BM202: Organizational Behavior Analysis of Woolworths Supermarkets

This essay provides a comprehensive analysis of Woolworths' organizational behavior, examining its structure, leadership styles, communication strategies, conflict resolution processes, organizational culture, and change management initiatives. The introduction offers a brief overview of Woolworths' market position and financial performance, highlighting its significant presence in the Australian supermarket industry. The essay delves into Woolworths' organizational structure, identifying it as a flat hierarchy with a bureaucratic tendency and a mix of formalized and departmentalized units. It explores the company's autocratic leadership style, communication practices, and conflict resolution strategies, particularly concerning the grocery supplier code and interactions with the Australian Competition and Consumer Commission (ACCC). Furthermore, the essay examines Woolworths' organizational culture, emphasizing its family-friendly values, employee engagement, and ethical leadership. It also addresses the company's change management processes, discussing structural changes, subsidiary challenges, and workforce restructuring. The conclusion summarizes the key findings, emphasizing the need for Woolworths to adapt to market changes, focus on core competencies, and leverage digital strategies for future growth and sustainability. This analysis utilizes concepts and theories covered in organizational behavior modules to identify and recommend strategies for improvement, offering valuable insights into Woolworths' operations and management practices.

Running Head: MANAGEMENT 0
Organisation Behaviour

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Table of Contents
Introduction................................................................................................................................2
Organisation Structure...............................................................................................................3
Leadership and Communication................................................................................................4
Conflict and Negotiation............................................................................................................5
Organisation Culture..................................................................................................................5
Change Management..................................................................................................................6
Conclusion..................................................................................................................................7
References..................................................................................................................................8

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Introduction
In consideration with present Australia superstore and grocery market, the yearly
growth in the sector standouts to 2.1% for the year 2014-19 with profits of $103bn
(ibisworld.com.au, 2018). Woolworths is one of the leading retailers in the Australian
supermarket business with having extensive product range for large number of customer
segments. In Australia, the company have more than 995 stores. The product categories of
Woolworths includes groceries products, health and beauty products, magazines, DVDs,
products, stationery things and other household goods. The revenue of Woolworths in 2018
was nearly $ 56, 726 million (woolworthsgroup.com.au, 2018). With regards to this, the
market share of the company is 34% in relation to its competitors such as Coles, Aldi and so
forth (Neo, 2019). The company stores and distribution centres are operated by more than
201, 522 employees and individuals who are also a part of organisation human resource and
asset.
Source: (Woolworth logo)
Woolworth future growth and sustainability is impacted with fierce competition in the
Australia retail industry and with entering of Costco and Aldi, Woolworths is losing the high
number of customers reflecting alarming situation for all Australia superstores. In addition,
rise of e-commerce channels also forces Woolworths to opt for online channels with the aim
to sell goods and products online.

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Organisation behaviour is about the behaviour of human beings who are linked with
enterprise activities (Suppiah & Singh Sandhu, 2011). This is about the way of managing and
communicating with individuals with having an important influence on the overall
performance of a specific enterprise. This report is about the analysis of the organisational
behaviour of Woolworths. If Woolworths aims to attain desired level of success in the
marketing, the company needs to integrate effective level of communication among the
individual’s staff of the corporate firm. The study also includes leadership and
communication, conflict and negotiation process, Woolworth culture and change
management happened recently in the company.
Organisation Structure
Woolworth organisation structure can be considered as flat hierarchy which is
directed by the chief executive officers and board of directors followed by the different
departments which help the organisation in its development and growth. The organisation
structure of Woolworths appears to be like more bureaucratic where rules and regulations are
followed strictly. In addition, the structure of Woolworth seemed to be mix one. Woolworth
is a big firm having hands under a lot of units and all these different units are taken care by
different managers working with coordination. The top management is responsible for the
controlling of all these units and therefore, it can be said that Woolworth structure is more of
formalised nature. The name of these different units includes marketing, research and
development, finance, etc. These units formally report to the top level management
representing mechanistic formalization in the enterprise. In relation with departmentalisation,
Woolworths being a large organisation having a lot of departments such as health, clothing,
food and liquor (Knox, 2015). The three core functions of Departmentalisation includes
development of mental models, building chain of commands, and motivating employees
through informal communication.

