Corporate Strategy and Governance Assignment - Boots organisation

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Corporate Strategyand Governance
Table of ContentsTOPIC..............................................................................................................................................1INTRODUCTION...........................................................................................................................1LITERATURE REVIEW................................................................................................................4METHODOLOGY.........................................................................................................................9CRITICAL REVIEW....................................................................................................................16RECOMMENDATION.................................................................................................................24CONCLUSION..............................................................................................................................27REFERENCES..............................................................................................................................28
TOPIC“Investigation into the relationship between staff turnover and leadership”. A casestudy of Boots.INTRODUCTIONCorporate strategy is referred as an overall direction and scope of an organisation and theway in which its different business operations working together in order to accomplish particulargoals. Along with this, corporate governance is identified as a system of practices, processes andrules by which a company is controlled and directed. It significantly involves balancing theinterests of firm's different stakeholders such as customers, suppliers, management, government,financiers, shareholders and the community(Amran and et. al., 2014). In this dissertation, givenorganisation is Boots which is a pharmacy chain in the UK, Norway, Ireland, Thailand and manyother territories. This business was founded in 1849 by John Boot. Company mainly specialise inselling of many health and beauty products and also gives optician and hearing care facilitieswithin shops.Background of the IssueEmployee turnover is identify to the percentage or number of employees who leave anenterprise and are situated by new workers. Measurement of employee turnover is essential forthe manager to analysis main reasons for turnover. Leadership styles and theories have beendetermined in this research that provides large effect to employee's turnover intention(Bender,2013). Along with them, expenditure cost of Boots will be maximised if high turnover ofemployees is not solved. Therefore, staff turnover is more effective on entire level of enterpriseand mainly the productivity and services or product quality are always affected in negativemanner. It is also impact on direct and indirect cost of an organisation. Direct costs in Boots isassociated with selection, training and induction of new workers. On the other hand, indirect costis related with cost of learning, decreased moral and force on the existing workforce. Inaddition, high turnover of employees will threaten the progress and success on accomplishingpredetermined goals and objectives of organisation(Castañer and Kavadis, 2013). Apart fromthis, monetary and non-monetary measurable cost such as lost of customer's loyalty, deterioratedreputation, decreased branding trust and so on. All these have high effect on business operationsand goodwill at marketplace.1
Therefore, the objective of dissertation is to look at the two variables. In this, leadershipis an independent variable that may impact employees' turnover intention. It may be the mosteffective and essential in reducing the issue of high turnover of employees in Boots. In order toovercome high employees turnover at workplace, leadership is one of the important and criticalfactor because it play significant role in enhancing business performance. Leaders in Boots isexpected to execute all tasks and activities with sufficient resources to the large level in order toretain the competitive advantages. It is also essential for the organisation to sustain strong orprofitability reputation of the business.Boots Plc is the part of retail pharmacy global division of Walgreens Boots. For over 165years business have used their pharmacy-led expertise and assist to enhance the well-being andhealth of local community. In the organisation, there are large number of employees work forachiving long term goals and objectives of an organisation. Employee's turnover has alwaysbeen a main issues faced by Boots regardless of its natures, sizes or locations of business. Besidethis, all parties in the enterprise play vital role in promoting and encouraging human capital toattain competitive benefit. Thus, high turnover of employees definitely will impact this objectiveand goal.Leadership is an important and significant function of management which supports to increaseefficiency and to accomplish business goals. A leader is important in various ways in anorganisation, some are determined as under:Motivation: A leader play essential and incentive duty in the every organisation'sworking. They motivates the workers with financial and non-financial reward and therebyacquire the work or task from the subordinates. It is more essential and important for companyto manage employee's turnover and achieve better outcomes within predetermined time period.Training and development of subordinates:A leader proves supportive in training anddevelopment of their employees. They gives them the data regarding the modern method of work(Coates, 2012). Training and development is more effective and essential for achieving staffretention at workplace.Retaining workers is identified as a common objective and goal of company leader andhuman resources professionals. Over time, comparatively low turnover of employee is expensiveand can reduce overall moral as well as competency of the workers. There are some advantagesof high turnover which are determined as under:2
High turnover improve talent:The pace of advanced technology brings innovativechances, demands and challenges upon a employees(Donaldson, 2012). Some organisationshave effectively and appropriately implemented a business culture where workers improve orleave on continue basis.High turnover create incentives to perform:The growth and success of bureaucracy is aever-present risky in Boots. It replaces creativity and initiative with standing hierarchies,formalized rules, defensive managers and developed procedures.Thus leadership and staff turnover is important for the productivity and performance ofan enterprise. It will also essential for the Boots to accomplish their long term objectives andtargets within predetermined time duration(Filatotchev and Nakajima, 2014). Leadership andstaff turnover has positive and good relationship because it will help in motivating workers byproviding monetary and non-monetary benefits to the staff members.Aim: “Toinvestigate the relationship between staff turnover and leadership”. Acase study of Boots”.RESEARCH OBJECTIVES:To determine indicators of staff turnover.To determine the main indicators of good leadership.To determine relationship between staff turnover and leadership.RESEARCH QUESTIONS:What are the determinates of staff turnover issue?What are the main indicators of a good leadership?What is the relationship between staff turnover and leadership?What are recommendation to Boosts in order to achieve staff retention at workplace?RATIONAL OF THE STUDY:Staff turnover is mainly connected with the leadership because good leader can help toguide their employees. Thus, accurate guidance and direction support the employees to worksystematically and maintain long-lasting relation with company. Main reason behind conductingthis dissertation is to determine indicators of staff turnover, main indicators of good leadershipand relationship between the leadership and staff turnover (Formentini and Taticchi, 2016).These are essential and important for the growth and development of Boots to maintain their3
