Strategic Innovation Solution for Woolworths: BUS705 Report

This report focuses on Woolworths, an Australian retail company, and addresses its challenges in a competitive market. The paper identifies a significant reduction in profit margins due to an inability to identify customer preferences, ineffective communication, and issues with product quality. The proposed strategic innovation solution involves infrastructural development, integrating Radio Frequency Identification Device (RFID) tags, Enterprise Resource Planning (ERP), and Customer Relationship Management (CRM) to improve communication, track best-selling products, and tailor products to customer preferences. The action plan includes changes in operational methods for employees, leveraging technology, and establishing an efficient flow of communication. The report also emphasizes the importance of participative leadership in innovation implementation. The integration of these elements aims to improve product quality, increase sales, and build a strong customer base for Woolworths.

Running head: MANAGEMENT
Management
Name of the Student
Name of the University
Author Note

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The modern business industry is seen to experience a significant level of rivalry and
that is pretty apparent with the increasing level of consideration of the managers towards the
application of the various strategies such as the application of the low pricing or the
improvement in the quality of the products or the services that the organizations offer to their
customers. Ghemawat (2017) commented that the influence of the globalization is a key
reason responsible for the reduction in the monopoly in the market. Along with that,
Swoboda et al. (2013) highlighted an important fact with the claim that the increased entry of
the new organizations in the industry is the fundamental factor responsible for the increment
in the intensity of the competition faced by the organizations operating in the various
industries. The retail industry is seen to be one of the few industries that are facing the entry
of the increased number of new organizations and that is populating the global retail industry.
Under such situation, the companies operating in the industries are facing the need of
designing their products and services in accordance to the demands of the customers. Under
such situation, the incorporation of the modern technology and innovative solutions in the
process of identifying the preferences of the customers becomes much needed to increase the
flexibility and speed in the operations of the organizations. The paper is focused in the
elaboration of one such organization in the form of Woolworths, facing the need of
incorporating innovative solutions in their business operations. The paper formulates a
strategic innovation solution for the company with a precise focus on the identified problem.
Other than this, the paper delivers important information regarding the action plan that the
company is expected to undergo for the effective management of the innovation. In addition
to this, the paper includes a important argument regarding the leadership that is required to
promote the innovation along with the innovation implementation process for the company.

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Company Related Innovation Challenge:
With specific attention on the business operations of the selected company, it is
obvious that the company is facing a series of difficulties in maintaining the sustainability of
their business actions. Considering the classification of the sustainability, it is prominent that
the organizations specifically are specifically involved with three different forms of the
sustainability such as the economic sustainability, social sustainability and the environmental
sustainability (Vigneau, Humphreys and Moon 2015). The identified problem that invites the
incorporation of a leading edge strategic solution is related to the economic sustainability of
the company. Though, some of the aspects of the identified challenges have significant
connection to the industry problems but the base of the problems is seen to affect the
sustainability of the business operations of the company. The company is seen to be affected
by a significant reduction in the margin of profit of the company. Several business analysts of
the region stated the cutthroat competitive market to be the main reason responsible for such
a status of the company. The main drawback of the company’s internal business process
which restricted the company in achieving increased margin of profit is seen to be the
incapability in identifying the likings of the customers (Woolworths.com.au. 2019).
With a precise focus on the intense competitive market, it becomes important for the
organizations to identify the requirements or the demands of the clients to design the products
in accordance to the preferences of the customers. In the modern business setting, the design
or the manufacturing of the products in relation to the preferences of the customers becomes
highly important as it has the potential to increase the participation of the customers with the
organizations and form the much required customer loyalty amongst the customers (Mende,
Bolton and Bitner 2013). Other than this, the company is seen to be notably affected with the
ineffective flow of communication amongst the departments responsible for the effective
management of the manufacturing and the selling operations that according to many of the

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business researchers was the main point of concern for the senior management of the
company. One of the major strong point of the company is the differentiated product chain of
the company and that played a crucial role in favour of the selected company in meeting the
varied requirements and demands of the customers in the Australian region. However, the
variation in a particular product category along with the appropriate identification of the best
seller products in seen to be a major concern for the company. The best seller products reflect
the increased preferences of the customers towards a particular product and under such
situation it holds greater possibility for the companies in achieving a significant increment in
the profit of the company (Knapp, Hennig-Thurau and Mathys 2014).
However, the inappropriate identification of the best seller products is seen to place
the company in an irrelevant position in achieving the increment in the sales. Other than this,
the company was seen to be affected with the lack of quality in their products and many of
the customers were seen to prefer other supermarkets as the company was unable to provide
them quality products. The senior management of the company was seen to put strong
emphasis on the manufacturing of the products in relation to the demands of the clients and
considered it to be one of the reason that is forcing the business operations of the company to
be irrelevant in the intense competition of the market (Woolworths.com.au. 2019). Apart
from that, the senior management of the company considers it to be important for them to
form a strong customer base for the increased sales of their products. Considering the
increasing intensity of the competition, it becomes an important for the companies to create a
customer community to increase the sustainability of their business operations and under such
situation, there is limited good options for forming a strong customer base other than
manufacturing the products as per the specification of the customers.

