The Influence of Unilever Culture on Business Strategies in the United Kingdom - Literature review Example

The influence of Uniliver culture on Business strategies in the United Kingdom By + Introduction and Objectives The purpose of this paper is to explore the influence of Unilever’s culture on its business strategies; more specifically, the research is based on the question how does the Unilever culture influence the business structures in the United Kingdom? This research will analyze the different operational strategies ascribed to its cultural dimension; highlight its strengths, weaknesses and the company’s threats and ways in which they can utilize the opportunities available to them. In discussing Unilever’s culture and how it has influenced business operations, the paper will examine the different strategies that have been adopted by the company and how the company has achieved success through sustainability. LITERATURE REVIEW Organizational culture connoted the collection of norms and values that the individuals and groups within an organization share. These tenets control the manner in which these entities interact with one another and their relationship with the stakeholders outside the organization. This definition is essential in the understanding of organizational values and how they espouse the development of the business. Organizational culture is intricate and is influenced by a multiplicity of factors as cited by Hofstede (1993). He highlighted the effects and influences that a multicultural workforce has on multi-national ambiences. He intimated a theory that delves into cultural dimensions to explicate the influence of multiple cultures on organizations. In his cultural dimension theory, Hofstede intimates that despite the fact that not every individual in a country’s populace exudes exactly similar traits, cultural dimensions function to influence administrative and institutional arrangements ascribed to the nation and will proceed to establish the standards norms for behaviour (Hofstede, 1993). Hofstede’s sentiments are strongly echoed at Unilever whose culture emerges from its multi-national background. Unilever’s culture has instrumentally influenced the strategic decision-making process within the U.K. The strategic decision-making process at Unilever has been influenced by Whittington’s work on strategic development. Whittington highlighted that organizations with similar profiles to Unilever would operate well if they adopted a systematic approach of decision-making. This strategy propels organizations to develop a process-based strategy based on organizational objectives but tempered by utmost respect for differences in culture (Yaziji & Doh, 2009). Unilever’s Strategy and its Culture of Sustainability The organization stands out as an established multinational that has a substantial portfolio that comprises of brands and products ascribed to numerous fast-moving consumer commodity markets. The company is extensively regarded among the best epitomes of enterprises that uphold corporate social responsibility along with sustainability. Unilever’s CSR approach can be dated back to the business’s formation. Paul Polman, C.EO, who has acted in his capacity to set some challenging and ambitious targets for the company to attain out and out sustainability, has out rightly sustained Unilever’s heritage. Unilever boasts of attracting investors whose preferences lean towards investing ethically while at the same time ensuring profit maximization. One of the major issues facing the company is how to curb the increased imitation of their products by other companies and the distribution of fake and cheaper brands to the rural areas, when they experience such competition from the imitation of their own products then it means that the company will have to incur more costs when purchasing raw materials bearing in mind the rising inflation. Unilever Limited faces a lot of competition now than before hence the need to strategize on how to stay relevant in the market (Schittich, 2011). Strategic alternatives: these alternatives must be addressed by the company if they want to avoid the high cost of raw materials, increased imitation and the high inflation. They include: Proliferation of brand portfolio and leverage Since Unilever is one of the best reputations of meeting their customers’ needs by providing the best products, it has an upper hand owing to its strong chain of supply ascribed to its products so it means that if the brand portfolio was to be proliferated then the customers will be protected from buying the cheap and the fake brands Competitive pricing For the company to beat their competitors, they need to increase the price of their products to avoid competition and help the customer to distinguish the best from the rest. Introduction of cost-efficient initiatives Due to the rise of the cost of raw materials and the unpredictable movement of their commodities, the company needs to find ways of being cost-effective, for example by reducing the operational cost and advertisement so that they can stop worrying about the price of raw materials. Alternative Evaluation The company can still opt to introduce new brands of the same type; this will increase competition in the market because it will provide the customer with the chance to choose from the wide range of products hence they will be able to retain the customers; the only disadvantage will be that the company will still have the same products in different brands, making it difficult for them to manage their products (Kakabadse, 2006). On the other hand, choosing to lower the price of their products will mean that their profit margins will also decrease yet the company is still struggling with the cost of raw materials and input, which will not favour the company. When the company initiates cost reduction through the regulation of the advertisement cost and its operations, it will have an advantage in its operations. However, this requires constant advertisement and promotions to make their products stay in the minds of the customers. If the company does so, it gains favour in the eyes of the consumer over its competitors. There is nothing the company can do to reduce the cost of raw materials so it has only one choice left and that is to limit the procurement of these materials (Lopes & Duguid 2010), Strategy Implementation No cultural or structural organisation is required to implement the strategy. The organization has a good chain of command and a good distribution network. This signifies that the brand can still reach customers just like other brands. This need leads to an automatic plan of action whereby the company has to first differentiate the best-performing brand from the non-performing brand and at the same time a research needs to be done in order to asses both the competitor brands and their association with the organization. After doing that, Unilever will have to constitute a monitory system to monitor the performance of the newly introduced brands and the existing ones (Lee, & Parker, 2014). Success through sustainability Despite all the competition, the company has still managed to sustain itself through various modus operandi: Asking the right question from generation to generation-whereas many businesses thrive to manipulate the society in order to succeed and sustain themselves, Unilever does the opposite by ensuring they give