Waitrose supermarket is one of the UK’s leading food retail outlets offering wide range of products under its own brand name as well of other companies. The company operates in more than 60 countries and have created a name for it in bringing to the customer fresh farm produce and organic products. The company is on a mission to push the envelope of the food trading across the world. The company operates in the environment of click and mortar model which is extremely competitive in nature and thus a formal strategic planning is very much essential and required to grow and stay upbeat in the market. The importance of strategic planning lies in providing a direction for the organization and defining the goals (Wolf & Floyd, 2017) Strategic planning also comes handy when evaluating the existing processes and adopting changing process to move forward in the ecosystem. It also helps to ascertain the goals set for the organization and measure them on the go. Strategic planning is a very critical factor which plays an important hand in the success of the organization in the longer term. Strategic process not only influences and helps in creating powerful forward looking sustainable business strategies, but it also plays an influencer in the performance of the individuals, investors, human resources and also impacts the performance of the managers. Strategic planning importance lies in the fact that it translates the vision of the organization into personal vision which results in development of positive synergies and collaboration amongst teams to achieve the intended results (Channon & Jalland, 2016)
Strategic planning is a simple yet complex 5 step process, and each step has to be defined carefully in order to make a formidable business strategy which would result in sustained growth for the organization (Haines, 2017)
All the individual elements in the strategic planning process have to be addressed individually and then act upon to achieve the desired outcome. Mission is not just a statement, it is the building block for the business operation for the company. Waitrose has a mission of pushing the envelope of food trading, now in order to achieve this mission Waitrose has to ensure that the entire organization, its employees, its business process and policies are all directed towards the mission laid down by the company (Dibrell, Craig & Neubaum, 2014).
Environmental scanning is the understanding of the various micro and macro environmental forces which might affect the business in the future or at present. It also helps in understanding the strength and weakness of the organization which are internal to the firm and stay away from threat and grab the opportunities arising in the business segment. Models like Porter 5 forces, PESTLE analysis, BCG matrix, SWOT analysis are used to do an environmental scanning and help in gaining a competitive edge and stay ahead in the competition (Grunig & Morschett, 2017). Hence the environmental scanning helps in achieving three objectives:
SWOT analysis is used for accessing the firms internal strength and weakness and focus on the external opportunities and threats. SWOT analysis is a micro environmental force and helps in internal analysis of the firm, which further forms the base for building a good formidable strategy (Hollensen, 2015)
PESTLE analysis is a one of the fundamental framework which helps to ascertain the external marketing environment. It helps the company to analyse the macro environment according to the forces of Political, economic, social, technological, environmental, legal nature (Feys & Probert, 2015)
After completing the environmental scanning it is pertinent for the organization to map its strength to the opportunities identified me the SWOT analysis and addresses the weakness and the threats realized from applying the strategic model. Weakness and threat have to be focussed upon and it helps the organization to make futuristic strategy to prevent the damage from the threat in the future. The purpose of the strategic implementation is to attain profitability and developing a competitive advantage over its rivals. Michael Porter has identified three generic industries to achieve competitive advantage; the strategies are cost leadership, differential strategy and focus strategy. The strategies are generic in nature because they are not dependent on the firm and the industry (Chang, 2016)
This type of generic strategy calls for being a low cost producer in the industry for a particular quantity. The entity sells products at an average price to earn a profit higher than the rivals or below the average price to gain market share. In case of Waitrose, its products are perceived to be higher priced and it has leverage the premium pricing owing to its superior quality of food products (Barney, 2014)
The understanding of differentiating strategy lies in creating unique attributes and products that makes them differentiated from their competitors. A premium pricing can be levied on the products to justify its differentiation. Waitrose can apply differentiation strategy owing to its unique benefits and freshness of products. The organic products diversifies the product range and makes the firm highly differentiated.
