BUS705: Innovation Report on Woolworths and Strategic Innovation Model

This report examines the sustainability challenges faced by Woolworths, a leading Australian supermarket chain, focusing on waste management, carbon emissions, and packaging. It proposes a leading-edge strategic innovation solution, emphasizing banning plastic bags and recycling plastic bottles, to enhance customer perceived value. The report outlines the strategic innovation model, including the innovation action plan, leadership requirements based on Fiedler's Contingency theory, and the 13 steps of the strategic innovation model. It analyzes Woolworths' current business approach, market offerings, and customer segments to develop a sustainable market strategy. The report also addresses the importance of customer perceived value, implementation challenges, and the need for a holistic approach to strategic innovation management to achieve desired outcomes. The report also discusses about the sources of idea generation within Woolworths, strategic innovation model as well as 13 steps of strategic innovation model.

Running head: INNOVATION AND MANAGEMENT DECISION MAKING
Innovation and Management Decision Making

INNOVATION AND MANAGEMENT DECISION MAKING 2
Table of Contents
Introduction.................................................................................................................................................3
The innovation challenge.............................................................................................................................3
Leading edge strategic innovation solution.................................................................................................4
The strategic innovation model...................................................................................................................5
The innovation action plan......................................................................................................................5
The leadership.........................................................................................................................................6
The innovation implementation...............................................................................................................7
Explain all 13 steps of the strategic innovation model.............................................................................7
Conclusion.................................................................................................................................................15
References.................................................................................................................................................16

INNOVATION AND MANAGEMENT DECISION MAKING 3
Introduction
In the modern business scenario, several companies focus on eliminating sustainability
challenges. Sustainability indicates the attainment of own needs without considering the
capabilities with reference to future generations. In current times, several challenges are faced by
the company such as sustainability, CSR as well as, industry challenges. This report takes into
consideration about the sustainability challenges from different challenges (Morioka, Evans, and
de Carvalho, 2016). The aim of this report is to demonstrate the sustainability challenges that are
faced by Woolworths.
The report discusses the innovation challenges as well as, describes the sources of idea
generation within Woolworths. It also explains the Fiedler Contingency theory of leadership.
This report also describes the strategic innovation model as well as 13 steps of strategic
innovation model.
Background of the Company
Woolworths is a leading supermarket that deals in 995 stores within across Australia. Along with
this, approximate 115,000 team members facilitate convenience, range of products as well as,
value to consumers. Moreover, there are different sustainability challenges faced by Woolworths
such as wastages, climate change together with, packaging. The initiatives were introduced for
developing significant changes within the society such as developing sustainable environment
(Woolworths, 2019).
The innovation challenge
Woolworths is taking into consideration about the distinct products since the implementation of
sustainability greening retail strategy. Along with this, the management of Woolworths is
capable in terms of administrating the product supply through the manufacturer and thus, it

INNOVATION AND MANAGEMENT DECISION MAKING 4
makes a commitment with respect to a sustainable environment in the nation of Australia. In
addition, the company makes collaboration with the farmers as it is depicted as a transformation
in production technique. Along with this, farmers use a feasible tool that makes optimum
utilization of water in order to create a sound product. It could be traded at the grocery unit of
Woolworths (Woolworths. 2019).
The controlled agenda for transport could be addressed as a business collaboration with the
company that offers delivery services in terms of diminishing the engagement regarding the
truck. Woolworths has increased the amount of fleet for workforces by sharing that could
encourage the lower extent for potential carbon emission (Dubey, et. al., 2017).
The selling of quality and safe products to a consumer can aid to develop the trust regarding
sustainability in the market. The chain of stores of Woolworths could be led by several
philanthropic responsibilities within some region across Australia. The management of
Woolworths has developed the strategy for supporting the society by campaign, sensitization and
funding process. The action provided by the company is offered the advantageous toa member of
public and respective system for offering supports (Tidd, and Bessant, 2018).
Leading edge strategic innovation solution
(Sources: Varsei, 2016).

