Business Strategy Assignment: Information System Strategies For Coles Supermarket
Develop a business strategy assignment advising to Coles’s CEO on developing the best information systems strategies that would help Coles to improve its business performance and competitive advantage.
Introduction & Historical Background
The discussion developed in the business strategy assignment revolves around the “Coles” which is the leading Australian grocery chain that revealed its intention to cut A$1 billion deliberating the cost and use of technology. It is the most trusted retailer in Australia and has growth on long-term shareholder value. Investing technology to IS implementation has undermined the Coles proposition values and get the price-consumers alternatives with a streamline cost process. Ensuring retailer about the IT/IS business strategy has been generated cost savings and also address the consumer's needs.
Figure 1: Coles’s strategic innovation
(Source: Coles, 2020)
Talking about the historical background of Coles IT/IS strategy in this business strategy assignment it can be said that Coles follows Artificial Intelligence (AI) to use most deliberate and personalised shopping experience in product assortments. Significantly from the historical point of view to the current scenario, Coles IS/IT business strategies has been implemented to Global Data’s 33% shoppers in 2018. On the other hand, in the dynamic grocery landscape, learning powerful machine algorithms (IS/IT) based on the consumer shopping behaviour is staying afloat increasingly for Coles, Australia. Since it has been introduced into Coles’s strategic business model evolving IT/IS application for the Management Information System (MIS) & Strategic Information System (SIS) encompassed. Information strategic planning (ISSP) has been recognized in the supermarket IT/IS industry to get the organisational opportunities for using and exploiting IT and seeking advantages from these.
Figure 2: IS/IT strategy environment
(Source: Peppard and Ward, 2016)
Thus, building the IS and its strategies to Coles supermarket industry the available business value from IS/IT has been optimized. Thus, it is required to implement a functional integration system in Coles’s IT domain and evaluate its function. Thus, discussing about the company’s IT strategies i.e. AI & machine learning herein business strategy assignment the project milestone objectives which are going to be achieved as follows:
- To understand the business environment and relate it with Information Systems (IS), Digital, and Information Technology (IT) strategies.
- Delivering the business value based on customer demands.
- Strategic alignment to strategic coevolution.
- Developing the Three-era model and understanding evolvement into IT application systems for Coles, Australia.
- Examining digital disruption, characteristics of IS/IT and its impact on these supermarket industries.
- Being a CEO of Coles, it has been possible for me to advise best information system strategies to improve its business performance and getting ahead in competitive advantage.
- ISs in the form of new digital and social media in case of rising consumer demand and immediate access within the speed of response.
- Referred to project evaluation, use of smart connected devices will be opening up new opportunities for introducing products and services in the supermarket industries and applying new business models before the advent of IT/IS strategy.
Major Challenges including present situation at Coles
Recently Coles has underpinning its strategy based on customer motivation, smarter selling and top ranked in the market. But in the last five years (2015-2020) Coles faced several problems related to its IT/IS business strategy and adopted a business communication process. The major challenges identified in the business strategy assignment are as follows:
Table 1: Major Challenges facing by Coles, Australia including present situation (Source: Coles, 2020)
Major Challenge in Coles
? Supply Chain Issues, 2019
Supply chain issues have dominated Coles AGM where the workers are raising their concerns over poor payment, working conditions, and practical management (Inside-Retail, 2019). As a result of this members of the United Workers Union, National Union of Workers, and United Voice merged are claiming their exact position and salary from Coles and get involved into strikes or several substantive issues. It also impacts on the automation process and creates problems to the AGM workers and reduces the manufacturing facility in NSW.
On the other hand, Business Council of Australia (BCA) does not share the same stance so the supply chain issues will be formed as social issues that Coles has (Inside-Retail, 2019).
Issues with the next Federal Election, 2018
CEO of that time Steven Cain says that Coles may face problems in the next federal election campaign (AUSFOODNEWS, 2018). It may be considered a big challenge to business regain and community trust. Problems in:
? Economic growth will give a solid track under the government policies.
? Issues in Productivity and Innovation that reduce the shareholders benefits and economic growth.
? Transport Infrastructure challenges.
