Comparative Analysis of Coles and Woolworths Operations Strategy

This report provides a detailed analysis of the operations strategies employed by Coles and Woolworths, two major supermarket chains in Australia. It examines their cross-functional interactions, consumer-driven approaches, and the development of core competencies. The report explores the specific strategies of each company, including Coles' focus on cross-functional integration, customer-centric strategies, and the development of core competencies, as well as Woolworths' emphasis on cost reduction, product quality, speed of delivery, dependability, and flexibility. The report also highlights the key differences between the two companies, covering aspects such as social media strategies, revenue growth, and margin growth strategies. The analysis covers various aspects of the retail industry, including supply chain management, customer service, and competitive advantages. The report concludes with a comparative overview of the operational approaches of both companies, highlighting their respective strengths and weaknesses. The report uses various academic sources to support the findings and provide a comprehensive understanding of the subject.

OPERATIONS STRATEGY
Running Head: OPERATIONS STRATEGY 0

OPERATIONS STRATEGY 1
Table of Contents
Introduction......................................................................................................................................2
Operations strategies of Coles.........................................................................................................2
Cross-functional interactions and corporate strategy..................................................................2
Consumer-driven strategies.........................................................................................................3
Developing core competencies....................................................................................................3
Operations strategies of Woolworths...............................................................................................4
Reduction of cost.........................................................................................................................5
Product quality.............................................................................................................................5
Speed of delivery of the product..................................................................................................5
Dependability...............................................................................................................................6
Flexibility.....................................................................................................................................6
Differences between Coles and Woolworth....................................................................................6
Conclusion.......................................................................................................................................7
References........................................................................................................................................9

OPERATIONS STRATEGY 2
Introduction
Operations of an organization are driven by the operations strategies. This is the part of the
business that distributes and produces services and goods. This strategy underlies all the strategy
of business that is crucial for an organization to compete in an ever-changing market. The
effective operation strategy optimizes the use of technology, resources, process, and people
(Nenycz, 2013). According to Michael Lewis and Nigel Slack "Operation strategy is the overall
pattern of decision that shapes the capabilities at long term within each type of operations and
their contributions towards the overall strategy."
Business models and technologies are rapidly changing, so organizations have look and pace to
the future. This is the profession that encompasses planning, supervising, and implement to the
production. The functions of operations are supply chain, product management, forecasting,
inventory, quality, scheduling, and facilities planning and management. Operation strategy puts
all the department together for contributing the strategies and missions towards sales, finance, IT,
human resources, marketing, and other departments depends on the business. Operations strategy
guides all the evolution and structural decisions of operational capabilities within the
organization (Pritchard, 2019). Operation strategy of Coles and Woolworths have been covered
under the following discussion.
Operations strategies of Coles
Retails chain of supermarket in Australia is Coles. This organization is owned by Wesfarmers.
This organization has been established by the goal "to give people of Australia a shop they trust,
quality of delivering, values and services. Following are the operations strategy of Coles.
Cross-functional interactions and corporate strategy
Corporate strategy of Coles includes a system of interconnected parts. This is the muscle of the
Coles that depends on functions of the brain in a human body with each department that depends
on the others to achieve desired outcomes. This strategy uses cross-functional interactions of
Coles to support the organization in an effective manner (Lee, 2019).
 This organization will continue like to serve fresh food by a good network for storage of
products to the consumers.

OPERATIONS STRATEGY 3
 This organization will continue like to deliver quality service and products to the customers at a
lower price.
 This organization will continue to drive the team by establishing a modern culture with great
adaptability and decisiveness environment of work.
 This organization will expand the network and store with the strategic partnership to building the
long term relationship with the suppliers.
This organization has a large number of supermarkets in Australia. This organization has
employed one lakh employees by attracting talented and young graduates. This organization has
continued focus on providing good and fresh food to consumers with the enhancement of supply
chain system. This organization prioritizes to improve the relationship with the main suppliers to
simplify the chain of supply. Management of the organization delivers provides great services
with a low price to customers. This organization also has the operation strategy to reach the
customers by applications of mobile and click and collect sites (Chan & Mauborgne, 2018).
Consumer-driven strategies
Operations strategies of Coles are customer-driven approaches. This meets the desires and needs
of the target market of Coles. This organization develops strategies that adapt and evaluate the
environment by enhancing the core competencies to develop new strengths on an ongoing basis.
This organization evaluates the environment by monitor trends to avoid possible threats and take
the advantages of new opportunities. This organization recognized the needs of customers by
providing a quality product at a low price with great service (Hoyer, 2011). This organization has
to improve the chain of supply by the distribution center to control the system of transport. The
stores of Coles are designed to utilize the efficiency of space and enhance productivity
(Humphery, 2018). This organization has invested in technology in its supermarkets to provide a
great experience to customers. The stores of Coles have a very fast process of decision making to
solve the queries of customers (Huddleston, et al., 2014).
Developing core competencies
Core competencies are the resources and strengths within Coles. These are varied by business
and industries. This operation strategy of Coles includes optimal locations of business marketing
and financial expertise with well-trained staff. This organization developed a process like the
satisfaction of customers, development of the product, and building professional relationships

