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Staples is an American multinational organisation in the business of providing office
products to its customers. The company has experienced tremendous growth since its
inception in 1986 and is one of the largest office products company in terms of sales
and footprint. The entity has relied on its stores to reach its customers. As of 2006, the
company had over 1500 stores in united States and Canada (Gavin and Levesque,
2007 p.1). The stores were responsible for 80% of the company sales.
The organisation’s stores have some level of autonomy. The manager of the store is
responsible for all activities carried out within the establishment. The units also maintain
their own Profit And Loss Statements. Therefore, the manager is responsible for the
growth of revenue at their unit. Gavin and Levesque (2007 p.1) report that each store
averaged an income of six million dollars in 2006.
Competition in the office product industry is high. Staples face competition from other companies in the same business like Office Depot and also big departmental stores such as Walmart. The heightened competition requires the firm to improve its customer service. The business instituted several measures that ensure the customer service at its stores is to a high standard. The firm has trained its staff and incorporated a customer-centric culture in its operations. The management at the stores is responsible for maintaining the required customer service levels.
This paper is a case study on Staples that focuses on the management of the company; the challenges faced by the managers in running the units are discussed. The characteristics of the manager and their influence on customer service are also critically analysed. The case study also examines the organisational structure; it further evaluates the positive and negative effects of changing the structure to a matrix format. Lastly, the obstacles to an effective strategy implementation at the organisation are cited and explained.
Challenging Aspects of a Manager’s job at Staples
The role of management is essential for any business entity. Barros, Sampaio, and Saraiva (2014, p.3) argue there is a correlation between quality management, organisational practices, and the performance of the firm. Schraeder, et al., (2014 p.57) add that a manager is critical in the successful implementation of a firm’s vision and mission. Furthermore, the leadership in a company is responsible for a conducive work environment (Henry, 2013 p.93). Staples relied on the leadership at the centre and on-the-field to run the business efficiently and effectively in order to achieve its revenue and growth objectives.
The management at Staples was designed in a structured manner, such that there were different levels of management. The job description and expectation at the different levels were similar, but the scale and scope increased with each hierarchical level (Gavin and Levesque, 2007 p.6). Therefore, the leadership faced similar challenges in executing their mandates. This is a list of the issues the managers at Staples faced.
Meeting Performance Targets
The company has sales, customer service, and efficiency objectives which each manager is tasked with ensuring are achieved at the store, district, regional, and divisional levels. Sales, expenses, and profit reports are generated daily and weekly. The General Manager has a mandate of checking sales volume and margin at stores level. The reports are then passed up the chain of management and each subsequent manager would study the reports to ascertain whether their area of influence is performing according to the set targets. The leadership has the challenging tasks of ensuring company’s income and profits grow amidst heightened competition.
Staples also have a system in place to check customer service delivery. Mystery shop scores and online customer service surveys are used to check whether the stores adhered to the brand’s customer service strategy. As a manager, ensuring the employees under your supervision deliver service at the set levels is not an easy task. It is through the customer experience that a consumer makes a decision on whether or not to maintain a relationship with a company (Voorhes, et al., 2017 p.271). A manager has to design a proper strategy that will ensure the customer has a good experience (Lemon and Verhoef, 2016 n.p). Therefore, a firm cannot meet the brand’s promises if the team’s action is not based on quality customer management. Consequently, the managers have to share and ensure the customer service vision is understood and implemented in the workplace.
Inventory management is also vital for Staples operation. The general managers have a daily report that update them on the daily inventory needs. Problems such as outages, low balances, and products which need to be moved from the storage area to the shelves were highlighted by the reports. The management, especially the general manager has to ensure they adhere to the firm’s inventory policy in order to have an efficient and effective operation. However, stock level management can be a difficult and tiresome task to accomplish. At Staples, each store would take manual daily stock counts, the point of sale system would also aid in stock management. Perusing through all that data could be a time consuming and energy draining activity.
The different stores compete with each other; there is a performance metric developed to check if the stores meet the requirements. The general manager, districts, regional and divisions’ heads have to ensure they perform well against their internal competition.
The Home Office which is the central governance unit of Staples makes budget decisions for the different units of the company. Each manager is expected to deliver the performance target while operating within the funds allocated. The set expenditure can be a challenge since the management has to balance costs and spending to meet the objectives of the company (Serrador, 2013 p.3). This is evident during the course of the budgetary period; when a number of operations would ask for supplementary allocations due to changes to the operations plan or increased competition.
Implementing the Management Action Plan (MAP)
The MAP is a system used to inform the general managers of a corporate initiative; the timelines for the initiative, the activities needed to implement it, and the personnel the manager should delegate the responsibility to. The up-to-date to-do list enables the manager to know the direction the company wants to take in terms of strategies. The activities can be challenging since they involve change and implementing it can be a difficult task.