? Cost of living pressures and tax reform problem (AUSFOODNEWS, 2018).
? Competitive Challenges, 2017
Coles could not beat Woolworths since 2017 it would be nine separate metrics around the in-store execution. Woolworths easily outpointed Coles and got the capability of its senior managers.
In addition to investment in pricing there is little doubt about Coles IS/IT strategy as well as refurbishments & presentation system (Coles, 2020). However, Coles looms as the biggest challenge for incoming Wesfarmers in the battling with the recent chain.
? Present Situation and Challenges in Coles, Australia: -
It is seen in this business strategy assignment that presently, Coles is also facing supply chain challenges due to the recent coronavirus outbreak in 2020 (MHD, 2020). Meat that Coles usually sell to the Chinese market has been diverted to other Asian countries and problems occurred. Coles spokesperson said that the logistics department has remained challenging now-a-days after the Covid-19 condition. Moreover, Coles minimises its suppliers and transport partners to manage their response and it will be impact on the product availability to the customers.
Figure 3: Coles’s Supply chain issues due to recent Covid-19 pandemic
(Source: MHD, 2020)
So, Coles is keeping close contact with its affected suppliers and face challenges to deal with Chinese markets with major frozen products such as pork, beef, and chicken. In this way Coles caused a logistical nightmare in the supermarket industry.
Current IS strategies and suitability judgements
Current IT strategy of Coles described herein business strategy assignment should be a framework development process that defines internal & external business perspectives (Latan et al., 2018, p. 300).
Understanding the Current IS strategies
? Internal Business:
The elements of current IT strategies have involved internal parts and these are identified, analysed and understood with Cole’s internal business. It has been defined as objectives and intended business strategy by means of project planning or changing programmes (Peppard and Ward, 2016). As a CEO of Coles, it is necessary to obtain existing business processes which include current IT activities, IS systems and main information entities such as store locates, account, stock items, Coles’s key customers. However, evaluating knowledge, competence, values and style with Coles’s competitive company it has been possible to derive the current organisational environment and suggest the best IS strategy suits for its culture and relationships (Baumgartner and Rauter, 2017, p. 85).
On the other hand, primary & secondary activities that are needed to measure Coles’s business performance towards achieving those milestone objectives. Monitoring the necessary products and effectiveness associated with advertising & promotional activities it is beneficial to include its target increasing market and develop a capacity to meet customer’s requirements.
? External Business:
As suggested by Latan et al., (2018, p. 305), The purpose of IS strategy implementation in Coles is essential to understand and analyse the current economic & competitive environment. From the formulation it has been noticed that Woolworths is the Coles’s competitor in which IS/IT can also impact to contribute to the business shaping or strategy development in the supermarket industry. Based on the analysis, development of new IT/IS initiatives will be done in the current organisational environments and current IS/IT capabilities (Baumgartner and Rauter, 2017, p. 91).
Justification of Suitability
Yes, the current internal and external IS/IT business strategies are appropriate for Coles and its competitive organisation, Woolworths, Australia. Interpreting the IS business strategies, the majority of information is found out that meets the system requirements and IS needs. Furthermore, the internal and external IT/IS strategies are interpreted and suitable which are done by a business group to represent the skills and disciplines. Based on the perspective of Peppard and Ward, (2016), Key Performance Indicators (KPIs) are also subjected to IS/IT strategy to conjugate with current situation in Coles and displaying medium-term requirements to fulfil the necessary improvement.
Competitor's IS strategies and Comparisons
Coles’s competitor Woolworths food group has its own IS/IT strategy which is different from Coles (Mukonza and Swarts, 2020, p. 840). Woolworths food strategy has been implemented into its business IT/IS and focusing on the key principles such as:
- According to Govender, (2017), Woolworths defined that offering IS/IT to an automatic basic business environment could be efficient with the information processes and achieve the milestones.
- Woolworths follows a low-cost strategy which has also been known as a cost leadership strategy to minimise overhead expenses.
- Growth and Innovation to meet the customers; needs have also been executed with Woolworths lean retail model (Das Nair and Dube, 2017).
