MGMT6012 Case Study: Analyzing Woolworths Management & Ethics

This case study critically analyzes Woolworths Group Limited, an Australian retailing company, focusing on the roles and functions of its managers, the challenges and risks they face, and the impact of values, ethics, and diversity on the organization's culture. It explores the management strategies employed by Woolworths, including their customer-centric approach, sustainable sales initiatives, and efforts to enhance stakeholder value. The research methodology involves a qualitative analysis of secondary sources, such as company reports and case studies, using a post-positivism philosophy and deductive approach. The study also examines Woolworths' organizational structure, ethical practices, and adherence to management theories like contingency theory and Henri Fayol's administrative theory. The case study aims to provide insights and suggestions for Woolworths to improve its management practices and regain its market position.

Running head: WOOLWORTHS MANAGEMENT
Woolworths Management
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Table of Contents
Introduction..........................................................................................................................2
Research methodology.........................................................................................................3
Overview of the organization..............................................................................................4
Reason for choosing............................................................................................................7
Management strategies........................................................................................................7
Ethics and diversity..............................................................................................................9
Conclusion.........................................................................................................................10

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Introduction
Management theories have been evolving with time as each new era has distinct
problems of their own (Shafritz, Ott & Jang, 2015). New theories on management develop by
doing case studies on companies to identify the factors that make a company successful or
failure. It is to be understood that a single theory cannot achieve success for every company.
Research undertaken by Woolworth shows that, they have used several management strategies
based on theories to develop a customer centred culture and team within the workplace. In this
aspect, the management theories of the company are aligned with the generation of sustainable
sales with the growing momentum of food demand. In this aspect, Woolworth is evolving their
business to offer increased value and convenience to the consumer along with empowering
portfolio of business for pursuing ways to produce stakeholder’s value. Thereafter, the
management has to understand which theory is in relevance with their organization and can be a
benefactor to it. Recent theories such as knowledge management, risk management, quality
management, six sigma, core competencies, and others have some fundamental similarities, as all
of them emphasizes on improving the process of work and constantly providing better product
and service quality (Jones, George & Langton, 2013). The management also is obligated to
follow the ethics of the company. Social environment and politics play a crucial part in
determining the role of managerial function in an organization.
Woolworths Group Limited is an Australia based retailing company, which operates
extensively in Australia and New Zealand. This report will critically analyse the roles and
functions that managers perform and discuss the challenges and risks they face in the
Woolworths Group Limited. Moreover, it will also discuss what impact values, ethics and

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diversity have on this organization’s culture. The report will provide a rationale that discusses
research methodology and compares different organizational theory. Qualitative analysis and
authentic external sources will be used to prepare this report.
Research methodology
Within the concepts of strategic management, there are diverse ranges of theories that can
be used by the organization to focus on the interactive effect used for framing variables of
performance. In this aspect, it can be said that the success of the organization is not dependent on
a single element of isolation. The research methodology used by Woolworth is integrated with
resource-based management theory of the company. In this, it has been identified that
competitive edge is necessary for managing the organizational ability. Similar to this the role of
competitive advantage is deduced from the mutual reinforcing influence of the consistency
between organizational elements. In this context Gallardo-Gallardo et al., (2015) argues with the
fact that organizational unique system is the major source of managing competitive edge.
In this aspect, the management theory used by Woolworths is stakeholder there that is
used to create value for the stakeholders. In order to evaluate the way by which suppliers are
being treated by Wools worth in rendering them as suppliers, the method used by the research
was based on Post-positivism, descriptive approach for investigating the data within a specific
context of the organization. In this context, a range of data could be used consisting of archived
records for generating the strategy of theory. It has been found that in the case of Woolworth,
ACCC charged the organization of behaving in an unconscious was by demanding cash in the
year 2014. The program was labelled as Mind the Gap program that revealed that the company
has four major dimensions in their theory of management such as delegation of duty, lack of

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management inference, grandfather theory and the system of feedback inside closed door of an
organization.
It is very important for the managers of different organizations to make the right
decisions by collecting information. If the managers do not have access to sufficient information
about the working environment then they have no other options than to take decisions based on
assumption. Although intuition plays a role in management it is not similar to providing
sufficient information at the right time. It depends on the quality of information that the decision
of the management is effective or not (Grimmer & Mortimer, 2018). The prime requirement,
being a manager of the organization, is to gather information as per the need of the present
scenario.
Information can be collected using different methods of data collection. The most
common form of research at Woolworths was conducted using post-positivism philosophy and
deductive approach. The researcher who worked on this project has used secondary sources from
Woolworth’s organization for collecting data, which was analysed in a qualitative manner. The
company reports and Woolworths case study was used as secondary sources to gather
information. Qualitative analysis was used to study the collected data. The annual reports of the
company and shareholder reports were collected to find out that the company was suffering from
certain managerial issues. Moreover, the news about the managerial issues in Woolworths was
highlighted in the daily media, which helped in collecting information about the research.
Grimmer (2018) stated that information could be sourced from two areas- inside the organization
and outside the organization. The internal and external environment of the Woolworths is
contrasted in terms of the forces and conditions, which might have an impact on the performance
of the organization. Both the internal and external environments are the prime factors of

