The Coles Supermarket Company is an Australian supermarket, retail and consumer services chain corporation and is one of the largest retailing companies in the world. The company was found George Coles and owned by the parent company Wesfarmers. The company provides a number or services such as fresh foods, groceries, general merchandise, financials services among other services to their esteemed customers. The company has continued to provide employment opportunities to the Australian communities. The company operates a store network of 807 supermarkets, 702 Coles express fuel stores and has a record of over 21 million customers visiting the company stores every week. The company continues to be the leader in local sustainability, corporate philanthropy and employment opportunities (Wang, 2015). However, their success has been attributed to the company unwavering commitment to creating opportunities, value creation to their customers as well as effective communication strategies around the world. Its success has been as a result of the successful pursuit of some policy by the company managers and most importantly the founder of the company George Coles who laid a good foundation for the business growth.
Despite the stiff competition in the Australian market, Coles Supermarket has been able to develop and implement an adequate or suitable plan that has enabled it to achieve excellent business performance and also increased its competitive advantage in the market by becoming one of the largest brands in the retail industry. The management of the company boasts of their ability not only to understand what their customers want and need but also by following where they want it and also how they would love to experience it. This means that the company has laid much focus on developing effective customer relationship strategies. The company can, therefore, be said to be positioned as a customer private firm in the retail industry (Phillipov, 2016). The company business strategy is driven by their desire to be the Australian best food companies through greater investments in prices, quality and strong focus on delivering tasting foods. The business strategy has contributed positively to the growth and sustainability of the company in a current retail environment which has become very competitive. The strategies have enabled the company to lower its cost structure, charge low prices for their goods and services, gain a significant market share as well as increase their profitability in the industry.
The company management team has been able to appreciate the fact that a customer choice of a retailer is depended on the company’s ability to develop price, access, assortment and customer-driven strategies and especially in the modern retail environment which has become very competitive due to the rapid growth of e-commerce. To win and gain a competitive advantage as well as become the leader in the industry, Coles Supermarkets has developed price strategy that aims at providing products and services at affordable and fair prices, invested in differentiating company products and services on access, increase their competitiveness on assortment and deliver a great experience to their customers (Porter & Kramer, 2019). The company price competitive strategy aims at providing more service to their customers at a lower cost compared to their competitors in the industry. Developing an effective pricing strategy plays an essential role in enhancing business growth especially in markets segments which are price conscious. Offering relatively low prices for their quality services and products has enabled the company to increase their customer base globally and therefore translating to increased productivity and profitability of the company.
Secondly, the company differentiation strategy has enabled the company to establish itself in the market by offering unique products and services. This is very important as customers want to associate themselves with specific brand globally and therefore their uniqueness has enabled them to gain a competitive advantage in the retail industry globally (Wheelen et al., 2017). The company has also developed effective access strategies aimed at improving their efficiency in service delivery and increasing customers the convenience to acquire the company goods and services most conveniently and reliably (Wang, 2015). The company has focused on continuously on improving the accessibility of their stores, sites as well as the workplace and digital platforms. These platforms are aimed at improving customer interactions and relationships which also gives them competitive by having over 21 million customers every week visiting the company stores as well as the company internet platforms. The company developed strategies have enabled it to maintain a high level of profitability over time and gaining a competitive advantage over their rival companies. However, it is the company business model that has enabled its managers to conceptualize how the different set of strategies will contribute to increased competitive advantage since it defines the ways through which the company will seek to pursue the objectives.
In increasing the organizational performance through strategic management, it is essential for the organization to develop the culture of strategic leadership. Strategic leadership in an organization is concerned with control of the organization strategy making process with the aim of increasing organizational performance and thereby resulting to increased enterprise value creation and creates a competitive advantage (Brea?Solís et al., 2015). The managers are therefore involved in a process to select and most importantly implement a set of strategies which will give the company a competitive advantage. Then develop a strategy formulation strategy which involves the task of choosing the best approach while the last process is the strategic implementation which has become the hardest aspect of strategic management.
Coles Supermarket current strategy had laid a significant focus on three critical factors which include; increasing emphasis on customer services. To achieve this, the company has been able to invest heavily in satisfying their employee needs and motivating them to commit their efforts in providing quality service. The company has therefore invested in providing higher wages to their employees, spent in more training for their staffs on customer service delivery and have also provided increased growth career building activities such as the graduate training program with the company. Secondly, the company has been able to focus on improving their groceries or freshness a move that has been brought about by an increased level of health consciousness by consumers (Frynas & Mellahi, 2015). To achieve this goal, the company has developed a strategy for improving their range of organic options and fresh produce for their products the company has been able to partner with local growers and producers of fresh groceries and has continuously worked with their suppliers to ensure a continuous improvement on the quality and availability of fresh food. Lastly, the company has also focused on enhancing the flexibility of their customer shopping experience by integrating the physical company stores with the digital business. Such a strategy has enabled customers to collect their online orders from different stores and also provide them with an opportunity to get text reminders of company new products within their regions or stores.