Figure 4: Strategic management comparison- Woolworths vs. Coles
(Source: Marketing, 2016)
Comparisons of IS strategies between Coles and Woolworths
It is evident in this business strategy assignment that Woolworths and Coles have different IS/IT strategies which they actually adopted into their business. Virtual technologies for planning information systems would be utilized as a part of business planning where the Chief Information Officer (CIO) of both companies are engaged to give proper directions.
Table 2: IS/IT strategy comparison in between Woolworths and Coles (Source: Marketing, 2016)
Battle of Brands- Covered areas
Impact on IS/IT strategies of selected (2) companies
Brand sentiment acts predominantly in case of digital IS strategy implementation. Settlement conversion with a large media coverage has been useful to sum up the challenges [Refer to Appendix 3].
Volume and Share of Voice
It has been calculated that Woolworths generated more than double (60%) social media conversations than Coles and it could be a part of IS/IT strategy competencies in social sites & forums [Refer to Appendix 1].
Interestingly, Woolworths and Coles have their theme difference that makes sense on IT/IS strategy implementation (Liang et al., 2019, p. 286). It has been noticed that approx. 2491 digital marketing (social media) campaign is for Woolworths that creates a huge impact on IS strategic adoption along with ANZAC day campaign [Refer to Appendix 2].
As per the ideas of Phillipov, (2017, p. 170), Woolworths gained more interesting IS/IT implementation parts i.e. in social media, online news and digital marketing than Coles. Though handling the public criticism, they have extracted their market value and are more responsive in those senses.
Woolworths and Coles have remained to be dominant players in the Australian supermarkets (Sullivan and Gouldson, 2017, p. 419). Despite the threats the major competition is based on their strategic movement. Strategic management issues are dominated while being a part of marketing campaigns and sought to enter the random markets trends towards the development of monopoly industry. Weighing up strategies in those logistic IS/IT strategies has been an act of redundancies in supermarket industries (Van Kampen and Kirkham, 2020).
What is the importance of IS/IT strategy and competitive advantage with regards to the present case scenario of business strategy assignment?
Thus, as per the guidance of Chae et al., (2018, p. 530), to achieve competitive advantage Coles Group wants to implement IS/IT strategy and management plan to improve its business criteria’s. The following stages are followed for strategic management and business planning which has been broadly implemented for Coles company, Australia.
- Phase I: Financial Planning
To trace the origins of the formal planning system Coles annual budgeting process has been used to develop the powerful business strategies and get the concrete indication for meeting the debt/equity targets. Havice and Campling, (2017, p. 295), stated that, Expensive planning apparatus has been used to this planning implementation phase.
- Phase II: Forecast-based Planning
Complexities in Coles, Australia is common thus to understand the implicit technological sophistication is required. It usually pinches with the strategic planning system and might be used as strategic planning tools to improve the business process and resource constraints. Adjustment short falling and extending the trend lines is important for future IS/IT strategic planning in Coles.
- Phase III: Externally Oriented Planning
The business strategy assignment examines the words of Chae et al., (2018, p. 535) that in this third phase, level of effectiveness will be used to get the market redefinition system and develop the idea of steel-fabricating capacity. In the next three years, field interviewing with sales force distributors has been used to resist the trade associations.
- Phase IV: Strategic Management
It has been defined as a single management process to strategically present within the rapidly evolving Coles’s supermarket business (Havice and Campling, 2017, p. 300). This IS/IT planning strategy has been largely accomplished with a planning framework, corporate value system & planning process.
Figure 5: IT/IS Strategic business planning phases for Coles group
(Source: Chae et al., 2018, p. 542)
Thus, discussing with the IS/IT strategic management plan it can be said in this business strategy assignment that to achieve competitive advantage throughout the supermarket industries Coles, Australia would be following the planning phase after knowing it’s business importance (Havice and Campling, 2017, p. 306).
Strategy Proposals with back-up planning
The strategy proposal is considered as board concepts or approaches where it has been going to achieve the business objectives to encompass a long-period of time during the project proposal (Pulker et al., 2019, p. 3377).