Managing the firm’s human resource is another challenge faced by Staple’s managers. The general managers have a guideline that advises them on costs, work scheduling and expected performance from the associates. The leader has the task of ensuring they get the maximum productivity from each employee; this can be a difficult mandate to accomplish.
The Characteristics of a Manager and its Influence on Customer Experience
The mandate of designing, developing, and maintaining a customer service oriented culture in an organisation rests with the leadership of a company (Wisner and Linda, 2008, p.121). The responsibility is with the management because they have the authority to influence the corporate culture, and they also make service decisions and communicate the customer service vision to the rest of the team. Odiakaose (2018) argues that a firm’s organisational culture has the potential of determining the performance of the company.
There are various characteristics and personal attribute that can be essential to a manager when it comes to customer service such as communication skills (Luthra and Dahiya, 2015 p.45). The skills are vital and without them the business runs the risk of offering poor service; therefore, losing the competitive edge that is associated with superior service. The manager can use these attributes to enhance customers’ experience and also act as a role model to other employees; therefore, influencing the whole value proposition at their area of influence. This case study highlights some of the attributes that can positively impact customer service at an organisation:
The ability of a manager to listen to customer is crucial. An executive should carefully pay attention to the needs of the consumer; taking greater care to understand the language used by the customer in describing their problem. The leader should also be attentive to the feedback given by their client. By having an in-depth understanding of customers’ issue, the manager will be able to develop a viable solution for the customer; and therefore, enhance their customer service. Staples’s management should be alive to customer needs to enable them offer office products that meet their needs.
Managers should be able to receive information from the consumer and offer a solution in a manner that ensures miscommunication is avoided. Valila (2017 p.3) performed a study on the relationship between customer satisfaction and employee communication skills and found out that the ability to pass information significantly and positively affect consumers perception of a company.
It is important that the leadership of a unit has a great understanding of the products and services on offer. The manager is better positioned to address the problems of the customer if they know which product or service that can be used to offer a solution. Product knowledge also helps the leadership to have an insight into the customer experiences; this can be useful in enhancing customer experience through upgrades and new offerings.
Time Management Skills
Customer solutions should be offered in the most efficient manner. A manager should be able to develop a solution in the least possible time since the customers have other endeavours to attend. If the leader lacks a solution, the best action would be to refer the customer to someone else within the company with the capability to solve it. By offering quick and timely service, the entity will enhance the customer experience and ensure their time is saved.
The management should be able to convince the customer to purchase their products. This is achieved through learning about the positive attributes of the item being sold and being able to enumerate these benefits to the consumer. The manager should also enhance their closing skills: this is the ability to end a conversation with a client and they feel their needs have been addressed.
Willingness to Learn
Willingness to learn is one of the most important characteristics. The leader should have the capability and willingness to educate themselves through modes of training and experiences. This traits can be inherent in a manager or can also be developed through constant learning process. By self-improvement, a leader is able to gain the qualities that enable them to offer superior customer service, and thus, improve the consumers’ experience once they interact with the manager.
Staples has identified customer service as one of the areas that can differentiate its service offering and that of its peers (Gavin and Lévesque, 2007 p.3). The firm has designed a customer service policy that guides its employees in the most appropriate way to interact with customers. The management has a responsibility of living these values and also ensuring staff under them uphold them.
Staples Organisational Structure
The reporting structure at the company is hierarchical; the reporting units are grouped into geographical units and these units progressively became larger categories such as districts, regions, and divisions. The geographical units have heads who report to those in-charge in the upper level of the structure. The organisation of the structure is that of a pyramid model. The diagram below shows the leadership structure at Staples.
Figure One: Leadership Structure at Staples
Divisional Senior VP
The case study analyses the impact of changing Staple’s current organisational structure from the hierarchical to the matrix model.
Matrix Organisational Structure
A matrix organisational structure is a reporting framework in which the reporting lines are set up in a grid format. Schnetler, Steyn, and Van Staden (2015 p.29) posit that a matrix structure is a mixed approach to organisational leadership, the traditional hierarchical approach is overlaid by some form of lateral authority. The diagram below is a pictorial representation of the matrix structure.
Figure Two: Matrix Structure
There are two stands concerning the matrix structure: one is a group of leading scholars who believe the approach is beneficial and needed for corporate, and another group is of the opinion that the model is not useful in organisational structures. The proponents of the model argue that the structure is a prerequisite for across-the-board coordination for large entities (Burton, Obel, and Hakonsonn, 2015 p.3). The opponents hold the position that the approach slows down decision making and interferes negatively with accountability. The two camps have tabulated the benefits and disadvantages of the method. Below is a discussion of the advantages and disadvantages that will accrue to Staples if it changed its organisational structure from the traditional pyramid model to the grid model.
