Management Analysis of T2 Company - Case Study Example

Management Analysis of T2 By Course Instructor Institution Date Management Analysis of T2 Introduction T2 Company is the leading retailer in the tea industry in Australia. Since its inception in 1996, it has grown in leaps and bounds to offer some of the most recognized tea brands such as Liquorice Legs, Chai, and Buddha’s Tears as its bestsellers. Its main products are tea and crockery for serving tea, all sourced from various parts of the globe. The company, other than contributing to Australia’s revenue, has helped to revolutionize consumer habits in its host country. Being a pioneer luxury brand, it rose to challenge the dominance of coffee intake among Australians. This report analyses T2 Company and its business styles relative to sustainability related issues and strategies. It offers considerations for T2 to help it achieve better results in future. It looks at how T2 is enhancing sustainability of its brands. Background Two business partners, Maryanne Shearer and Jan O’Connor originally had an idea to start a home-ware chain but later lost confidence after realizing that bigger brands such as Country Road had similar notions. It was while unpacking their first samples for the home-ware chain that the idea for a tea store was born. The two partners who both had previous experience in the retail industry founded T2 Company in 1996. The first T2 store was in Fitzroy’s Brunswick Street, Melbourne. Shearer often says she was driven by the need to establish tea as a contemporary for coffee in Australia, at a time when most people were consuming the latter. She would go on to offer daily tea tastings at her stores. Initially, funds for the company were a problem and Maryanne relied on her life partner Bruce Crome who had accumulated considerable savings from his engineering years. A second store was opened in St Kilda, later closing due to financial reasons. Another store replaced it soon after at a shopping mall in Chadstone, Melbourne. Today T2 has over 600 employees and sells its wares in 60 stores and upmarket restaurants and cafes sprawled across Australia, New Zealand and recently United Kingdom and America. Currently, the company has the capacity to sell enough tea per month to make nine million cups. It boasts renowned flavours such as Creme Brulee, Pumping Pomegranate, Gone Surfing, and Melbourne Breakfast. Its main competitors at both local and global level include Liptons Tea. Noticeable history and background of T2: Year Landmark 11996 Founded by two business partners in Melbourne, Australia 22001 One partner, Jan O’Connor bought out by Shearer and her life partner Bruce Crome 22007 50% of T2 Company sold to retail players Jonathan Dan and Phillip Blanco. Later Shearer bought back 25% from Blanco, leaving Dan to become minority investor. 22012 T2 achieved revenue of AUS $57 million (for the 12 months ending June 2012) 22013 T2 purchased by global company Unilever that already owns other premium tea brands such as Liptons and Bushells. The deal is reported to be worth $ 80 million. Role of technology management Technology management involves the use of management skills in the invention, development, function, and appropriate use of technology (Crespi et al 2007). Technology managers help create value for their business by using technology among other resources to unravel problems and improve efficiency and effectiveness. In short, twenty-first century technology managers help certify that technology achieves a better future for all. This is because it increases efficiency of services and improves quality of products. Employees need to be constantly educated on new technology therefore the company in general has to look out for alternative ways of improving their products. Some of the current technology trends include e-commerce and internet advertising (Martin 2006). At T2, most of the business operations are done internally, including purchasing, packaging, and branding of their products. Shearer, who travels worldwide to sample them, selects the tea brands. This is has contributed to the personal and creative touch that T2 Company so proudly exudes. This also helps create an edge over their competitors, with their signature dark wooden shelving and wallpaper made of Chinese newspapers evoking an old-world oriental feel in their stores. This shows the technological creativity of its founders who sought to be thematic in the presentation of their brand-tea. Previously reliant on word of mouth, T2 now has a website that advertises their products and has consumers shop online. This has helped cement their global presence as customers can now access their products from anywhere in the world. Its recent acquisition by Unilever promises better technological management that will increase the company’s profitability. Human Resource Management Practices The term Human Resource Management refers to the design and application of formal systems in an organisation to ensure the effective and efficient use of human talent to accomplish organisational goals (Millmore 2007). Human resource managers are tasked with hiring and managing a workforce and should therefore be able to know who is right for what job, and device ways of keeping workers motivated. As a strategy, human resource management recognises three main essentials; employees are perceived as company assets, those in management are all human resource managers and that the aim of human