OPERATIONS STRATEGY 4
with stakeholders. This organization has been continuously improving and reforming operation
strategies to provide a great experience of shopping to customers by focusing on stores, people,
financial returns, and care. This organization has six plans to provide quality services to
customers.
 Truly better value.
 Delivering the best experience to customers.
 Working smarter stores.
 Excellent availability.
 Serving and selling with personality.
 Providing good quality food to customers.
This organization has innovative ways to develop the methods and strategies to enhance the
merchandise and logistics system. By the support of operation strategies organizations have
established trust in the market by providing quality services (Hansen, et al., 2013).
Operations strategies of Woolworths
Woolworths has the target to become the best-loved retailer for youth, kids, and families. The
objective of the organization is to optimize the efficiency of the market and to improve the turns
of stock. This organization has invested a large amount in the distribution and supply chain
network. This organization has planned many priorities of studies for the accomplishment of
long term business goals. This organization has the desire to maximize the values of a
shareholder in the portfolio. This organization has moved to profitability by the effective chain
of supply and focus on growth. This organization has built a competitive advantage by providing
world-class efficiency at an operational level in a sustainable manner. Operations strategy of
Woolworths has value propositions by positive efforts of the business. This organization has a
focus on the hiring of competent and skilled human resources (Santos, et al., 2013).
Operation strategy of Woolworths is a function of business that an organization linked with
design, supervision, and redesigning of the operations of the business for the production of
service and goods. This organization designed an efficient and effective system for the work
process by procurement of technologically advance hiring and machinery of competent staff. The
aim of the operation strategy of Woolworths is to deliver the quality services and products to

OPERATIONS STRATEGY 5
customers by the division of operations. In this division, many areas are covered like centers of
distribution, a chain of supply, and improvement of strategies and strategies to minimize the
shrinkage. This organization believes that sub-contracting with suppliers is necessary for the
success of the organization. This organization has the improve process of suppliers selection with
the quality service of products received from suppliers to determine the customer's satisfaction.
This organization will emphasize building the long term relationship with the suppliers. This
organization does not support to buy a service and product from the open market. This
organization buys products from suppliers that only produce products for Woolworths.
The focus Woolworth’s operational strategy is to minimize the waste of material. The technology
of layout has taken a step ahead to use specific supplier distribution center for tracing and
tracking fresh products with the movement of the distribution network and supply chain. This
minimized the paperwork with the documentation process of Woolworth. The operation strategy
of Woolworth is to save money without compromising the good service and quality that provides
quality products with the competition level in the market of the organization (Hensher & Zheng,
2015).
Reduction of cost
One of the main operational objectives of Woolworths is to control the cost. The purpose of the
organization is to provide a good quality product at an affordable price. This can be done by
controlling the cost of operational activities. This is also full filled by the minimization of waste.
This is necessary to control by achieving the profit objective (Brown, 2014).
Product quality
This aim of the organization is to sell the quality product by putting the customer first. By
focusing on quality organization likely to lead maximization of profit. The customers of an
organization prefer to purchase a high-quality product with the competitive structure of price
(Robert, 2012).
Speed of delivery of the product
This operation strategy of Woolworths presents the lead time in which delivery of a product is
done. This organization is quite enough in the effective delivery of products with customer
preference to purchase products of Woolworths (Ungson, 2013). This organization has a focus

OPERATIONS STRATEGY 6
on elimination and identification of bottleneck in strategies of operation in order to maximize the
satisfaction of customer and profits.
Dependability
Dependability is an aspect of quality to the certainty and reliability of the services and products.
Dependability describes the reputation of the organization. Woolworths focuses on the reputation
of the organization by focusing on the reputation of supplying good quality products in the
marketplace (Kenny, 2012).
Flexibility
Flexibility is a reference that presents the changes in the organization according to the demand
for products that increased and decreased by a predictable time. This organization refers to meet
the demand of product and customers. This organization has the services to deliver produced
goods. Good reputation presents the flow of cash and generation objective of income. This
should be flexible according to the customer demands at the right time.
This organization focuses on the effects of the organization to identify the threats and
opportunities for the benefits in the future to the organization. Statement of vision, mission, and
values to help the operation strategy for the future. Performance goals established by the
organization for the future strategy to manage the resources with future objectives (Hubbard,
2016).
Differences between Coles and Woolworth
 Operation and quality
The operation strategy for wool Woolworth is to increase the number of stores. Woolworths is
the largest chain of the supermarket with 995 stores in Australia. The operation strategy for
Coles is to provide quality services to customers. Stores of Coles in Australia are 807.
 Social media conversation strategy
Woolworths produced more than double social media conversation of Coles. Woolworths
covered 60% of the global online news coverage and Coles covers only 40% of global online
news coverage as this organization focus lesser in conversation (Lyndie, et al., 2017).
 Revenue growth strategy