their best products to the populace (Jones, 2005). Thinking of the long term-many businesses base their success on short-term profits forgetting the essence of looking into the future hence compromising the long-term creation of the business. Unilever focuses on remaining relevant in the market for decades to come and hence gets the assurance that the business will thrive. Accepting that no business can stand on its own-Unilever believes that issues ranging from food insecurity to climate change among others cannot be handled on an individual basis but by coming up with new networks and by working together with multiple organizations to raise the operational standards. Embedding sustainability into the business-this is done by accepting that cultural transformation is inevitable and in the survival of their operations will depend on the evolution of culture (Jones, 2002). Pushing sustainability to the customers- in every business, operational success is always dependent on giving the customer what they need and not waiting for the customers to demand for their services. For Unilever, that is what it does best; giving consumers some sense of ownership over the company. Changing the system-finally, being able to manage the consumer will help in the long run to achieve satisfaction on the customer’s side and at the same time ensure that the company still makes profits. Over time, the company is required to overcome the barrier ascribed to system management and reach the target customer (Clay & Indonesia, 2005). No business entity is perfect and Unilever Company is no exception; that is why it essential for the business to be progressive in its operations. Cultural differences Since Unilever is a multi-national company with branches almost all over the world, they need to consider rebranding their products to suit all the needs of the different cultures (Han, 2008). This fact will even enable the company to increase the products they sell to the customers and their overall profit margins. Unilever’s strategic Culture in the U.K Passion for Brands Unilever people exhibit passion for its products and brands. Irrespective of their niche in the business, each and every individual enjoys the opportunity to be part of the activities ascribe to a new product’s launch. They are able to learn the operation of a fast-moving consumer commodity, right from the inception of an idea, to its creation, to its appearance on a store shelf. This passion does not merely stop at that; Unilever’s stakeholders monitor the impacts of the products on consumers and its ability to change lives. Team Culture Unilever values a team environment in which individuals treat one another with respect and integrity. There is considerable commitment to working collaboratively, passion and innovation; all geared towards fulfilling ambitious goals and ensuring the realization of true potential. The organization has established an inspiring workspace that seeks to espouse innovative thinking, a friendly and informal work ambience and a universal mindset that unites individuals from a diversity of backgrounds cultures. Well Being Unilever was recognized in 2012 for its innovation and flexible working. The organization offers its employees the chance to take part in an agile work scheme in which flexible working hours and extended leaves are offered, and this espouses a balance between fulfilling career ambitions with individuals’’ demands outside work. The result is a motivated staff that revers consumers and ultimately interacts positively with them, leading to consumer retention. Diversity Women constitute a bigger fraction of the company’s consumers compared to men. For this reason, Unilever has also tried to reflect this context in company; by the end of the year 2013 the percentage of women employees stood at 42%. This has enabled the company to serve the diverse consumer base even better since individuals understand the preferences of their specific genders. The retention of women in the company has driven the company to external recognition. The company believes in the principle of diversity and the inclusion of other cultures (Arnold, 2013). Learning & Development Unilever has embraced awareness training where all the employees have to undergo to understand that tolerating of other peoples’ culture is one of the strategies of the company. The organization believes in the development of talent and avails peer to peer mentoring, encouraging tacit feedback that espouses learning and sharing. Conclusion From the literature review ascribe to the operations of the Unilever Company, it is quite evident why the organization has managed to stay relevant in the market for quite some time (Chobanova, 2009). Every company has its shortcomings but it depends on how they use the shortcomings to their advantage. As one of the main food and personal effects suppliers in the world, the intense competition it faces from its competitors raises the need to customize their own brand globally and make it acceptable to the customer (McIntosh, 2003). Having known the external factors affecting the business’s operations, including social, cultural and economic differences among the target customers, Unilever needs to develop effective strategies of branding as discussed earlier in this review (Bluen, 2013). On the other hand Unilever is expected to adapt to the culture and the local preferences of consumers to customize global brands. The company is able to keep up the distribution of its products by lowering its products’ prices, maintaining consistency in the reduction of the brands and protecting the organisation’s innovation from foreigners who may offer competition at the local level. Customers always try to associate themselves with brands that they commensurate to their values and personal attributes. Recommendation For a brand to be globally accepted then it has to reflect the same set of values cutting across different cultures and countries and forming a lasting relationship with the customer (Fer, 2008). One of the most difficult challenges that emerge when dealing with branding is what to do with the brand as it stretches to different geographical regions and societies. A brand that compels the customer is the one that meets all the interests of the people using it. For the company to exhibit a strong global brand then it has to maintain its cost competitiveness. This research proposes that the customer should also have an obvious recognition of the overall brand (Jones, 2002). This modus operandi will go a long way to help the customer to subscribe to the right type of brand. Bibliography Arnold, D. 2013. Ethical theory and business (9th ed.). Boston: Pearson Education. Bluen, S. 2013. Talent management in emerging markets. Randburg: Knowres. Chobanova, Y. 2009. Strategies of multinationals in Central and Eastern Europe: Innovation systems and embeddedness. Houndmills, Basingstoke, Hampshire: Palgrave Macmillan. Clay, J., & Indonesia, P. 2005. Exploring the links between international business and poverty reduction: A case study of Unilever in Indonesia. Oxford, UK: Oxfam GB ; Han, Z. 2008. Managing Foreign Research and Development in the Peoples Republic of China the New Think-Tank of the World. Burlington: Elsevier Science Hofstede, G. (1993) Cultural constraints in management theories, in De Wit, B. and Meyer, R. 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