Business Strategy Analysis of Coles Supermarkets

This report analyzes the business strategy adopted by Coles Supermarkets in Australia regarding the introduction of advanced technology in its business operations. It discusses the strategic issues, benefits, and relevant theoretical concepts. The report emphasizes the importance of business strategies for growth and development in organizational structures.

Running head: BUSINESS STRATEGY ANALYSIS OF COLES SUPERMARKETS
BUSINESS STRATEGY ANALYSIS OF COLES SUPERMARKETS
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1BUSINESS STRATEGY ANALYSIS OF COLES SUPERMARKETS
Executive Summary
The significant objective of the report is to analyze the business strategy adopted by Coles
Supermarkets in Australia regarding the introduction of advanced technology in its business
operations. The strategic issues of such a implementing such a change has been discussed
along with the several benefits that the Company may be subject to. Additionally, several
theoretical concepts relevant to the business strategy has been discussed. In conclusion, the
importance of business strategies to bring about growth and development in organizational
structures is mentioned.

2BUSINESS STRATEGY ANALYSIS OF COLES SUPERMARKETS
Table of Contents
Introduction................................................................................................................................3
Discussion..................................................................................................................................3
Summary of the Case Study...................................................................................................3
Identification of Strategic Issues............................................................................................5
1. Resistance to change................................................................................................5
2. Costs.........................................................................................................................6
3. Competition.............................................................................................................6
Benefits of the Strategic Change............................................................................................6
1. Increased productivity and efficiency......................................................................6
2. Automated business processes.................................................................................7
3. Reduced business costs............................................................................................7
4. Increased customer satisfaction...............................................................................7
Relevant Theoretical Concepts..............................................................................................7
1. Change Management...............................................................................................8
2. Profit maximization and Competition based Theory...............................................8
3. SWOT Analysis.......................................................................................................9
Conclusion..................................................................................................................................9
References................................................................................................................................11

3BUSINESS STRATEGY ANALYSIS OF COLES SUPERMARKETS
Introduction
Business strategy can be defined as the process undertaken in business organizations
to plan and decide on competitive actions and moves that can used to attract customers and
strengthen the performance of the organization (Akter et al. 2016). Business strategies
thereby consist of an action plan that is aimed at fulfilling the objectives and aims of the
organization. Michael Porter observed three basic strategies that can be utilized by
organizations in the fields of leadership, differentiation and focus on business activities
(Alstete 2014). There may be several opportunities of strategizing business activities in an
effective manner. Such opportunities include solving the potential risks and threats for the
organization and its market, securing an advantageous position and directing the consumption
patterns of the customers. Coles Supermarkets Australia Private Limited is recognized as one
of the leading retail, consumer services and supermarket chain in Australia. The organization
was founded in the year 1914 and has its headquarters in Hawthorn (Colesgroup.com.au
2019). Coles Supermarkets has its operations in more than 807 outlets across the nation and
employs more than 110,000 individuals. The report will further analyze the case study on
Coles Supermarkets about making improvements in their technological facilities in order to
enhance their productivity and profitability. The various elements of such a business strategy
will be evaluated along with an application of the various theories and concepts relating to
the strategic issues.
Discussion
Summary of the Case Study
The Coles Group undertakes its trading operations under the name Coles
Supermarkets, Coles Liquor and Coles Express. The organization provides retail services at
more than 2400 locations throughout Australia (Brassrazoo.com.au 2019). The case study

4BUSINESS STRATEGY ANALYSIS OF COLES SUPERMARKETS
evaluates the business strategy adopted by Coles Supermarkets in order to maintain its
position as a major player in the competitive landscape of the retail industry. These strategies
are aimed at reducing the operating costs of the organization and make enhancements in the
levels of customer satisfaction through the use of improved and advanced technology. The
application of such strategies would further ensure improvements in the organization’s
business activities and thereby its profitability.
According to the case study, Coles Supermarkets had been facing a severe challenge
pertaining to their storage and server system (Brassrazoo.com.au 2019). The organization’s
existing storage infrastructure and server technology required to be developed to meet the
production requirements. The advanced versions of server operating systems developed by
Microsoft provided major improvements for remote monitoring and management.
Furthermore, the maintenance of systems of point of purchase required improvements for the
purpose of efficiently processing the retail transactions. The challenges faced by the
organization also included the management of each retail outlet to meet the needs,
requirements and changing consumer preferences of the customers. The systems in the outlets
and the back offices therefore required changes to be able to provide for the demands of the
customers and obtain optimum customer satisfaction. The business strategy employed by the
organization in order to solve the technological problems and make improvements in
customer services involved the inclusion of Server systems developed by Fujitsu, a
multinational organization manufacturing equipment for information technology
(Brassrazoo.com.au 2019).
The benefits of utilizing the technological solutions provided by Fujitsu included the
reduction of risks involved in delivering services to the retail customers and improvement of
productivity due to the fast and efficient processing of data (Brassrazoo.com.au 2019).
Furthermore, Coles could also obtain the advantage of using a technological system that was

