Organizational Dynamics of Woolworths Limited: MGMT6012 Report

This report provides a comprehensive analysis of Woolworths Limited, a major Australian retail business. It examines the company's organizational behavior, structure, and dynamics within a competitive market. The report identifies key management issues, including challenges related to organizational structure, communication, ethics, diversity, and supply chain management. Through qualitative research, including content analysis and interviews, the report explores Woolworths' hierarchical structure and its impact on innovation and employee satisfaction. It critically examines the role of ethics and diversity within the organization, addressing concerns regarding employee treatment and workplace culture. The report recommends adopting a flat organizational structure to boost innovation and productivity, along with emphasizing ethics and diversity to improve employee satisfaction and overall performance. The analysis concludes with a summary of the findings and recommendations, emphasizing the importance of adapting to the dynamic business environment.

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Introduction
Woolworths Limited is one of the largest retail business organization based in Australia.
The business organization operates in an oligopoly market, with few big companies operating in
the retail industry in Australia. The company enjoys better returns as compared to other small
organizations in the industry. The company has 31% market share in the retail industry. The
company also has a strong presence in the UK market. Since the past years, the company
managed to grow and expand its business, thereby increasing its market share. Woolworths
Limited has only one strong competitor that is Cole’s td. There is intense level of competition
between the two countries. The purpose of this report is to understand organizational behavior
and dynamics of Woolworths Limited in retail industry. It identifies specific management issue
that is faced by Woolworths. It provides recommendations and suggestions to overcome the issue
faced by the business organizations. Lastly, it sums up the main points and concludes the
assignment.
Methodology
Qualitative research will be done to gather data and relevant information for the report to
identify the issues faced by the selected organization that is Woolworths Limited. Content
analysis will be taken into consideration for gathering report and analysis. Various products,
media, documents, and other digital media will be used to collect data and information for
analyzing the organization and issues faced. Open ended surveys will be conducted among small
group of people and analyze qualitative data. The focus groups will be 5 to 15 participants

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thereby examining the trends or events occurring in the organization. Moreover, in depth
communication and in depth interviews will be taken into consideration. Various literatures,
journal articles will be used for analysis and description. These research methods are highly
flexible and are easily adaptable with minimal cost in different cases.
Review of management theory
As per management theories, it has been identified that senior executives and top level
managers of the business organization are responsible for dealing with conflicts, make tough
decisions, and supervise other employees in the organization. Along with the advancement of
technology and machines, old products and services tend to become obsolete quickly. The legal
and political environment of the business organizations are highly unstable, which makes it
challenging for the business organization. Business organizations have limited resources; hence
the managers of the business organization must ensure that the resources are optimally utilized. It
is believed that the overall structure of the business organization is essential for the success and
profitability of the business organization (Hill, Jones and Schilling 2014). The channels of
communication and the direction in which the communications flow in all the levels of the
business organization are critical for the success and profitability of the company.
Woolworths Limited is dominated by the top level managers and the senior executives
with a simple and hierarchical organizational structure (Dos Santos, Svensson and Padin 2013).
With the increase in demands and popularity of the business organization, the company has
expanded and grown in its size. It has diversified and increased the range of products and
services offered to the consumers. The company follows a traditional structure with is
challenging for the business organization in today’s highly dynamic and even changing business

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environment (Frias 2014). The employees of the business organization are characterized to be
highly bureaucratic with clear set of rules and regulations. The responsibilities and jobs of the
departments are standardized and clearly defined (Berning 2014). However, this structure lacks
collaboration which makes it difficult for the business organization to attain organizational goals
and objectives. It reduces the scope for innovation as it has rigid structures. There are tendency
of the managers to become territorial regarding their power. However, recently the business
organization panned to restructure which also rose concerning redundancies. The employees and
the union lodged disputes in the commissions to restructure the store management structure
before it lead to redundancies in Australia (Ntim 2015). As per their grievances they considered
the timeframe provided to them too short to confront circumstances and raises issues.
Furthermore, the business organization also faces challenges with the supply chain management
such as inappropriate tracking system, lack of storage space as mentioned by Deresky and
Christopher (2015). There are other management problems and high level of dissatisfaction
among the staff members who fail to provide quality products and services to the customers. The
ineffective structure of the business organization fails to effectively handle the stock and provide
on time deliveries to the customers (Bryant 2019).
Critical examination of the role of ethics and diversity
Diversity and ethics in business organization has always been a sensitive issue.
Employees belonging from minority group are often marginalized and stereotypes in the
workplace. For example, the Aboriginal people in Australia face the same challenges.
Henceforth, ethics and diversity in the business organization affects success and profitability of
the business organization. The leaders and managers of the business organization are responsible

