Strategic Management Strategies for Harvey Norman

This paper discusses the strategies related to Harvey Norman, including business and corporate level strategies, current strategies, and global strategies. The company's low price, promotional, training and development, omni channel, and networking strategies are discussed.

Strategic management

Strategic management
Executive summary
In this paper the focus will be given on the strategies related to Harvey Norman. It has been seen
that it is important for the company to consider the strategies as it can help to maintain the image
of the company in the market. In the first phase of the report, the discussion will be made on the
background and strategies related to business and corporate level strategies. In the next phase of
the report the discussion will be made of the current strategies considered by the company. In the
last phase the concluding part will be discussed. So, the strategies are essential to maintain the
competitive advantage and it also affect the overall growth of the company in the market.
1

Strategic management
Table of Contents
Executive summary.........................................................................................................................1
Background of the company............................................................................................................1
Strategies of the company................................................................................................................1
Business level strategies...............................................................................................................1
Corporate level strategies.............................................................................................................2
Network, partnership and Alliances................................................................................................3
Global strategies and Multinational Corporation............................................................................3
Current strategies of the company...................................................................................................4
Low price strategy........................................................................................................................4
Promotional strategy....................................................................................................................5
Training and development...........................................................................................................5
Omni channel strategy.................................................................................................................6
Networking strategy.....................................................................................................................6
Customer store strategy................................................................................................................7
Conclusion.......................................................................................................................................7
References........................................................................................................................................8
2

Strategic management
Background of the company
Harvey Norman is considered as the largest Australian retailers who are offering the range of
products in the market like furniture, consumer electronics and also fun products. It has been
seen that this company manage the activities through its franchise. The franchises of the
company are 280and the store of company is in Australia, Europe, New Zealand and South East
Asia under various brands like Joyce Mayne and Domayne. The CEO of the company is Katie
Page who helps to contribute towards the growth of the company.
It has been seen that company is able to establish the business in the Australian retail sector but
the company has to face the huge competition from the competing brand in the market like David
Jones and Coles (Harvey Norman, 2018). The company was selected just because of the creative
strategies considered by it. The company has the large product line in which there are many
products which are offered in the market. The products which are offered by the company are
furniture, laptops, kitchen appliances and video gaming. These are the products which are
offered by the company in the competitive market.
Strategies of the company
Business level strategies
Cost leadership strategy
In Harvey Norman, the strategy focuses on attracting the large customer’s base and also the
prices are kept low so that it can be simple to attract the customers towards the products and
services of the company. The company emphasizes on purchasing the products in large quantity
from the suppliers so that it can be easy to maintain the price ratio and just because of this the
company offers products at low price as compared to other competitors like JB-HIFI and IKEA.
Also, from starting the company maintained the price leadership strategy which helped in
achieving success and growth in high competitive market (Armstrong, Adam, Denize & Kotler,
2014).
Differentiation strategy
The differentiation of the products by the company is done by presenting the products in a
unique manner. It has been seen that the outlet of the company have special designs and
3

Strategic management
environment which attract the customers towards the products of the company. Quick services
are offered to the customers which also enhances the overall level of satisfaction (Steenkamp,
2017).
Focused cost leadership
It has been analyzed that Harvey Norman do not provide the full array of the consumer goods but
also take into consideration the strategy of reducing the cost of the products by purchasing it in
the large quantity. Through this strategy it can be simple for the company to attain the entire
competitive advantage in an effective manner (Berman, 2015).
Focused differentiation strategy
Harvey Norman emphasized on the focused differentiation strategy in which the company takes
into consideration the strategy of selling the unique products related to home appliances and fun
products.
Corporate level strategies
There are different types of corporate strategy considered by the company. Harvey Norman
considered the vertical integration strategy to grow in the market. The managers of the company
considered the corporate level strategy in vertical integration to search which industries their
company should focus so that profits can be earned. There are two types of vertical integration
considered by the company. One is related with forward vertical integration and next is related to
the backward vertical integration. It has been examined that company is using the backward
vertical integration to enhance the operations of the business and also to maximize the profits
(Young, Tsai, Wang, Liu & Ahlstrom, 2014).
There are many advantages which are achieved by the company by considering the strategy of
vertical integration. Harvey Norman focuses on developing the skills of the employees through
training and experience and also the company invested in the specialized products because it
helps to lower the cost structure and also differentiate the products in the market. The company
also focused on improving the scheduling. Strategic advantage has been considered when
vertical integration makes it simple and more effective for the plan to coordinate and transfer the
products on the store (Ethiraj, Gambardella & Helfat, 2017).
4