INNOVATION AND MANAGEMENT DECISION MAKING 5
There are several sources for generating the idea in innovation. These sources could be
competitor products, customer input, outsourcing, licensing, internal R&D, and brainstorming. In
this way, the brainstorming technique is used for generating the idea about the sustainability of
employees. This technique provides the chances to obtain a wide range of creative idea from
experts (Beh, et. al., 2016).
In addition, energy tool should be transformed, which is practiced in a shop unit of the company
from carbon-based energy to environmentally friendly techniques. It is recognized as natural gas
as well as, electricity. In current times, the company is processing for declining the use of plastic
bag as a packaging material in entire stages related to supply chain in the development of fresh
products. The corporation can make plan related to sustainable market by improving the
recycling procedure in relation to its own product packaged goods (Anastasiadis, and Poole,
2015).
The strategic innovation model
The innovation action plan
Woolworths presently emphasizes managing the wastages as well as, declining the carbon
emission. There is needed to make a transformation in a sustainability plan with reference to the
environment. In the context of innovation, the target market will be Australia as well as
innovation will be related to banning the plastic bag along with, recycling of plastic bottles
(Reimer, et. al., 2017). This would support to improve the customer perceived value (CPV)
because the company is going on to make innovation in the context of environmental
sustainability. The current capability of business is waste management as well as, it currently
deals in Australia market. It provides the added value to consumers. This innovation can be fitted
with the competencies of the corporation (Ayers and Odegaard, 2017).

INNOVATION AND MANAGEMENT DECISION MAKING 6
The leadership
(Sources: Vecchi, 2016).
Contingency theories: Fiedler
(Sources: Macchion, et. al., 2017).

INNOVATION AND MANAGEMENT DECISION MAKING 7
According to the view of Fiedler, there are several factors at which, effectiveness and leadership
are relied on such as the development of the group, the strength of leadership, and nature of
work. Contingency theory developed by Fiedler considers the psychological disposition as well
as, the personality of leader that are key variables in the ability of a leader. It leads this group in a
feasible way (Joyce, and Paquin, 2016).
In addition, the leader of Woolworths Company should have operated in three above situations.
There is a lack of three competencies that can outcome in a malfunction of leadership. Along
with this, leadership style can be evaluated by a significant relationship between leader and
group. Moreover, the competency of an effective leader is to clear the objective hence
workforces can perform in a basic routine as well as, less supervision is essential for re-describe
the allocated task and adjust the task (Evans, et. al., 2017).
The innovation implementation
The implementation of a sustainability program is related to several challenges. The business
expenses and expenditures have increased over the periods. The community engagement process
considers the terms about effective training as well as, sensitization. In such a manner, some
provisions could be costly to offer particularly to farmers. The contribution towards the company
in carbon emission reduction process has persuaded the efficiency towards the corporation with
respect to timely delivery. Along with this, the greening retailing strategy is being implemented
as sustainability with respect to Woolworth’s stores. It could be directly linked to the objectives
of an organization (Holbeche, 2015).
Explain all 13 steps of the strategic innovation model

INNOVATION AND MANAGEMENT DECISION MAKING 8
(Sources: Ansari and Kant, 2017).
Step 1: Checking the Now before Thinking about the How
Woolworths can assess the existing scenario before thinking regarding how innovation can be
executed. In such a manner, it can identify the challenges that Woolworths is making efforts
towards sustainability. The existing scenario could be assessed by SWOT analysis. Along with
this, Einstein’s theory could be applied by Woolworths. It links to business approach to space,
time as well as, mass (Esbjerg, et. al., 2016). It can be assessed by the following elements in
relation to innovation in Woolworths:
E= Management enterprise and expertise
M = Market offerings (product and service packages)
C² = speed of delivering innovative products to market
Step 2: Conventional Approach to Strategic Innovation
Woolworth's limited implements conventional strategy like waste management. However, it can
move with respect to strategic innovation like banning plastic bags as well as, diminishing CO2
emission. Woolworths can emphasize on market offers, speed of commercialization of

