Leadership in Business: Challenges and Strategies for Innovation Management at Woolworths

Running head: LEADERSHIP IN BUSINESS
LEADERSHIP IN BUSINESS
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Assessment 1
Part 1A (1.1)
In the globalized era, organizations are encountering intense competition and challenges
in attaining growth in the market. Woolworths known as Australia’s largest supermarket chain of
grocery and fresh food products comprises various loyalty schemes and strategies for sustaining
its market share as well as position in the Australian retail market. The organization operating
over 933 stores provides various discount fuel offers, regular rewards along with frequent
shopper club in order to generate greater degree of loyalty from consumers and further sustain
proper customer base1. The company has been leveraging exceptional data assets in order to
generate new insights along with competitive advantage which are not yet being accessible to
other retailers.
CRM (Customer Relationship Management) primarily entails evolution and integration
of marketing ideas and knowledge, technologies and tends to concentrate on developing and
maintaining effectual long-term associations with well-chosen customers. CRM could be applied
to systematically leverage consumer-related ideas and information in order to skilfully align new
product development (NPD) with marker demands and requirements, further condensing new
product rates. Nicuta et al. suggested that manufacturers in globalized era must implement
advanced technologies such as digital analysis, customer information methods and service
centres to explicitly understand and establish communication base with the buyers2. Furthermore,
organizations are able to show rapid responsiveness to the requests and demands of customers
who seek new product innovation. Thus, renowned enterprises must implement technology-
1 Woolworths.com.au. 2018. Woolworths.Com.Au. https://www.woolworths.com.au/.
2 Nicuta, Alina-Mihaela, Florin-Alexandru Luca, and AndreeaApetrei. "Innovation And Trends In Crm-Customer
Relationship Management." Network Intelligence Studies 11 (2018): 21-25.

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based CRM endorses product innovation to maintain their competitive advantageous position in
the Australian retail sector3.
Though Woolworths has been applying significant CRM strategies, the customer
relationship management of the company has not been effectual enough to successfully retain
customers and attain long term loyalty. Furthermore, the customer retention regulations and
policies implemented by the company are not underlined by the CRM system. Thus the
modernized CRM system by Woolworths can facilitate it to develop rapid responsiveness to
customers’ increasing demands and shifting preferences and successfully offer enhanced
customization if provided with accurate knowledge from the purchasers through technology-
based CRM practices4. Further to this, various marketing strategies could also be developed for
specific targeted customer groups. Thus, innovation based CRM system is recognized to have
constructive impact on marketing innovation of Woolworths. Author observed that developing
IT systems with strong consumer focus enhances services quality along with the level of
customer satisfaction. However applying data mining tools, organizations such as Woolworths
are able to develop insights attained from their data warehouse to efficiently increase sales and
offer new and improved products and services to their buyers5.
Challenges-
Reports by Jalali (2015) reveal that Woolworths has been facing a slow profit growth in almost
two decades and must focus on reducing its product price range in order to compete with its two
3Garrido-Moreno, Aurora, Nigel Lockett, and Victor Garcia-Morales. "Exploring the role of knowledge
management practices in fostering customer relationship management as a catalyst of marketing innovation." Baltic
Journal of Management 10, no. 4 (2015): 393-412.
4 Gu, Vicky Ching, Marc J. Schniederjans, and Qing Cao. "Diffusion of innovation: customer relationship
management adoption in supply chain organizations." International Journal of Quality Innovation 1, no. 1 (2015): 6.
5 Wang, Ping, XuMeng, and Brian Butler. "How Do Community Ecology and Structure Shape Digital Innovation
Strategy?." (2015).