Strategic management
Also the company considered the vertical integration so that it can be simple to achieve the
bargaining power over the suppliers and it will also help to enhance the profits. In the present
scenario, Harvey Norman has considered as one of the big suppliers of the products and they use
this by reducing the price as company pays for its input by reducing the overall cost structure
(Doz, 2017).
Network, partnership and Alliances
The company focused on enhancing the networks in the market. So, Harvey Norman, MacPac
and Blue bridge Cook Strait ferry join the New Zealand Airports. The company opened the outlet
so that it can be easy to enhance the entire demand of the products in the competitive market. To
enhance the network the company also focused on selling the products through online platform
which enhanced the link with the large customer base. In partners and alliance, Harvey Norman
partnered with the commercial supplier of Clamroc Constructions so that highest quality of the
products can be maintained (Wheelen, Hunger, Hoffman & Bamford, 2017).
Global strategies and Multinational Corporation
The company focused on enhancing the entire market share and just because of this the global
strategies are considered which helped to survive in the high competitive market. The global
sales of the company has enhanced to $3.09 Billion (Avenell, 2018). The company achieved
success just because of the omni channel strategy which is considered by the company on the
global platform.
It has been examined that just because of this strategy the company focused on improving the
entire performance which has also given positive impact on the routine activities managed by the
company. The option related to franchise turned into the strong performance of the company and
also the company achieved success (Heide, Kumar & Wathne, 2014). To enhance the more sales
on the global platform the company considered the strategy related to minimizing the entire
production cost through outsourcing. Also the marketing strategy is considered by the company
in which the products are displayed in the innovative way. By displaying the products in the
innovative manner the company focused on attracting the customers towards the products and
services offered on the global platform (Rothaermel, 2015).
5

Strategic management
Current strategies of the company
Harvey Norman considered various strategies so that it can be simple to accomplish the entire
goals and objectives. Strategies are considered as an important part of the company as it helps to
achieve success in the market. It has been seen that just because of the innovative strategies
considered by the company the large market share has been grabbed. On the global platform also
the company achieved growth and success (Wirtz, Tuzovic & Ehret, 2015). The current
strategies which are considered by the company are many.
Low price strategy
One of the best strategies considered by the company is related to the low price strategy in which
the company offered the products at low price in the market. Harvey Norman focused on
maintaining the quality of the products by offering products at low price. Just because of the low
price the company attains success in the market and also large market share has been grabbed in
the competitive market. The products are purchased in the large quantity so that it can be simple
to reduce the cost as the products purchased in the bulk are less costly as compared to the other
products (Banerjee, 2014).
Competition pricing strategy is also one of the strategies which are considered by the company
as it helps the business to do research on the internet and also by checking the price catalogues.
This strategy provides proper insight to the company of the prices which are in the market.
Through internet the company can easily check the prices of the customers. This strategy is
works for the product based sales which is adopted by Harvey Norman. So, one of the best
strategy considered by the company is related with the competition strategy that help the
business to grow in the competitive market (Balasubramanian, Bhattacharya & Krishnan, 2015).
Promotional strategy
It has been seen that Harvey Norman also considered the strategy of the promotion. In which the
products are promoted by the company on the social media sites. It has been examined that
company achieved growth in the market just because of the promotional strategy which is
considered. In this the products which are launched by the company in the market are showcased
so that customers can gain knowledge of the product introduced in the market (Helfat & Peteraf,
2015). This helped the company in maintaining the large customer base and also focused on
maintaining the long time relations with the customers. This strategy assisted the company in
6

