The Woolworth's Management Success Story - Case Study Example

Case Study: ‘The Woolworths’ Management Success Story’ Introduction The importance and stress on keen management issues are fast gaining ground amongst most of the retail businesses, what with the competition increasing by manifold. The aim of this case study is to identify one of the retail giants, Woolworths as we have chosen, while assessing any potential threats or management problems within the company’s management. The case study will be with reference to the Woolworths case-study we are provided with “The Woolworths Management Success Story”. For this paper, we will be undertaking a task of evaluating any potential management threat to the company, even as we also assess the opinions and literature provided by the myriad authors in their journals with regards to the identified potential threat or management problem. It may be mentioned here that Woolworths is one of the oldest operating company which has a long history of successful retail business. Woolworths has the honor of becoming the most identified brand even as it has become a household name in Australia. Recently, Woolworths saw a shift in its management style with the entry of their new CEO Michael Luscombe. Even as an autocratic style of management was practiced by his predecessor Roger Corbett, Luscombe opted for a more democratic style of leadership in the company. Now for any company, especially in the modern business scenario, democratic management plays a very important role for the employees to think, opine and get a chance to act their ideas, hence fostering a healthy environment (Moswela, 2007). The present management style has been quite successful and Luscombe has succeeded in enhancing the company’s profile by manifold. Nevertheless, retail business has its share of threats. Problem Identification According to Flaherty et al (2009), with an advent of increased competition, it is absolutely necessary for any company to have leadership at all levels. It is not just the higher management that would score with good leadership skills, even the ones at lower and lowest levels need to showcase certain leadership skills to bring and give the best to the customers. Woolworths, despite showing extremely solid management regime, would be required to walk the path highlighted by Flaherty et al, if they really want to maintain their position on the top. Henceforth, we will be discussing on the important of Total Quality management and leadership for the success of Woolworths in retail business. Discussion With the changing scope of business processes, the former definition of Management is fast changing. Kanter (1989) explains aptly when she says that the managers are increasingly finding the “hierarchy fade away and the clear distinctions of title, task, department, even corporation, blur.” This also establishes the direction of our discussion which is to assert that incorporating leadership skills among all employees at all levels becomes extremely important for any company (in this case Woolworths) to combat competition. However, not many management institutions are aware that leadership is also a key factor towards improved management. Lakshman (2006) addresses the issue by explaining that in a survey it was realized that all good leaders are efficient at management skills; however, not all good managers were good at leadership. While good management is also a key to smooth functioning of the company, it is the leadership that will take the company ahead of its competitors. When it comes to our case study, it may be well said that Woolworths has a commendable management system. However, it still lacks leadership skills amongst its employees, as a result of which, it may lose to its competition. Authors like Lakshman are of the view that for any management system to work at its best leadership plays a very important role. He further goes on to say that leadership at any level helps enhance the focus on customers and customer relationship, which is the most important facet for any retail-based business. According to him, while management helps in able handling of the tasks at hand, it is leadership that initiates the process of continuous improvement. Flaherty et al explain that effective leadership enhances the evaluative process, even as leaders and followers can help maintain the sense of purpose at all times. They state that employees with high leadership skills, no matter at what level, will always tend to perform tasks better than those with low propensity to lead (PTL). Hence, the company’s performance will be directly affected. Higher the PTL of employees, higher will be the customer satisfaction and hence better sale in the retail business. Then again, employees with a high PTL have more inclination towards working in sync with other forces to one common goal. They are better at doing roles other than defined to them and often referred to as organizational citizenship behavior (OCB). Then again, retail store managers in general cannot be expected to make sales, just as the sales people cannot be expected to look after the store management. However, if the leadership element is included into the training of the employees, while recruiting employees showing aptitude for leadership at all levels, the store performance will improve exceptionally. A few authors such as Chan and Drasgow (2001) are of the view that even though leadership is an intrinsic component for growth in a company, this does not conspire that the employees are only involved in the role of leadership. Rather, leadership, maintained along with the daily tasks at hand is what would create the right mix for the employees and the company. For instance, in the retail sector the need for customer management has become more pronounced than the importance of management within a company. In such a scenario, amalgamating leadership skills along with the sales job will help enhance the overall performance of the staff and the eventual outcome as well. The basic point here is that the leaders are, in effect, the managers first and hence they need to work their responsibilities as manager and leader both. While routine tasks such as team design and structuring behavior would consist of managerial roles, tasks like institutionalizing quality, continuous improvement and customer oriented behavior would come under the leadership header (Flaherty et al, 2009). Metcalfe (1982) is, however, of the view that there cannot be a transformation from managers to leaders overnight, despite the training in the field of behavioral conditioning. He maintains that in training for managers to be leaders, social skills play a very important part and “interactive skills are enormously complex, requiring amongst other things skills in sensitivity, perception, empathy, selection of information, protes-sing of information, and so on.” Then again, Kanter (1989) cites a few reasons citing how the transition from manager-specific to leadership-specific may result in general discontent amongst those at a higher post. She says that this transformation will shackle the power hold of the managers and question the hierarchy-type management system. This may result to the managers feeling a sense of power loss and hence, stir in discontent towards the changed management style. It may be noticed here that traditional business processes and management system were hierarchy based where the manager or the boss had all the power. In the management system that we are introducing here, however, leadership at all levels is synonymous with instilling of power amongst all, thus reducing the power amongst the managerial posts. Moreover, as more and more employees get participative and involved, the knowledge amongst the work force increases, diminishing the manager and employee line even further. While this is beneficial for the business as whole, the seeds of discontent might get reaped amongst those managers still believing in the traditional hierarchy system. Conclusion and Recommendations– From the above arguments and discussion, it may well be concluded that Woolworths is in looking for a management style change by incorporating leadership as a key proponent amongst all its employees. Special training might need to be undertaken in view of the same. While leadership cannot be taught, a close pitch can be achieved by training the employees keeping in mind certain social and behavioral skills. Those in charge of conducting the training should first analyze the behavior that needs to be taught, even as they break the behavior into simple understandable modules. This will make the task of learning easier for the employees. Conditions should be set in which the individuals be taught to make decisions and take risks. While such a practice session is best conducted in real life situations, one must notice that the situation not be of a threatening disposition. The training should also include the understanding of the interactive behaviors, even as the employees learn these motor and social interactive skills. Teaching them ways to make the encounters more effective will prove to be of further beneficence. Thus, the employee will not only be equipped to act in time, he will also be better provided to perceive the whole situation in the correct manner and hence take a correct action (Metcalfe, 1982). It may be sufficiently concluded here that leadership and leader have the ability to motivate the subordinates to perform towards the betterment of the goal (in this case, increase Woolworths retail sales). Incorporating a sense of leadership amongst all employees will only and totally help enhance the overall functioning and output of the company. References Kanter, R.M. (1989). The New Managerial Work. Harvard Business Review, , 85-92. Flaherty, K.E., Mowen, J.C., Brown, T.J., Marshall, G.W. (2009). Leadership Propensity And Sales Performance Among Sales Personnel And Managers In A Speciality Retail Setting. Journal of Personal Selling & Sales Management, XXIX(1), 43-59. Lakshman, C. (2006). A Theory of Leadership for Quality: Lessons from TQM for Leadership Theory. Total Quality Management, 17(1), 41-60. Metcalfe, B.M.A. (1982). Leadership: Extrapolating From Theory And Research To Practical Skills Training. Journal of Management Studies, 19(3), 295-305. Read More