- IS Strategy Proposal I: Internal long-term & short-term
For the general business and organisational environment, it has been possible to effectively support & enhance the business strategy where enabling new technological innovations is important. For customer value proposition this strategic proposal will be helpful for future cases (Hanlon, 2019).
On the other end, IS/IT capability is depending on the current application portfolio to make it well existing policy and easily determine or acquire the business management. Arguing with prior experience professionals who can handle the current worst scenario and changing the overall procedure to improvement.
- IS Strategy Proposal II: External short & long-term
As per the research on business strategy assignment, the current state of Coles supermarket industry faces the IS/IT problems in terms of growth, competitive dynamics, regulation, and profitability. Pulker et al., (2019, p. 3377), stated that, in capable of products and services, business experts are valued for their industrial relationships with stakeholders. The actual cause of changing the competitive forces with product substitution is the project proposal of improvement for Coles and other supermarket companies.
- Back-Up planning
If one of the strategies fails then there will be a back-up strategy planning based on which Coles can improve the business environment. As it can be seen formed above that internal & external business proposals have the divination where either short-term planning fails or both long-term planning fails (Hanlon, 2019). If both plans fail then the organisation should be restructured along with its milestone objective.
Strategy selection and its Impact on organisational success
Depending on the subsequent customer requirements it has been possible for me as a CEO of Coles to suggest the best IS strategy which can be implemented to overcome the current business challenges (Filipe et al., 2017, p. 80). It can be recommended in this business strategy assignment that External short term & Internal long-term strategy will be helpful for IS/IT implementation in Coles and dealing with the existing value chain by new entrants or service products in the supermarket industry with the help of this application portfolio model, Coles looking for high potentialities with its key operational team based on the IT/IS strategic environment (Gidlöf et al., 2017, p. 30). How the above selected business strategy will be helpful for the acquisition of information systems in Coles, Australia and contributed to the same has been discussed as follows:
- With the help of External long-term policies, Coles can improve its economic business environment and get the top position in the competitive market.
- To overcome Woolworths, Coles have to be more innovative in nature while delivering its customer requirements in capable with IT/IS strategies (Filipe et al., 2017, p. 85).
- Implementing IT/IS and collaborating with the Internal short-term goals will be helpful for Coles to get the improvement.
- Furthermore, it is necessary to involve milestone objectives in project activities, Coles group founded innovation in strategic IS/IT planning system.
In these ways, seeking alignment between business and IS/IT strategies IT supply chain in Coles, Australia formed and it acted with Critical success factors (CSFs) and KPIs in the supermarket industries (Gidlöf et al., 2017, p. 36).
Best time of Strategy Introduction
The best time to introduce new ideas at work is before starting a financial year. Thus, to align with the key priorities Coles wants to stay flexible and get the imaginary business process to introduce its proposed strategy. Based on the perspective of Hobin et al., (2017, p. 510) undertaken to support the arguments raised in this section of business strategy assignment, strategy with a broad concept or approach needs implementation time whereas for other options a fixed plan will be achieved.
The time selected for new IS/IT strategic implementation is appropriate because it finds the issues and challenges within this time. However, preparing a new paradigm after developing twelve elements it would be useful to get the strategic meeting and use of upper management with a long convenience way of implementation. Before starting a financial year, the allocated budget will also be unknown for a company leading to a successful strategy (either internal or external) proper IT./IS strategic planning is going to be constructed within the stipulated time period (Hobin et al., 2017, p. 530).
Understanding the Business operational model of Coles, Australia and implementing actual IS/IT strategy is the main milestone of this project. Thus, looking into the above discussion on business strategy assignment, it can be states that after meeting the project criteria’s and delivering the consumer demands it has been possible for me, as a CEO Coles, Australia, suggesting best suitable IS/IT business strategy for competitive advantage.
After reviewing the Coles’s business performance, it can be recommended that external or internal or any of them will be a suitable IS strategies for Coles. Implementing IS strategies to overcome Coles’s business challenges and proceed to move on smart selling and customer motivation is the key successful factor to get the benefit within supermarket industries.
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Appendix 1: Volume and Share comparison
Appendix 2: IS theme comparison