MANAGEMENT STYLE : Morrisons Supermarket
Category : Management Samples
This essay utilized Morrisons Supermarket as the model organization to review its present management style and how they dealt with critical situations. From the analysis, key trends in the present management style of Morrisons Supermarket were then identified, how it worked and its effectiveness in dealing with critical situations was ascertained. The paper then moved on to assess the present management style of Morrisons Supermarket with regard to its suitability to critical situations, during which the internal capabilities of the present management style of Morrisons Supermarket in relation to the strategy being followed by the company was determined also. An overall analysis of the performance and effectiveness of the present management style of Morrisons Supermarket was also conducted to assess and compare the capabilities of its present management style with those of others. Gaps in the present management style of Morrisons Supermarket were then identified.
Finally, several choices of strategies to improve the present management style of Morrisons Supermarket as effective means in critical situations were recommended and evaluated in terms of appropriateness to the issues reviewed, feasibility in carrying out the options and acceptability within the key stakeholders and decision makers. Several key implementation issues related to managing strategic change were also addressed as well.
Morrisons Supermarket aims for sustainable growth as a broad supermarket leader in England as well as for segment leadership. This is the simple objective of the acquisition of Safeway Supermarkets. In both cases, Morrisons Supermarket and their branches including Safeway will play a crucial part. Morrisons Supermarket is able to establish its broad leadership usually by acquiring other strong supermarkets and their products, which are then combined into a new, larger company. Offering training to its employees, improving the company operations, and the introduction of new technologies then reinforces the positions of the various Morrisons Supermarkets. This practically results in economies of scale that is able to create a distribution network for both the local and international branches. If an area is already in the control of other supermarkets, Morrisons Supermarket devotes its attention towards the development of a premium segment with its various branches.
The mission of Morrisons Supermarket, on the other hand, is to secure the growth of its business in a sustainable manner, while at the same time constantly improving the company’s profitability. The strategy to achieve this involves four elements:
- Striving in order to reach a leading position in attractive markets
- Focusing on securing a competitive share of the supermarket segments.
- Working in order to improve the company’s efficiency and cut costs in operations.
- Continuous growth through selective acquisitions for as long as they are able to create shareholder value.
Morrisons Supermarket implements an autocratic type of leadership, wherein the management holds so much power and decision-making authority. They seldom consult their employees especially in making crucial decisions for the company. The management is close to being a perfectionist, supported by a consistent and efficient reporting system. The employees are expected to obey orders without receiving any explanations. The motivation environment is characterized through the establishment of a structured set of rewards and punishments (, 2002).
Amidst the criticism regarding this kind of leadership and management, it seems to work more in favor of Morrisons Supermarket. This simply proves that autocratic leadership is not totally bad at all. Perhaps, some leaders just think that it is the most effective leadership and management style to use from the start. But the leader has to be gifted of some sort in terms of planning strategies for the organization to pursue. Nevertheless, it is clear that this leadership and management approach can only work for as long as the management is always working effectively.
1) Improved corporate financial control – the capability of every division to gain profit is very evident because they are all converted into profit centres. Thus, the corporate centre will be able to operate an internal capital market more efficiently.
2) Improved Strategic Control – corporate staff will be able to concentrate on planning and refining corporate strategy since they are freed from operating responsibilities under a multi-divisional structure.
MANAGEMENT PROBLEM ISSUES
It is normal that when the new management starts to assume its post, it will have to implement stricter rights and privileges for its workers. There is a possibility that the once strong and transparent relationship that existed between the management and workers prior to the acquisition or merger would be replaced by frustration and hatred. When this happens, the performance of the new workforce will surely be severely affected and their efficiency will decline. This is because of concentrating on their work, they will now be more concerned about the diminished benefits they would be possibly be getting. These worries and anxieties will pave the way for them to inhibit frustration and anger towards their new supervisors and the management as a whole, feeling they are already taken for granted (, 2004).
It is a well known fact that human resources play a crucial role towards differentiation and a potent source of competitiveness for any organization or company (2001). Therefore, any organization must take care and constantly invest in human resource development especially during these periods of adjustment to a new management and environment. However, the determination of the extent to which an organization can invest in terms of human resources development depends on the financial capabilities of the company or organization. The rights and privileges of the workers must be carefully studied under the change management program of the company, because it should jive with the basic policies of an organization’s human resource development strategy.
Common Management related Problems within Morrisons Supermarkets
1) Formation of the divisional-corporate authority relationship – the problem here is in making the decision as to how much authority would be needed to centralize at the supermarket level and how much authority would be also needed to decentralize at the divisional level (, 2001).
2) Information Distortion – if the supermarket centre will pressure the divisions too much, then the divisions might be encouraged to radically change the information they normally supply to their managers.
3) Competition of Resources – since the Morrisons Supermarket branches are normally evaluated on return of investment (ROI) criteria, this might cause them to start competing for resources (. 2003).
4) Transfer Pricing problem – when the Morrisons Supermarket branches engage in competition, it would become extremely difficult to set fair prices for trading resources between them (. 2002). This is because each division will try to set the highest price it can to maximize its own ROI. However, these efforts can undoubtedly alter the corporate performance and ROI.
5) Short-term focus on research and development – if the Morrisons Supermarket branches will be evaluated on the basis ROI target, this might put pressure on research to improve their financial performance (, 2003).
Planning must be implemented by the management of Morrisons Supermarket in order for its activities and resources to be coordinated over time. This will enable the company to achieve its goals with minimal resource utilization, plus the opinions and suggestions of the employees can be also taken into consideration. Planning also will enable Morrisons Supermarket to monitor the progress of their plans at regular intervals and maintain their control over operations. Planning within Morrisons Supermarket must involve four elements: scheduling, labor planning, financial planning, and cost planning (2002).
- Scheduling involves the specification of the beginning, the length or the duration, and end of the planned activities.
- Labor planning involves allocating the necessary personnel and delegation of responsibilities and resources
- Financial planning involves identifying the types and needs in terms of financing.
- Cost planning involves determining the costs and the possibility of their occurrence.