Strategic Management of Coles & Woolworths

This report analyzes the corporate strategies employed by Coles Pty Ltd and Woolworths Ltd in the 21st century to achieve sustained competitive advantage within the Australian supermarket industry. It examines their corporate policies, strategic management frameworks, and the successes and failures resulting from these strategies. The research methodology involves a deductive approach using secondary data from sources like annual reports, journals, and articles. The findings compare and contrast the policies of both companies, highlighting their pricing strategies and customer focus. The report concludes that while both companies have utilized price reduction as a competitive strategy, their success varies in terms of market share and revenue generation, despite similar strategic approaches. The report also notes the limitations of the study, including budget and time constraints.

Running head: STRATEGIC MANAGEMENT
Strategic Management
An examination of the corporate strategies of Coles Pty Ltd and Woolworths Ltd in the 21st
Century to achieve sustained competitive advantage
Name of the student:
Name of the University:
Author note:

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Acknowledgement
The research conducted by me has been one of the enriching experiences of my life. This
research helped me in gaining enhancing experience by providing me the understanding to
skilfully carry out the research. The research helped me in overcoming the drawbacks by facing
them skilfully. However, this would not have been possible with the help and encouragement I
received from my professor. I also received the encouragement from my peers and all the people
who helped me carry out the research. I would like to thank my supervisor
_______________________________ for the constant support and encouragement to carry out
the research. It would not be right if I do not thank my academic guides who have constantly
assisted me in the research. I would also like to thank by friends who helped and encouraged me
for the research. Finally, I would like to thanks the customers who participated in the survey that
was conducted to gain primary data. Last but not the least I would like to thank the managers
who gave me their precious time to carry out the interview. The support of all these people has
been enhancing and inspiring throughout the research process.
Heartfelt thanks and warmest wishes,
Yours Sincerely,

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Abstract:
Strategic management refers to the designing and implementing the major objectives and goals
by the top management of an organization, which takes into consideration the available resources
while assessing the internal as well as the external environment of the organization wherein it
competes. Strategic management shows the path to the organizations, helps in the formulation of
policies, aims, objectives, and helps in achieving those objectives by proper allocation of the
resources. Strategic management has helped Woolworths and Coles to improve their sales and
revenues. Woolworths and Coles have reduced prices as a completive strategy, going against the
trend of overseas supermarkets competing through product differentiation. The report examines
the corporate strategies of Coles Pty Ltd and Woolworths Ltd in the 21st Century to achieve
sustained competitive advantage.

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Table of Contents
Chapter 1..........................................................................................................................................7
Introduction......................................................................................................................................7
1.1. Background:..........................................................................................................................7
1.2 Background of Woolworths Ltd:...........................................................................................7
1.3 Background of Coles Ltd:......................................................................................................8
1.4 Purpose of the project:...........................................................................................................8
1.5 Aims and objectives:..............................................................................................................8
1.6 Research questions:...............................................................................................................9
1.7 Summary:...............................................................................................................................9
Chapter 2........................................................................................................................................10
Literature review............................................................................................................................10
2.1 Meaning of strategy:............................................................................................................10
2.2 Concept of strategic management:.......................................................................................10
2.3 Levels of strategies..............................................................................................................11
2.4 Strategic management theories and models:........................................................................12
2.4.1 SWOT analysis:............................................................................................................12
2.4.2 Growth- share matrix:...................................................................................................13
2.4.3 PESTLE analysis:.........................................................................................................14

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2.4.4 Porters five forces model:.............................................................................................14
2.5 Characteristics of successful organizations:........................................................................15
2.6 Sustainability and strategic management:...........................................................................16
2.7 Summary..............................................................................................................................16
Chapter 3........................................................................................................................................17
Research methodology...................................................................................................................17
3.1 Introduction:........................................................................................................................17
3.2 Types of investigations:.......................................................................................................17
3.3 Justification of the type of investigation chosen:................................................................17
3.4 Research approach:..............................................................................................................18
3.5 Justification for the approach used:.....................................................................................18
3.6 Research design:..................................................................................................................18
3.7 Justification for the chosen research design:.......................................................................19
3.8 Data collection techniques:..................................................................................................19
3.9 Justification for the chosen data collection technique:........................................................19
3.10 Data analysis plan..............................................................................................................19
3.11 Accessibility issue:............................................................................................................20
3.12 Ethical issues:....................................................................................................................20
3.14 Gantt chart:........................................................................................................................20
3.15 Summary............................................................................................................................22

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Chapter 4........................................................................................................................................23
Findings and analysis.....................................................................................................................23
Theme 1: Comparison between the corporate policies of Woolworths Ltd and Coles Ltd.......23
Theme 2: Comparison between strategic management framework of Woolworths Ltd and
Coles Ltd....................................................................................................................................24
Theme 3: Success or failure of Woolworths Ltd and Coles Ltd due to strategic management
framework..................................................................................................................................26
Reflection on the findings..........................................................................................................27
Chapter 5........................................................................................................................................28
Conclusion.....................................................................................................................................28

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Table of figures
Figure 1: SWOT analysis...............................................................................................................12
Figure 2: Growth share matrix.......................................................................................................13
Figure 3: Gantt chart......................................................................................................................21