The success of the company business strategy can, therefore, be attributed to its cost leadership strategy in the retail industry not only in the Australia but also in its global markets as well as the company innovations strategy (Morschett et al., 2015). For instance, the company has been able to produce no wax apples which have received overwhelming response from over 70 percent customers. The innovative company strategy has enabled the companies to develop and produce quality goods and services which will satisfy the needs of their different target consumer groups as well as increase the company competitive advantage through differentiation in a retail industry that is characterized with by homogenous products.
The most significant factors driving the company growth in the industry and increased profitability include; large sales volumes attributed to the company increased market share in the industry and its cost leadership strategy and pricing model. Secondly, the company has been able to lower its operational costs compared to its competitors especially the IGA company which has continued to suffer from increased operational costs. However, it continues to lag behind the leaders such as the Woolworths Company which is the largest retail company in Australia. The company has been able to lower their operational costs through improved inventory control strategies which have also enabled the company to reduce its overhead costs.
Coles Supermarkets growth has helped the company increase their market share and productivity regarding sales returns (Lagat & Frankwick, 2017). Lastly, the company growth has been influenced by its technological innovations aimed at providing better and efficient customer service. The company has invested in fostering innovation through the Coles Nurture Fund by supporting the small and medium Australia businesses. From the above evaluation and critical analysis of the Coles business strategy, the company can be said to have developed and implemented effective policies. Therefore the company level of strategic management is very high and has contributed to the success of the company and increased competitive advantage in the retail industry.
Strategy implementation occurs after an organization management team has developed a set of strategies that will help the company when pursued to achieve increased performance and competitive advantage in the market. The process, therefore, involves taking actions at a corporate, business or functional level by the managers to execute a strategic plan. Strategy implementation can be achieved through putting a quality improvement program or strategy if the firm seeks to improve their service provision in the industry by offering quality products and especially to consumer groups characterized by quality consciousness (Jin et al., 2017). The implementation can also be achieved through changing the product design or positioning the product differently in the market. Market segmentation is also critical and plays a significant role in increasing company performance in the market by defining the various customer needs and characteristics which determine their consumption behaviors. Lastly, a company may choose to differentiate its products in the market based on the different consumer groups. Therefore based on the Coles Supermarkets strategy analysis, there is a need to implement a strategy focused on improving their groceries due to increased health consciousness of their consumers (Zarkada-Fraser & Fraser, 2015). There is also need to maintain the company competitive advantage in the company through increased technological innovations which will help in the production of quality goods and services and improved customer service
However, to achieve a successful strategy implementation process, there is need to understand the various organizational factors which will contribute to successful strategy implementation. Such factors include organizational leadership or strategic leadership, the people, the culture of the organization and the organizational capabilities. To achieve this, we use the Hubbard’s Model to evaluate how these factors influence successful strategy implementation. The model illustrates the relationships between the various elements and their impact on successful business strategy.
The success or failure of business enterprise or organizations is primarily attributed to the strategies developed and implemented by the management team or the managers. Every organization or business enterprise has a goal to achieve, and in most cases, they are guided by the efforts to make a persistent growth rate and achieve organizational sustainability which is dependent on the corporate strategic management decisions (Akter et al., 2016). Therefore, the strategies developed by organization management team have a significant impact on the organization performance relative to that of its competitors. The most significant challenge facing managers in the modern corporate world has been developing strategies which will enable the companies, or the organizations achieve superior performance in the market or industry relative to its rivals. Therefore, a company or organization strategies result in excellent performance then the company is said to have a competitive advantage in the market over its competitors (Klettner et al., 2014). Therefore, developing effective strategies plays an essential role in the development of a business enterprise regarding increased revenue growth and also through increased competitive advantage. The aim of this report is therefore to provide an understanding of different strategic management decisions taken by organizational managers to enhance the growth and performance of their companies with a significant focus on the implementation of the strategies which has been the most challenging aspect of strategic management in the company (Chang, 2016). Strategic implementation involves a complicated process of designing effective strategy, delivery strategies, supporting products, the method of improving the company efficiency and effectiveness of their operations. The report will focus on the analysis of the Coles Supermarkets in understanding the suitability of its current growth strategies.
The organizational strategic direction has been found to be one of the leading factors influencing strategy implementation. One of the contributing factors to increased failures of organization strategy implementation has been poor leadership. Strategic leadership ensures that the company employs will buy into the strategy implementation plan and direct their capabilities as well as business understanding towards the implementation of the new strategy (Olson et al., 2018). Therefore, the need for effective leadership in strategy implementation outweighs all other factors. It is the responsibility of the managers to provide or enhance communication within the organization. Improved communication plays a significant role in strategy implementation as it gives a clear vision of the strategy to the parties involved in implementation. It is the responsibility of the company or organization leadership to coordinate the operational and functional activities of the company, streamline the implementation process towards strategy implementation. Strategic direction helps in aligning the organizational structure and keeping the company employees motivated as well as ensuring commitment to strategy implementation.