Strategic management
accomplishing the goals and also in attaining the large market share. As the company operates its
function through franchisee so that advertisements or the promotions vary according to the place
the outlet is situated (Percy & Elliott, 2016).
So, by effective promotional technique the company achieved growth in the market and the
overall sales has been enhanced. There are also various discounts and offers introduced by the
company which attract the attention towards the product of the company. It has been seen that on
special occasions or festival the company focuses on giving discounts so that customers can be
attracted towards the products and services of the company (Hill, Jones & Schilling, 2014).
Also in the marketing area the company focused on spending the large amount so that it can be
simple to promote the products in the market. It has been seen that advertisements are given by
the company and also the company has a strong presence in the newspapers, commercial and
subscription TV. Harvey Norman also emphasis on taking into consideration the sports
sponsorship so that customers can be attracted towards the products offered in the market. The
main aim to give sponsorship in the sports event is to steal the customers away from the retailers
who are not there in the market like Clive Peeters and Wow Sight & Sound (Avenell, 2018).
Training and development
This is also considered as one of the strategy which is considered by the company for its
employees. It has been investigated that company offers training to the employees so that they
can learn new and innovative ways to deal with the customers. It is important for the employees
to know how to manage or deal with the customers. So, Harvey Norman focuses on giving
training to the employees so that their skills can be developed and it also help in maintaining the
good relations with the customers (Adner, 2017). The main purpose of giving training to the
employees is related to the satisfaction level of the customers which is important for the
company. If customers are satisfied then it can be simple for the company to grab the large
market share. The skills are taught to the employees to deal with the customers so that customers
can be satisfied with the management of the company. It can be stated that the company can
achieve success then the customers are happy with the services given to them (Haff & Triplett,
2015). So, training and development helps to groom the employees and also direct them towards
the overall activities of the company.
7

Strategic management
Omni channel strategy
One of the best current strategies of the company is related with Omni channel strategy through
which the company attained success in the competitive market. Harvey Norman analyzed that the
sales can be enhanced if focus is given on ecommerce platform. It has been seen that through this
the overall sales of the company has been enhanced. So, company focused on introducing the
products on the websites and also the services are offered by the company through the internet. It
has given success in the market and now also the customers are availing the services through
proper channels (Holmes Jr, Hoskisson, Kim, Wan & Holcomb, 2018).
It has given positive impact on the overall activities of the company and due to this the company
attracted the customers towards the products and services of the company. Also it has been seen
that now day’s customers are demanding for relevancy and personalization which can be only
received through online platform and also through digital commerce platforms. This strategy
considered by the company helped to achieve the large market share and also enhanced the
image of the company in the market (Howarth, 2018).
Networking strategy
The company focused on enhancing the networking by considering the different partners. It has
been seen that networking can only be enhanced if there are partners who have the goal to
enhance the market share. So, this is considered as the strategy which is considered by the
company in the competitive market. In this Harvey Norman focused on enhancing the networks
in the market. So, Harvey Norman, MacPac and Blue bridge Cook Strait ferry join the New
Zealand Airports. The company focused on collaborating with commercial supplier of Clamroc
Constructions as it can help the company in maintaining the entire quality of the products which
are offered in the market (Krafft, Goetz, Mantrala, Sotgiu & Tillmanns, 2015).
This strategy helped the company to enhance the presence in many countries as with different
partners the company collaborated so that it can be easy to enhance the market share in the
competitive market. Now also the company is focusing on enhancing the network so that it can
be simple to maintain the goodwill on the global platform. The aim of the company is to open the
franchise in every area so that it can be simple to enhance the market share and it can also impact
the overall sales of the company in the competitive market (Ismail, Rahman, Ismail, Daud &
Khidzir, 2017).
8

Strategic management
Customer store strategy
Harvey Norman also focused on enhancing the customer’s experience who visits the franchisee
stores. In tis the strategy considered by the company is related with the display of the products.
The products are displayed in the innovative manner by the company which also attracts the
attention of the customers towards the products. The main objective of the company is to
enhance the experience of the customers so that it can be simple to attract more customers
towards the products and services of the company. Also the company focused on home delivery
which enhances the overall satisfaction level of the customers. Now customers can easily order
by sitting anywhere. This strategy has given positive impact on the entire operations of the
company (Mehta & Tajeddini, 2016).
Conclusion
So, by analyzing the report it has been concluded that Harvey focused on various strategies
which affected the entire operation of the company in the positive manner. It has been examined
that the current strategies which are considered by the company has given positive impact and
helped the company to achieve success in the market.
The strategies like Low price strategy; promotional strategy, Networking strategy, training and
development, Omni channel strategy has affect the overall demand of the company product in
the market. These strategies considered by the company helped to achieve the competitive
advantage and also created positive image in the mind of the customers. So, it is recommended
that company should focus on these strategies so that it can be simple to accomplish the
objectives in the competitive market. Also with the help of these current strategies the company
can focus on controlling the overall activities of the company.
9