OPERATIONS STRATEGY 7
The growth of revenue for Woolworths for 2017-18 was 3.4 percent and Cole growth of revenue
was 1.1 percent. Price deflation figure for Woolworth was 1.9 and for Coles were 1.2 percent.
The IBIS analysis stated that grocery and supermarket industry revenue expected to total $ 102.3
billion. Woolworth accounted for 37 percent and Coles for 30 percent.
 Growth of sale
Woolworths is ahead of its competitor Coles as the Australian supermarket giant sales continue
to grow in subsequent years. Analysis upgraded outlook with the highest shares level in years.
Woolworths experienced high closed at $27.70 while Coles owner Wes farmers traded in a range
of $44 mark. Woolworths maintained a lead in sales, while Coles does not.
The sales of Woolworths in the second quarter of 2016/17 have grown at a faster pace than
Coles. This presents the major sign of winning the customers after pouring more than $1 billion
by boosting the services of customers and lower prices (Tallaire, 2013).
 Margin growth strategy
The operation strategy of Woolworth has the double-digit rate of growth with the grocery margin
returns in earnings with the discounted store to break even.
Woolworth operations strategy prioritize the long term growth with profitability channel. The
supermarket of Coles does not prioritize the profitability channel.
 Review strategy
Woolworth review processes and business process to provide exceptional values to customers
rather than Coles.
Woolworth eliminates many costs associated with supermarkets tradition but the system of Coles
are based on the supplier's investments (Burch, 2013).
Conclusion
In the report, numerous discussions have been done within the highly competitive supermarkets
of Australia. Supermarkets of Coles and Woolworth covered almost 80% of this industry. Both
firms have a large amount of competition from Aldi. Both firms have strived by enhancing the

OPERATIONS STRATEGY 8
loyalty program. Both firms have launched credit cards and frequent flyer points programs.
Coles and Woolworths most popular social media channel are Twitter. The negative
conversation for both brands is about stores or stock. The sentiments for both brands is neutral.
Both the organization have more negative online news than positive. This can be said that
Woolworth has a good position in the supermarket in Australia. This organization has the
capabilities to encounter the issues. Organization of supermarket in Australia have a competitive
advantage with the market scale to fill the positive journey regarding growth. The flow of
operation strategy enabled the organization to provide a good structure to supermarkets. The
supermarket of Coles and Woolworth had sustained to manage the risks with the advantages in
the process of business. These depend on handling the industry with metrological capabilities.
This industry has managed the crucial scenario with the organizational challenges to bring the
right content.

OPERATIONS STRATEGY 9
References
Brown, S., 2014. Operation Management. Journal of Cleaner Production, 06(02), pp. 852-963.
Burch, D., 2013. Woolworth. International Journal of Production Economics, 30(02), pp. 215-
224.
Chan, K. & Mauborgne, R., 2018. Procedural Strategic Decision Making. Business Strategy and
The Environment, 19(04), pp. 323-338.
Hansen, J. M., McDonald, R. E. & Mitchell, R. K., 2013. The Role of Core Competencies.
Journal of The Academy of Marketing Science, 41(03), pp. 300-319.
Hensher, D. A. & Zheng, L., 2015. The Urban Spatial Economy. 2 ed. London: Tel-Aviv and
Oxford.
Hoyer, W. D., 2011. An Examination of Consumer Decision Making For a Common Repeat
Purchase Product. The Journal of Consumer Research, 11(03), pp. 822-829.
Hubbard, G., 2016. Flexibility. International Journal of Business and Management, 85(04), pp.
789-987.
Huddleston, P., Whipple, J. & Van, A. A., 2014. Customer Driven Strategies. Business Strategy
and The Environment, 05(01), pp. 89-96.
Humphery, K., 2018. Culture of Supermarkets. The Journal of Australia, 26(03), pp. 41-56.
Kenny, G., 2012. Dependability. International Journal of Business and Management, 08(01), pp.
56-98.

OPERATIONS STRATEGY 10
Lee, J., 2019. The Market of Coles. European Journal of Business and Management, 45(01), pp.
85-89.
Lyndie, B., Schepis, D. & Purchase, S., 2017. Efficiency and Effectiveness at The Network
Level. Industrial Marketing Management, 07(06), pp. 134-147.
Nenycz, T., 2013. Labels in Australia. Journal of Management and Strategy, 18(08), pp. 624-
633.
Pritchard, W. N., 2019. The Modern Supermarket. European Journal of Business and
Management, 38(02), pp. 204-218.
Robert, J., 2012. Operations Management. Journal of Marketing Research, 88(08), pp. 84-96.
Santos, D., Maria, A. O., Svensson, G. & Padin, C., 2013. Woolworths. Supply Chain
Management: An International Journal, 18(01), pp. 104-108.
Dallaire, A., 2013. Growth Strategy. International Journal of Marketing Studies, 33(03), pp. 71-
77.
Ungson, R. G., 2013. Operations Management. Journal of Marketing Research, 16(01), pp. 98-
155.