Corporate culture plays a significant role in strategy implementation, and therefore every management team should be committed to establishing a culture that promotes increased performance and attainment of company strategic goals. Effective strategy implementation requires the development of a culture of accountability amongst the top management and the employees. If the senior management is accountable to their given responsibilities and actions, it helps the employees to grow confidence in the leadership. The company should also strive to establish a culture of sharing information within the organization as it facilitates effective communication of the goals and objectives of the developed strategy to different levels in the organization structure (Ahearne et al., 2014). Lastly, it is essential for the organizations to create a culture of enhancing responsibility for both employees and the management team. Accountability helps in ensuring that there is a commitment towards the strategy implementation. Therefore, organizations which have been able to align their strategies with organizational culture have been found to be more successful compared to those who have not. Investing in the development of the employee’s skills enhances the effectiveness of strategy implementation. Employees are very resourceful and innovative and therefore motivating the employees through good wage packages and offering career development opportunities is very significant in strategy implementation.
Hubbard Model is a decision research framework that has developed solutions on quantitative analysis to investments in different fields of study. These include entertainment media, business operations, policy decisions, investments in information technology, and military logistics among others. In using the model, it is postulated that customers range for small scale business to global international organizations, an aspect that needs companies to measure their strategies in making decisions to ensure the right information is relayed to the customers. Adopting the use of Hubbard Model will help Cole Supermarket to achieve three primary objectives. These include;
In application of the model, several factors will be influenced, an aspect that will change the operation and strategic process in the leadership, culture of the organization, the people (staff and consumers), and the organizational operation.
Leadership- the process of decision-making and effective communication is essential aspects that help leaders to successfully meet the strategic objectives of the organization. Implementation of the model will be vital in ensuring management objectives and employee relationship improves, an aspect that will promote the functionality of the employees and in return lead to customer satisfaction.
People- there have been reported cases of lack of cleanliness and tidiness in some stores which have affected the convenience of customers shopping in the area. Therefore, using Hubbard Model will help in improving the strategy of service within the organization.
Culture and Strategy- One the major fundamental problem facing the successful strategy implementation is rapid technological advancements in the retail industry which have increased competition in the industry and especially from online retailers. For instance, the groceries in the company due to increased health consciousness by a consumer segment. Such concerns require the company to develop effective strategies as it would affect the quality of company products and services negatively and destroy the already established reputation.
Organizations have different structures which have been developed to help in coordinating various organizational tasks. Some typical compositions include different managerial levels through which company strategies are developed and implemented. The strategy adopted makes it easier for the development and execution of top-bottom aspects from top management level. Brewster (2017) denotes that while others are designed from high management levels, the strategy help in implementing the middle management responsibilities. Lastly, some other strategy implementation follows the top-bottom organization structure or even bottom top-approach. However, there is weakness in the effectiveness of organizational structure that can work in line with the strategy implementation is it is dependent on the effectiveness of company communication strategy. Therefore, it makes it difficult to the organization structure in defining the decision-making process and resource allocation and therefore plays a critical role successful strategy implementation. It also reduces the organizational capability to develop and implement effective strategies that will provide the company with an opportunity to increase its performance and gain a competitive advantage in the industry.
Some company store layouts and design have been reported to compromise customer’s convenience and space for their shopping which also affects the company service delivery in some areas. Such issues may affect the company strategy implementation in that it can lead to losing customers loyalty to the company brands (Cândido & Santos, 2015). The emergence of digital disruptions in the corporate world has also affected many businesses strategies implementation by requiring the companies to adopt the modern technologies to remain competitive industry. Greater focus in the retail sector is shifting towards customer service and therefore there is a need for the company to develop effective customer service strategies to maintain or improve their performance and competitiveness in the industry.
Based on the above analysis, successful strategy implementation is determined by the efforts or strategies developed by the company management team. Despite the excellent performance of Coles Supermarkets company in the retail industry and been a leader regarding their customer and quality focus strategy, there is a need to develop other strategies which will help in increasing the current competitiveness in the industry and improving the company productivity and profitability to those or over their competitors such as the Woolworth Company. Therefore based issues rose above, the following recommendations can support the management of the company to provide a solution to the problems and contribute to increased efficiency in the industry.
The management of the company should improve their groceries by focusing more on the development of organic based products and the production of fresh products. They should also keep maintaining high standards of cleanliness in their stores as this will help in providing a solution to the concerns of the health-conscious consumer segments and quality service delivery.
The management of the company should also seek to integrate the modern digital technology with the physical company stores to improve customer service and reduce competition from online customers. The management should also increase their focus on improving customer service provision by not only developing their employee’s skills through training and motivation but also through increased customer rewards and after sale services. It is also essential for the management of the organization to develop effective leadership strategies by focusing on promoting a bottom-top approach to decision making. This facilitates them with an opportunity to get a better understanding from the employees who usually interact with the customer on what they need and how they would want it and even on where they can access it.
Conclusion
The above report gives a clear analysis of the business strategy of Coles Supermarkets. Despite the good strategy, the success or failure of the business will depend on the organization’s ability to implement its plan. Therefore, there is a great need to conduct an adequate analysis to understand the various aspects of strategy and factors that may influence strategy implementation in any organization. A successful strategy implementation will help the organization to increase its productivity and performance in the industry and gain a competitive advantage.
References
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