Harvey Norman Company
Harvey Norman is amongst the top biggest retail brands in Australia, which operates a large number of retail stores more than 250 across Australia and other parts of the world. The company was founded by Ian Norman and Gerry Harvey in 1961, where it was specializing in electrical goods and appliances. Currently, the company focuses majorly on four business lines including, bedding, furniture, electrical appliances, and computers (Harvey Norman, 2019). Being a one-stop destination, the business provides various solutions for each room in the house, which includes the latest technological innovation for both home office and home. Harvey Norman primarily operates through franchising using the main brand and all the other company-operated retail stores that are owned by ASX-listed; a Sydney-based mother company. The business is certainly one of the consistently recognized brands within Australia, as it translates to its multi-billion dollar sales revenues it receives. The business also operates in Malaysia, New Zealand, Slovenia, Ireland, Croatia, and Northern Ireland. Overseas, the business operates and owned by ASX-listed. As of June 2015, Harvey Norman had 36 retail stores in New Zealand.
Harvey Norman utilizes an Omni-channel communication approach to relate to its relevant stakeholders (Innovation Enterprise Channel, 2019). This implies that the company has established a multi-channel approach providing stakeholders with integrated customer-care experience, rather than a parallel working communication channel. In this case, the company has its supporting resources orchestrated and designed to cooperate. Such a modern communication approach of this company enables it to make prompt online communication through platforms such as email, Whatsapp, Facebook, and Twitter. With such a system, a customer can do online shopping from a mobile device or a desktop without many hustles.
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The company also has an established online chatting platform in the company’s website where any interested stakeholder can make inquiries and get prompt feedback from experienced company’s personnel. If a stakeholder is chatting online with the caring person from Harvey Norman, then the stakeholder is linked to a person who has specialized in the specific area of interest of that stakeholder. Further, the company has incorporated a communication strategy known as customer journey mapping that involves the use of rich information from the interested stakeholder’s online services and social media; for instance, where a customer interested in Harvey Norman has selected click and collect option while online.
Harvey Norman faces stiff competition from related companies although it has established good response mechanisms to the competition. Currently, there is 326 business of similar kind to Harvey Norman in this industry (D&B Hoovers, 2019). However, there are some key companies that are very competitive to this Harvey Norman including, Woolworth Group Limited, Myer Holding Limited, Flemings, Safety, and Action. Some of the directly competing products include consumer goods such as video games, CDs, DVDs, and Ultra HD Blu-rays. Harvey Norman’s direct competitor in New Zealand is JB Hi-Fi, which is a retail store that was founded in Australia in 1974 and later expanded to New Zealand in 2006. The company has 303 locations worldwide and is specializing in items such as hardware/electronics, DVDs and CDs, Blu rays, cameras, computers, sound systems, iPods and large home appliances. Its operating revenue as at 2016 was more than $4 billion (JB Hi-Fi, 2018). In New Zealand alone, the company has 13 stores.
Comparably to Harvey Norman that has 36 stores in New Zealand, the competitors are strong but do not have equal capability to impact the market as Harvey Norman does. Within the industry, Harvey Norman competes typically on the basis of product and price range. On the external, competition emanates from other operators who sell an item or a couple of similar ones provided by Harvey Norman. Despite the existing competition, the industry has been witnessing increased revenue over the last five years and Harvey Norman has been part of this performance. The company’s trend is illustrative of increasing profits accounting to $348.61 million, which is driven majorly by its growth in franchise sales.
Business Communication Issues
In December 2011, the company was penalized by the Australian Federal Court an amount totalling to AU$1.25 million for misleading advertisement that related to promotion of 3D TVs to watch AFL and NRL Grand finale in regions where 3D signals had not been received. The ruling made came along with a tainted image as put by the judge who stated that this was seriously deceptive and misleading information with a far-reaching scale. The Australian Competition & Consumer Commission which had presented the case was granted a win over this case. On the other end, the company was restrained for 3 years from creating a similar deceptive claim and directed to put corrective advertisements in stakeholders’ platforms.
Another communication issue was faced on October 2015, when the company communicated cheap furniture offers between midnight and 8:00 am. However, the business did not honour the sales and rather it stated that the prices set were as a result of ‘genuine error’. This led to many customers disgruntled while the brand name was damaged. To cover up this communication issue, the business offered free $100 vouchers alongside apologies to clients who were left furious after the failed sale. This incident increased the number of complaints about the company which is expected to have created some turbulence effect in the company’s successive revenue generated.
- The Response Plan
The following steps would be important in resolving these communication issues as guided by Rahim’s Meta conflict management model (Himes, 2008):
- Selection of response team – it would be imperative to select or to task an already existing response team to make suggestions and possible responses to the issue instead of engaging the entire organization’s team. This will enable swift and timely responses through easy coordination.
- Start a discussion – since these issues arose due to communication gaps, it would be important to engage the relevant stakeholders to know their point of view. These would include using platforms such as Twitter and Facebook where stakeholders can leave their comments/opinions about the matter of interest. This would be used to quantify the magnitude of the issues towards the stakeholders.
- Suggest all possible solutions – all possible solutions to the issues should be noted down and their significance level indicated in reference to the identified impact of the issue. Alternatives are also identified in this case as the different opinions are integrated with openness.