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organizational operation. These dynamic areas need to be properly supervised by the managers
for collecting information. It is helpful in recognizing new opportunities, look for changes and
take effective decisions.
For instance, if the manager of Woolworths takes the decision of modifying the selling
price of the products then he needs to look for a variety of categories before taking the final call.
He needs to consider the cost of production and it is extremely unfortunate for certain companies
to be unaware of their product price. While taking this decision, it is important to have a clear
concept about the pricing strategy of the competitors. This is because if the management of
Woolworths keeps the price of the product very expensive then there is the least scope for the
products to be sold. In this way, they will miss the opportunity to sell their products on the
market. On the other hand, if the prices are kept too low then the company will lose the
opportunity to gain a better profit margin (Grimmer, 2018). Therefore, the manager has to look
carefully at the customers' preferences and demands. The individuals who are more experienced
in the field of management gather better information in their regular activities as a form of
naturally occurring data.
Overview of the organization
On 5th of December, 1924, Woolworths inaugurated their first retail shop called
Woolworths Stupendous bargain Basement in Sydney ("The Woolworths Story - Woolworths
Group", 2017). The company was founded by five people -, Stanley Chatterton, Cecil Scott
Waine, Ernest Williams, Percy Christmas and George Creed. Over the decades, the company
extended their business by opening supermarkets, grocery stores, food stores, petrol stations,
liquor stores, hotels and pubs, and other departmental stores that offer discounts, under various

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names across Australia and New Zealand. Currently, the company had been employing 202000
employees under its name.
In recent times, Woolworths Group Limited is facing problems in profiting from their
existed shops in comparison with their competitors in the market. As a result, their revenue is
experiencing a decrement. They have grown a strong relationship with their customers and
suppliers for their consistency in proving quality service and products. Yet, at present, challenges
are arising with their profit level. The company has great potential to make a proper use of their
resources in order to attract the new generation. Nevertheless, there has been proof of recent lack
in innovation in the field of marketing; the high price is also another problem that they are
facing. The management is being unable to make proper utilization of the e-market through
online shopping (Kelly & Tetlock, 2013). In the intensely competitive market, they are losing
customers for their comparatively high price than their competitors. The management has to
make use of the technologies to create better and more attractive advertisement strategy and
make effective e-marketing plans (Jolivet, Jullien & Postel-Vinay, 2016). In addition, they need
to make themselves sufficient in conceptual skills to visualize the future of their business and
take actions accordingly.
Rationale for selection
For this research, Woolworths Group Limited was selected as it is one of the leading
organizations in the retail industry. It is successfully running in their retailing market for more
than ninety years. It has been expanding its business from general merchandise to food, petrol,
liquor, grocery, hotels and pubs in Australia and New Zealand. Through the years, they had
brought many innovative strategies to satisfy their customer requirements. The new generation

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depends much on gadgets and technology. Modern technology has brought the stores to their
houses. The company utilize this advantage in making their online stores more available. It will
be effective in attracting the contemporary generation and increasing the target market (Laudon
& Traver, 2013). A thorough study of the Woolworths Group Limited will help the company to
comprehend the current market trends and the competition in the relevant industry. Being able to
understand that, it will be possible for them to make a proper plan and execute them accurately.
The company had been selected as it has the potentiality in the management and the resources to
provide better and more effective services to their customers in a more convenient way (Goetsch
& Davis, 2014). This report will make some suggestions for the organizations, which will direct
them towards their attainment of the current company goal. With appropriate strategy, the
company will gain its previous position in the market.
Management strategies
The management strategies at the Woolworths group are intended to put the customers as
first preference. They have set different objectives in order to attain their goals. Those objectives
are given below:
 To build up a strong team of culture led by the customers and store
 To create sustainable sales popularity in food
 To modify the retail business so that customer value can be enhanced and they can be
provided more convenience (King & Thobela, 2014)
 To boost up the portfolio businesses in order to look for the strategies for providing
shareholder value
 To be the lean retailer in the end- to- end process and system excellence