INNOVATION AND MANAGEMENT DECISION MAKING 9
innovation as well as, management expertise and experience. Along with this, Woolworths can
emphasize too much on existing best practices, imitation of rivalry or holding an existing market
position at the time of approaching the content. Woolworths should also focus on implemented
last year plan rather than searching for new and changing opportunities (Linder, and Williander,
2017).
Step 3: Basic Processes of Strategic Innovation
Woolworths can think about the strategy associated with sustainability. After that, it can give
strategic priority as well as illustrate the concern of sustainability. After detecting the concern, it
has created the ideas via several sources such as internal R&D, customer input, competitor
products, and brainstorming. The different process could be considered by Woolworths in
strategic innovation such as visualizing strategy, strategic focus and problem solving, generating
ideas, evaluating ideas as well as, implementation. These processes could be beneficial to
overcome the sustainability challenges (Evans, et. al., 2017).
Step 4: Strategic Innovation Action Plan
Woolworths has targeted both end consumers and business customers. Along with, it facilitates
the added value through wastage management as well as, recycling the plastic bottles. It develops
the favorable perceived value between consumers. A significant business model could be used by
Woolworths and this should be feasible in the context of revised company mindset (Joyce, and
Paquin, 2016).
It should consider a multi-functional approach that will bring together all creative assets as well
as, capabilities of the company in terms of producing innovative ideas for driving the business
growth. There is also a need for substantial review regarding the real condition of Woolworths. It

INNOVATION AND MANAGEMENT DECISION MAKING 10
should also show willingness in the context of top authority for sanctioning along with,
enhancing the climate that leads to innovation (Holbeche, 2015).
Step 5: Reviewing the Business
Woolworths can assess the assumption about the retail industry such as deliveries, prices,
products as well as, customers. Within Australia, the retail industry has focused on a customer-
centric strategy. The company makes control of existing assets as well as capabilities. The major
rivalry delivers the same goods and services as Woolworths. Moreover, a distinct feature of
Woolworth's is sustainability practices such as water waste management, which could not be
easily imitated through its rivalry. Woolworths Company uses outdated IT capabilities. Hence,
there is need to hire experts for attaining the competitive benefits (Ansari, and Kant, 2017).
Step 6: Reviewing the Market
The existing consumer of Woolworths is ended consumer as well as, business customers. Along
with, these types of customers have need of added value from the company and for this, they
purchase the products through Woolworths because it emphasizes on customer perceived value
as well as involves the sustainability in its strategy. This company meets the need of the
customer. There are homogenous market segments that are not being served through the
corporation. In addition, there are similar types of services that are unique competencies of
Woolworths like responsiveness to change as well as customer handling. It meets the
requirement of consumers (Anastasiadis, and Poole, 2015).
Step 7: Reviewing the Market Offering
The asset of Woolworths is goodwill and patent, core competencies are responsiveness to
change, together with customer handling as well as, capabilities are human resources and IT.
This could be feasibly unique for the company. Woolworths is making efforts for addressing

INNOVATION AND MANAGEMENT DECISION MAKING 11
environmental concerns. The non-consumers are not buying a market offering of Woolworths
because they are not happy to consumer handling facilities (Beh, et. al., 2016). Woolworths
always welcome consumer involvement in the context of co-creation projects. The market
offering of the company is evoking a favourable emotion with respect to consumers. Moreover,
Woolworths can focus on banning plastic bags and reducing the CO2 emission for attaining the
needs of consumers (Vecchi, 2016).
Step 8: Creating Customer Perceived Value
(Sources: Macchion, et. al., 2017).
A new market offering is appealing to consumers by promising a high degree of consumer
perceived value at an acceptable rate that will generate an acceptable return for the company. It
can focus on the expectation of buyers with regards to stages of buyer experience model. It will
also support the innovation activity of the company. It will also create radical innovation that
generally takes longer to appear. It will use modern technologies in terms of attaining the needs
of customers (Joyce, and Paquin, 2016).
Step 8: Creating Customer Perceived Value

