Woolworths Group: Analysis of Operations, Systems, and Market Position

This report offers a comprehensive analysis of Woolworths Group, a major player in the Australian retail industry. It begins with an overview of the company, including its history, operations, and market position, highlighting its significant revenue and online retail presence. The report then delves into t...Read More

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WOOLWORTHS GROUP
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WOOLWORTHS LIMITED
Woolworths Limited is a public limited company founded on 22nd September 1924 that deals with retailing of general
merchandise such as household items, office equipment and other materials that are used by consumers on a regular basis. The
company has a large network of outlets within Australia which makes it accessible to people all over the country. The firm is ranked
as one of the best retail outlets which are reflected in the overall sales and production of the firm. The firm also controls the online
retail market with its stores offering an option for buyers who wish to purchase online (Vesty et al. 2017). Since it’s a large company
the revenue from sales is the second largest after Westfarmers. The firm has over the years encountered an upward rise in the retail
industry because of the rapidly growing economy that has enabled households to have enough money to spend within the country.
There have been transformations in improving operations and the adoption of different processes and strategies such as the adoption of
inventory management systems to help in regulating and managing of stock. There have also been transformations that have led to the
embrace of information technology which yielded the acquisition of accounting software for the management of finance and
monitoring the stock movement within the organization. The major issues raised in this case relate mainly to the use of different sets
of inventory management systems and coordination processes (Lyons, K. 2007).
Organization Structure
The organization boasts of a clear chain of command that allocates duties and responsibilities to different members of the
community. The organization is managed by an overall chief executive officer who is in charge of operations within Australia. The

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CEO is assisted by departmental heads at the central office who are mainly the financial officer, the procurement officer, sales and
marketing head and the human resource office in charge of internal operations (Ismail & King 2014). The chain further breaks down
to the respective store managers who control operations in their respective centers and report to the overall head. The branch manager
is assisted by subordinates who help in the running of activities within the center. The organization relies on a decentralized
management approach that has enabled the empowerment of different managers who help in coordinating activities within the region
(Federici 2009).
The first goal of the organization is customers comes first across all their brands. The firm prioritizes the customer by
building a customer and employee culture and team. Providing value in their products such as drinks to be able to provide convenience
to customers, Generating sustainable sales momentum in food. Delivering shareholders value by empowering the firm’s portfolios to
implement strategies. Lastly, by being a lean retailer the systems and processes used provide excellence service to the customer. The
firm advocates building a team that listens to their suppliers, team members and further customers and thus a continuous improvement
of shopping experiences to the customers.
Problems Related to the Organization Structure
The current structure subjects the organization to a myriad of challenges arising from the daily operations of the company.
Firstly, the process limits decision making which makes it slow to decide on issues. The organization encounters a slow decision-
making process because of bureaucratic process that delays the process due to the need for approval and validation (Smit et al. 2017).

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Secondly, errors occur on a regular basis because of the system. The decentralization approach allows for different units to operate at
an individual level so as to allow for the organization to flourish and progress. Lastly, the overall performance of the organization is
derailed by failure arising from one unit (Arli et al. 2013).
System of Acquisition
The idea system of acquisition for the organization is likely to be custom software. The process involves the provision of
specifications by the company on how the firm wants its software to appear and the problems that it seeks to remedy. Custom software
is applicable in this case because of the unique format of the organization and its giant size which may have extra needs to be fulfilled
in the development of an ideal accounting software.
Systems Flowchart of the sales Procedure
Systems flowcharts are used to show a process in which several individuals in a departments and other functional areas are
involved in the organizations day to day activities. It’s also important to note that it’s sometimes very difficult to keep track of the
different responsibilities of different people. The flowchart is divided in columns to be able to do an analysis of the number of times a
process is ‘handed over’ to different types of people and departments. It also shows the relationship between departments and a
business process.

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This flow chart above explains the systems flowchart for clients who buy via the website, mobile app, virtual stores any other
CUSTOMER SALES WAREHOUSE
CUSTOMER
SERVICE
NO
YES
NO
YES
PLACE ORDER
ORDER
COMPLETE?
ORDER SENT
TO
WAREHOUSE
ITEMS IN
STOCK?
SHIP ITEM
TO
CUSTOMER
RECEIVE
ITEM
REFUND
AND CALL
CUSTOME
R

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delivery option.
CUSTOMER SALES
CUSTOMER
SERVICE
Above is a flow chart of when a customer gets into Woolworths retail store goes around looking for the items that thy want. After
picking everything they need the customer heads to the counter where they will pay and their items packaged. Further the firm have
made recent improvements like making big packing bags, more half sized trolleys, updated store directories in the aisles of the store
and clearer information about fresh foods, all these for customer satisfaction
Control Problems
CUSTOMER
ENTERS THE
STORE, PICKS
TROLLEY AND
WALKS AROUND
TO PICK ITEMS AT
THE SHELVES
CUSTOMER PAYS
USING CASH OR
CREDIT PACKAGING

