Change Management In Woolworths: Analysis And Recommendations

Generic Report Writing Guide on CloudDeakin

The report brings about the analysis of the change management concepts and theories in the contemporary organisations. It incorporates the processes, outcomes related with the change management, describing in detail change management behaviours. The report discusses the needs or opportunities of the organisation, leading to the change management process. It further mentions about the interventions, and the recommendations regarding the plans to be formulated for improving the performance of the organisation. For the purpose, of gaining an understanding considering change management approach, an Australian supermarket company has been taken “Woolworths”, which includes all the related aspects (Cameron and Green, 2015).

Woolworths also known as, Woolies is an Australian Supermarket/grocery store chain which is operated and owned by Woolworths Limited. Founded in the year 1924, Woolworths accounts for the 80% of the Australian market, and forms a duopoly of the supermarkets along with the Coles. The company employs about 200,000 people and aims to provide their customer a better experience, superior service, convenience, and value. The company deals or specialises in selling grocery items which include vegetables, fruits, meat, and packaged foods. Ina addition, to the grocery items the company also deals in selling DVDs, pet & baby supplies, stationery items, and the beauty and health related products (Grimmer, 2018).

Change management approach or the organisational change management is the framework which incorporates the management of a change in any organisation. The change may relate to the change in the processes, organisational structure, or the changes in the culture. Every organisation implements change with respect to the internal and external environmental conditions in order to become successful in the long-term. The process of change management is a series of steps which are followed sequentially by the change management team or the leader in an organisation. The level of interventions, in the change management process, is associated with the precise and correct identification of the groups. Therefore, the report states about the change management in Woolworths limited in Australia (Mone and London, 2018).

Every organisation faces some challenges due to the increasing pressure and competition in the industry. This requires incorporating change management in the organisational practices in relation to the internal and external environmental situations. With context to the organisation chosen, Woolworths there has been a stiff competitive pressure from the other retailers such as Coles, Mark & spencer’s. The retail sector in the Australia has given employment to many people. Woolworths is facing some challenges currently in the grocery business and regarding their share prices. It has been observed that there is showdown over drop in the share prices. There has been a constant decrement in the share prices of the Woolworths, which deprived the company to earn profits, i.e. creating the situations of huge losses. Therefore, Woolworths has made initiatives in utilising the cost cutting measures which will help the company further to bring back the customers, ensuring customer loyalty. This situation leads to the losing the potential customers, as they have now switched over to other companies. Woolworths is failing is achieving maximum customer satisfaction, which is creating a threat for the future growth and success in the Australian market (Hult et al., 2017).

Woolworths: An Overview

Woolworths reported the share price opened weaker at the JSE, after the company reported a 17.7% decline in the earnings per share. This became the major reason for the losing trust in the management operations by the executives of the company. Besides the decreased share prices in the market, there is another factor which is affecting Woolworths majorly, i.e. the attack from the various competitors. As Woolworths is earlier known for providing cheap products to their customers, and this strategy is now adopted by the companies likes Coles, Marks and spencer’s, and Aldi from the Germany is doing the same to attract customers   (Wardle and Chang, 2015).

Need and the opportunities in every organisation are enforced with respect to the various aspects in the business environment. Every organisation need to change to survive and achieve their goals and objectives both long term, and short-term. Similarly, Woolworths need to bring and establish change in their management practices, organisational culture to ensure long-term sustainability and attainment of profits in the future (Carnall, 2018).

The major changes in the processes of operations and the management practices will eradicate the losses and the company will regain the profits in the industry. The results from the past few years has represented that the company Woolworths has been facing the slowest growth in the 19 years. There has been a management shake in the business of Woolworths, in terms of food, liquor, and petrol businesses (Santos et al., 2015).

