Challenges in Managing People: A Case Study of Woolworths Group

This report analyzes the critical challenges that Woolworth Group is facing while managing people. It includes three key challenging issues in HRM field in Woolworths Group and assesses the implications of these challenges on the future HR planning and programs of the organisation.

Running Head: Woolworths Group
Woolworths Group
Report
SEPTEMBER 19, 2019

Woolworths Group 1
Executive Summary
The purpose of this report is to analyze the critical challenges that Woolworth Group is
facing while managing people. This report includes the three key challenging issues in HRM
field in Woolworths Group and assesses the implications of these challenges on the future HR
planning and programs of the organisation.
It has been discussed in the report that changing employment relation is the major
challenge for the Woolworth organisation and the major causes behind this is increasing
competition in the retail sector. The competition in labour market to recruit people at any cost
also affects the employment relation. The second challenge for the Woolworth Group is related
to recruitment and selection of people. In the era of digitalization and online selling and buying
of products killed the job of people in retail sector. The third issues are related to unethical
behavior of employees at the workplace that is raised because of poor organisational culture and
moral value of people. The target pressure and challenging situation also force the people to
select unethical way of doing work or involve in any type of misconduct in the organization.
In the recommendation of the report, it has been included that if Woolworth encourages
employee relation in the organisation and avoid the conflict situation then it will help HRM
department to recruit new people in the organisation and retain the existing employees for long
time. This practice will help the organisation to enhance the moral value of employees that will
further help to avoid any unethical behavior at the workplace. This will also enhance the
productivity of the employees and create a brand image of Woolworth Group.

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Table of Contents
Executive Summary.........................................................................................................................1
Introduction......................................................................................................................................3
Overview about the Company.........................................................................................................3
Three Critical Challenges in Woolworths Group............................................................................4
Changing Employment Relations................................................................................................4
Issues Related to Recruitment and Selection of People...............................................................5
Unethical Behaviour of Employees.............................................................................................6
Impact of these above three critical challenges on implementation of the organisational HR
program............................................................................................................................................7
Key findings.....................................................................................................................................9
Recommendations............................................................................................................................9
Conclusion.....................................................................................................................................10
References......................................................................................................................................11

Woolworths Group 3
Introduction
Woolworth Group is one of the popular retail chain organizations in Australia and New
Zealand and a brand name in the grocery and fresh food market in Australia. The company is
known for its quality products and huge market share in Australia and New Zealand market.
Although the company is facing several issues related to management of people in the
organization. This report includes three critical challenges that Woolworth group is facing
currently and analyses that how these challenges will affect the future business strategy of the
company. The report also includes that how these critical challenges affect the implementation of
future HR program of the organisation and performance of the people. In the end of this report, a
short summary has been added as a conclusion of the entire analysis done in this report.
Overview about the Company
The Woolworth Group was founded in 1924 by five key founder members when the first
store was opened in Pitt Street, Sydney on 5th December 1924. The current Chairman of the
company is Gordon Cairns and CEO of the company is Brad Banducci (Woolworth Group,
2019). The company has more than 3000 stores in Australia and New Zealand and it has more
than 201,000 employees who are serving more than 29 million of customers every week.
Woolworth is an Australian supermarket /grocery store chain owned by Woolworth Group
(Woolworth Group, 2019). The revenue of the company was A$55.669 billion in 2017 while the
operating income of the company was A$2.325 billion in 2017. The net income of the
Woolworth Group was A$1.593 billion in 2017 (Woolworth Group, 2019).
Woolworth Group is known for its best quality products and value provided to its
customers. The company provides best customer experience in its stores. Woolworths Group
deals in variety of business including supermarket for grocery products and cloths (Woolworths
supermarket, Countdown, Woolworths online), liquor products (Dan Murphy’s), General
Merchandise (Big W), and Financial services (Woolworths rewards and Woolworths finance)
etc. However, managing these huge numbers of subsidiaries including large number of peoples is
really a challenge for the Woolworths group when the company has to manage varieties of
demand and needs of its employees (Woolworth Group, 2019).