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Woolworths Organisation Structure
Source: (orreconomics.weebly.com, 2018)
Leadership and Communication
Woolworth has an autocratic leadership style, which is stated as the management
group responsible for creating all corporate choices and will inform it to employees reflecting
traditional management style to the company. The company leadership team includes the
board committees, board of directors and group executive committee.
Some of the major advantages of this leadership style include staff is having little
uncertainty in the business practices and their roles and expectations are clearly defined.
However, this style also come up with certain disadvantages like dissatisfaction from job. For
instance, there is a dress code in Woolworths and employee’s notions and ideas generally not
welcomed and so the staff of Woolworths will just perform the tasks the management ordered
them to do. The key reason Woolworth has adopted this leadership style as it is paramount
for them to retain order within the business as a significant proportion of its staff represents
students and casual employee having lack of limited skills and experience (Klettner, Clarke,
& Boersma, 2014) and hence, it is effective for the management with higher experience to

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makes the significant corporate decisions. The communications style of Woolworths is clear,
simple and minimalist. It trails a distinctive style where it advances Woolworth brand value
and improves the sales rate. Bradford Banducci had always seek from the staff to respect top
executives and this system has established a formal yet simply accessible association amid
various management levels.
Conflict and Negotiation
Woolworth’s present conflict is associated to grocery supplier code and Australian
Competition and Consumer Commission (ACCC) took Woolworths to charge over the way
they are executing a code of conduct developed to close years of conflict amid the two ways.
This code must be thought to end the confrontational and conflict-driven linkage amid
thousands of suppliers who had registered complained they were being unfairly pressured and
the superstores. Even ACCC chairman also stated that “we are expecting the code would
being about an adjustment of approach” (afr.com, 2015). In addition, this also created
conflicts between Woolworths and ACCC as the company was dissatisfied with the system
the ACCC is managing the matter. Woolworths believe that the code must act as route
breaker when there was an issue, eliminating the necessity to get solicitors involved. The
company also argued that ACCC promotes this issue in public in relation with the negotiation
with the terms of agreements.
In relation to negotiation process, Woolworth transcribed to nearly 1000 suppliers
who had not yet sign up the code with an aim to end up the misunderstanding by saying that
the demand spoke of to the managerial procedure and did not define the contracts were non-
negotiable. ACCC also stated that they went public as some sellers commended them to do so
(afr.com, 2015).
Organisation Culture
Woolworth has a down to earth culture including family friendly values. One can
found various senior leaders of the company on the shop floor and each aspect of their
corporate exists with the aim of creating customer lives better, simpler and easier. The
business culture for Woolworths limited is based around developing internal capability as the

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company believes that this is the driving factor behind the success of the enterprise and their
ability to perform, change and grow (Lury, 2009). Furthermore, the company also believe in
having a balance of men and women in their senior roles as it will constitute Woolworths in
its development and growth.
The organisation culture of Woolworths is also based on certain principles that
establish the pillars of success in the organisation. One of the foremost aspects of Woolworth
organisation culture includes strong employee engagement. The company always ensure that
all its employees are motivated and directed to reach their productive potentials at the
workplace. Woolworth’s culture is also linked with reference to leadership as it is firmly
based on ethical values (Keith, 2012). This encourages company commitment in achieving its
strategic goals and vision.
The company culture also reflects effective partner relationships which are ruled by
three simple notions including fairness, collaboration and sourcing domestically. The
company annual report states that more than 80% of the company suppliers have been partner
for a longer or decade and they are working faithfully with them to build the products and
services their consumers seek to praise (woolworthsgroup.com.au, 2019). The company also
have provided them a platform where each partner and vendor are comfortable enough to tell
anything relating to the relationship. With regards to this, Woolworths became first company
in Australia in 2012, to come up with a third-party managed complaints platform, particularly
for managing with issues upraised by sellers. This shows that Woolworths believe in
transformation that is sustainable and that works. The company also believes that in a
growing business, recognising skilled talent early in their professions and building that fresh
talent over a number of years brings true sustainability to transformation.
Change Management
Change management is a methodology which directs the moves in the organisation
with impacting overall productivity in the organisation (Benn, Edwards & Williams, 2014).
In this dynamic and competitive business environment, changes are necessary for the growth
of an enterprise. With regards to this, increasing market pressure is also considered as one of
the major factors of change management
Woolworth also had faced structural changes as major sections of its senior executives
left the enterprise losing trusts in its processes. Major changes are faced by Woolworths in