In order to convert the situation of losses into opportunities, the company first need to bring back the trust from the executive or the higher management level. As many of the executives left the organisation due to lose of faith in the operations carried out in Woolworths. Therefore, Woolworths need to implement changes in the management of the operations and management practices in the organisation. In addition, the subsidiaries of the company are facing problems struggling in the retail market in Australia.  Also, an over-ambitious goal by the management of the organisation has led the employees to leave the organisation on a long-term basis. This shift in the structure of employees is mainly due to the disturbance in the management structure and losses earned due to the ineffective operations (Duvall, 2018).

Woolworths has recently announced of the loss of 400 executive jobs, impacting the reputation of the company greatly. In a broader sense, Woolworths is losing in terms of various aspects collectively such as customer relationship, marketing, and loyalty. The change can be implemented in the organisation in a way that the organisation mainly focuses upon matching of the resources with the available opportunities in the market. The company will need to emphasize the need of the customers, and the market situations need to be considered in order to reduce losses. Woolworths need to bring change in the structure of the management to satisfy the goals and requirements of the executives as well. The change in the structure of the organisation also accompanies, the other changes such as establishing the customer-oriented practices or policies in the organisation, as they would be able to attract as many customers leading to the attainment of the organisational objectives as a whole    (Booth, 2015).

Change Management Approach in Organisations

The term interventions in context of any organisation such as Woolworths define about all the possible and planned activities which are carried out to bring changes in the organisation. These interventions are intended to restore the company’s operations and improve the functioning of the organisation. This will ensure the better working efficiency, and effectiveness of the organisation in the longer period. Therefore, Woolworth in their management implemented some of the interventions keeping in consideration all the changes and challenges faced by the company in the recent years. These interventions in any organisation can be brought about or introduced by an external agent or the consultant who may be consulting the client members of the organisation. This can also be introduced by those who are in the organisation itself and acting as the in-house consultant. Interventions can take place at the task, process, strategies, system or interface levels or the hierarchy levels of an organisation. Interventions help an organisation to majorly overcome problems or challenges faced and achieving the desired future position in the market. With respect to the above discussion on the decreased share of the company, and the terrible changes in the share prices, the company implemented some interventions (Financial review, 2015).

Interventions include ‘Technology’, which interconnects people in an organisation, and adds value to the organisation. In the modern era of e-business, technology plays an important role in shaping the future growth of the organisations. Customers in every sector of the industry are more inclined towards the technology upgraded organisation/company. Several pressures in the Australian retail sector are the making the business organisations face competition and it has been exemplified by three recent changes. These changes are the emergence of the competitors, Australia taste, and disruptive technologies. An organisation which lacks in effective technology system or is handicapped in terms of better technology is assumed to have less survival years as compared to other firms. With context of the essay it has been stated that there are two interventions which ensures about the easy and smooth functioning of the organisation, thus improving efficiency (Borlea and Achim, 2014).    

• Intervention 1: EziBuy

The mentioned name depicts the intervention by the subsidiary of the company Woolworths, operating in Australia and New Zealand. EziBuy deals in providing a wide range of clothing to the customers via online mediums. The company is focused as they provide their services online and make the products available at the door-step of their customers. The company is importantly affecting the customers in a positive way, and is considered as attracting due to the companies’ goals of satisfying their customers. This intervention was made for the customers to ease their shopping and improve their experience. Ordering clothes online is considered in the technology intervention typology of the change management in the company. In simple terms, the goals of the interventions were to improve technological advancements and the benefits to the customers in the Australian marketplace. Thus, the interventions used by the Woolworths stated about the practices needed to be included in the management of the company. As the company aiming to provide best services to their customers can only achieve this aim by focusing on the improvement of the overall experience to their customers. Henceforth, Woolworths adopted these interventions in order to give their customers best experiences in every aspect (Doppelt, 2017).