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Three Critical Challenges in Woolworths Group
Woolworth Group is a diverse group that is involve in variety of retail and supermarket
businesses. Although as there are large numbers of employees and people are connected with the
Woolworths Group, the human resource management plays a key role in managing these huge
workforces both in national and international venues of the companies. The company believes in
creating better experience together to create a better future (Govender, 2017). However, the
Woolworths Group is facing some key critical challenges in the organisation because of
increasing competition in the retail sector, especially in grocery and fresh food industry. The
three critical challenges that Woolworth group is facing related to HR functions, practices and
strategy in the organisation are as follow:
Changing Employment Relations
Since the time of globalization and digitalization in the business world, companies that
are more flexible in labour market and establish a flexible relationship with employees are more
successful than competitors. The relationship between employees and employers is a crucial
factor in the organisation (Nankervis, Baird, Coffey, & Shields, 2016). The relationship between
employees and employers depends on several factors such as wages system, work environment,
safety and security during jobs, employee satisfaction level, performance management, and
rewards and recognition for best performance (Nankervis, Baird, Coffey, & Shields, 2016).
These all factors determine the employment relationship between employees and organization.
The current organisational policies in Woolworths to manage the employee relation in the
organisation are based on the strategic planning of the organisation (Reilly & Williams, 2016).
Woolworths specifically uses both strategic and operational plans to set the long-term
employment relations objectives. However, in last few years when the competitors of
Woolworths increase the market share in Australia, Woolworths faced several employment
relation issues in the organisation (Roy, Balaji, Quazi, & Quaddus, 2018). Apart from this, the
employment discrimination and workplace bullying are two several causes that affects the
relationship in the Woolworth Group. It has been found that the organisation very frequently
changes the roster of employees and increases the overtime work of employees without their
permission only for enhancing the profit on the business operation. These all factors affect the
employment relationship in the organization.

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Woolworth Company is known for its competitive salary structure and employment
facilities, but the satisfaction level of employees plays a crucial role in the forming relationship
in the organization. The major issue in the organisation is related to unequal pay structure. It has
been observed that the pay structure of Woolworths is a major issue of conflict in the
organisation that affects the relationship between employees and employers (Smith, Rohr, &
Panton, 2018). The Australian Workplace Relation Act, 1996 clearly mentioned about the fair
wages policy of employees that should be adhere by every organization. Apart from this, the
employees are also expecting a huge hike in the salary from the organisation because the
competitor’s company like Aldi and Wesfarmers are some of the competitors who offers huge
pay to their employees and manipulate the market wages rate with aggressive wages plan. These
factors affect the employment relationship in the Woolworths Group (Noe, Hollenbeck, Gerhart,
& Wright, 2015).
Issues Related to Recruitment and Selection of People
Recruiting people is one of key function of human resource department in any
organization. However, in the presence of large competitors where rivalry companies are
offering high salary packages to new employees to establish in the market is the real fear for a
company like Woolworths. The advancement in technologies has also a huge impact on the
recruiting and selection of people (Evans, 2017). It is really a challenge for the Woolworths
Group to hire people on competitive salary where other companies like Aldi minimize their
profit margin and operational cost to attract customers with very low prices products. Aldi recruit
people on high salary packages and offer varieties of employment offers to the employees that
creates problem for the Woolworth to recruit and retain its employees in the organisation (Noe,
Hollenbeck, Gerhart, & Wright, 2017). These factors force the organisation to review its
employment policies and retain people with some attractive salary packages and facilities to
them (Nankervis, Baird, Coffey, & Shields, 2016). Apart rom this, due to a high retail market
turnover it is really a tough HR function for Woolworths to retain and recruit people.
The introduction of online sells is also crating problem for the organizations. In the era of
online shopping, digitalization of buying and selling products through internet is killing jobs in
all sector in all over the world. Apart from this, the online selling and buying products required
very less interaction between seller and buyer. This will lead to a tough situation for Woolworths