5BUSINESS STRATEGY ANALYSIS OF COLES SUPERMARKETS
future proof and unlikely to become obsolete in the near future. The technological
advancements could also enable the supermarket chain to meet its requirement of optimizing
the performance of the vendors and customer service providers (Brassrazoo.com.au 2019).
The application of advanced technology to the business activities and systems of the
organization, would further enable them to gain a competitive advantage in the rapidly
evolving retail industry by catering to the changing consumption patterns and demands of the
customers.
Identification of Strategic Issues
Technology has an ever changing and expanding impact on organizations in the
modern world of rapid globalization. Technology affects the manner in which the various
activities and process of business are conducted in organizations, additionally determining the
extent to which it can undergo development and growth. Advancements and innovations in
technology thereby entails the growth and adaptation of business organizations in order to
remain competitive in the changing trends of the market (Pantano 2015). The strategic issues
involving the challenges faced by Coles Supermarkets can be identified to be the following:
1. Resistance to change – Employee resistance refers to the negative reaction or attitude
among employees observed due to their inability to adapt to organizational changes.
Resistance to change by employees and other individuals of the organization not
because of their disagreement to the business strategy adopted but because of their
lack of understanding or knowledge about the outcome of such changes (Matos
Marques Simoes and Esposito 2014). The change in Coles Supermarkets regarding
the introduction of new systems for managing data and other technological
advancements may cause ambiguity among the employees regarding the methods of
their utilization and their benefits. Therefore, to resolve such a strategic issue it is

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necessary for the employees to undergo training so that they can acquaint and adapt
themselves to the new business processes.
2. Costs – The demand for efficient and diversified technology in various industries is
increasing due to the rapidly changing trends in the market as well as the preferences
of the customers (Euchner and Ganguly 2014). The use of technology in the retail
industry is essential as it helps in the balancing of stocks, management of orders and
tracking of prices. Moreover, technology also helps the organizations in the retail
industry to maintain and process data regarding the operations in the outlets, stores
and the back-offices. However, the introduction of such advanced future-proof
technology involves Coles Supermarkets to incur high costs initially for their
installation and efficient utilization.
3. Competition – The ever changing and competitive market in the retail industry has
made several organizations to engage in developments pertaining to the use of
technology (Hong and Li 2017). Such organizational changes and business strategies
poses a severe challenge to Coles Supermarkets regarding the scope of the newly
implemented technological changes to obtain a competitive edge. The success of such
advanced technology in improving the performance, productivity and profitability of
the organization is hugely dependent on the manner of its utilization and the ability of
the members of the organization to adapt to its processes within a short period of time.
Benefits of the Strategic Change
1. Increased productivity and efficiency – The introduction of technological
advancements in the business processes and activities of organizations help in
increasing the productivity and thereby the efficiency of its performance (Willems et
al. 2017). The introduction of new system for the management of database in Coles

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Supermarket will enable the organization to process their sales and allocation of
resources in an improved manner.
2. Automated business processes – The automation of business process through the use
of technology aids the business organizations to allocate their resources efficiently
and manage their activities (Van Der Aalst, La Rosa and Santoro, 2016). Manual
processing of data is time consuming and requires training of the employees.
However, with the use of automated systems for the databases as provided by Fujitsu,
Coles Supermarkets will be able to manage their business processes in an improved
manner.
3. Reduced business costs – Implementation of technological advancements in business
organizations may be initially costly. However, in the longer run such technological
advancements helps in the cost effectiveness of the business processes. It is so
because, the efficiency of the technological systems increase the productivity and
reduces the scope of manual errors.
4. Increased customer satisfaction – Improvements in technology is directly related to
the increase in customer satisfaction especially in the retail industry (Orel and Kara
2014). It is so because, by utilizing the advanced systems of databases, the employees
of Coles will be able to track the efficiency of the customer services pertaining to
orders and their deliveries, in addition to tracking the trends of consumption patterns
that will aid the Company to strategize business plans further.
Relevant Theoretical Concepts
Strategic Management relates to the identification of strategies and plans that can be
undertaken by managers of a business organization in order to improve the performance and
productivity of the firm (Gamble, Peteraf and Thompson 2014). In this aspect, the strategic