• Intervention 2: Fly Buys (Woolworths reward)

Challenges faced by Woolworths

 The second type of the intervention used by the company is the rewards given to the employees i.e. the human resource in the organisation. Woolworths which included the human resource intervention is considered as a necessary step in the overall efforts made in the organisation. It is the most attractive reward system implemented by the company to their customers. This included giving discounts to their loyal customers, and introduction of various themes. The goals behind these interventions are to hold their customers for a longer time-period, which helps in the overall services. Use of the redemption schemes such as money-off shopping, exclusive member-deal, and the other schemes helped Woolworths in making good customer tally. The reward system in the company is considered as an effective strategy to pay back to the loyal customers, thus maintaining healthy customer relationships (Olstad et al., 2016).

The intervention of the human resource and establishing an effective customer relationship is focused with respect to the intervention termed as ‘Fly Buys’. Thus, intervention implemented by the Woolworths, stated about giving rewards to that customer who bring their personal bags for shopping. An organisation in order to survive and emerge successful in the industry amongst their competitors, need to accelerate in terms of the resources mainly emphasizing on the human resource. Hence, it is clearly understood that the reward points is the beneficial strategy to create an advantage over the competitors by taking care of the customer’s convenience specially (Pulker et al., 2018).

With context to the interventions implemented in the organisation, and the problems

identified which were related to the technology and achieving and maintaining customer

relationships. A business diagnostic or the diagnostic model refers to the activity or the tools

used required for different jobs. In a broader sense, diagnostic model is the framework for identifying, analysing, and interpreting data in a given context to assess the possible needs. Employees in an organisation need something which drives them to work with their best ability and potential to achieve desired goal. In most cases, the employees are motivated with their salary and compensation. However, it may not work in every case, some employees need more than compensation/pay provided by the organisation   (Ainsworth and E., 2016).

With respect to the intereventions the holistic diagnostic model used by the Woolworths to improve their product delivery and developing effective employee and customer realtionships. The holistic diagnostic models includes everyone in the organisation as well as identifies and assess the strengths, weakness, threat and the opportunities at every level of the organisation. This will also include the systems i.e. finance, production, marketing, operations, and IT alongwith the traditional aspects in the organisation (Woolworths group, 2017).

Need and Opportunities in Woolworths

The diagnostic model in the company Woolworths, in relation to the interventions such as ‘EziBuy’ and ‘FlyBuys’, is 7s diagnostic model, developed by McKinsey designed to help an organisation evaluate and improve performance. There are various elements of the 7s model, which includes structure, system, staff, style, skills, and shared value (Dong et al., 2015).

(Source: Mindtools, 2018)

• Structure- this elements define how the units in an organisation are interrelated, it tells about the sequential form of data which forms the basis of the organisation.
• System- this element is focused upon defining and determing how the work should be done or the manner of carrying out various activities and functions in an organisation.
• Staff- this is one of the most important element in every organisation. Simililarly Woolworths puts greater emphasis on their employees.
• Style- The elements defines about the leadership styles adopted by the management o the organisation, as it affects the oiverall performance of the organisation.
• Skills – this states about the skills required in the organisational members to achieve the goals and objectives, every organisation needs skilled employees in order to become efficient and effective in the long run. Skilled employees also relate to the organisational behaviour as employees forms the basis of other functions.
• Shared value – An organisation which is based on the fair values and beliefs tend t grow and sustain for the longer term. The shared value of the organisation is also defined well by their mission and vision statement (Gökdeniz, Kartal and Kömürcü, 2017).

The change management process is the process or sequence of steps that is applied by the change management leader or the project leader, to bring change in organisation. It has been analysed from the above discussion on the change management process that in every organisation change is constant and necessary to sustain in the competitive market. It is irrespective, of the other factors operating in the external and internal environment of the organisation. Caused by the advancement of technology, improvements in the customer service delivery or the restructuring or reorganisation, change is always taking place. As it necessary, it is considered important for the growth and profitability prospects of the business (Pulker et al., 2018).

With the context of the company, Woolworths Australia, change has been inevitable for the organisation, because of the losses earned past few years. In fact the company has been facing the situation of loss currently which essentially requires change in the organisation in every aspect. To implement the change management in Woolworths, there have been several interventions used by the company in order to facilitate and improve their services, to attract customers and regain their position in the Australian supermarket (Cummings and Worley, 2014).  