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Strategic Innovation Solution:
The leading edge strategic innovation solution that is selected for the case is a form of
infrastructural development for the company. The basic objective is to strengthen the
communication between the store managers, manufacturing department, supply chain
operators, the customer relationship management and the line managers of the company. The
company will label all of its products with the Radio Frequency Identification Device (RFID)
tags (Kuhl et al. 2013). The tags will be loaded with all sorts of information regarding the
manufacturing and the specification details of the product. The company will take the help of
the Enterprise Resource Planning along with the Internet for establishment of the efficient
flow of communication inside the organization. With the help of the scanners, the employees
of the departmental stores will read the specification loaded in the Radio Frequency
Identification Device tags. With the help of the Enterprise Resource Planning and Internet,
the read information will be transferred to the manufacturing centres of the company, the
supplier operators and line managers. The application of the technology will ensure a
significantly speedy exchange of the information. Other than this, the company will be able to
identify the best seller products with the repetitive readings of same specifications.
Hence the effective tracking of the best seller products will be significantly easy for
the selected company. Apart from this, the exchange of the information across the mentioned
stakeholders of the company will be vital for the company in manufacturing of the products
that are repetitively purchased by the customers. The exchange of the specification will allow
the employees of the manufacturing departments to manufacture the products in accordance
to those specifications so that the company be able to continuously provide the products in
agreement to the likings of the clients (Poksinska, Swartling and Drotz 2013). The exchange
of the information to the supply chain operators will be crucial for the company in sourcing
of the quality materials for the manufacturing of the products in accordance to the shared

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specifications. The inclusion of the CRM will be crucial for the company in achieving the
diverse requirements of the customers over the online medium. With a precise focus on the
tech savvy people of the nation, it becomes important for the company to enable themselves
in the achievement of the inputs shared by the customers through the online mediums.
With a precise understanding of the innovation, it becomes evident that the company
will be able to track their best seller products in an efficient manner and along with that, the
implementation of the innovation will be crucial for the company in the design of the
products in agreement to the likings of the clients. Hence it will be vital for the company in
minimizing the quality concerns of the products and the services that they offer to their
customers. On the other hand, it will certainly increase the sales of the company along with
the profit of the company. The increment in the involvement of the customers will be the
main reason responsible for the increment of the profit for the company and along with that,
it will also meet the objective of the high- rank management of the company in the
formulation of a strong customer base.
Strategic Innovation Model:
Innovation Action Plan:
With a detailed emphasis on the current approach of the company, it is obvious that
the management of the company employs no specific method for the identification of the best
seller products or for the evaluation of the specifications of the customers of the company.
Hence it becomes complicated for them in penetrating the market with the products that are
preferred by the customers in a significant manner. The company has the necessity of
incorporating an appropriate method for the identification of the best seller products. The
company needs to establish an efficient flow of communication across the different
stakeholders and the departments responsible for the management of the manufacturing and

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the sales operations of the company. The company requires to change their model of formal
communication which involves the mails to the respective authorities. However, the method
becomes time consuming for the company and with a precise focus on the varying market
and the demands of the customers, it is important for the company to establish a method that
has the possibility to eradicate any sort of scope of excessive time consumption.
The implementation of the mentioned innovation will allow the company in
improving the infrastructure of the company where it will inherit the significant application
of the technology. The employees of the mentioned departments will be required to change
their method of operations as well. The employees will be required to have the expertise of
transferring the data of the products through the application of the Radio Frequency
Identification Device, Enterprise Resource Planning and Internet (Nofal and Yusof 2013). On
the other end, the employees will be responsible to portray the excellence in sourcing the data
shared by the employees of the departmental stores or the Customer Relationship
Management for conducting their operational activities in accordance to that. With the
change in the approach of the company, the efficiency in providing quality products and the
goods in agreement to the likings of the clients will be significantly possible for the company.
As the company will be able to inherit the quality of providing improved products in terms of
the quality and the design of the products, it will be significant improving the value of the
customer’s money.
Leadership:
In the implementation of an innovation, the appropriate leadership will be the
participative management (Rolková and Farkašová 2015). It will be better as a leader to
identify a pool of suitable solutions instead of striving towards the identification of the only
correct solution. As the terms such as the creativity and innovation relate to a sort of
leadership that promotes the out of the box thinking, it becomes important for the managers

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to undertake the participative management style for incorporating the innovation and the
changes. With a precise understanding of the appropriate style of leadership for promoting
the innovation, it becomes important to conduct the various engagement activities amongst
the employees for the achievement of the suitable ideas that will effectively solve the
challenges that the company is facing (Edwards-Schachter et al. 2015). The employees of the
company are in need to be involved in the various brainstorming activities along with the
practices of the six thinking hats or the Osborn checklist.
The increased occurrences of these sorts of sessions will be significant for the
company in the increment of the involvement of the employees towards the company which
is much required for effective implementation of the changes. Other than this, one of the
important responsibilities for the leaders in these sorts of situation will be to meet the
progressive needs of the employees. It is evident that the company is incorporating a new
tactic for their business operations and under such situation, it will be difficult for the existing
employees to cope up with the requirements for the management of their business processes.
Hence the leaders will be required to recognise the progressive needs of the employees with
the consultation sessions. Along with that, they will be in need to conduct the relevant
training and progressive activities for the staffs to meet the developmental needs of the
employees responsible for the management of the manufacturing and the sales operations. In
addition to this, the leaders will be required to form an attractive rewarding policy for the
employees with the addition of the intrinsic and extrinsic rewards for inspiring the employees
in performing in an efficient manner and for recognising the improved performances of the
employees as well.

