Stakeholder Analysis of Woolworths: Business Environment Report

This report provides a detailed analysis of Woolworths, an Australian retail giant, focusing on its business environment and key stakeholders. It begins with an executive summary and an introduction to the organization, outlining the roles of internal and external stakeholders. The report utilizes the PESTLE analysis framework to identify and examine the influence of political, economic, social, technological, environmental, and legal factors on Woolworths' operations. It identifies internal stakeholders such as investors, employees, and board members, and external stakeholders including customers, the government, and suppliers. The report then delves into the nature and degree of stakeholder interests, highlighting potential conflicts and their implications. It concludes by assessing the levels of influence each stakeholder group exerts on Woolworths, emphasizing the importance of customer satisfaction, supplier relationships, and investor contributions. The report underscores the interconnectedness of these stakeholders and their collective impact on the company's performance and strategic direction.

Running head: BUSINESS ENVIRONMENT ANALYSIS
BUSINESS ENVIRONMENT ANALYSIS
Name of the Student
Name of the University
Author Note

1BUSINESS ENVIRONMENT ANALYSIS
Executive Summary
The report is built on the study of different stakeholder groups that have been developed by a
firm. The firm that has been chosen for the analysis in the report is Woolworths. Woolworths
is an organization that functions in the retail industry of Australia. The internal and external
stakeholders of the company have been examined in the report based on activities that are
performed by them and services that they provide as well. The levels of influence of the
stakeholders on operations of Woolworths have also been analysed in the report. The report
further provides details based on the comparison of stakeholders of Woolworths with that of
an organization that belong to another industry.

2BUSINESS ENVIRONMENT ANALYSIS
Introduction and the background of the organization
Stakeholders of an organization are able to influence the processes of a company in
their respective industries. The stakeholders are also influenced by the organizational
processes and the levels of profitability as well. The main stakeholders of the organization
who are able to affect the operating processes and revenues include, creditors, employees,
suppliers, unions, owners and the community as a whole (Barros, Hernangómez & Martin-
Cruz, 2016). The support that is provided to the stakeholders is able to play a crucial part in
the methods by which the company is able to develop its place in the industry. Two types of
stakeholders play the most important part in the methods by which the companies can uphold
their revenue levels in a stable way. The internal and the external stakeholders are considered
to be the significant part of the operations that are performed by organizations (Daspit et al.,
2017).
The report will be built on the study of the internal and external stakeholders of an
organizations and their levels of influence on the organizational operations as well. The
organization is taken into consideration for this study is Woolworths that functions in the
retail industry of Australia. The operations of Woolworths will be compared with the
stakeholders of another industry.
Woolworths is the largest supermarket chain of Australia that functions more than 900
stores in different parts of the country. The organization is dependent on more than 100000
team members who are a part of the stores, support offices and distribution centres who are
able to offer superior levels of services to the customers. Woolworths is also known in the
industry for working in a close manner with the farmers and growers in Australia. The
organization has also been able to grow itself as the most innovative retailer in Australia
(Woolworths.com.au., 2019).

3BUSINESS ENVIRONMENT ANALYSIS
Analysis of the organization
Identification of functional areas
The major stakeholders of Woolworths can be identified and analysed with the proper
implementation of PESTLE analysis framework. The most significant role that is played by
the analysis is based on the picture that PESTLE framework is able to offer based on the
levels of importance of the different stakeholders. The levels up to which different
stakeholders are able to influence the processes and functions of the company will be
analysed in a detailed manner with the help of this framework (Demir, Wennberg &
McKelvie, 2017).
Political factors – The level of political stability of Australia has an influence on the
methods by which Woolworths is able to uphold its operations in the retail industry. The
major stakeholder of the organization with respect to the political factors that have an impact
on Woolworths is the Australian government (Durand, Grant & Madsen, 2017). The
regulations and policies that are established by the government are able to play a significant
part in the methods by which Woolworths can develop organizational regulations. The tax
based laws formed by the Australian government are also able to influence the prices of
products and services which are offered by Woolworths. The firm can decide the wages that
can be provided to the employees with the support of appropriate study of the government
policies and regulations (Dyer et al. 2015).
Economic factors – The economic condition of a country has a key effect on the
prices of products of Woolworths and levels of revenues as well. GDP rate of Australia in the
year 2017 was around 1 Billion US Dollars. The stable economic condition is able to offer
maximum levels of support to the processes of Woolworths for a long period of time. The
major stakeholders who are affected by the economic factors of Australia are the business

