Organizational Analysis of Wesfarmers: External and Internal Factors

This organizational analysis of Wesfarmers examines the external and internal factors affecting the conglomerate's operations in Australia. The PESTLE framework is used to analyze the macro environment, while strengths, weaknesses, opportunities, and threats are identified through internal analysis. The analysis covers the history of the organization, names of businesses within the organization, rationale for selecting the organization, and a list of references and appendices.

Running head: ORGANIZATIONAL ANALYSIS
ORGANIZATIONAL ANALYSIS
Name of the Student
Name of the University
Author Note

1ORGANIZATIONAL ANALYSIS
Table of Contents
Location..........................................................................................................................2
History of the organisation.............................................................................................2
Names of businesses within the organisation.................................................................2
Rationale for selecting the organisation.........................................................................2
External analysis............................................................................................................3
Internal analysis.............................................................................................................4
List of References..........................................................................................................6
Appendices.....................................................................................................................7
Appendix 1.................................................................................................................7
Appendix 2.................................................................................................................7
Appendix 3.................................................................................................................8

2ORGANIZATIONAL ANALYSIS
Location
The multi business organization or conglomerate that has been taken into
consideration for this analysis is Wesfarmers. The organization has its operations in Australia
and has many different businesses that operate under the Wesfarmers group 1.
History of the organisation
Wesfarmers Limited is a conglomerate that operates in Australia and the headquarters
of Wesfarmers is located in Perth, Western Australia. Wesfarmers was established in the year
1914 as a co-operative that provides merchandise and services to the farmers in Western
Australia. Wesfarmers was thereby listed on Australian Securities Exchange in the year 1984
and then grew up into a major retail based conglomerate. Wesfarmers has been able to
continue its operations in the industry with the help of different types of businesses that are a
part of the group 2.
Names of businesses within the organisation
Wesfarmers operates many business organizations that belong to different industries
that include, outdoor living, home improvement, general merchandise and apparel, industrial
goods, office supplies and many more. Wesfarmers has been able to develop its position as
the largest employer in Australia with more than 4,90,000 employees in different businesses.
The business organizations that are a part of the business groups that operate in the industry
include, Bunnings Trade, Bunnings Warehouse, Kmart, Target, Officeworks, Wesfarmers
Chemicals, Energy and Fertilisers, Australian Vinyls, Kleenheat, Colesm Flybuys, Wespine 3.
Rationale for selecting the organisation
The major reason behind the selection of Wesfarmers for the analysis is based on the
different business organizations that are a part of the group. The businesses belong to
different industries and the analysis will provide a detailed picture of the operations of
organizations that are a part of various industries 4.
1 Bailey, Matthew. "Shopping for entertainment: malls and multiplexes in Sydney, Australia." Urban
History 42.2 (2015): 309-329.
2 Wesfarmers.com.au. "Home". Wesfarmers.Com.Au, 2019, https://www.wesfarmers.com.au/.
3 Wesfarmers.com.au. "Home". Wesfarmers.Com.Au, 2019, https://www.wesfarmers.com.au/.
4 Balaji, M. S., and Sanjit Kumar Roy. "Value co-creation with Internet of things technology in the
retail industry." Journal of Marketing Management 33.1-2 (2017): 7-31.

3ORGANIZATIONAL ANALYSIS
External analysis
The PESTLE framework is used for the purpose of analysing the external macro
environment based factors of an organization. The retail business based operations of
Wesfarmers that operates under the name of Coles can be analysed with the help of this
framework 5.
Political factors – The political stability levels in Australia is considered to be the
most important factor that is able to affect the revenues of Coles. Laws and regulations in the
industry are considered to be important factors that have an impact on the operating processes
of Coles. The minimum wages that are offered to the employees are also affected by the
political situation in Australia. Taxes and tariffs are able to affect the prices of different
products and services that are offered to the customers 6.
Economic factors – The economic transition that has taken place in Australia has led
to the lack of investments that are made in different sectors. The growth of domestic
consumption has also been affected in a negative manner by the slowing of the Chinese
economy. The five major factors that are able to affect the retail industry of Australia include,
population growth and high levels of unemployment. The lack of growth of the Chinese
economy and policies developed by the government also affect the retail based sector of
Australia and the organizations like Coles 7.
Social factors – The retail sector of Australia is also affected by the different social
factors and situations that are created in the country. The levels of acceptance of ecommerce
in Australia are high and this is able to affect the choice of consumers. The buying habits of
Australian consumers are based on the healthy choices related to different food based
products. The products that are provided in the stores are based on the health based standards
that need to be maintained by Coles 8.
5 David, Fred R., and Forest R. David. Strategic management: A competitive advantage approach,
concepts and cases. Pearson, 2016.
6 Grimmer, Louise, et al. "The impact of resources and strategic orientation on small retail firm
performance." Journal of Small Business Management 55 (2017): 7-26.
7Liu, Ming-Hua, Dimitris Margaritis, and Zhuo Qiao. "The global financial crisis and retail interest rate
pass-through in Australia." Review of Pacific Basin Financial Markets and Policies 19.04 (2016): 1650026.
8 Michael, Steven, David Storey, and Howard Thomas. "Discovery and coordination in strategic
management and entrepreneurship." Strategic entrepreneurship: Creating a new mindset (2017): 45-65.