resource management is to strike a balance between organizational goals and approaches to human capital (Konrad et al 2006). Human resource management is significant in creating sustainability in an organisation. Sustainability with regard to business refers to a firm’s ability to maintain long-term growth not just economically but also socially and environmentally (Blowfield 2013). This also involves corporate social responsibility. Sustainability is part of organizational strategy, hence placing immense responsibility on human resource managers to create and maintain an efficient workforce trained to achieve the company’s goals (Epstein, 2008). This implies that an organization’s workforce should be used to advance its strategies and goals. Human capital is essential to a company’s success, including T2, and their aim should be to acquire the most talented and competent individuals and offer them relevant training in line with the company’s vision. At T2, they aspire to create a memorable customer experience; hence, the focus is on presentation and quality of the brand. Based on this aspiration, human resource managers at T2 ought to train their employees on proper customer service and improve the quality of their tea to attract more sales. There are numerous ways of improving human capital such as training, motivation through wage increases and that of benefits (Paludi 2012). Many global conglomerates have invested heavily in human resource including The Coca Cola Company and the result is seen in their record sales. With regard to sustainability, T2 can invest in environmentally friendly methods of packaging and involve the public in a campaign to preserve their natural surroundings. Role of international business International business refers to all transactions whether private or governmental carried out between two or more countries (Sitkin & Bowen 2010). Many firms operating at global level are involved in international business, mostly through imports and exports. International business has three main components: legal-political, economic, and cultural environments. In the cultural environment, employees of a business are greatly influenced by their countries culture. This affects their thinking abilities, which in turn dictates how they work. In the economic environment, factors such as currency exchange rates, inflation rates, taxation have to be considered. Differences in these factors affect the decisions of managers as pertains to business operations. The legal-political environment influences a country’s stability therefore affecting the decisions of business managers. Given that T2 takes part in international business, they are affected by any changes in the above-mentioned factors. Economic environment for instance comes in play in the importation of the company’s products. High inflation affects price of commodities. Currency exchange rates have effect on volume of sales, revenue earned and prices being charged. It subsequently becomes harder to predict the sales and budgets to be made, all decisions that managers have to make. In the cultural environment, T2 takes into consideration the different cultural influences of its diverse workforce. This is because they have stores in different countries none of which shares any cultural aspects. Legally and politically, T2 has managed to invest in countries with economic and political stability. These countries are not rigid in Role of organisational behaviour Organizational behaviour studies the behaviour of people in an organisation, their interactions with the organization (Karsten 2006). Its study is important in increasing overall productivity, job satisfaction, and a company's ultimate profitability. Organisational behaviour has different roles, all of which T2 Company has effected to increase its sustainability. Innovation and change- through organisational behaviour, T2 management has ensured that employees are agents of positive change, as opposed to hindering the same (Miner 2007). Promoting ethical behaviour- managers at T2 have used organisational behaviour as a guide in making decisions that promote productivity and job satisfaction. Upgrading customer service- T2 Company is in the service industry and customer satisfaction is their top priority. They have with the help of organisational behaviour, ensured that their employees are well equipped to satisfy their numerous customers. Globalization- T2 has expanded its services to other countries over their years. Their managers’ decisions are flexible to the needs of their employees and their growing customer base. Governing workforce diversity- through organisational behaviour T2 has recognised diversity has managed to promote it by increasing cultural and gender diversity. Additionally they have enhanced equality and diversity skills. Creating a positive work environment- through organisational behaviour, T2 has developed resilience and competition within its workplace. This is part of the reason for their huge success. Enhancing quality and productivity-, the employees at T2 have been empowered through organisational behaviour. This is because of efforts the management has put into understanding their employees including what motivates them (Kitchin 2010). Analysis of Entrepreneurship and Innovation Innovation helps a company achieve competitive advantage over its colleagues (Franz et al 2012). It also ensures sustainability since there will always be new products to satisfy