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The control problems the system used by the organization is likely to incur include system downtime that may arise from a
large number of users accessing the system at the same time. The organization’s decentralization approach may also be a problem in
developing and running a software that cuts across the different departments. Accounting errors such as double entry are likely to be
generated which may cost the organization a huge sum of money. Bandwidth challenges may also emerge because of the systems
complexity and the large database that the system will be managing. The integration is likely to affect the systems overall performance
(Burch & Goss 2009).
Part Two
Development and Adoption
The development and adoption of accounting software and packages require a clear-cut plan that focuses on different aspects
of the overall business. Based on the idea fronted the development should seek to mitigate the possible challenges that may emerge
such as system breakdown and errors in financial calculations. As a means to arrive at the ideal solution a stable database should be set
up and also the organization should avail all the necessary information required for the research and development.
Current Market Size
Woolworth limited boasts of a large market size in Australia that are mainly household consumers of retail products. The firm
also does liquor retailing alongside other household items which makes it a key player in the industry. The market size, in this case,

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comprises of middle-aged consumers who are the main users of the company’s products. The market size for household consumers
can be estimated to be around 5 million people from within the country who buy the organizations products on a daily basis (Rompho
2011). The market of the organization also extends all the way to neighboring New Zealand.
Market Leaders
As much as Woolworth enjoys the position of the market leader it faces stiff competition from retailers such as Coles who
deals with a range of items used by households. Coles enjoys a competitive advantage because of its focus on the utilization of the
internet as a niche for its survival. The company has a fully functional automated system that allows members to place orders,
therefore, making the organization to sustain itself economically. The market leaders also enjoy a large market share which makes it
difficult to compete fairly in the market (Dixit & Prakash 2011).
System Gaps and Recommendations
The system encounters several gaps such as errors arising from the side of the company and the customer as well. The system
has major issues in accommodating a large number of orders at once which in most cases affects its productivity. The system also has

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a major gap in harmonizing records in the inbound logistics section and the outbound logistics section. The main reason is that the
system fails to take into account the materials that are leaving the organization which makes it a challenge in balancing books of
account and recording of financial records (Pritchard 2000). The ideal recommendation to remedy the issues should include the use of
an integrated system that incorporates inventory management to help in tracking materials that are entering and living the system. The
sluggish system response can also be addressed through reprogramming the software to provide more routing points for the use of
materials and issues that arise from the process. The developer should also consider adopting the use of a large server that can
accommodate many users at the same time. The user interface should also be adjusted to accommodate a large number of customers at
the same time.

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List of References
Arli, V., Dylke, S., Burgess, R., Campus, R. and Soldo, E., 2013. Woolworths Australia and Walmart US: Best practices in
supplychain collaboration. Journal of Economics, Business & Accountancy Ventura, 16(1).
Burch, D. and Goss, J., 2009. Global Sourcing and Retail Chains: Shifting Relationships of Production in Australian Agri‐
foods. Rural
Sociology, 64(2), pp.334-350.
Dixit, A.K. and Prakash, O., 2011. A study of issues affecting ERP implementation in SMEs. Researchers World, 2(2), p.77.
Federici, T., 2009. Factors influencing ERP outcomes in SMEs: a post-introduction assessment. Journal of Enterprise Information
Management, 22(1/2), pp.81-98.
Ismail, N.A. and King, M., 2014. Factors influencing the alignment of accounting information systems in small and medium sized
Malaysian manufacturing firms. Journal of Information Systems and Small Business, 1(1-2), pp.1-20.
Lyons, K., 2007. Supermarkets as organic retailers: Impacts for the Australian organic sector. Supermarkets and agri-food supply
chains: transformations in the production and consumption of foods, pp.154-172.

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Pritchard, W.N., 2000. Beyond the modern supermarket: geographical approaches to the analysis of contemporary Australian retail
restructuring. Geographical Research, 38(2), pp.204-218.
Rompho, N., 2011. Why the balanced scorecard fails in SMEs: A case study. International Journal of Business and
Management, 6(11), p.39.
Smit, R., Kingston, P., Wainwright, D.H. and Tooker, R., 2017. A tunnel study to validate motor vehicle emission prediction software
in Australia. Atmospheric Environment, 151, pp.188-199.
Vesty, G., Sridharan, V., Northcott, D. and Dellaportas, S., 2017. (In Press) Burnout among university accounting educators in
Australia and New Zealand: Determinants and implications. Accounting and Finance, pp.1-23.