This strategy focuses on the narrow or a niche segment and with that particular segment it aims to gain either a cost advantage or differentiation. The underlying principle for Focus strategy is to focus on the needs of a particular segment than that of the entire population (Focus, 2016)
Following the process of strategy formulation, the intended strategy has to be implemented by conducting various programs, defining budgets and procedures. Implementation of the strategy formulated involves employing the resources of the organization and a lot of motivation for the staff to achieve the desired objectives. Strategy implementation is a tricky process, in the sense that people who formulated the strategy are different from the ones implementing it and thus the communication flow has to be seamless between the teams. Hence, it becomes important to communicate the rationale and the purpose of the intended strategy resulting in impactful implementation of the same (Van Der Kolk & Schokker, 2016)
Evaluation and control is the last step in the strategic planning process and one of the most important ones, as all the efforts and caution taken in the earlier steps in the end boils down to evaluation and control of the strategy implementation and taking right actions if the results are deviating from the expected outcome. Define the parameters to measure, defining the target value for the customers, performance measurement, comparing the result with the pre-defined and make suitable changes in case of any deviation from the intended outcome (Wheelen & Hunger, 2017)
All these steps ensure that the objectives defined by the company take its normal course to fulfilment by the objectives. Strategic planning ensures that the deviation from the desired strategy is monitored and steps are taken to put it back on the track. Strategic planning process is like a guide which is extremely important to follow in a competitive environment. In the absence of it, all the efforts taken by the organization are prone to go haywire resulting in distortion and waste of time and efforts. Strategic planning process binds the entire organization together, and creates an environment of coherence among the employees and the teams, wherein everyone is working together to achieve the objectives of the organization. Environment plays a very important role in the strategic planning process, as a competitive environment results in aggressive strategy formulation, better understanding of the market and the competition, analysing the strategies of the competitors and thus tweak the organization’s strategy to achieve profitability and sustainability in the business and stay ahead of the competition.
Conclusion
In the light of the above mentioned argument, it can be established that Strategic planning process is dependent on the business environment the company is operating in and at the same time it provides a direction for the entire organization to move forward. Thus, it is highly recommended that the company carefully make a strategy in order to achieve the momentum in its business and get a competitive edge over its competitors. The strategy proposed is differentiation for Waitrose.
Strategic planning is a very important tool for the business owing to following reasons
The strategy proposed for Waitrose is to have a differentiation strategy to target the up-market. In order to achieve the proposed strategy certain objectives have to be identified for the departments and function of the business. The reason for identifying clear cut objective is to assess the performance of the objectives along the actual outcome; also it helps in defining the mission and vision with clarity (Branes, Montoya & Ciravegna, 2014)
As the name suggest differentiation strategy is achieved by developing product or services which offer unique attributes and benefits to the consumers. The benefits should be so that the customers turn in to the organization for its unique products and services, and customers perceive that the product and services are much better and are different from other competitors offering. Differentiation strategy is not easy to execute as it may lead to addition of certain costs, also the company has the option of charging premium price for the uniqueness. In order to succeed in achieving the differentiation strategy, the following strength is must require (Block, Kohn, Miller & Ullrich, 2015)
Based on the strategy recommended (Differentiation), Waitrose has to determine the objectives in its department/functional heads to succeed with its strategy
Every business is in operation to earn profit and do well for the society. Waitrose as a chain has been doing fairly well, but it wants to set it apart and in order to do that it will have to define financial objectives that do not hurt the firm financially while a new strategy is proposed. The financial objectives will be defined under the heads of growth and efficiency.
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Financial Growth: To achieve the net income of 250 Million pound by financial year ending 2019. Financial Growth: To increase the revenue by 10% annually Financial efficiency: Decreasing the operation expenses by 5% annually Financial efficiency: To increase net profit by 10% annually |
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Reduce the time product takes to reach the store Reducing the number of staff in the process of distributing products in the store Increasing the organic products in the store Increase community outreach Use the warehouse and the store location judiciously Better and improved communication by using gadgets and devices across the store Achieve 6 sigma operation processes. Focus on making the system lean and more efficient Better and renewable packaging material to be used Ensure that the product meets the requirement and the standards Improving internal communication Manage and use the CRM tool effectively to produce better results Improving the distributer and supplier relationship Increase the in-house production of various grocery products Weekly performance report of the goods sold/unsold inventory and maximize the sales of the high selling product and increase the visibility of the lower sale product and offer discount and promotion on that. Working on the strategic alliance management and increase the partners |