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Theories
In this context, the contingency theory can be used which stated that the managers make
effective decisions based on the current scenario instead of a general one that is applicable to all.
The Woolworths management had taken decisions based on their current scenario in order to
utilize the leadership approach. Such an approach includes the participation from the co-workers,
but the leader might want to utilize an autocratic approach. Apart from the contingency theory,
there are other principles, which Woolworths follows, in its organizational structure. They follow
the processes of planning, organizing, commanding, coordinating and controlling as per the
administrative theory of Henri Fayol (Eacott, 2015). These are the five important functions in the
field of management, which helped in solving the issues in a creative manner. They have always
maintained the strategies of creating a great retail team that pay heed to the customers, suppliers
and team members.
Contingency theory
Contingency theory is signified as the organizational environment that helps to establish a
leader within the workplace. Therefore, based on the theory of contingency it can be said that the
surroundings of the leaders are effective for Woolworths Company. It is the connection between
the subordinate employees and the managers that help the company to develop effective
communication between them (Goetsch & Davis, 2014). In this context, Woolworth’s
organization maintains the trait and contingency theory for developing the organizational
structure of the company. In order to maintain HR management theories within organization
Woolworth have successfully adapted the trait theory and Contingency theory. However, the trait
theory has not been beneficial all the time, as a result, physical features have been taken into
consideration. It has been found that the application of trait theory in Woolworth has not been

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proved to be effective since subjective judgment is associated with it. On the contrary, the
implementation of contingency theory is appropriate for Woolworth Company. In this regards, it
has been seen that Contingency theory helps the company to make sure about the accessibility of
the appropriate people for the specific project. Moreover, through the implementation of
contingency theory, Woolworth exercises control over all the employees in a wide area of
locations.
Trait theories
The trait theories are implied ad the great man theory after the evidence of the talent. In
this aspect, the employees working for the HRM department in Woolworth have got some
certain unique capabilities. These particular capabilities help them to behave, like a leader within
the organization. Moreover, it helps the organization to recognize the innovative personality of
the employees and their attitudes. It is, therefore, one of the most naturally pleasing theories that
offer them constructive data on leadership motivation. By approaching and managing change
within the firm, with the help of individual effort the organization manages its business in an
innovative way. Woolworth members are trained in a way to establish the necessary skills to
implement changes across all their departmental area.
The management programs, which were implemented in the organization used to receive
daily feedback and suggestions from the customers. It referred to focusing on the on the regular
activities to improve the services and shopping experiences of the customers. The management
team has struggled hard to serve the purpose of bringing little good to everyone on a daily basis
and putting the customers as first preferences. The management uses the strategies of innovation
in their products in order to provide the best to their customers as they consider the customers as

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their top priority. Moreover, their portfolio businesses enable them to highlight in providing the
shareholder value. They are thinking of modifying their strategies in order to turn around their
business scenario.
By implementing the use contingency theory, Woolworths is slowly responding towards
the new age of innovation by delivering the foundations of growth and opportunity. Therefore,
addressing the demands made by the customers at the central point of their business, the
management system of the company has drastically changed their way of selling the products
with the use of mobile technology. The company has also raised the availability of operations
towards the products and stability of process procedures (Otley, 2016). For examples, the
companies have sold all their retail products, in the local stores of Australia. Thereafter, by
accepting the changes within the contingency theory, the company has focused their business
operations towards online processes to reach the most potential consumers. Eventually, the
organization has realized the requirements to keep up with the changing demands of the
customers by ensuring the retailed growth of operational processes (Hörisch, Freeman &
Schaltegger, 2014).
According to Knox (2015), they follow simple strategies of developing one team,
refreshing stores, upgrading their product offering, developing a cohesive brand and reducing
costs to improve the policies and procedures. As it is said that retailing is never stagnant,
therefore they place their customers in the forefront, listen to their opinions and create unique
ways to shop with them. Mobile technology advancement has helped since the past years have
helped in providing the best shopping experience to the customers. It is their lookout that the
customers can move forward in the retail industry without any barrier and get access to the
products and prices from every corner of the world. They are concerned about their customers

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and therefore decided to invest in the areas of open business so that it is a compliment to their
retail stores. Such open businesses include mobile applications, websites, online stores and
special delivery options.
Woolworths has approximately 18 million customers every week where everyone values
the other. They get ample choices about the locations from where they want to shop. Therefore,
they work hard and struggle to gain their custom and reward as loyalty. Owing to the various
associated product lines delivered by Woolworths, the company has to follow a conglomerated
structure. In this the structure of management within the company are classified into three major
areas, Woolworths South Africa, based on Africa, David Jones, trading operations are managed
in Australia and country road group is based New Zealand and southern Africa. The specific
organizational structure offers them with much-required flexibility, improved speed and
reliability to face and resolve the changing environment of business while developing deceptive
organization (Brannen, Piekkari & Tietze, 2015). Apart from these, the companies organizational
structure includes the board of directors, the board of management and brand management
operators who manage the brand the board of directors within the organization are accountable
for evaluating the overseas operators of the organization. Therefore, it is evident that the
management system of Woolworths is engaged in the management system of control.
The management board includes the range of individuals like CEO, managing directors,
CFO and other employees. All of these managers and employees manage their expertise areas to
gather evaluated and reported information based on the performance of the areas. These areas
analyse the different management strategies of the company in comparison to the performance of
the specific unit of the group. By doing so, it helps the organization to accomplish the pre-
developed objectives. For instance, with the help of organizational and management group of