The interventions used by Woolworths were EziBuy, and Fly Buys, therefore to achieve the milestones determined by them requires a proper planning and implementation process, in the organisation. Planning an implementation to achieve the desired goals and the milestones set focuses on the key areas of the organisation. It means the overall goal of the company is achieve a specific standard of proficiency in a specific time-period. The plan for the change management interventions in the company is a series of steps which are as follows:

• Identify the measures to be taken: The utmost aspect of the process of attainment of goal is that the goals should be measurable. The work done by the change management leader in the stage ‘A’, defines the base for the practice. The data will help in defining the measures for the achievement of milestones set by interventions. To identify those measures, look for the lowest performance scores.
• Evaluate the information of the measure given in Stage ‘B’:  Stage B provides the resources and the practical steps to be used as information for the implementation of intervention plan. As with the case, interventions such as Ezibuy, and Fly Buys, information must be evaluated effectively (Financial review, 2017).
• Creating a challenging goal with the set deadline: The change management team or the leader must have to find and locate sources to achieve challenging goal, within a fixed deadline.
• Get the acceptance from the staff and other members: It is essential step for the organisational members to be aware of the change in the processes of organisation. A change management leader must first take the acceptance from the staff by organising a general meeting of these members to give information regarding the change management plan.
• Establishing an intervention plan: Given the set measures through the plan, the staff, and leader needs to propose strategies towards the goal achievement of the interventions (Waddell et al., 2016).
• Goal commitment from the staff: An organisation deals with humans, who are resistant to change and easily reject the new goals set in the organisation. Therefore, the goal may be dropped in the middle of the process, which can be improved by the managers or leaders. They can conduct weekly meetings, explaining them about the plan’s effectiveness. In addition, they can also provide them, additional resources if required (Goel et al., 2017).
• Provide Feedback: The Company must have two types of data, i.e. before and after the intervention plan. In case the data collected after the intervention does not shows the improvement, then more data should be collected, shared with the team.
• Rewarding team efforts: The last step of the procedure is to reward the efforts put by the team members and appraising them to work with the same motivation further    (Herzberg, 2017).

Developing a structured model in daily working to improve productivity.

Establishing the customer-centric policies, to improve customer relationships.

For both the intervention, EziBuy and Fly Buys their implementation and sustainability in the future must be improved by making these practices permanent in Woolworths.

Focusing on the implementation of the online customer services.

The company needs to focus on attaining competitive edge over other competitors.

Interventions in Woolworths

The company should direct all the resources in a direction towards the achievement of the goal. It will help Woolworths in establishing a well- known customer brand.

Conclusion 

To conclude the above discussion, it has been analysed that implementing change in the organisational practices and processes, is a critical process. The change is the result of a number of issues and opportunities in the external environment of the organisation. These needs are then supported by the application of interventions in context to the company. Every organisation has own diagnostic model, which further states about the plan for change management. The company focuses on the planning and implementation of the goals, set by the interventions as a major process. Hence, the overall change management process is a complex, time-consuming and a vital process which determines the organisations ability to achieve sustainable competitive advantage.

References

Ainsworth, D., and E. Feyerherm, A. (2016) Higher order change: a trans-organizational system diagnostic model. Journal of Organizational Change Management, 29(5), pp. 769-781.

Booth, S.A. (2015) Crisis management strategy: Competition and change in modern enterprises. United Kingdom: Routledge

Borlea, S.N. and Achim, M.V. (2014) Diagnosis of Business and Predictive Models of Bankruptcy Risk–A Model Design. Studia Universitatis, Vasile Goldi?” Arad, Seria ?tiin?e Economice, 24(1), pp. 16-34.

Cameron, E. and Green, M. (2015) Making sense of change management: A complete guide to the models, tools and techniques of organizational change. United Kingdom: Kogan Page Publishers.

Carnall, C. (2018) Managing change. United Kingdom: Routledge.