Advantages of the Matrix Structure
Efficient Use of Resources
This approach has been shown to contribute to the efficient use of a firm’s resources. Burton, Obel, and Hakonsonn1 (2015, p.23) postulate that various mechanisms can be put into place to ensure the team is more effective and efficient. Talents, resources, and information can be better leveraged in this system and this will positively impact productivity. The lateral coordination can lead to a better utilisation of the firm’s asset such as leadership. For example, a procurement officer reporting to the finance manager and procurement manager will have access to two viewpoints, and this can improve the decisions made by either one of them.
Better Flow of Information in the Company
With a matrix structure, information flows upwards and sideways. It means more people are accessing vital data about operations of the company. Information flow will also be rapid and in most cases interdisciplinary. Schnetler et.al (2015 p.32) supports this point by stating the approach increases frequency of information flow. This is beneficial since it is more efficient than the traditional way of following up one channel, and then the information is dispersed from the top to the other departments of an entity. Staples can benefit from this as the initiatives and feedback from the activities can be passed both upwards and laterally.
Better Trained Management
This approach ensures a manager gets to handle more than one reporting line. By interacting with different functions, the leader becomes knowledgeable in multiple aspects of the company, and thereby able to better contribute to the growth of the company. Other cited advantages are a high team spirit in the organisation due to more interactions and a reduction in the possibility of conflict when initiatives or projects interact.
Disadvantages of the Matrix Structure
Increasing Organisation Complexities
Reporting to more than one boss can increase confusion in the company. The staff will face difficulties in identifying who is the leader to give feedback to or to obey when it comes to instructions. The opponents of a matrix structure cite this complexity as an impediment. The lack of clear reporting lines will reduce accountability since the employees can take advantage of the absence of a direct boss.
Requires a High Degree of Cooperation
The structure requires coordination between the different managers in the company. In a situation where teamwork is low, the approach will lead to inefficiencies. Burton, Obel, and Hakonsonn1 (2015, p.34) state that for a matrix approach to meet its set objective shared targets, accountability, team interactions, and team building attributes must be present. The above requirements complicate the process.
Potential of Varying Management Directives
Crisis can occur when two different executives issue conflicting directives. Two managers can have a different interpretation of a strategy or a work plan, and this can lead to confusion.
Difficulty of Establishing Priorities in the Business
Different functions may have different objectives; a matrix approach will, therefore, complicate a process of allocating resources since each department has different needs.
Other shortcomings of the approach can be employees instigating two bosses against each other and a slowdown in the management reaction when they have more than one issue to handle. For Staples to apply this method, it has to carefully address the disadvantages and create mechanisms that can mitigate them. The matrix approach has gained usage in the modern business world especially for large organisations such as Staples (Schnetler et al., 2015 p.30).
Obstacles to an Effective Strategy Implementation at Staples
The company has instituted various changes to how it operates in a bid to capture new revenue streams. The increased focus in the copy and print segment of its services is an example of one of the changes in strategies the firm has previously carried out. The initiative was successful; however, various challenges were encountered in this change. The section below highlights some of the obstacles the company faces in rolling out a new strategy.
Initiating a change in the way the business conducts its business can be an expensive affair. Costs are incurred in the purchase of new equipment, restructuring the human resource, and in collecting information about the new approach. A high-cost implication can act as a hindrance to the successful implementation of a new strategy. The firm has to conduct a cost analysis and identify whether the benefits accrued from the change match and exceed the expenses.
Resistance to Change
When laying out a new strategy, the management and employees can resist the new way of doing things, more so, if there are uncertainties in the project. Pieterse, Caniels, and Homan (2012) argue that implementing organisational change can prove problematic. In their study, they claim only thirty per cent of change initiatives are successful. When Staples changed its focus to copy and print, both the management and the staff had apprehensions about the move. The management felt that it would be difficult to change the organisational culture and the employees felt that the new changes will result in job losses. Therefore, managing change is crucial in implementing a new strategy.
The capability of the company to educate its employees on a new strategy can impact its success. The firm has to first ensure that managers have a grasp of what the change means. Thereafter, the management has to disseminate this information to the rest of the team.
The management of a large organisation such as Staples requires a carefully designed and developed approach. The implementation of management elements will depend on the managers of the company. To achieve this, the management faces various challenges that need to be overcome for the process to be successful. The case study examines the challenges and some of the measures that can be used to improve management at Staples.
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