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relation to its subsidiary companies and various subsidiaries of the company are facing lot of
challenges to survive in the marketplace. SAP structure of the company causing common
issues and the company was failing to meet customer requirements; with a loss of trust in
management leads to noteworthy change in employee structure. Woolworths just has faced
bulk retreat of its senior employees and the company was planning to restoration of sick units
by cost cutting. It was noted that 400 executive jobs were cut down (Mitchell, 2015). This
reorganisation plan has led Woolworths to lost majority of its senior support. This situation
proved to be a downside for Woolworths as the company is dropping consumer relationship,
loyalty and marketing.
Conclusion
Ultimately, Woolworth being a leading supermarket having enough resources and
assets to change its structure, culture and implementing successful change management. Due
to entering of new competitors including Aldi and Costco, Woolworths is facing significant
changes resulting in big losses. This requires Woolworths to embrace upon various diagnose
models to emphasis on restructuring and revival. In addition, Woolworths can also focus on
its core competency to safeguard its sustainability for extensive period.
From future perspective, Woolworths also required to alter a structural model in its
daily operations. Before spending their revenue in other sectors, Woolworths needs to
emphasis on restoring the sick units. The company also needs to use social media as a
corporate business strategy to ensure positive communication with the users and provide
them platform to welcome necessary feedback. With rise of e-commerce channels, major
section of the community are purchasing goods online and this requires company to emphasis
on its online sales. It will help Woolworths to add new consumers in its user basket and
ensure more customer loyalty attributes.

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References
afr.com. (2015). ACCC takes supermarkets Woolworths, Aldi to task over grocery supplier
code. Retrieved from
https://docs.google.com/spreadsheets/d/1Xf8eEFn9nfu5ow_bfc_UGY676ZT9jlGB_
We0WgAMaGI/edit?ts=5c162326#gid=1116006694
Benn, S., Edwards, M., & Williams, T. (2014). Organizational change for corporate
sustainability. NewYork: Routledge.
ibisworld.com.au. (2018). Supermarkets and Grocery Stores - Australia Market Research
Report. Retrieved from https://www.ibisworld.com.au/industry-trends/market-
research-reports/retail-trade/food-retailing/supermarkets-grocery-stores.html
Keith, S. (2012). Coles, Woolworths and the local. Locale: The Australasian-Pacific Journal
of Regional Food Studies, 2(1), 47-81.
Klettner, A., Clarke, T., & Boersma, M. (2014). The governance of corporate sustainability:
Empirical insights into the development, leadership and implementation of
responsible business strategy. Journal of Business Ethics, 122(1), 145-165.
Knox, M. (2015). Supermarket monsters: The price of Coles and Woolworths'
dominance (Vol. 6). Australia: Black Inc.
Lury, C. (2009). Brand as assemblage: Assembling culture. Journal of Cultural
Economy, 2(1-2), 67-82.
Mitchell, S. (2015). Woolworths to slash 400 jobs to 'turbocharge' cost cuts. Retrieved from
https://www.smh.com.au/business/woolworths-to-slash-400-jobs-to-turbocharge-cost-
cuts-20150505-ggui53.html
Neo, P. (2019). Supermarket wars: Woolworth takes commanding lead over Coles in battle
for Australian grocery sales. Retrieved from
https://www.foodnavigator-asia.com/Article/2019/04/30/Supermarket-wars-
Woolworths-takes-commanding-lead-over-Coles-in-battle-for-Australian-grocery-
sales

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orreconomics.weebly.com. (2018). Management Structure. Retrieved from
https://orreconomics.weebly.com/management-structure.html
Perkins, B. (2019). What is ERP? A guide to enterprise resource planning systems. Retrieved
from https://www.cio.com/article/2439502/enterprise-resource-planning/enterprise-
resource-planning-erp-definition-and-solutions.html
Suppiah, V., & Singh Sandhu, M. (2011). Organisational culture's influence on tacit
knowledge-sharing behaviour. Journal of knowledge management, 15(3), 462-477.
woolworthsgroup.com.au. (2018). FINAL PROFIT AND DIVIDEND ANNOUNCEMENT
FOR THE 52 WEEKS ENDED 24 JUNE 2018. Retrieved from
https://www.woolworthsgroup.com.au/content/Document/ASX%20announcements/
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%20the%2052%20weeks%20ended%2024%20June%202018.pdf
woolworthsgroup.com.au. (2019). How we do business. Retrieved from
https://www.woolworthsgroup.com.au/page/about-us/our-approach/how-we-do-
business