4BUSINESS ENVIRONMENT ANALYSIS
partners or alliances that are made by Woolworths in order to maintain the cost-effective
processes. The levels of efficiency of financial markets have an impact on the partnerships
that are developed by Woolworths (Engert, Rauter & Baumgartner, 2016).
Social factors – Demographics of population of Australia is considered to be an
important factor that needs to be considered for study of the social condition. The choice and
likings of the consumers are changing on a continuous basis and this is considered to be a key
aspect that is able to influence the product portfolio of Woolworths in Australia. The
customers in this case can be considered as the major stakeholders of Woolworths who can
affect the operations and stages of cost-effectiveness as a whole (Ethiraj, Gambardella &
Helfat, 2018).
Technological factors – The technological interruptions that have recently taken
place in the Australian retail industry have an influence on the development of revenues of
Woolworths. The technological service providers can be considered to be extremely
important for the methods by which Woolworths is able to maintain its operations and levels
of productivity in the retail industry (Frynas & Mellahi, 2015). The experience offered to
customers in the stores are also improved with help of effective implementation of the
technologies. Technological service providers can be considered as the major stakeholders of
Woolworths.
Environmental factors – The conditions of the Australian environment have an
impact on the services that are offered by Woolworths to its customers. The effect that
operations of Woolworths have on the environment of the country are considered to be
significant aspects that have an influence on the organization. The government based
organizations that have the responsibility of taking care of environmental issues are
significant stakeholders of Woolworths in the retail industry (Hill, Jones & Schilling, 2014).

5BUSINESS ENVIRONMENT ANALYSIS
Legal factors – The intellectual property based rights that have been gained by
Woolworths are significant aspects that have an influence on the organizational policies. The
board members can be considered to be major stakeholders of Woolworths who are
responsible for the development of proper regulations and policies (Hubbard, Rice & Galvin,
2014).
The internal and external stakeholders of Woolworths are thereby able to influence
the operations of the organization in Australia.
Identification of internal and external stakeholders and their roles
The internal stakeholders of Woolworths include, the employees, board members and
shareholders. The external stakeholders of the company on the other hand include, the
suppliers, customers and the government (Karadag, 2015). The roles that are played by
different stakeholders in Woolworths are as follows,
Internal stakeholders
Investors – Woolworths has gained more than 400,000 shareholders or investors who
are able to offer maximum levels of support in the effective operations that are accomplished
by the organization in the retail industry. The majority of shareholders of Woolworths belong
to the Australian origin and have the capability of the development of funds based on the
processes of the company in an active way (Kasemsap, 2014).
Employees – The employees play a key part in the services and experiences that are
offered by Woolworths in the retail industry of the country. The local communities form a
major part of the employee base that has been gained by Woolworths. The association that is
developed by Woolworths with the local farmers and growers have played a important part in
the proper growth of the employee base (Meyer, Neck & Meeks, 2017).

6BUSINESS ENVIRONMENT ANALYSIS
Board members – The members of the board of Woolworths have been an important
factor that are able to influence the processes of the company. The policies that are developed
and followed by the organization are important for appropriate maintenance of the revenue
levels of the organization. The work process of employees and the customers are affected in a
vast way by the decisions that are made by the board members of the organization (Michael,
Storey & Thomas, 2017).
External stakeholders
Customers – Consumers are the most significant stakeholders of Woolworths who
have the highest levels of impact on the operations that are performed by the organization.
The trust levels of the customers are able to help Woolworths in order to continue its
profitable processes in the retail industry in a sustainable manner. The organization considers
the interests of the customers to be most significant for growth of the portfolio in the industry
(Michael, Storey & Thomas, 2017).
Government – Woolworths has gained major support from the government based on
improvement that the company has made in the growth of local farmers and growers. The
profitability levels of the organization are considered to be significant for development of a
position of Woolworths (Morschett, Schramm-Klein & Zentes, 2015).
Suppliers – The suppliers of Woolworths mainly include the local farmers and
growers who are influenced by the revenues that are gained by the company in the retail
industry. The local farmers are also able to facilitate the quality of products that are provided
by Woolworths to the customers. They have helped the organization to develop an image of
“Fresh Food People” in Australia (Sakas, Vlachos & Nasiopoulos, 2014).

7BUSINESS ENVIRONMENT ANALYSIS
Identification of the nature and degree of main stakeholders’ interests and implications
of conflicting interests
The interest levels of the stakeholders of Woolworths are considered to be quite
different for the various operations and functions of the organization. The customers are the
most crucial stakeholders of the organization who have an impact on the profitability levels.
The customers expect the get the freshest products at prices that are lower than that of the
competitors of Woolworths (Morschett, Schramm-Klein & Zentes, 2015). On the other hand,
the interest of the shareholders is based on the methods by which they are able to gain a
return on the investments that are made by them. The proper fulfilment of this interest can
lead to rise in prices of the products and services that are provided by Woolworths. The
conflict of interests can further cause issues in the levels of profitability that are earned by the
organization (Steinbach et al., 2017).
Levels of main stakeholders’ influence
The major stakeholders of Woolworths are able to affect the prices of the products
and the policies that are developed as well. Customers are the most significant stakeholders
of Woolworths who in this case have a key influence on the methods by which Woolworths is
able to develop the product portfolio. The demands and needs of the customers are
considered to be highly important for the types of products that are offered in the stores. The
suppliers or the local growers of the company can affect the raw materials that are gained by
Woolworths (Wheelen et al., 2017). The interests of local growers have to be considered by
the organization so that they can be satisfied with the benefits that are provided due to the
profitable operations of Woolworths. The investors or shareholders have an impact on the
organizational processes that are implemented by Woolworths. The influence of shareholders
on functions and areas of Woolworths is high. The levels of capital that are provided to the
organization by investors are able to support the diverse processes (Morschett, Schramm-

