Contemporary Management Issues - Sainsbury's Response to Change Drivers
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This study examines the contemporary management issues present in the current business environment, with a focus on Sainsbury's response to change drivers after acquiring Argos. It covers the impact of technological development, business growth, and more.
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Contemporary Management Issues
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Table of Contents Introduction.................................................................................................................................................3 Discuss how Sainsbury has responded towards the change drivers with consideration for the nature of the pressures for change..........................................................................................................................4 Recommend how the organization can enhance its response.................................................................10 Conclusion.................................................................................................................................................12 References.................................................................................................................................................13
Introduction Contemporary management issues are the issues which have not been resolved yet and put a tremendousimpacton the people.In management,there are numerousissuesare encountered by managers. These issues are related to uncertainty about the future, wellbeing of employees, shaping the culture of company, hiring and on boarding right employees and more. It is important for the managers to prepare suitable strategies so that they can face the contemporary issues efficiently. In addition to this, they need to anticipate of the issue and prepare suitable policies accordingly(Imazio and et. al., 2017). Main aim of the present study is to examine the contemporary issues present in the current business environment. The study is based on the takeover of Agro by Sainsbury. Here, Sainsbury is the second largest supermarket chain in UK. It offers groceries and general items such as clothes, home appliances, mobiles and more.In 2016, Sainsbury acquired Agro with an aim to expand the business. This takeover boost the sales of the entity by strengthened the production capacity efficiently. The study will cover change drivers and their impact on strategic decision-making of the organization.In addition, it will include the strategic response of Sainsbury to the change drivers. Further, suitable recommendations have also been included in the report for the further growth and enhancement. Overview of takeover Sainsbury is one of the largest retailers of UK. It offers variety of products in order to offer wide range of choices to customers. The company was founded in . Sainsbury acquired Agros in 2016 with an aim to offer wide range of products to customers. Main aim of the expansion was to earn substantial amount of profit. The acquisition proved beneficial in terms of improving the sales and minimizing the cost. It was noticed that Agros outlets were increasing tradingintensitywithinthecompany(ArgostakeoverboostsSainsbury'strading,2018). However, Sainsbury cut 3500 jobs and closed nearly 420 stores of Argos in order to respond towards change in customer demand and growth in online shopping (Sainsbury's to cut 3,500 jobs and close 420 Argos stores, 2020). As a result, Sainsbury needs to find alternative roles so that they can appoint the staff on those positions. The agenda to takeover of Argos was to make business more profitable and efficient.
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Discuss how Sainsbury has responded towards the change drivers with consideration for the nature of the pressures for change Change drivers are the internal and external factors which cause changed in the current business practices. It might include change in the strategy, plans, products, operations and more. Sometimes, changes occur due to the internal factors such as management style, change in staff, union etc. In addition to this, change in current organizational strategy also facilitates changes in the entire working practices of an entity. On other side, changes can also occur due to the external elements(Hafberg, Borinstein and Alexopoulos, 2019). Technological advancement, businessgrowth,expansionaresomecrucialreasonsofchanges.Additionally,external environment has a major influence on the working practices of the business. It includes numerous factors such as political, social, technological, demographic, legal and more. However, it is not possible to control these factors but these elements put a significant impact on business entity. The external situation easily gets change by modification in policies, norms and more. These changes affect the business and cannot be controlled by business managers. To cope up with the changes, it is imperative to understand the different change drivers. It helps to understand the change driver that is affecting the company. Further, it allows managers to take suitable steps in order to deal with the impact of changes within organization. In current situation, Sainsbury is dealing with the changes due to takeover of Argos. This takeover affected the operations of the entity profoundly. Now, company is required to address these change drivers while taking decisions. Analysis of the change drivers will help in taking important business decisions in order to improve strategic efficiency of the organization. Technological Development:In current time, technological development has become an essential requirement of a business. It is important to adopt creative and unique ways so that businessoperationscanbe maintainedin anefficientmanner.In addition,technological advancements are important in order to ensure competitive edge in current market place. It allows a company to offer unique, different products to the customers. If a company needs to survive in current competitive environment, it is imperative to adopt new, unique and advance techniques. These techniques play an imperative role in ensuring growth of company(Veneris, Mahajan and Frazier, 2020).