8BUSINESS STRATEGY ANALYSIS OF COLES SUPERMARKETS
change of implementing technological advancements in the business processes of Coles
Supermarkets can be analyzed using the following theoretical concepts:
1. Change Management
The structural changes in an organization involves changes in the business activities and
process of the organization. Such changes must be managed efficiently by the organization in
order to protect the interests of the employees and other stakeholders (Hayes 2018). A
primary challenge for an organization involved in change of technology for improvement of
business procedures is the management of resistance to change by the various internal and
external stakeholders. In this aspect, the organization also faces the threat of dissatisfaction
among the employees due to ambiguity after the operational changes have been implemented.
The case of Coles Supermarkets entails the development of new software developed by
Fujitsu. For this purpose, the management must engage in a training process for the
employees so that they may be accustomed to the new operational procedures. The theory of
Lewin’s change management process can be applied to the case, which involves a three step
process of unfreeze, change and refreeze (Cummings, Bridgman and Brown 2016). Such a
change management procedure can ensure the success of the implementation of changes.
2. Profit maximization and Competition based Theory
The theory of Profit maximization and competition entails that the primary objective of a
business organization is to gain a competitive advantage in the market in which it operates,
thereby maximizing its profits (Na 2015). This theory follows the opinion that the strategies
and decision of the organization relating to its business activities and procedures must lead to
incurring greater profits. In this aspect, the process of implementing new technology for
processing database is aimed at obtaining improved performance of the business operations
and thereby incurring greater profits and a competitive advantage in the retail industry. Such
competitive advantage is gained through the efficient utilization of resources available to the

9BUSINESS STRATEGY ANALYSIS OF COLES SUPERMARKETS
organization for the purpose of catering to the requirements of a larger number of customers
and diversification of products in the new locations.
3. SWOT Analysis
Determining the Strengths, Weaknesses, Opportunities and Threats of the organization is
an important strategic tool that can aid it to grow and develop. The concept of SWOT
analysis provides the organization the scope to improve upon its strengths and opportunities
and reduce the identifiable threats and weaknesses (Gürel and Tat 2017). The strengths of
implementing technological changes in Coles Supermarkets include data redundancy in point
of sales and improved performance of employees. The weaknesses of the strategy includes
greater initial costs for implementation of the change and ambiguity among the employees
regarding the operational changes. The opportunities of the technological changes in Coles
include the utilization of the skill and experience of Fujitsu in terms of development of
technology for retailers and maximization of profits. The threats involving the technological
advancements include the resistance to change by the employees and competition that may be
faced from other retailers using similar technology.
Conclusion
From the above analysis of the strategic management undertaken by Coles
Supermarkets, it can be concluded that strategizing and managing changes is an important
requirement to ensure the growth and development of business organizations. Introducing
technological advancements is a strategic business tool that enables an organization to gain
advantages in the market by improving the efficiency of performance and maximizing
productivity through the proper allocation of resources, thereby expanding the scope of
business process and activities. However, this process also entails several challenges like
resistance to changes and incurring greater initial costs for the installation of new technology.

10BUSINESS STRATEGY ANALYSIS OF COLES SUPERMARKETS
Such challenges can be efficiently managed by the organization through the process of
efficient change management. This process may also include the training of the employees to
help them adapt to the changes and improving the efficiency of the human Resources
Management System so that the grievances and problems faced by the employees during the
change process can be resolved efficiently. Furthermore, to ensure that the strategies of
changes implemented by the organization are successful, the Company may analyze its
internal strengths and weakness and external opportunities and threats. Such an analysis will
further enable the Company to maximize its productivity and profitability.

11BUSINESS STRATEGY ANALYSIS OF COLES SUPERMARKETS
References
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