Strategic Management of David Jones

This paper discusses the market size and scope of the Australian retail market and analyzes the strategic options for David Jones. It also provides a recommended strategy for the company to overcome its issues and increase its sales and customer base through social media marketing.

Running head: STRATEGIC MANAGEMENT
David Jones
Strategic Management
6/17/2019

STRATEGIC MANAGEMENT 1
Executive Summary
The intent of this paper is to discuss the market size and scope of the Australian retail
market. The report has also presented the situation analysis of David Jones in order to analyze
its position in the market. From the analysis, it has been identified that the company is
presently dealing with a number of issues related to decreasing market share, declining profit,
and decreasing customer base. Despite huge marketing efforts, the company is experiencing
all these issues in the market. For overcoming these issues, the report has suggested David
Jones increase the intensity of its social media marketing and online presence to attract a
maximum number of customers. In conclusion, it could be said that the company could
possibly increase its sales and customer base through social media marketing.

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Table of Contents
Executive Summary...................................................................................................................1
Introduction................................................................................................................................3
Market Size and Trend...........................................................................................................3
Financial and Corporate Performance....................................................................................4
Strategic Options....................................................................................................................4
Final Recommended Strategy................................................................................................5
Implementation of Final Strategy...........................................................................................5
Strategy Formulation..........................................................................................................5
Strategy Implementation....................................................................................................6
Monitoring and Control of Future Performance....................................................................9
Conclusion................................................................................................................................10
References................................................................................................................................12

STRATEGIC MANAGEMENT 3
Introduction
Strategic management is said to be the management of the resources of the business to
attain its objectives and goals. Strategic management is comprised of setting objectives,
evaluating the competitive environment, analyzing the internal operations, accessing
strategies, and confirming the role of the management in the strategies. Besides this, strategic
management provides a direction to the business and comprises specifying the objectives of
the business, designing policies, and attaining those objectives, and then assigning the
resources to execute the plan. There are different models and framework introduced by
academics in order to assist in the decision making procedure. The intent of this paper is to
provide the final recommendation for David Jones by analyzing its previous report based on
the situation analysis. The report is also focused on providing the implementation procedure
of the recommended strategies and then monitoring their progress.
Market Size and Trend
David Jones Pty Limited is one of the well-known upmarket department stores of
Australia that is owned by one of the largest retail group that is Woolworths Holdings
Limited. The company has established headquarter in Melbourne, Australia. The company
presently operates its business in around 48 locations. On a broad level, the company operates
its business process in New Zealand and Australia. The company generally deliver household
and retail items to its customers (David Jones, 2019).
The Australian retail sector has revealed major growth in spite of low improvements
in the wages and increasing debt of the household. According to the analysis, it has been
identified that in 2018, the Australian retail market has earned the revenue of around 571.1
billion dollars that us 2.2% higher in comparison to the data of preceding year (IBIS World,

STRATEGIC MANAGEMENT 4
2018). In regards to the contribution of this sector in the growth of the country’s economy,
the Australian retail sector has contributed around 1.22% in the GDP of Australia (Australian
Government, 2015). The major contribution is executed by the top 5 players of the market
that is Woolworths Group, Wesfarmers, Myer, David Jones, and Coles. The latest trend in
this industry is the increasing use of online shopping portals. The main reason behind this
increase is the aging population and the high-speed life of Australian people.
Financial and Corporate Performance
Regardless of the fact that David Jones is majorly involved in adopting and
implementing different marketing strategies for attracting a maximum number of customers,
in the year 2018, company has experienced a decline in its profit of around 58.3% (Blake,
2018). The main reason for this drastic decline in the financial performance of the company is
the same store sale and limited or absence of online marketing of the product and serviced of
the company. While the annual profit of David Jones in the year 2017 was around 108
million dollars, but in the year 2018, it roughly touched 45 million dollars profit (Woolworths
Holdings Limited, 2018). The department store has attained a flat gross profit of around 820
million dollars; however, there were increased expenses due to store openings and for new
food formats (Woolworths Holdings Limited, 2018). For covering the huge decline in the
profit, the company has been involved in investing a high amount on creating its presence on
the online platform. Considering the corporate performance of David Jones, it could be
noticed that the company's management has been involved deeply and effectively done
market segmentation. The primary target market of the company is upper middle class and
middle-class customers. The branch manager of the company is responsible for maintaining
the track of the supply chain for ensuring high product quality is offered to the customers.