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Group where large number of people not opting to do jobs in retail sector. However, the major
problem for the Woolworth Group is that the company is facing issues related to recruitment and
selection from two fronts and both effect the business performance of the company (Arora &
Gupta, 2016). The inner environment in the organisation is also not good that attracts people
towards the organisation (Kumar, 2016). The unpaid employees and people who face
discrimination at the workplace leads to employee dissatisfaction that will further affect the
recruitment process in the company. To hire new people in the organization, it is really important
for an organisation to create a brand image of world’s best workplace and provide confidence to
the employee, so they can perform well in the organisation (You & Barry, 2016). However,
Woolworths Group is facing extreme pressure of competitors, online retail market, poor working
conditions, and dissatisfied employee issues that affect the recruitment and selection function in
the organization.
Unethical Behaviour of Employees
The third challenge is related to unethical behavior of employees in the stores of
Woolworths. It has been found that people who perform their duties on the stores were not
behaving in ethical manners. Several complaints were filed against the employees who were
involved in workplace harassment, theft of products, and doing misconducts on the workplace.
The behavior of employees matters a lot for the organisation. Apart from this, workplace
bullying was another major in the organisation where large numbers of people were involved in
the organisation facing bullying and workplace discrimination (Tuckey, Boyd, Winefield, Bohm,
Winefield, Lindsay, & Black, 2017). Ethics is the part of organisation culture and it plays an
important role in the success and failure of an organization. Ethics generally helps the
organisation to ensure that people understand the culture of the organisation and give their best,
so the organisational goals and objectives can easily be achieved. This type of challenges in the
organisation clearly shows the failure of human resource department in the organization. People
generally consider the image of Woolworths in the Australian retail market as the price
manipulator. Woolworths sell its products under its own labelling and branding that enables the
organisation to manipulate the prices of the products (Seethamraju & Diatha, 2019). This will
destroy the image of Woolworth as an unethical organisation that creates a bad image of the
organisation in the mind of Australian people. However, this is directly related to the thinking
and behavior of employees in the organisation who are also involved in several other unethical

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behavior and misconducts in the organization. To determine an ethical culture in the organisation
and expect these things from the organisation, it is necessary for the organisation to show an
image of itself as an ethical organisation that practices every function of the organisation under
the law and under the rules and regulations of the organisation.
Impact of these above three critical challenges on implementation of the organisational HR
program
The first critical issue is related to employment relationship which is the crucial aspect of
human resource management in the organization. The employment relation in the organisation
determines the behavior of employees and their role in future success or failure. Even in the
future human resource program and strategies, the participation of employees is so crucial for
any organisation. Woolworth is a large organisation that spread almost every part of the
Australian retail market. In such a scenario, if the employees will be not satisfied with the
employers, it is tough for the organisation to identify the source of conflict in the organisation,
ensure success of various training programs or earning profit from the business operations. The
future success of various HR programs like training of employees, performance management,
capacity test, or situational leadership only possible if the employees of the organisation will
satisfy with the management procedures and plans (Boxall, Bainbridge, & Frenkel, 2018).
Woolworth conducts periodic training and conflict management and handling programs in the
organisation on regular basis. It also helps the new employees to learn and adjust in the
workplace environment. However, these things are only possible if the employees will have trust
in their employers (Nankervis, Baird, Coffey, & Shields, 2016). However, the employment
relationship also plays a crucial role in retaining people for longer time of period in the
organisation. If organisation will not consider the interest of employees, the competitors of
Woolworths are already offering a high package of salary and facilities to hire these unsatisfied
employees. Therefore, it is really essential for the Woolworth to manage the employment
relationship in the organisation and ensure good organisational culture that attract people towards
the Woolworth job offerings (Radovanovic, 2018).
The second HRM issue in the Woolworth is related to recruitment and selection of people
in the organisation. The attractive salary package and era of online sales is a challenge for the
Woolworth to attract people towards the sales job or giving jobs to people in the stores. The