- Obliging – the differences should be minimized as much as possible by comparing the suggested solutions to the issues and trying to satisfy the concerns of the stakeholders.
- Avoiding – where the decision would have a significant impact on the company’s operation, then such a decision should be avoided at the expense of the affected stakeholder.
- Compromising – if the solution can be handled to satisfy the stakeholder without significant impact on the company, then the selected team can choose to compromise and satisfy the stakeholder’s concerns, and then communicate it out.
- Implementation Plan’s Efficiency
By coming up with a response plan that will be communicated to the relevant stakeholders, it would first imply to the stakeholders that their concern is also the company’s concern and that their opinions matter. This would then enable in genuine feedback about the company which will not only help to solve the immediate issue but even other related issues. It will also enable the company to become proactive of such issues in the future by establishing controls in its processes to ensure that there are no communication hitches within the company. Further, the implementation plan will enable the company to understand the degree to which such issues have an impact on the overall company’s performance and the level of impact. This will help the company to come up with other better alternative ways of undertaking some processes within its operations.
- Communication Methods
The stakeholders of concern in the communication issues identified in Harvey Norman Company are the customers. This is because the issues identified affected them as the end product consumer. The customers follow what the company communicates to them without understanding if it is a genuine communication problem or not. Therefore, in a case where they get the wrong information they feel to have been taken advantage over. As could be seen from the cases, the customers are the ones who raised a lot of concern while seeking to be considered. Additionally, there was a relative increase in customer complains during such incidences of communication problems; an implication that the issue affected them in one way or another.
Since the stakeholder of interest, in this case, is external, communication methods that would be appropriate include; newspaper, television, Twitter chats, and Facebook chats. With these media platforms, it would be important that the message passed is put in a clear and simple language of understanding the correction undertaken. The message should also be repeated in these media platforms for a while to ensure that a good number of the stakeholder have received the communication officially. While other platforms such as Facebook and Twitter would be receiving feedback from the customers regarding the issue, it would be good to ensure that the responses are moderated with an experienced person in line with the response plan established. With the response to the communication issue being made by the company’s official platforms, it attracts the interest of the stakeholders to consider the issue addressed for their interest. An example of such communication that was made by the company to re-assure the stakeholders that their interests are the company’s interest is a communication made about a phishing scam on November 15, 2018, in Facebook. Such a message as evidenced with the attachment below attracted stakeholders opinions and shares which indeed communicated on the appropriateness of the message content to the relevant stakeholders.
- D & B Hoovers (2019). Harvey Norman: Related Companies. http://www.hoovers.com/company-information/cs/company-profile.harvey_norman_holdings_ltd.b4dc37b5dbdf9a4f.html?aka_re=1#related-companies
- Harvey Norman (2019). Harvey Norman NZ: About. https://www.harveynorman.co.nz/
- Himes, J. S. (2008). Conflict and conflict management. University of Georgia Press.
- Innovation Enterprise Channel (2019). Go Harvey Norman – Omni-Channel: How are successful retail stores going omnichannel? https://channels.theinnovationenterprise.com/articles/2644-go-harvey-norman-omni-channel
- JB Hi-Fi (2018). https://www.jbcommercial.com.au/home
Communication Issue 1:
RETAIL giant Harvey Norman has been fined $1.25 million for misleading advertising after a court ruled that it had manipulated its customers by publishing false advertisements for 3D televisions.
A Harvey Norman catalogue and website in September last year promoted its 3D television as capable of showing AFL and NRL grand finals.
But Harvey Norman “knew it to be fact” that 3D broadcasts were only available in Melbourne, Brisbane, Newcastle, Sydney, Adelaide and Perth, as stated only in the fine print.
In a highly critical decision handed down in Brisbane’s Federal Court, Justice Berna Collier wrote the company’s conduct was “seriously misleading and deceptive, on a significant and far-reaching scale”.
She ordered that Harvey Norman is restrained for three years from making similarly misleading claims, that corrective advertisement is placed in newspapers and on the company’s website and that Harvey Norman pays $10,000 in costs to the ACCC. She said the company had taken no steps to correct the representation during the promotional period.
Communication Issue 2:
Customers charged more after pricing glitch
Some customers who believed they picked up dirt-cheap furniture deals in a Harvey Norman online sale say extra payments due to be deducted from their accounts have shot up.
The debacle surrounding the launch of Harvey Norman’s “New Zealand’s Biggest Retail Sale” intensified yesterday when the company confirmed it would not honour the deals.
Hundreds of super-cheap online deals on pricey furniture products were taken up between midnight and 8 am on Thursday. The near-330 people who took up the deals were later advised by email that the prices were the result of a “genuine error”. “All sales made during this period cannot be honoured,” Harvey Norman wrote. “Our website terms and conditions state that we may accept or reject any offer to purchase made by you and that we have the right to correct any errors.”
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Affected customers have all been offered a refund and $100 voucher. But the Weekend Herald has learned of at least two customers who claim pending internet bank transaction amounts for their purchases have jumped dramatically from the price they agreed to pay.
Auckland woman Charlotte Butcher said she thought she had paid $159 for her lounge suite but then noticed the electronic charge of $1359. By yesterday the figure was $1699.
“So I don’t know if that’s the original price or what, I don’t know what’s happening. It’s just bizarre.” Harvey Norman did not respond to requests for comment yesterday.
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