Strategic management
References
Adner, R. (2017). Ecosystem as structure: an actionable construct for strategy. Journal of
Management, 43(1), 39-58.
Armstrong, G., Adam, S., Denize, S., & Kotler, P. (2014). Principles of marketing. Pearson
Australia.
Avenell,P. (2018). $200 million later, Harvey Norman’s saturation marketing strategy
questioned. Retrieved from https://www.applianceretailer.com.au/2012/03/tgxrktjxoj/
Balasubramanian, S., Bhattacharya, S., & Krishnan, V. V. (2015). Pricing information goods: A
strategic analysis of the selling and pay-per-use mechanisms. Marketing Science, 34(2),
218-234.
Banerjee, M. (2014). Misalignment and its influence on integration quality in multichannel
services. Journal of Service Research, 17(4), 460-474.
Berman, B. (2015). How to compete effectively against low-cost competitors. Business
Horizons, 58(1), 87-97.
Doz, Y. L. (2017). Strategic management in multinational companies. In International
Business (pp. 229-248). Routledge.
Ethiraj, S. K., Gambardella, A., & Helfat, C. E. (2017). Reviews of strategic management
research. Strategic Management Journal, 38(1), 3-3.
Haff, G. G., & Triplett, N. T. (Eds.). (2015). Essentials of strength training and conditioning 4th
edition. Human kinetics.
Harvey Norman. (2018). About Harvey Norman Online. Retrieved from
https://www.harveynorman.com.au/about-harvey-norman-online
10

Strategic management
Heide, J. B., Kumar, A., & Wathne, K. H. (2014). Concurrent sourcing, governance mechanisms,
and performance outcomes in industrial value chains. Strategic Management
Journal, 35(8), 1164-1185.
Helfat, C. E., & Peteraf, M. A. (2015). Managerial cognitive capabilities and the
microfoundations of dynamic capabilities. Strategic Management Journal, 36(6), 831-850.
Hill, C. W., Jones, G. R., & Schilling, M. A. (2014). Strategic management: theory: an
integrated approach. Cengage Learning.
Holmes Jr, R. M., Hoskisson, R. E., Kim, H., Wan, W. P., & Holcomb, T. R. (2018).
International strategy and business groups: A review and future research agenda. Journal of
world business, 53(2), 134-150.
Howarth,B. (2018). Omni channel. Retrieved from
https://www.cmo.com.au/article/588754/navigating-future-omni-channel-retailing/
Ismail, S., Rahman, A. A. A., Ismail, A. R., Daud, K. A. M., & Khidzir, N. Z. (2017). Internet
marketing strategy for furniture industry: A research based ergonomics sofa. In Advances
in Human Factors, Business Management, Training and Education (pp. 571-579).
Springer, Cham.
Krafft, M., Goetz, O., Mantrala, M., Sotgiu, F., & Tillmanns, S. (2015). The evolution of
marketing channel research domains and methodologies: an integrative review and future
directions. Journal of Retailing, 91(4), 569-585.
Mehta, A., & Tajeddini, J. (2016). Developing system approach for integrated customer
relationship marketing in light of different prospective. Middle East Journal of
Management, 3(2), 110-143.
Percy, L., & Elliott, R. H. (2016). Strategic advertising management. Oxford University Press.
Rothaermel, F. T. (2015). Strategic management. McGraw-Hill Education.
Steenkamp, J. B. (2017). Global Brand Strategy: World-wise Marketing in the Age of Branding.
Springer.
11

Strategic management
Wheelen, T. L., Hunger, J. D., Hoffman, A. N., & Bamford, C. E. (2017). Strategic management
and business policy. pearson.
Wirtz, J., Tuzovic, S., & Ehret, M. (2015). Global business services: Increasing specialization
and integration of the world economy as drivers of economic growth. Journal of Service
Management, 26(4), 565-587.
Young, M. N., Tsai, T., Wang, X., Liu, S., & Ahlstrom, D. (2014). Strategy in emerging
economies and the theory of the firm. Asia Pacific Journal of Management, 31(2), 331-354.
12