Cummings, T. G.  and Worley, C. G. (2014) Organization development and change. United States: Cengage learning.

Dong, Y., Liao, H., Chuang, A., Zhou, J., and Campbell, E. M. (2015) Fostering employee service creativity: Joint effects of customer empowering behaviours and supervisory empowering leadership. Journal of Applied Psychology, 100(5), p. 1364.

Doppelt, B. (2017). Leading change toward sustainability: A change-management guide for business, government, and civil society. United Kingdom: Routledge.

Duvall, K. (2018) Future of retail in Australia. [online] Available from: https://home.kpmg.com/au/en/home/insights/2018/04/bernard-salt-next-5-years-retail-future-australia.html [Accessed 11/09/18].

Financial review (2015) 10 Challenges for Woolworths. [online] Available from: https://www.afr.com/business/10-challenges-for-woolworths-20150120-12u29m [Accessed 11/09/18].

Financial review (2017) Woolworths sells EziBuy to Noni Shareholder Alceon Group. [online] Available from:   https://www.afr.com/business/retail/woolworths-sells-ezibuy-to-noni-b-shareholder-alceon-group-20170626-gwymif [Accessed 11/09/18].

Goel, A., Kamble, V., Banerjee, S. and Goel, A. (2017) Network Formation of Coalition Loyalty Programs. ACM SIGMETRICS Performance Evaluation Review, 44(3), pp. 15-20.

Gökdeniz, I., Kartal, C. and Kömürcü, K. (2017) Strategic Assessment based on 7S McKinsey Model for a Business by Using Analytic Network Process (ANP). International Journal of Academic Research in Business and Social Sciences, 7(6), pp. 342-353.

Grimmer, L. (2018) The diminished stakeholder: Examining the relationship between suppliers and supermarkets in the Australian grocery industry. Journal of Consumer Behaviour, 17(1), pp. 13-20.

Herzberg, F. (2017) Motivation to work. United Kingdom: Routledge.

Hult, G.T.M., Morgeson, F.V., Morgan, N.A., Mithas, S. and Fornell, C. (2017) Do managers know what their customers think and why? Journal of the Academy of Marketing Science, 45(1), pp. 37-54.

Mind tools (2018) The McKinsey 7-S Framework. [online] Available from: https://www.mindtools.com/pages/article/newSTR_91.htm [Accessed 11/09/18].

Mone, E.M. and London, M. (2018) Employee engagement through effective performance management: A practical guide for managers. United Kingdom: Routledge.

Olstad, D.L., Ball, K., Abbott, G., McNaughton, S.A., Le, H.N., Mhurchu, C.N., Pollard, C., and Crawford, D.A. (2016) ‘A’ process evaluation of the Supermarket Healthy Eating for Life (Shelf) randomized controlled trial. International Journal of Behavioural Nutrition and Physical Activity, 13(1), p. 27.

Pulker, C.E., Trapp, G.S.A., Scott, J.A., and Pollard, C.M. (2018) What are the position and power of supermarkets in the Australian food system, and the implications for public health? A systematic scoping review. Obesity Reviews, 19(2), pp. 198-218.

Santos, M. D., Svensson, G., Padin, C., and Høgevold, N. M. (2015) Corporate risk exposure by implementing sustainable business practices-an African case. International Journal of Logistics Economics and Globalisation, 6(3), pp. 223-235.

Waddell, D., Creed, A., Cummings, T. and Worley, C. (2016) Organisational change: Development and transformation. Australia: Cengage Learning.

Wardle, J. L. and Chang, S. (2015) Cross?promotional alcohol discounting in Australia’s grocery sector: a barrier to initiatives to curb excessive alcohol consumption? Australian and New Zealand journal of public health, 39(2), pp. 124-128.

Woolworths group (2017) Statement on EziBuy. [online] Available from: https://www.woolworthsgroup.com.au/page/media/Latest_News/statement-on-ezibuy [Accessed 11/09/18].