4ORGANIZATIONAL ANALYSIS
Technological factors – Technological disruptions that recently taken place in the
retail influences the retail industry of the country. The innovative alternatives that can be
offered by customers to the customers are able to attract huge number of customers as well 9.
Environmental factors – The production based operations of Coles and the levels of
waste that are produced by the organization have an impact on the environment. The
organization needs to develop its position in such a manner so that these environmental
effects can be reduced 10.
Legal factors – The laws related to intellectual property are considered to be a major
part of the factors that have an impact on the profitability levels and operations of Coles as
well. The regulatory obligations that have been developed in Australia are able to affect the
revenue levels and profitability of Coles in the retail industry. The laws based on Australian
business operations are able to affect the development of the revenue levels and policies of
Coles 11.
Internal analysis
Strengths – The returns that have been received by Coles based on the expenditures
are considered to be a major strength of Coles. The track record that has been formed by the
company is based on the levels of customer satisfaction that is offered by Coles. The portfolio
of products of the brand is also highly diverse in nature. Cash flow levels of Coles are also
quite high 12.
Weaknesses – The promotions and marketing based activities that are performed by
Coles have not been helpful for the proper development of revenues in the industry. The
challenges that are faced by new organizations are also faced effectively by the organization
13.
9 Morschett, Dirk, Hanna Schramm-Klein, and Joachim Zentes. Strategic international management.
Springer, 2015.
10 Morschett, Dirk, Hanna Schramm-Klein, and Joachim Zentes. Strategic international management.
Springer, 2015.
11 Pantano, Eleonora, ed. Successful technological integration for competitive advantage in retail
settings. IGI Global, 2015.
12 Wheelen, Thomas L., et al. Strategic management and business policy. Boston: pearson, 2017.
13 Balaji, M. S., and Sanjit Kumar Roy. "Value co-creation with Internet of things technology in the
retail industry." Journal of Marketing Management 33.1-2 (2017): 7-31.

5ORGANIZATIONAL ANALYSIS
Opportunities – The increase that is being seen in the spending levels of the
consumers are able to affect the revenues of Coles. Technological disruptions that have taken
place in the retail industry have affected the processes that are developed by the organization.
Coles has aimed at implementing different technologies in order to attract more number of
customers towards the organization 14.
Threats – The implementation of new technologies by the competitors of Coles can
affect the disruption levels that have taken place in the retail industry of Australia.
Competition in the retail industry is intense due to the price based wars that have taken place
with another major organization named Woolworths 15.
14 Grimmer, Louise, et al. "The impact of resources and strategic orientation on small retail firm
performance." Journal of Small Business Management 55 (2017): 7-26.
15 Michael, Steven, David Storey, and Howard Thomas. "Discovery and coordination in strategic
management and entrepreneurship." Strategic entrepreneurship: Creating a new mindset (2017): 45-65.

6ORGANIZATIONAL ANALYSIS
List of References
Bailey, Matthew. "Shopping for entertainment: malls and multiplexes in Sydney,
Australia." Urban History 42.2 (2015): 309-329.
Balaji, M. S., and Sanjit Kumar Roy. "Value co-creation with Internet of things technology in
the retail industry." Journal of Marketing Management 33.1-2 (2017): 7-31.
David, Fred R., and Forest R. David. Strategic management: A competitive advantage
approach, concepts and cases. Pearson, 2016.
Grimmer, Louise, et al. "The impact of resources and strategic orientation on small retail firm
performance." Journal of Small Business Management 55 (2017): 7-26.
Liu, Ming-Hua, Dimitris Margaritis, and Zhuo Qiao. "The global financial crisis and retail
interest rate pass-through in Australia." Review of Pacific Basin Financial Markets and
Policies 19.04 (2016): 1650026.
Michael, Steven, David Storey, and Howard Thomas. "Discovery and coordination in
strategic management and entrepreneurship." Strategic entrepreneurship: Creating a new
mindset (2017): 45-65.
Morschett, Dirk, Hanna Schramm-Klein, and Joachim Zentes. Strategic international
management. Springer, 2015.
Pantano, Eleonora, ed. Successful technological integration for competitive advantage in
retail settings. IGI Global, 2015.
Wesfarmers.com.au. "Home". Wesfarmers.Com.Au, 2019, https://www.wesfarmers.com.au/.
Wheelen, Thomas L., et al. Strategic management and business policy. Boston: pearson,
2017.

7ORGANIZATIONAL ANALYSIS
Appendices
Appendix 1
Appendix 2

8ORGANIZATIONAL ANALYSIS
Appendix 3