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technological advancement and tough competition in the labour market will force the
Woolworths to hire people on high wages and salary packages. This will increase the operational
cost of the Woolworths that further affect the profitability of the organisation (Rakhy & Vijayan,
2018). The use of technology almost reshapes the recruitment and selection procedures in every
organisation. Woolworth is a large retail chain organisation in grocery and fresh food products
in Australia and forms a duopoly with Coles. The company acquires almost 80% of the retail
market in grocery and home appliances products in Australia. In such a situation, the company
needs a huge workforce to fulfill the demands of customers. Therefore, the problem related to
recruitment and selection of people still exist in the country, then it will be problematic for the
Woolworth in long-term. It not only affects the profitability of the company rather it will also
damage the brand name of the company in Australia and New Zealand (Rees & Smith, 2017).
The third critical challenge for the company is related to ethical issues in the organisation
that is directly related to organisational culture and their business practices. The involvement of
people in various misconducts like theft and bullying at the workplace, discrimination with the
employees and a huge gender pay gap affect the mentality of employees and it is directly related
to other two problems discussed above. Ethical issues in the organisation damages the brand
image of the organisation in public and large number of people who want see opportunities to
build career in Woolworth are facing a perception of bad image of the company (Bratton &
Gold, 2017). It is really important for the organisation to consider the future impact of ethical
issues of employees in the organisation. However, the absence of ethical culture in the
organisation affects the organisational performance as well as individual performance of people
in Woolworth (Carter, 2019). It has been seen that it is very usual that when superiors were
involved in any unethical behavior then it directly affects the performance of employees and they
practices the same thing and follow the same unethical behavior. This will affect the
performance of employees in the long term. However, the meeting schedule pressures, high
target pressure, and force from top management to do a particular work within the deadline
encourage people to adopt unethical means for doing things in the organisation (Nankervis,
Baird, Coffey, & Shields, 2016). Therefore, it is crucial for Woolworths to consider those factors
that force the people towards the unethical practices. The organisation should remove the wrong,
misconduct behavior of people by punishing them, or provide them training that how they can
avoid such situation or pressure that force them towards unethical practices.

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Key findings
From the above study of the three critical HR issues in Woolworth, it has been found that
changing employment relation, issues related to recruitment and selection of people, and
unethical behavior of employees are some of the major concern for the Woolworth. The issue of
changing employment relation is raised because of increasing competition in the market where
the competitor’s offers better salary and employment offers to the existing employees of retail
sector. Apart from this, issues related to pay structure is also a major concern for the company
that leads to poor relation of employees with the organisation. The second issue is related to
recruitment of people and this problem arises because of growing demand of online selling and
buying of products in retail sector. Apart from this, the image of Woolworth is not as ethical as
other retail companies in Australia. The third issue has been raised in the organisation is
unethical behavior of employees that is related to poor organisation culture and lack of training
of employees to face the tough situation in the organisation and meet the demand of customers.
Recommendations
Woolworth is a large retail organisation and has to focus on following recommendations that
can help the organisation to overcome these HR issues.
1. Woolworth should follow a procedure of keeping a record of conflicts resolution and its
output. All conflicts and complaints of the employees, which can lead to future problems
or destroy the relationship between employees and employers should be recorded at that
place and later organisation should review those cases and causes of conflicts and should
resolve the conflict or eliminate the issues. These issues can be related with pay structure,
overtime work, work schedule, performance management etc.
2. The organisation should visit colleges and professional schools to hire fresh graduates
and should offer better and competitive salary to people. The better salary package, better
employment offers, and job security in the Woolworths will attract people to make their
career in the Woolworths.
3. The Woolworth can organize training programs for new employees to avoid any
unethical activities in the organisation. Apart from this, the organisation can also take the
strict action against those people who involved in any unethical activities in the
organisation. However, if organisation will provide better salary and wages to employees

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and provide better employment offers, then unethical practices and behavior can easily be
removed from the organization.
Conclusion
In conclusion, Woolworth is a large retail organisation of Australia and it has to manage a
huge workforce. Managing large workforce creates many problems for the organisation and
changing employment relation is the major issue among three top HR issues in Woolworth. The
problem related to recruitment of people and unethical behavior of employees is other two
critical challenges that affect the organisational performance and its image in the country.
Woolworth needs to encourage employee relation in the organisation that will further help the
organisation to retain existing employees for long time and enhance their moral to avoid the
unethical behavior at the workplace. This will also enhance the productivity of the employees
and create a brand image that will attract people towards making career in Woolworth Group.

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