Running head: MANAGEMENT
Innovation Implementation:
The procedure for the innovation implementation is mentioned below:
Objectives Activities Timeframe Success Factors
Infrastructural set
up
The shareholders of the company need to
provide the sufficient investment for
building the infrastructure with the inclusion
of the Radio Frequency Identification
Device, Enterprise Resource Planning and
Internet.
The objective is expected
to be achieved within 24
weeks.
The ability of the shareholders
of the company to invest in an
appropriate manner.
Training and
Developmental
Activities
To conduct the consultation sessions with
employees of the relevant departments for
the identification of their developmental
needs.
The formulation of the appropriate training
and progressive actions with a detailed
emphasis on the identified developmental
needs of the employees will be much needed
for the company.
The objective is expected
to be achieved within 8
weeks.
The capability to identify and
encounter the progressive
needs of the staffs in a well-
organized manner.
Employee
Motivation
To conduct consultation sessions for
identifying the needs of the employees so
that the company be able to align the
rewards with the identified needs.
To formulate an attractive and effective
rewarding plan with the inclusion of
extrinsic and intrinsic rewards for
The objective is expected
to be achieved within 8
weeks.
The success factor for the
objective will be the capability
to effectively recognize the
basic requirements of the staffs
and align the rewards with
those needs in an efficient

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motivating the employees in improving their
performances. This will be crucial in
recognizing the good performances of the
employees.
manner.

Running head: MANAGEMENT

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References:
Edwards-Schachter, M., García-Granero, A., Sánchez-Barrioluengo, M., Quesada-Pineda, H.
and Amara, N., 2015. Disentangling competences: Interrelationships on creativity, innovation
and entrepreneurship. Thinking Skills and Creativity, 16, pp.27-39.
Ghemawat, P., 2017. The laws of globalization and business applications. Cambridge
University Press.
Knapp, A.K., Hennig-Thurau, T. and Mathys, J., 2014. The importance of reciprocal spillover
effects for the valuation of bestseller brands: introducing and testing a contingency
model. Journal of the Academy of Marketing Science, 42(2), pp.205-221.
Kuhl, C., Wakim, P., Vesikivi, P. and Huomo, H., Nokia Oyj, 2013. Reader device for radio
frequency identification transponder with transponder functionality. U.S. Patent 8,384,519.
Mende, M., Bolton, R.N. and Bitner, M.J., 2013. Decoding customer–firm relationships: how
attachment styles help explain customers' preferences for closeness, repurchase intentions,
and changes in relationship breadth. Journal of Marketing Research, 50(1), pp.125-142.
Nofal, M.I. and Yusof, Z.M., 2013. Integration of business intelligence and enterprise
resource planning within organizations. Procedia Technology, 11, pp.658-665.
Poksinska, B., Swartling, D. and Drotz, E., 2013. The daily work of Lean leaders–lessons
from manufacturing and healthcare. Total Quality Management & Business Excellence, 24(7-
8), pp.886-898.
Rolková, M. and Farkašová, V., 2015. The features of participative management
style. Procedia economics and finance, 23, pp.1383-1387.

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Swoboda, B., Berg, B., Schramm-Klein, H. and Foscht, T., 2013. The importance of retail
brand equity and store accessibility for store loyalty in local competition. Journal of Retailing
and Consumer Services, 20(3), pp.251-262.
Vigneau, L., Humphreys, M. and Moon, J., 2015. How do firms comply with international
sustainability standards? Processes and consequences of adopting the global reporting
initiative. Journal of Business Ethics, 131(2), pp.469-486.
Woolworths.com.au. 2019. Home. [online] Available at: https://www.woolworths.com.au/

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Appendix:
Idea Generation:
1st Idea:
The first idea that was put forward was the usage of a common register for all the
departments where the sales of the company will reflect.
2nd Idea:
The inclusion of a combination of RFID, ERP and internet for improving the communication
amongst the manufacturing, supply chain and the departmental store authorities.
3rd Idea:
The inclusion of a combination of RFID, ERP and internet for improving the communication
amongst the manufacturing, supply chain and the departmental store authorities along with
the line managers and the customer relationship management of the company.
Reason for selection:
The 3rd idea was selected as it has the potential to provide the customer preferences
achieved in offline and online medium. Other than this, the application of the technology will
be cost- efficient and time saving for the company and will be of great significance in
increasing the speed of the decision making.