strong position at marketplace as well as sustain competitive advantages with predetermined timeduration.LITERATURE REVIEWLiterature review refers to the comprehensive summary related to previous report on thesame topic. These reviews describe, evaluate, clarify and summarize this literature. It provides atheoretical base for research and help in identifying the nature of research. This project is aboutBoot UK Limited company which is headquarters in UK and is also present in other countrieslike Ireland, Norway, Thailand and other territories. This part of the research project is based onresearch questions which are determined as under:The determinants of staff turnover issue:-Staff turnover refers to the situation in which number of workers that are leaving theorganisation are replaced by new employees. Evaluation of turnover help an employer to identifythe reason behind staff turnover and to estimate the cost of hiring for budget purpose. Main issuefaced by Boot UK Limited is to increase in number of staff turnover that have a direct impactover performance of the company. According to Muniz (2018); main factors that contributetoward employees turnover are:-Low compensation:-Turnover ratio of employees depends on the conditions in which anemployee performs their job and difficulties they face at workplace. A low paid salary job whichoffer little reward is not an option for long term sustainability. This is the main cause which leadsto increase in staff turnover ration.Less enforcement of labour rules:-Employees have right to get timely wages, meal andbreaks as well as fixed working hours. Less enforcement of these labour laws create anenvironment of dissatisfaction and conflicts at workplace. This leads to increase in turnover ratioamong employees due to dissatisfaction from job.As per the view point of Alaniz, (2018); employees turnover within an in organisationhas always been a problem. As it leads to increase in cost such as recruitment & training,inconsistent production, poor morale and continuously reduction in profit. According to authorstaff turnover leads to three major issues that are:Cost implications:-Increase in turnover ratio of employees leads to increase in cost asreplacing and hiring new workers is 60 % higher than the old employee's salary ((Westphal and4
Zajac, 2013). This cost of replacement includes advertisement for vacancy, recruitment,training, lost production etc. which is almost 90% of an employee's annual salary.Overall business performance:-Employees turnover has a direct impact over theproductivity and operation of company. As existing employees have knowledge about the area oftheir action and perform effectively as compare the new employees who require training andtime to learn about their work. Companies having lower employee retention tend to be lesscompetitive and produce less as compare the companies with stable workforce.Turnover can be difficult to control:-According to author Sethi, (2012), main reasonbehind employees turnover is culture at workplace and inter-employees relations. It is harder tomanage a workforce which is continuously in flux and the company which fails to retainemployees tend to be less competitive in market place.Porter's Generic strategy:-It refers to the set of business tactics or strategies that a company uses for achievingcompetitive advantage within marketplace. A company position its product in an industry withthe help of its strength which can be product's unique feature, its price or trained staff.According toMcCahery, Sautner and Starks, (2016);when an organisation work well in market,having good reputation as well as earn higher profit then these factors motivate employees toretain in organisation for longer period of time. This model includes three strategies such as,Cost leadership strategy:-This strategy refers to penetrating the industry by keeping thecost of product or services to minimum. It help in attracting large number of customer towardcompany's product that that of competitors. Cost leadership support in generating higher revenuewhich lead company to provide better salary to their employees which make them satisfied withtheir job.Differentiation strategy:-It refers to the development of products or services that haveunique features which add value to customers. By developing unique products or servicescompany can achieve competitive advantage. This strategy will also be beneficial for employeesas they get growth opportunities and thus they will not think of leaving the organisation for thetime being.Focus strategy:-This strategy defines that a company must divide its target market intosome specific section and then develop marketing strategies for each section separately. This5
helps in achieving higher market acceptance which contribute toward maximum revenue. Thisalso benefits to employees as success provide opportunities related to promotion to employees.According to the view point ofMichelon and Parbonetti, (2012);main reason behindincreasing turnover is rise of job dissatisfaction among employees and poor work culture.Therefore, motivation is the only factor that help an organisation in boosting up the confidenceamong employees as well as increasing job satisfaction at workplace.Maslow's motivational theory is considered to be one of the best known theory atworkplace. According to Maslow, each human have a hierarchy of need and they act in awaywhich provide satisfaction to their need.Source: Maslow’s Hierarchy of Needs, 2018This image depict about the needs of human being which is represented in a hierarchicaltriangle. It position the need of a human being from lower to higher which are explainedbelow:Physiological need:-It refers to the basic needs of a human being such as air, food,drink, cloth etc., these needs are required to be fulfilled for keeping a person work effectively.An organisation must remunerate their employees in a proper manner so that they can fulfil theirbasic needs.Safety need:-It refers to the safety and security need such as protection from elements,law, stability, freedom from fear etc. A company must provide a feel of job security to their6Illustration1: Maslow’s Hierarchy of Needs
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