Technology is considered as one of crucial change driver. In current environment, several changes are introduced in technology. The existing ways become obsolete and companies need to embark advance methods to perform a particular task. It is crucial to understand the changes coming in the technology so that organization can adopt efficient ways of production and development(Brown and et. al., 2018). Technology is not something that has been evolved once and can be used over the period of time. Here, advancements are introduced in technology over the period of time. Also, it is vital for the business owners to understand these advancements and work accordingly. Technological development is one of the crucial change drivers which affected the business functions of Sainsbury. British Supermarket group Sainsbury acquired Argos for 1.3 billion. This takeover accelerated the growth of the company by enlarging the product category. Combining o these two companies will enlarge the product portfolio of the company. It will make company enable to meet with requirements of customers with 2000 stores and 100,000 products within the country. With this deal, Sainsbury was able to offer products to customers online. Here, 25 million customers will be able to buy products online or using mobile device (Sainsbury's bets on Argos takeover for digital age, 2021). Argos had a strong technical infrastructure which helps company to offer products to buyers. In this situation, customers have option to buy products in stores and online. It is considered as one of the most effective and advanced online sales and delivery network in Britain. With the takeover, Sainsbury got benefit of technology advancement of Argos. As a result, they implement online sales techniques in business.Inadditiontothis,thecompanystartedtotakemovetowardstechnological development. It strengthens the business presence of the organization and makes them enable to meet with demand of customers in an efficient manner. In addition to this, the change in current practices will also become a reason of resistance of employees. They are not likely to easily adopt new business practices. However, technological advancement will make things easier. It will help the company to undertake business practices effectively. According to the new trend set by COVID-19, Sainsbury is embarking e-commerce practices and contactless shopping. It is because of change in behavioral trends of the customers. For this purpose, they enhance the technical infrastructure so that they can meet with changed requirementsof the buyers. Impact on strategic decision making:Technological developmenthas profound influence on the strategic decision making of Sainsbury. Now, they need to take decisions so that they can drive positive results through technological changes. In addition to this, company keeps
an eye on technological advancements and take suitable decisions in order to ensure further enlargement. It is analyzed that employees are not likely to work in a change environment. They are comfortable with the existing work practices(Hrustek, Furjan and Pihir, 2019). In this situation, Sainsbury take effective decisions so that employees get ready to work in an advanced and enhanced environment. Now, the decisions of the company are affected by the technological development and enhancement. Here, they consider ample of factors before taking the final decision with an aim to drive positive outcomes through technical advancements. Impact on Commercial and Operational activities:Commercial activities of each and every company are the major source of revenue. It is related to perform daily activities so that an organization can easily operate the business successfully(Backman, Verbeke and Schulz, 2017). In present scenario, the Argos has been takeover by Sainsbury. Here, Argos is a well-known catalogue retailer. It maintains the sales through physical and online medium. The takeover will bring technological advancement in the Sainsbury that will further affect its operation and commercial activities. With technological advancements, the company can easily sale their products to customers via online medium. It will enlarge the existing profit and will allow company to maintain large customer base. In addition, technological development will make the organization enable to offer timely delivery of products to customers. Now, Sainsbury will receive the order through online medium and also make sure that they can deliver the order timely.Therefore,technologyisa crucialchangedriverthatputaprofound impacton commercial and operational activities of the respective business entity. In response to the technology change, Sainsbury is modifying its current practices accordingly.Inthiscontext,theyhavebeenadoptede-commerceandonlineshopping techniques. They make sure to offer best possible experience to customers. However, increasing use of technical advancement has brought a drastic change in the working mechanism of the company.Now,employeesneedtoadjusttheirworkingpracticesasperthechanging environment of the company. In this situation, Sainsbury is arranging training sessions for employees so that they can easily cope up with technological enhancements. Apart from this, they are also using motivation techniques so that workforce bet ready to work in an upgraded and changed work environment. Here, managers make sure that they maintain proper communication
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with staff members. Additionally, they put all necessary efforts in order to maintain a healthy and positive atmosphere at workplace. Business growth:Business growth refers to the expansion of organization with an aim to earn substantial amount of profit. Main aim of business growth is to enlarge the existing customer base so that a company can enhance the sales significantly. There are ample of ways by which growth can be achieved such as merger, acquisition, takeover and more(Gasbarro, Iraldo and Daddi, 2017). Business growth not only helps in enhancing profit but also formulates a positive image of organization in market. It makes a company enable to stay in competition for longer period of time. It is not possible to survive in the current competitive marker for longer duration without planning the growth. Additionally, business growth also contributes towards enlargement of company. It inflates the profit margin by enhancing the existing customer base. There are several financial benefits of growth. By embarking growth, an organization can easily get an edge on rival firms. Business growth is a crucial change driver. It facilitates changes in existing operation of the entity. Here, it introduces