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Employing professional who are customer centric and thoroughly professional in their conduct Developing leadership abilities in the lower and middle level staff Performance management system through balanced scorecard framework Aligning the incentives to the performance, customer focus and innovation Keep the practice of learning open in the organization Conducting at least 2 training in a month for the employees to make them accustom to best practices |
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Increasing sale to the existing customers Start with customer loyalty program and give them incentive for their loyalty and faith with Waitrose Achieve exceptional customer service and give stars to employees based on their performance Develop and use the existing customer database and update information in the CRM tool Introducing existing products into new market Expanding sales in a global marketplace Improving the service approach to serve the existing customers Open and acquire more retail outlets Focus on online selling more than offline selling Opening of more stores in highly populated regions |
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Online promotion of products on social platforms Increase the impression of advertisement online by 40% Promote products on different internet sites and start with affiliate marketing Increase the likes on Facebook page by 30% Increase the number of post on Facebook, Instagram by 4/ day, the post to revolve around the different product segments, hygiene, better quality and a great customer service Get into influencer marketing model on twitter and get fitness and entertainment celebrity to endorse its product Start conducting events and experiences for the customers Increase the ATL and BTL promotion activities |
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Increase the line of organic products Focus more on groceries and clubbing of products Make the packaging attractive Improve the packaging material Launch the online application of company and provide great user experience. Increase the product line by self-branded items and products from major companies. |
These are the objectives which are to be inculcated in the different departments and function of Waitrose. All these objectives will help the company in achieving a differentiation strategy. It has been seen that Waitrose does most of its sales through the retail outlets and focuses less on the online sales. In the current market scenario it makes more sense to increase the spend online as it also helps in reducing the costs while transferring the cost benefits to the consumers. Mobile marketing is increasingly becoming popular owing to the usability and the increased penetration of internet and smartphones. Great application with push notification to the targeted users will help the company in increasing its growth and achieve sustainable revenue. At the same time it is required to focus on the CSR activities to build a positive brand image of the company. Another effort in the direction of the differentiation strategy is to do online reputation management for Waitrose, this will help the company in addressing the concerns and queries of the customers and solving them in a stipulated time will increase the faith in Waitrose. The UK grocery market is dominated by the Big 4s Tesco, Sainsbury, ASDA and Safeway, and Somerfield, Iceland and Waitrose , all these players in totality constitute the UK’s grocery market, thus if Waitrose has to create differentiated waters for itself, it has to focus more online and improve its efforts in creating more organic products. Organic products are the nation’s choice for staying fit and healthy, and it still has a huge market for expansion as the adoption of organic product is increasing day by day
In case of MNC the process of strategic planning differs in the basic concept that extensive research has to be done on the industry and the way of entry into the foreign market has to be sewed well in advance.
Conclusion
Waitrose has to go for differentiation strategy if it has to have a sustainable advantage over its competitors and boost its efforts in online sales and organic products to keep the momentum up and running. Waitrose is doing a good job presently, a little more focussed and differentiated strategy in terms of product and marketing strategy will help it to gain a higher market share
References
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Barney, J.B., 2014. Gaining and sustaining competitive advantage. Pearson Higher Ed.
Block, J.H., Kohn, K., Miller, D. and Ullrich, K., 2015. Necessity entrepreneurship and competitive strategy. Small Business Economics, 44(1), pp.37-54.
Brenes, E.R., Montoya, D. and Ciravegna, L., 2014. Differentiation strategies in emerging markets: The case of Latin American agribusinesses. Journal of Business Research, 67(5), pp.847-855.
Chang, J.F., 2016. Business process management systems: strategy and implementation. CRC Press.
Channon, D.F. and Jalland, M., 2016. Multinational strategic planning. Springer.
Dibrell, C., Craig, J.B. and Neubaum, D.O., 2014. Linking the formal strategic planning process, planning flexibility, and innovativeness to firm performance. Journal of Business Research, 67(9), pp.2000-2007.
Feys, B. and Probert, C., 2015. PESTLE analysis. Primento Digital.
Grünig, R. and Morschett, D., 2017. Overview of the Strategic Planning Process for Going International for New Markets. In Developing International Strategies (pp. 81-84). Springer Berlin Heidelberg.
Haines, S., 2016. The systems thinking approach to strategic planning and management. CRC Press.
Hollensen, S., 2015. Marketing management: A relationship approach. Pearson Education.
Koks, S.C. and Kilika, J.M., 2016. Towards a Theoretical Model Relating Product Development Strategy, Market Adoption and Firm Performance: A Research Agenda. Journal of Management and Strategy, 7(1), p.90.
Porter, M.E. and Heppelmann, J.E., 2014. How smart, connected products are transforming competition. Harvard Business Review, 92(11), pp.64-88.
Van der Kolk, B. and Schokker, T., 2016. Strategy implementation through hierarchical couplings in a management control package: an explorative case study. Journal of Management Control, 27(2-3), pp.129-154.
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Wolf, C. and Floyd, S.W., 2017. Strategic planning research: Toward a theory-driven agenda. Journal of Management, 43(6), pp.1754-1788.
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