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Strategic Options
The management of David Jones has scope for two strategic options. These two options
possess the potential to enhance the revenue of the company by a drastic amount in the
coming five years. The two strategic options are:
 David Jones possesses a low online presence in comparison to its key competitors
such as Myers, Woolworths, and Coles. Hence, to cover this, the company has to
invest over its online marketing and different promotional techniques for increasing
the awareness of its products and base of the customer.
 Another strategic option is the expansion of the business in the eastern nations where
the retail market has yet not been saturated like developed nation Australia.
Final Recommended Strategy
From the above analysis, it has been identified that David Jones is losing its position
in the market and dealing with the huge financial loss. The main reason behind this is its
limited presence over an online platform. Hence, in order to overcome this issue, the
company must get involved in investing in social media marketing. Through this, the
company will not just be able to decrease its marketing cost, but it will support the company
to target increased customer base in a limited time period.
Implementation of Final Strategy
Strategic management is said to be the most important activities of every business
because it is incorporated with the entire scope of the decision making of the organization.
With the help of strategic management procedure, the business can frame different decisions,
actions, and measures that are collectively called as strategies that could be implemented to
attain the goal of the organization (Anastasia, 2017). Some of the steps involved in the
implementation of the strategies that will be followed by David Jones are:

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Strategy Formulation
This stage is all about framing the objectives, mission, and strategies to attain a
defined goal. This is the initial stage where everything starts, which means that if the business
is unable to perform at this stage with good outcomes, then the strategic management of the
business is a bust from the initial stage only (Kopytova, 2016). There is a number of
organizations that fail at this first stage, which reflects that they are incapable to adopt new
strategies that possess the potential to take the organization to the desired position.
At this stage, the strategy of increasing the online presence of the company will be
formulated. Under this stage, the strategic management team of David Jones will come
together to plan each and every step that has to be followed to successfully attain this stage.
The company will plan to invest in social media marketing. This will help the company in
decreasing its huge cost of marketing and it also assists in increasing the base of the customer
in limited time. If David Jones desire to gain success in this strategy, it has to give
importance to the effective implementation of the strategy.
Strategy Implementation
The second stage of the procedure of strategic management is the implementation of
the formulated strategy. This is the stage where the actual action takes place because at this
stage the tactics of the planning will be converted into actions and actual performance will be
executed (Henderson & Ruikar, 2010). There is no need to say that, it is one of the most
severe and hard portions of the complete procedure of the strategic management, and also the
one that asks for higher input of the resources of the organization. However, this step has
been executed in the correct manner, then it will confirm the attainment of the objectives and
the organization's success.

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At the implementation procedure, the management team of the David Jones Company
will come together to execute the planning of increasing the online presence of the company.
At this stage, all the department of the company will contribute their portion of efforts such
that they can attain success. This stage will be comprised of different elements such as:
People – This element is said to be one of the key resources of the organization.
People are the asset of the organization as they are the one who executes the plan effectively
(Matharoo, Thomas-Gibson, Haycock & Sevdalis, 2014).. At the implementation procedure,
the management team of David Jones will plan along with the human resource department
related to the requirement of the people for executing the plan. The management team will
allocate the responsibilities to different people for increasing the online presence of the
company. Here, the management of the company will contact the marketing team for
increasing the promotion of the business over social media. Here, the company will increase
its promotion through innovative videos and audio over social media sites such as Facebook,
Twitter, YouTube, and Messages.
Resources – One of the fundamental activities of the implementation procedure is
resource allocation. This is comprised of both non-financial as well as financial resources that
are most valuable for the business (Cascio, 2015). At this stage, the management of the
company will also plan to arrange funds for increasing the intensity of the promotion over
social media platforms. The company can arrange funds from its parent company that is
Woolworth since it has a strong financial position and one of the leading organizations of the
Australian retail segment. In addition to this, the company can also arrange funds through
equity. The human resource will also arrange through the recruitment and selection of the
workforce.