the ever changing and demanding market. T2 has continued to marvel its customers with the diversity of its products. New products are created by infusing existing tea brands or by acquiring new ones. Maryanne Shearer, co- founder of T2 admits to blending tea with products such as vanilla to create some of their top brands. With competition from brands such as Liptons and Bushells, T2 is constantly researching new ways of reinventing itself. Entrepreneurship involves increasing the economic value of goods and services. An entrepreneur has the ability to make decisions about a company, create new ideas to enhance diversification, and to employ managers he or she believes will take the company to the topmost level. At T2, Managing Director Maryanne Shearer and her managers have been making relevant decisions that have ensured their business is successful. This is evident in the company’s rapid expansion and creation of popular brands in the retail industry. The recent acquisition of T2 by global giant Unilever is also a bold economic move that has opened an opportunity for the company to increase its market share. Slowly but surely, T2 tea brands are gaining competitive advantage over Lipton’s and Bushells also owned by Unilever. These decisions have been made under the leadership of the perceptive entrepreneur Maryanne Shearer. Future strategies at T2 There are three levels of organizational future strategies, business, corporate, and functional. Functional level strategies include departmental activities such as finance, marketing and human resource (International journal of sustainable strategic management 2008).T2 should engage in more marketing campaigns to increase public awareness of their products. These campaigns should also be taken to various destinations in the globe as tea consumers are everywhere. By merit, the latest buyout by Unilever will ensure that T2 achieves massive global status. T2 should also increase the innovation of new and better products with the ability to compete with counterparts at global level. Furthermore, T2 can employ mechanisms that ensure its most creative and productive workforce is retained. Its rapid expansion has increased demand for tea products; therefore, the company needs more talented employees to advance its goals. Corporate level strategy involves decisions made by high-ranking managers (MCelroy & Engelen 2012). The decisions include where to allocate resources, business lines and whether or not to invest. Although majoring in branded tea flavours, T2 has ventured into other wares such as teacups and pots. T2 should consider opening their own restaurants and cafes where their products are offered. In line with this, they could also venture into producing tea accompaniments such as pastries. Business level strategies involve decisions made with the aim of gaining competitive advantage. Middle level managers in a company (Bartlett et al 2013) can implement this level. T2 has brands such as Liptons and Bushells competing with it hence, they should be wary of their activities if they want to gain competitive advantage. So far, T2 faces no threats of being replaced in the market, as they have curved a niche for themselves as an exotic brand. References (2008). International journal of sustainable strategic management. United Kingdom, Inderscience Enterprises. http://inderscience.metapress.com/openurl.asp?genre=journal&issn=1753-3600. BARTLETT, C. A., DOZ, Y., & HEDLUND, G. (2013). Managing the Global Firm (RLE International Business). Hoboken, Taylor and Francis. http://public.eblib.com/choice/publicfullrecord.aspx?p=1114721. BLOWFIELD, M. (2013). Business and sustainability. Oxford, Oxford University Press. CRESPI, G., CRISCUOLO, C., & HASKELL, J. (2007). Information technology, organisational change and productivity. London, Centre for Economic Policy Research. EPSTEIN, M. J. (2008). Making sustainability work: best practices in managing and measuring corporate social, environmental and economic impacts. Sheffield, UK, Greenleaf Pub. FRANZ, H.-W., HOCHGERNER, J., & HOWALDT, J. (2012). Challenge social innovation potentials for business, social entrepreneurship, welfare and civil society. Berlin, Springer. http://dx.doi.org/10.1007/978-3-642-32879-4. KARSTEN, M. F. (2006). Gender, race, and ethnicity in the workplace issues and challenges for today's organizations. Westport, Conn, Praeger Publishers. KITCHIN, D. (2010). An introduction to organisational behaviour for managers and engineers a group and multicultural approach. Amsterdam, Butterworth-Heinemann/Elsevier. http://site.ebrary.com/id/10378915. KONRAD, A. M., PRASAD, P., & PRINGLE, J. K. (2006). The handbook of workplace diversity. London, Sage Publications. MARTIN, G. (2006). Managing people and organizations in changing contexts. Oxford, Elsevier. MCELROY, M. W., & ENGELEN, J. V. (2012). Corporate sustainability management: the art and science of managing non-financial performance. London, Earthscan. MILLMORE, M. (2007). Strategic human resource management: contemporary issues. Harlow, Financial Times Prentice Hall. MINER, J. B. (2007). Organizational behavior 4. Armonk, N.Y., M.E. Sharpe. http://www.books24x7.com/marc.asp?bookid=20745. PALUDI, M. A. (2012). Managing diversity in today's workplace: strategies for employees and employers. Santa Barbara, Calif, ABC-CLIO. SITKIN, A., & BOWEN, N. (2010). International business: challenges and choices. Oxford [England], Oxford University Press. Read More