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Chapter 1
Introduction
1.1. Background:
The following report is an attempt to understand, compare and contrast the strategies used
by Wesfarmers (Coles) and Woolworths to achieve sustained completive advantage in the
modern business environment primarily in the Australian Supermarket industry. The Australian
industry consists primarily of retail groceries. Supermarkets and grocery stores retail a range of
groceries and products, including fruit and vegetables, bread, cigarettes, canned goods, toiletries,
dairy goods, delicatessen items and cleaning goods. Specialist retailers, niche retailers and
convenience stores are excluded from the industry. The industry as a whole is characterized as
mature with low relative volatility with high barriers to entry.
1.2 Background of Woolworths Ltd:
Woolworths Ltd is a Public Company that is ranked number 2 out of the top 2000
companies in Australia. The company generates the majority of its income from the
Supermarkets and Grocery Stores in Australia industry. The Chief Executive of Woolworths Ltd
is Mr. Brad Banducci whose official title is Managing Director &Chief Executive Officer. The
Chairman of Woolworths Ltd is Mr. Gordon Cairns whose official title is Non-Executive
Chairman (Woolworthsgroup.com.au, 2017).

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1.3 Background of Coles Ltd:
Wesfarmers Limited is a Public Company that is ranked number 1 out of the top 2000
companies in Australia. The company generates the majority of its income from the
Supermarkets and Grocery Stores in Australia industry. The Chief Executive of Wesfarmers
Limited is Mr. Richard Goyder whose official title is Managing Director. The Chairman of
Wesfarmers Limited is Mr. Michael Chaney whose official title is Non-Executive Chairman.
Wesfarmers Limited owns a diversified portfolio of businesses operating in the supermarket,
hardware and department stores, gas processing and energy distribution, coal mining, chemicals
and fertilizer and industrial and safety product industries (Coles.com.au, 2017).
The retail division has a range of operations from supermarkets and convenience stores to
hardware and office supplies. Brands include Coles - operating as a retailer of groceries and
other household consumables through Coles and BI-LO supermarkets in Australia and New
Zealand, and its online presence through Coles Online. The company also retails liquor through
Liquor land, Vintage Cellars and 1st Choice stores, and petrol outlets through Coles Express, a
joint venture with petrol retailer Shell. Coles also provides financial services and operates a
number of hotels under the Spirit Hotels brand.
1.4 Purpose of the project:
The purpose of the research is to analyze the corporate strategies and policies of
Woolworths Pty Ltd and Coles Pty Ltd in the 21st century in order to achieve sustained
competitive advantage.
1.5 Aims and objectives:
The major objectives of the research are as follows:

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 To understand the corporate policies of Woolworths Ltd and Coles Ltd
 To understand the role of the corporate policies of Woolworths Ltd and Coles Ltd in
achieving sustained competitive advantage
 To analyze the successes and failures of both organizations within the Strategic
management framework in relation to the goal of achieving competitive advantage
1.6 Research questions:
The following are the research questions:
 What are the corporate policies of Woolworths Ltd and Coles Ltd?
 What is the role of the corporate policies of Woolworths Ltd and Coles Ltd in the
achievement of sustained competitive advantage?
 What are the successes and failures of the organizations within the Strategic
management framework in relation to the goal of achieving competitive advantage?
1.7 Summary:
The introduction part introduced the background of the research along with a brief
description of both the organizations namely Woolworths Ltd and Coles Ltd. This part
mentioned the purpose of the research, aims and objectives of the research and finally the
research questions related to the topic.

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Chapter 2
Literature review
2.1 Meaning of strategy:
According to Rothaermel (2015), strategy refers to the plan of action that is designed in
order to accomplish a specific goal or objective. The concept of strategy was earlier used by the
military forces and was later on borrowed by the business organizations in order to bridge or
lower the gap between the policies of an organization and the tactics. Strategy is defined as the
basic decisions, aims, objectives and mission of an organization that are decided by the top level
managers.
2.2 Concept of strategic management:
According to Hill and Jones (2014), strategic management refers to the designing and
implementing the major objectives and goals by the top management of an organization, which
takes into consideration the available resources while assessing the internal as well as the
external environment of the organization wherein it competes. Strategic management shows the
path to the organizations, helps in the formulation of policies, aims, objectives, and helps in
achieving those objectives by proper allocation of the resources. Strategic management is the
procedure through which an organization forms its objectives and the the ways in which the
management achieves those objectives. The proper coordination between the objectives of an
organization and the strategies determine the effectiveness of the management. Strategic
management integrates the various functions within an organization into a whole. These
strategies enable an organization to achieve its high-level goals and assist the lower level

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managers in accomplishing those goals and objectives. Therefore, strategic management can be
referred to as the art and science of designing, implementing and analyzing the organizational
decisions that help an organization to achieve its aims and objectives. Strategic management
aims at integrating the activities and functions of the various departments within an organization
such as marketing, finance, operations, research and development department and others.
Strategic management involves taking decisions regarding changes in the present policies,
activities and functions or formulating new policies, activities and functions (Peppard and Ward
2016).
2.3 Levels of strategies
Strategic management contains several integrated action programs that are aimed towards
achieving long-term competitive advantage that is sustainable. The following are the levels
within an organization:
a) Corporate level: There are mainly three levels within an organization. The top level
comprises of the CEOs, board of directors and the administrative officers. The top
management is responsible for achieving the financial objectives of the organization and
maintain the image of the organization. They are responsible for forming strategic plans
to overcome the issues within an organization and maintain the goodwill of the
organization (Eden and Ackermann 2013).
b) Business level: This level comprises of the business managers who are responsible for
devising strategic plans for facing the competition in the market and gaining competitive
advantage over the others. They are responsible for identifying the profitable market
wherein the organization can gain the maximum profits (Wheelen and Hunger 2017).