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ASDA Case Analysis - Assignment Example

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Management is an important part of an organization. The management must be able to provide leadership in the organization so that employees can meet their targets and enable the organization to continue growing. ASDA lacked effective management that would steer the…
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ASDA Case Analysis
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1. Management is an important part of an organization. The management must be able to provide leadership in the organization so that employees can meet their targets and enable the organization to continue growing. ASDA lacked effective management that would steer the organization into prosperity. In addition, the organization also faced serious problems with its culture. Employees need to be motivated and have their needs met in order for an organization to succeed. This was not available at ASDA hence the collapse of the organization. Financial problems in the organization were caused by the shortsightedness of the management (Beer & Weber, 2008). The company had acquired loans to facilitate its expansion and it was therefore necessary for the organization to develop new measures to ensure profitability. The management was unable to ensure that the new stores were profitable. Communication between employees and the management is a serious issue for any organization. There was a breakdown in communication between the management and lower level employees in the organization. The management structure in an organization can limit communication and ASDA had placed a structure that prohibited effective communication.
2. The organization faced serious management issues ranging from lack of motivation for workers to poor financial decisions. According to the motivational theory, employees can only perform when they are given flexibility and the chance to succeed. At ASDA, creativity from the employees was continuously repressed and they lacked the ambition to succeed in the work place. In addition, leadership theories such as transactional theory suggest that leadership is about focusing on the set goals and motivating employees to achieve these goals. At ASDA, these problems created a vacuum, which in turn brought about uncertainty. The financial crunch at the time and bad management were therefore responsible for the issues at ASDA. The goal setting theory states that organization should set goals. The management should therefore have set clear goals to avoid the issues. Strategies adopted by Hardman introduced a dictatorial culture in the organization that inhibited creativity from the employees.
3. It was clear to Norman that the culture in the organization needed an overhaul so that it could accommodate all employees and attract new customers. In addition, the shareholders needed to trust the organization once more. To achieve this, it was important to change employee attitude at ASDA. This should have been done using the charismatic theory that encourages employees to interact and be creative (Wart, 2007). The interaction is not single tiered as it enables employees to interact with fellow employees as well as management. This creates an atmosphere of trust and responsibility in the organization. Such a culture would have enabled the leader to get information from people working in ASDA stores as well as other managerial positions. An important part of this aspect is the motivation that it creates in employees. Motivated employees are likely to perform better than those who have lost their morale for work. The crisis at the organization at the time would have served as an opportunity for the emergence of a charismatic leader.
Profitability is the goal of any organization. ASDA intended to regain its profitability within the shortest time possible. Since the business was in financial trouble, it was important to value the assets owned by the organization and evaluate how such assets could be turned into fortune for the company. Most of the allied businesses for ASDA were either non-profitable or were not contributing significantly into the organizational revenue. To this end, it was important to reduce the organization’s costs as much as possible. Such businesses should have been disposed of or leased to other organizations. This would have given support to the parent company in its operations. A thorough analysis of the main products that were profitable should have followed. This would have led to reduction in products that were acquired but had not been sold. This course of action would have left the organization with profitable products, which would have increased its profit margin. A restructure of the organizational culture should have taken place as well. This would have been achieved through motivational talks as well as retraining some of the employees to work in new positions. Redundant positions in the organization should have been eliminated with time.
Beer, M., & Weber, J. (2008). ASDA. Harvard Business School.
Wart, M. V. (2007). Leadership in public organizations: an introduction. New York: M.E. Sharpe. Read More
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