INNOVATION AND MANAGEMENT DECISION MAKING 12
(Sources: Ayers and Odegaard, 2017).
Woolworths offer fast delivery that supports to gain customer productivity. It also focuses on
environmental friendliness, which supports to persuade consumers in the context of the brand. A
new market offering is appealing the consumer by promising the high extent of customer
perceived value at an acceptable return. It would create an acceptable return to Woolworths
Company. In addition, attention towards the buyer expectation in relation to phases of the
purchase experience model (Woolworths, 2019).
It would aid in the innovation activity of the company. Moreover, incremental innovation should
become promptly. Radical or breakthrough innovations can generally take longer for emerging.
Along with this, Woolworths should review the customer perceived value by reviewing each
phase in relation to the buyer experience cycle. It can also consider the ways to make unique
features at each phase in order to develop customer perceived value (Holbeche, 2015).
Step 9: Implementation: Characteristics of Strategically Innovative Companies

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(Sources: Linder, and Williander, 2017).
In such a phase, Woolworths can analyze the structure, system, cultures, people, and processes.
In addition, culture can be associated with collaboration, reward successes as well as, support
teamwork. Moreover, a flat organizational structure could be practiced as it will lead the
collaboration. Furthermore, the decentralized decision-making process will be implemented to
create an appropriate decision. Apart from this, support innovation system will be executed to
develop the liaison with consumers. The right individual will be chosen who have the right
competencies as it will support in creating innovation (Holbeche, 2015).
Step10: Purpose of Strategic Innovation
A sound innovation strategy of Woolworths can be ambitious, inspiring as well as, challenging.
It should be iterative and capable of adaptation over time. In order to attain this, Woolworths can
allow time and space for creative thinking. It can use resources in order to initiate small-scale
experiments. It can also motivate risk taking as well as, challenge the old habits together with,
ways of performing things. It can also motivate and encourage an individual to pursue ideas. The

INNOVATION AND MANAGEMENT DECISION MAKING 14
aim of strategic innovation is to reduce the sustainability challenges in the context of
Woolworths (Ansari, and Kant, 2017).
Step11: Transformation through Strategic Innovation
There are three people-management fundamental that could be used by Woolworths. In this way,
executives can officially integrate innovation; executives can consider explicit phases for
enhancing the innovation culture as well as, executives can make better utilization of existing
talent related to innovation. Moreover, transformation procedures will be implemented to create
strategic innovation. Along with, this procedure will support in significantly execute the
innovation within an organization (Evans, et. al., 2017).
Step 12: Holistic Approach to Strategic Innovation Management
Woolworths can create innovation as a key sector of Sustainability. It will highly execute within
innovation projects. Moreover, it will train innovative problem-solving facilitators for aiding the
innovation within an organization. It would also hire all employees with the intention of
sustainability business plan. It will also install the innovation room within the business unit as
well as, at headquarter. It will make scheduling in terms of assessing the meeting regarding
innovation performance within the business unit (Vecchi, 2016).
Step 13: Key Issues of Intent
(Sources: Varsei, 2016).

INNOVATION AND MANAGEMENT DECISION MAKING 15
The existing aim of Woolworths is to emphasize on declining carbon emission as well as, waste
management. It is essential to make transformation within the plan related to environmental
sustainability. For making innovation, the target market will be Australia nation as well as,
innovation would be linked with the recycling of plastic bottles as well as, banning the plastic
bag. This would support in improving the CPV due to making innovation in the context of
environmental sustainability (Anastasiadis, and Poole, 2015).
Conclusion
As per the above discussion, it can be summarised that several challenges faced by Woolworths
in terms of keeping sustainability like packaging, water waste, and climate changes. It can be
concluded that ideas within Woolworths could be generated by brainstorming technique.
Moreover, Woolworths can use strategic innovation model in terms of attaining the competitive
benefits. It can be concluded that Woolworths can practice Fiedler Contingency theory in terms
of dealing with innovation. It can be concluded that innovation can be applied by using the 13
steps innovation model as it would support in influencing the customer perceived value.

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