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strong rivals Coles and Aldi.
Absence of core CRM team- One of the critical areas Woolworth’s has faced is implementing
CRM strategy with the assumption that it is an IT project. However the organisation must
employee of course CRM team which works with the organisation stakeholders, customer
support executive, senior executive as well as end users in order to essentially understand the
requirements and demands6. With comprehensive understanding and clear
objectives,Woolworths can facilitate the IT team to initiate the CRM innovationimplementation
procedure.
Defining the CRM strategy processes-The process to implement a successful CRM should be
well comprehensive to ensure the success and attainment of the proposed CRM project.
Woolworths must practice to efficiently create universal repositories that is accessible to all
which stores all process definitions. The fundamental processes that the company need to define
from the initial stage can involve change management procedures and further feature revaluation
process.
Studies on universal idea-to-launch practices state that around 90% of most efficient
performers in NPD exhibit distinct NPD procedures with comprehensively defined performances
at each stage along with a precise decision making outline. However in order to successfully
develop innovation in a NPD, Woolworths have incorporated customer response in the process
of innovation process7. It has been identified that CRM software facilitates to generate ideas
either directly or through customer responses. To execute process of idea generation,
6 Jalali, Seyed Mahdi, and MasoudSardari. "Study the effect of different aspects of customer relationship
management (CRM) on innovation capabilities with mediator role of knowledge management (Case study: Mahram
company)." Mediterranean Journal of Social Sciences 6, no. 6 S6 (2015): 343.
7 Spillan, John E., and Howard G. Ling. "Woolworths: An Adizes Corporate Lifecycle Perspective." In Business
History Conference. Business and Economic History On-line: Papers Presented at the BHC Annual Meeting, vol.
13, p. 1. Business History Conference, 2015.

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Woolworths sales executive have used performance records in CRM in order to record ideas and
innovation offered by customers and further incorporate appealing attributes of competing
products, potential complementary services and products as well as physical characteristics.
1.3)Leadership Approaches Fostering Innovation Management
There are strong indications that leadership is vital for innovation. Leadership tends to
play acrucial role in improving organisational creativity introducing and driving innovation
projectsalong with implementing innovation assignments and overcoming resistance.
Emphasisingon the impact of transformational and transactional leadership approaches it can be
statedthat both these approaches tend to influence business performance. However, D’Innocenzo
et al. posited that transactional leadership approach is unconstructively associated two
businessperformances and innovation which involve two forms of transactional
leadershipcontingent reward and management by exception passive active8. However due to
itsnegative impact on innovation procedure, the other form of approach that istransformational
leadership technique is seen to be vital for organisations innovation.
Transactional leaders tends to influence on the decision making procedure on
launchingnew ideas innovation as well as specific objectives and encouraging forms of
innovation.However both transformational leadership and organisational learning house
simultaneousinfluence on process of innovation organisation learning process a stronger direct
impact oninnovation in comparison to the direct impact of transformational leadership on
innovation.As a result it can be stated that both organisational learning and transformational
leadership can foster innovation procedure and the direct influence of organisational learning
oninnovation procedure and creative ideas are regarded to be more crucial than the
8 D’Innocenzo, Lauren, John E. Mathieu, and Michael R. Kukenberger. "A meta-analysis of different forms of
shared leadership–team performance relations." Journal of Management 42, no. 7 (2016): 1964-1991.

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directinfluence of transformational learning on innovation9. However contemporary managers
areof the opinion that they seek innovative leaders to take risks and think ‘out of the box’
ratherthan deriving ideas from the past or emphasising on intellectual stimulation.
Furthermorethere can be witnessed a positive association between transformational leadership
andinnovation to organisational learning Where are there can be identified a direct butdiminutive
positive relationship between transformational leadership and innovation. Thishowever
underlines that transformational leadership fosters innovations in a positive way. Evaluating the
willingness of modern leaders to embrace risk
Strategies and errors have beenthe initial steps for launching innovation within an
organisation. Further to this, facilitatingorganisational members in launching and implementing
knowledge in a constructive internalenvironment are important approaches towards innovation
for organisations10. Thus emphasising on transformational leadership, it can be stated that this
approach tends to advance leaders and organisations to the Future which are core determinants
forsuccessful innovation process.
Shared leadership approach- It is important to know that shared and distributed
leadershipapproach tend to challenge the assumption of formal leadership techniques that
signified‘an individual in charge and the others will follow”11. However, shared leadership
approachhas been considered as a dynamic unfolding interactive factor for individuals there by
theprimary aim is to lead one another towards the attainment of collective goals.
9 Jaiswal, Neeraj Kumar, and RajibLochanDhar. "Transformational leadership, innovation climate, creative self-
efficacy and employee creativity: A multilevel study." International Journal of Hospitality Management 51 (2015):
30-41.
10 Li, Voyce, Rebecca Mitchell, and Brendan Boyle. "The divergent effects of transformational leadership on
individual and team innovation." Group & Organization Management 41, no. 1 (2016): 66-97.
11 D’Innocenzo, Lauren, John E. Mathieu, and Michael R. Kukenberger. "A meta-analysis of different forms of
shared leadership–team performance relations." Journal of Management 42, no. 7 (2016): 1964-1991.