wcm/connect/webSite/Woolworths/ . Read More