change in existing process of production. In addition to this, human resource structure of a company also gets change while growing the business. If a company merge with another company, role of existing workers get changed. Sometimes, employees are laid off after takeover of organization. Growing business is really important but it cause huge changes in the existing structure of the entity. In case of international expansion, employees are required to work in a change environment(Cai and Li, 2018). In current scenario, main reason of Argos takeover by Sainsbury is the business growth. Argos is a well-known catalogue retailer which is doing business through online and offline mediums. In 2016, Sainsbury acquired Argos with an aim to grow the business. The main rational behind this acquisition was enhancing the current customer base. After the deal, Sainsbury is able to offer wide range of products to customers. It has a variety of products and numerous stores across UK. It helped Sainsbury in improving the trade intensity. As a result, the respective company grabbed the position of the second largest retailer in UK. It is stated that combining Sainsbury and Argos offered nearly 100,000 products through 2000 stores that was bigger than the UK’s clothing and general merchandise business of TESCO. The acquisition made company enable to offer wide choices to customers. As the result of the acquisition, Sainsbury was able to deliver more non-food products
to customers. They widen the range of electronics, home appliances, toys and more. According to the expansion, deal boost the earning of the company resulted they become capable to offer high earning per share to the investors. For the purpose of business growth, numerous stored of Argos was opened across the UK. Here, the business growth is crucial for success of the entity. However, it will cause ample of changes in the existing structure and process of the organization. Impact onstrategic decision making:Each and every company aims to grow the business. For this purpose, they take suitable steps. While planning the growth, it is important to analyze different factors. Growth enhances the profit of the entity. But, it might change the entire process of the company(Olofsson, Hoveskog and Halila, 2018). Here, employees need to perform different functions and roles. In addition to this, it will also change the environment of the business entity. In context of Sainsbury, they acquired the Argos with an aim to embark growth in business. The business growth profoundly affects decision making of the organization. They make sure that business growth has a positive impact on the company. They analyze the impact of growth on employees, working practices as well. In addition to this, they make sure to maximize the welfare of employees while planning for the growth. In this context, managers of the company ensure to positively influence the company. Therefore, they analyze various elements in order to take meaningful decisions to ensure positive impact of growth on the business entity. Impact on commercialization and operation:While growing the business, operations of the business entity get highly affected. Growth brings changes in daily operation of the organization for further betterment. It is a crucial change driver that has direct impact on commercialization and operations. In current scenario, Sainsbury acquired Argos with an aim of growth and enlargement(Cunningham and Miller, 2021). After this, the company opened a lot of outlets and embarked technology in daily operations. Later, they decide to close some of the outlets of Argos as they were not getting intended results. Due to this, company fired nearly 3500 individuals(Sainsbury's to cut 3,500 jobs and close 420 Argos stores, 2020).In addition to this, it also affected the supply chain practices of the company. Post takeover, Sainsbury started to prefer online practices rather physical shopping. They not only started to offer products online but also improved the efficiency of supply chain in order to fulfill timely delivery of goods to the customers. Therefore, the acquisition affected operation of Sainsbury profoundly.
Response towards change drivers In the current scenario, technology development and business growth has been identified as the crucial change drivers. Here, Sainsbury responded towards the change drivers efficiently. For this purpose, they ensure to maintain proper communication with employees in order to develop positive attitude towards changes. In addition to this, they also provide suitable leadership and guidance to the employees so that they can easily work in change and enhanced environment. With proper leadership and guidance, it is possible to turn the resistance in acceptance. Apart from this, manager also motivates employees through suitable motivational techniques. These techniques help the organization in stimulating employees so that they can easily work in a change environment. In this context,Lewin change modelhas been applied by the company which is mentioned below: Unfreezing:It is the first stage of change management. It is considered as one of the critical stages in the process of change management. Under this process, managers of Sainsbury put significant efforts so that employees get willing and ready to change in work setting. Here, they make sure that employees get ready to come out from the comfort zone to work in a transformed situation(Trianni and et. al., 2017). In addition to this, it involves to make people aware regarding changes and motivate them to work in a change environment. Here, managers put significant efforts in order to make employees aware with the positive impact of change practices. Additionally, they try to maintain effective communication with employees with an aim to ensure their support & involvement throughout the process of change management. Change:It is the second stage of change management process. It is the most crucial stage wherein changes are actually implemented. This step is about actually work in a transformed environment. Here, managers of Sainsbury ensure that employees accept the new ways of doing things(Ahmadi and et. al., 2017). At this stage, leaders of the company prepare plans and maintain proper communication with team members. In addition to this, managers encourage employees so that they become a part of change practices of the company. Here, managers also face ample of challenges as people are in fear due to the consequences of changes. Refreezing:It is the final stage wherein people move towards stability from the stage of transition. It is a stage wherein employees finally accept the changes(Alvaro and et. al., 2018).