8BUSINESS ENVIRONMENT ANALYSIS
Klein & Zentes, 2015). The capital of the organization has an impact on the functions that are
performed and the proper development of revenues as well. The internal and the external
stakeholders are thereby able to affect the position of the company and its revenues in the
retail industry of Australia. Woolworths needs to consider the interests of these stakeholders
in order to maintain the stages of profitability in retail industry. The influence of stakeholders
on organizational operations is able to play a major part in appropriate growth of the revenues
(Michael, Storey & Thomas, 2017).
Development of a stakeholder matrix
Stakeholder
Name
Impact
How much
does the
project
impact
them?
(Low,
Medium,
High)
Influence
How much
influence do
they have
over the
project?
(Low,
Medium,
High)
What is
important to
the
stakeholder?
How could the
stakeholder
contribute to
the project?
How could the
stakeholder
block the
project?
Strategy for
engaging the
stakeholder
Investors High High Profits Capital
investment
Lack of
proper
capital
Providing
decision
making rights.
Government High High Operations Implementing
flexible
policies
Developing
unfavourable
policies.
Providing
information
based on
operations.
Suppliers Medium High Operations Providing
appropriate
supplies
Charging
high prices.
Including
suppliers in
different
operations.
Customers High High Profits Purchasing
products
frequently
Not
cooperating
with the
management
Developing
effective
communication.

9BUSINESS ENVIRONMENT ANALYSIS
Analysis of the organization with the activities of another organization
The stakeholders of Woolworths are able to play a significant role in the development
of its processes in Australian retail industry. The consumers, suppliers or local growers and
investors of Woolworths have huge influence on the levels of cost-effectiveness and
operations of the different functional areas well. Woolworths is also highly important for the
growth of the local farmers of Australia. The company and the major suppliers are thereby
able to provide mutual benefits to each other in order to uphold the processes in a sustainable
way (Woolworths.com.au., 2019).
Another organization that can be considered in this case in order to compare the role
of stakeholders is Telstra. Telstra operates in the telecommunications industry of Australia
and aims at providing services to customers all over the country. The organization has played
a key part in the growth of levels of connectivity that is developed in Australia. The major
stakeholders of the organization in this case are the investors, government, suppliers and
customers (Telstra.com.au. 2019). Although the suppliers are major stakeholders of Telstra in
the industry they are not able to affect the processes of the organization in a huge manner.
The large number of suppliers that have been gained by Telstra are able to provide support to
the organization so that it is able to uphold its processes in the environment. The operations
of Telstra have no major effect on the suppliers and their activities. The interest levels of the
suppliers or Telstra are different from the interests that have been developed by the suppliers
of Woolworths (Telstra.com.au. 2019).
Conclusion
The report can be settled by asserting that an organization like Woolworths that
functions in the competitive retail industry of Australia is able to influence the stakeholders
and their position in a vast way. The stakeholders have an influence on the organizational

10BUSINESS ENVIRONMENT ANALYSIS
operations and are also able to influence the revenue levels. The profitability of the
organization on the other hand have an impact on the stakeholders and their future
associations with the other organizations as well. The stakeholder interest levels in the retail
industry are however different from the levels of interests that are developed in an
organization like Telstra that operates in the telecommunications industry.

11BUSINESS ENVIRONMENT ANALYSIS
References
Barros, I., Hernangómez, J., & Martin-Cruz, N. (2016). A theoretical model of strategic
management of family firms. A dynamic capabilities approach. Journal of Family
Business Strategy, 7(3), pp.149-159.
Daspit, J.J., Chrisman, J.J., Sharma, P., Pearson, A.W., & Long, R.G. (2017). A strategic
management perspective of the family firm: Past trends, new insights, and future
directions. Journal of Managerial Issues, 29(1), p.6.
Demir, R., Wennberg, K., & McKelvie, A. (2017). The strategic management of high-growth
firms: a review and theoretical conceptualization. Long Range Planning, 50(4),
pp.431-456.
Durand, R., Grant, R.M., & Madsen, T.L. (2017). The expanding domain of strategic
management research and the quest for integration. Strategic Management
Journal, 38(1), pp.4-16.
Dyer, J.H., Godfrey, P., Jensen, R., & Bryce, D. (2015). Strategic Management: Concepts
and Cases. Wiley Global Education.
Engert, S., Rauter, R., & Baumgartner, R.J. (2016). Exploring the integration of corporate
sustainability into strategic management: a literature review. Journal of cleaner
production, 112, pp.2833-2850.
Ethiraj, S.K., Gambardella, A., & Helfat, C.E. (2018). Theory in strategic
management. Strategic Management Journal, 39(6), pp.1529-1529.
Frynas, J.G., & Mellahi, K. (2015). Global strategic management. Oxford University Press,
USA.