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for overall culture and diversity issues of the business organization. Concerning Woolworths
Limited, the core values of the business organization is to create better experiences with the
customers. The company has strong values which enable the managers and the leaders to behave
honorably with the employees (Arli et al. 2013). However, as mentioned by Arli et al. (2013), the
company has faced various criticisms regarding ethics and diversity in workplace. It has been
identified that the business organization is highly customer obsessed. They continuously focus
on improving and enhancing the experiences of the customers, however, the company fails to
value to employees as major stakeholders of the business organization. It has been argued by
Methner (2013), that Woolworths has been accused of underpaid workers. This reduces the
reputation of the business organization and damages the brand image of the company. It has been
stated by Knox (2015), that ethical behavior in organizations is guided by the rules and
regulations of the government. Therefore, it is essential for the managers and the leaders to
comply with the governmental laws and regulations to ensure sustainability and continued
profitability of the business organization.
With the increase in globalization and internationalization, diversity in workplace is
crucial element for success with widened scope of talent and skills. Diversity in organizations
builds stronger departments with better flow of communication (Rothaermel 2016). Diverse
workforce ensures innovative and collaboration leading to better improvement of
communication. It is the responsibility of the managers and the leaders to consider the ethics and
diversity issues faced by the organizations. It is believed by Handel (2014), that the organizations
must set some ethics policies and code of conduct including legal and moral issues. For instance,
if the business organization is guided by high moral standards, they become a part of the culture
and brand. This reflects on the brand positioning and image of the organization. As per

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Woolworths they prioritize ethics in the highly competitive business environment. Ethics in
organizations are mainly recognized as a success factor of the business (Islam, Jasimuddin and
Hasan 2015). The ethics and values of Woolworths provide a positive culture in the organization.
They are basic guidelines of the business organization to operate and run the business.
Woolworths addresses the concerns of the business organization by implementing ethical
sourcing strategy thereby confirming to responsible products to the consumers and protecting the
reputation and image of the business organization (Galbraith 2014). The managers and leaders of
the business organization are committed to uphold the rights of the employees and provide fair
working conditions. The operations and core activities of the business organization are based on
moral standards and ethics. The activities are aligned with the requirements and goodwill of the
communities, government, and business.
Recommendation and suggestion to improve the management issue
It is recommended that the business organization must incorporate a flat organizational
structure to boost innovation and productivity in the organizations. According to XU and LIU
(2013), the flat organizational structure involves fewer levels of hierarchy between the
management and lower level employees. The flat organizational structure also requires less
number of workers in the organization. This reduces operational cost of the business organization
and increases productivity. The flat organizational structure elevates the level of responsibility
among the employees (Arli et al. 2013). The flat organizational structure has little supervision,
thereby initiating innovation and lower operational cost of the employees. Most importantly, it
will help the business organization to improve the flow of communication in the business
organization between the managers and the staffs of the organization. In the dynamic and fast
changing business environment, it is essential for the business organization to improve decision

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making in the business organization (Ho, Lai and Lee 2015). The flat organizational structure
enables the business organization to improve decision making. As there are minimum number of
in line staffs and employees, the communication need not be done through intermediaries, which
increases the speed of communication in the organization. Most importantly, it enables the
business organization to improve employee’s level of satisfaction and motivation (Deresky and
Christopher 2015). As the organizational structure reduces authority, the employees can
implement their own personal ways of performing the work. This boost innovation and
productivity in the business organization. This in turn boosts the level of motivation and
satisfaction level of the employees. This increase employee satisfaction in the organization and
reduces conflicts (Ntim 2015). This in turn increases productivity and performance in the
business organization. Further, it is recommended that the business organization must ensure
ethics and diversity in the business organization. Having ethics and diversity in the business
organization ensures favorable business environment among the employees. The company must
provide equal opportunity to all the employees and provide promotion. It has been identified that
the company faced criticism from the employees regarding underpayments and strict
organizational structures which had created a cause of discomfort and discontentment among the
employees (Methner 2013). Therefore, it is recommended that the business organization must
improve the structure of the business organization and ensure that they are given with proper
time to complete their work efficiently. The managers and the leaders of the business
organization must consider the opinions and feedback of the employees before undertaking any
managerial decisions in the organizations (Rothaermel 2016). In this way the employees might
feel valued and included in the business organization. It has also been identified that
organizational diversity is a vital element for the success and profitability of the business

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organization. Woolworths must consider cultural diversity in the organization, it will enable the
business organization to gain various advantages by integrating alternative perspectives and gain
additional insights to handle the issues faced by the business organization (Berning 2014)..
Embracing inclusion and diversity in the business organization might enable the business
organization to gain new footholds in the market.
Conclusion
Therefore from the above analysis, it has been identified that the senior managers and the
top levels managers of the business organization deals with organizational conflicts and make
tough decisions for the business organization. It has been identified that Woolworths Limited has
a hierarchical organizational structure dominated by the top level managers of the business
organization. The structure of the business organization is ineffective in today’s highly dynamic
and competitive business environment. The structure of the business also increases conflicts and
discontentment among the employees in the business organization. There is high level of
dissatisfaction among the employees thereby reducing inefficiency in the business organization.
Therefore, it is recommended that the business organization must have flat organizational
structure which boosts innovation and productivity. This organizational structure reduces the
level of authority in the business organization and provides adequate time and space to ensure
efficiency. Further, it is also recommended that the organization must incorporate diversity and
inclusion in the organization. This will boost innovation and ensure satisfied employees in the
business organization.

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References
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