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In this, managers of Sainsbury put efforts so that individuals accept the changes and start to work with new ways. Here, managers put efforts that employees stick with the new ways of working. To strengthen the reinforcement, employees are rewarded and recognized by the company. In addition, they also offer positive reinforcement to workers so that they continue to work in change environment for longer period of time. With above discussion, it is analyzed that Sainsbury is responding towards change drivers efficiently. For this purpose, they adopt Lewin change management model wherein they adopt different practices in order to motivate employees to work in change setting. Here, managers maintain appropriate communication with workers. They guide employees, support them so that they easily get ready to adopt new ways. Apart from this, positive reinforcements are also given to the employees in order to ensure that they stay in change environment for longer period of time. Recommend how the organization can enhance its response Takeover of Argos by Sainsbury caused ample of changes in the company. Here, the change drivers have been identified as business growth and technological development. Due to the changes, company is facing issues of employee resistance, change in existing environment and more. They are responding towards changes efficiently. For this purpose, they have been adoptedlewinchangemanagementmodel.Underthismodel,managersmaintainproper communication with employees. They interact with workforce in an efficient manner. These steps are helpful in working in the change environment effectively. However, the response of the company could be enhanced by adopting the following ways. Employees get directly affected with the changes. Hence, they are likely to resist the changes as they are not ready to work in change environment(Pousttchi and Dehnert, 2018). In Sainsbury, employees also need to modify their existing business practices so that they can work efficiently. For this purpose, they need to adopt efficient technology that will bring changes in current setting. In this situation, Sainsbury needs to understand the issues that are being faced by the employees. For this purpose, they are required to maintain proper interaction with workers. It will allow the organization to know the actual problems of employees so that they can provide appropriate solution. It will help in formulating positive attitude amongst workforce regarding changes.
The response of Sainsbury could be improved by analyzing the subsequent effect of change drivers. Analysis of these after effects helped company to prepare suitable strategies so that they could face the changes efficiently. It enabled the mangers to take appropriate steps in order to face the changes effectively. For employees, it is not easy to work in change atmosphere. They have to face several challenges while working in change environment. In this situation, it is imperative to arrange necessary training programs for enhancement of employees. These training programs will enhance the capabilities of human resources to perform a particular task. After getting proper training, it will be easy for employees to cope up with changes. These training sessions will improve the productivity, knowledge and skills of workers which will further make them capable enough to work in a change setting. The response of Sainsbury could be improved via proper planning. They need to make the anticipation and then prepare suitable plans in order to get the positive outcomes from changes practices. Planning is helpful in minimizing the uncertainty and ensured the success of business. Along with the forecasting, planning could help the organization in facing the situation effectively. It is analyzed that the response of the company could have been improved by implementing above-mentioned recommendations. They could make the plans, do the forecast, train the employees in order to respond towards changes efficiently. By implementing, the above-stated recommendations, company could have been easily face the impact of change drivers in order to ensure success in the current dynamic environment.
Conclusion It is concluded through above-mentioned information that contemporary management issues are the emerging problems in the field of management. There are several issues are being faced by managers in current time.These issues are related to uncertainty about the future, wellbeing of employees, shaping the culture of company, hiring and on boarding right employees and more. It is important for the managers to prepare suitable strategies so that they can face the contemporary issues in an efficient manner. The above study is based on takeover of Argos by Sainsbury with an aim to enlarge the business and minimize the cost by improving production efficiency. It is analyzed that takeover of Argos enhanced the trade intensity of Sainsbury. It improved the market presence of the business entity by enlarging the current product portfolio of the company. It is analyzed that the acquisition caused ample of changes in the company. In the above study technology development and business growth has been identified as the major drivers of changes. It is concluded that technological enhancement facilitate ample of changes in thecompany.Itaffectedexistingdecisionmakingpractices,commercialand operational activities of the company. The other change driver is business growth that affected the existing practices of the organization efficiently. It is summarized that the organization ensured to maintain positive impact of growth on business practices. In addition to this, the operations of the entity are also affected through growth of business. There is discussion of Lewin change management model so that the company can face the changes efficiently. It is summarized that theresponsecouldhaveimprovedthroughproperplanning,forecastingandtrainingof employees.
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