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Structure – The structure of the organization should be clear and proper allocation of
the responsibilities and authorities and underlined chain of command (Islam, Jasimuddin &
Hasan, 2015). Every member of the company must be aware of what is being planned and
must take part in the execution of the strategies. The strategy of increasing social media
marketing of David Jones, proper communication must be done with all the departments.
Culture – For the successful implementation of the planned strategies it is very
important to have a common culture within the group. It is very important for the business to
let its employees feel comfortable as well as important for attaining the goals of the
organization by engaging them in the decision-making procedures (Young & Ghoshal, 2016).
Encouraging the culture of being accountable and responsible for one’s action is one of the
essential requirements for a successful organization. The management team of David Jones
must involve its employees in the decision making for new ideas that could support business
in increasing its profit.
The milestone for covering the financial loss of David Jones through increasing the
intensity of its social media marketing:
Actions Objective Time Line Responsible
department
Strategy
Formulation
For having the
desired goal
From 1/7/2019 to
31/7/2019
Strategic Marketing
Team
Allocating
Responsibilities
For allocating
responsibilities and
accountabilities
From 1/8/2019 to
15/8/2019
Top Management
Hiring Human
resource
For having a
sufficient
From 17/8/2019 to Human Resource

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workforce 31/9/2019 Department
Allocation of
Resources
To ensure
feasibility
From 1/10/2019 to
8/10/2019
Administration
department and
Financial Department
Establishing the
ideal structure and
culture of the
organization
For increasing
motivation
From 10/10/2019 to
15/10/2019
Top management
Implementation of
the strategy
For achieving
results
From 20/102019 Top management
Monitoring and Control of Future Performance
The aim of monitoring and controlling is to offer a clear understanding of the progress
of the work and also positively communicating the status of the work. This process helps in
recognizing the deviations in the work majorly from the planning such that proper corrective
actions could be taken (Bright Hub, 2019). Work activity monitoring is one of the key aspects
of strategic management that is executed all over the procedure. Controlling is said to be
another concept of strategic management which is concerned with taking preventive and
corrective actions. It is the responsibility of the manager of the company to ensure that the
monitoring and controlling actions are properly executed. The monitoring and controlling
actions of the strategic management procedure are key steps since it supports the managers in
identifying the issues in the system as well as the update of the work or project (Lin & Lin,
2012).

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The manager of David Jones has to take responsibility for monitoring and controlling
the progress of the planned strategy such that success could be attained in the work (Mariuța,
Raluca-Mariana & Lăcrămioara-Rodica, 2013). The increasing online presence and social
media marketing, the manager must monitor the entire procedure such that each point could
be covered and issues could be avoided at the highest level. Some of the possible issues that
could be committed are ignorance of the employees, missing the key step in the
implementation procedure, failure in meeting the requirements, etc. All these issues could be
identified through regular monitoring of the implementation procedure.
In consideration of the controlling action, the management must have complete
control over the progress of the procedure. Controlling is all about measuring the actual
performance and then comparing it with the set standard (Guild, 2017). Under this, the
manager has to first set the standard that is to increase the brand awareness and customer base
of David Jones and then implementing the process. After the completion, the management
has to compare the actual performance with the set standards. At this stage, the manager of
the David Jones Company has to recognize the issues into the implementation procedure of
the strategy. Then after identified the issue the manager has to take corrective actions. In this,
the issues such as ignorance of the employees could be corrected by motivating employees to
work effectively and explaining the benefit of the adopted strategy to them individually and
to the organization as a whole.
Conclusion
The above report has discussed the strategic management of the David Jones
Company in order to analyze its position in the market. The analysis has identified that the
retail segment of Australia is one of the growing segment which offers increasing growth
opportunity to the businesses. However, in spite of major efforts exerted by the company to

STRATEGIC MANAGEMENT 11
increase its revenue and attract customers, it has failed and resulted in decreasing its profit.
This highlights that the financial position of the company is also weak in the market. This is
due to a lack of online presence and social media presence of the company in the market.
Hence, in order to overcome these issues, the report has recommended David Jones to get
involve in huge investment in the promotional activities of the business and increase social
media marketing. The report has suggested the company to design different, creative and
innovative video and audio messages over social media sites such as Facebook, YouTube,
Twitter, etc. for the promotion of the business. This will support the company in increasing
its customer base as well as sales. The report has provided proper implementation procedure
along with monitoring and controlling actions that are important for the success of the
strategy.

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from https://www.cleverism.com/strategy-implementation-process/
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australian_industry_report_2015.pdf
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https://www.insideretail.com.au/news/david-jones-posts-declining-sales-201807
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