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  • 1. Company Description Report Aakash Sharma Angel Tania Vicky Chen
  • 2. Contents Introduction 2 Description of Plus Supermarket 3 Recap of Methodology 5 Answers to Sub questions 6 Structure & Processes 6 Organization Structure & Coordination Mechanisms 6 Processes 7 Culture and Leadership 10 Company Culture 10 Leadership Style 12 Decision Making Processes 13 Reflection of Methodology 15 Conclusion 16 Recommendations 17 References 18 Introduction PLUS Supermarket Page 2
  • 3. We are a group of three students from Project Management class in Arnhem Business School. During this period, our assignment is to do a research project about the management model of a real supermarket in the Netherlands. The supermarket we have chosen is PLUS. The objective of our project is to give answers to the management model of PLUS in order to pass this class and get at least 7.5 grade. There are six topics that we will cover in our research--- Organization Structure, Process, Coordination Mechanisms, Company Culture, Leadership Style, and Decision Making Processes. After conducting our research by using both field and desk research methods, we come to a conclusion of each specific topic and in this report we will also present our results separately. Overall, the conclusions we get provide a complete picture of the management model of PLUS supermarket and how it operates generally. Furthermore, we give our recommendations in which way we can improve our projects and make it better, for instance, another better research method to make our conclusions more reliable. This research project not only give us the knowledge about management model and how to use it in real business life, but also, it makes us well prepared for the later graduation assignment and how to use research methods correctly. Description of Plus Supermarket PLUS Supermarket Page 3
  • 4. Plus was first introduced as ‘4=6 PLUS’ in 1988, this supermarket had been making modifications in its name and organization structure until it became PLUS in 24 January 2001 1. In this report we are implementing the theories about management, research, interview skills, and planning which we had in class; into real life cases in PLUS. PLUS Retail is a subsidiary of the Sperwer Group, an organization of independent supermarket operators, which was established in 1928 by a number of independent entrepreneurs. In a highly competitive market, their aim is to improve in their cooperation basis. PLUS supermarket has been performing excellently recently, with 5.84% market share in the year 2012. Attention, quality, and local responsibility are the values of PLUS, according to them, they give their customers more attention than any other supermarkets around. Plus doesn’t have the ambition to become the largest supermarket in the Netherlands, however, they aim to become the best service supermarket in the Netherlands. They are customer-oriented type of supermarket. No matter how big or small the errand, they will help finish. Attention isn't the only thing you can just live with. At Plus grocers benefit from greats deals every day. Plus demonstrates they have a responsibility with the local community and that's why they provide the largest range of organic products. PLUS Supermarket Page 4
  • 5. Recap of Methodology There are certain topics that will be covered in this report, namely: organization structure, processes, coordination mechanism, culture, leadership style, and decision making. To answer these questions we had to make use of two types of research methods which are primary and secondary research. Most information regarding the supermarket and its financials were available on the internet but however to answer some of the particular sub questions we had to conduct interviews with management and make observations in the supermarket. We used the Plus website during our desk research as an addition for our verification. This was done because the Plus website has a lot of useful information. To receive more information and to ensure that the information we had was correct, we approached the manager of Plus Supermarket for an interview. Then we received permission to conduct observations within the supermarket so that we could efficiently report this. PLUS Supermarket Page 5
  • 6. Answers to Sub questions Structure & Processes Organization Structure & Coordination Mechanisms Plus Supermarket employs 27 employees including the retail store manager. The store manager coordinates, oversees all activities by the department heads and assumes responsibility of his employees. This type of coordination mechanism can be described as direct supervision. The policies followed by the retail store manager come directly from the retail chain itself. However, the manager still has the ability to make decisions that don’t affect the long term policies of Plus supermarket. The manager is in charge of finding the most efficient way of reducing costs and increasing revenue within the organization. They work with forecast tables that indicate the amount of hours that needs to be worked today and its predicted revenue. Store managers are responsible for hiring/ firing staff, creating goals for the store, assigning responsibilities to its managers and his/her employee’s activities. Figure 1 depicts the entire organizational structure of Plus Supermarket Figure 1 To better coordinate the activities the supermarket manager has assigned a department head for each type of inventory the supermarket has. The four departments are:     Dairy and packaged goods, Fruit and vegetables, Meat and bread, and Alcohol and Tobacco. PLUS Supermarket Page 6
  • 7. They are responsible for planning the purchase orders of their respective inventory, making sure team leaders achieve the goals handed to them, training their ground floor employees and handling any discrepancies within the work force. In Plus supermarket there are team leaders that monitor the ground floor employee’s activities and making sure all tasks are completed. They are responsible for the actions of their employees but in more severe cases such as stealing, they aren’t. A team consists of only bakers, custodians and stockers; cashiers are a whole other department which is directly handled by the retail manager and the alcohol/tobacco department. The first type of job is the cashier whom is responsible for collecting money on the sales of goods in the supermarket. The second job is the stocker whom restocks an isle with inventory from the storage space; they are also responsible for helping a customer if he/she cannot find a particular item. The third job is the custodian or a janitor whom is responsible for cleaning up the supermarket at either opening or closing hours. The fourth job is specifically for the Bread department and it is the baker; they are responsible for baking bread and other wheat products. However unlike American supermarkets, the product isn’t paid for then at that time but in fact paid for at the cashier with the rest of your shopping goods. The Alcohol and Tobacco section is altogether in a completely different part of the supermarket and the section has its own personal cashiers solely for the sale of alcohol and tobacco. In Plus supermarket, direct supervision is used by the retail store manager to oversee his/her 4 managers and the 4 managers use direct supervision to manage the team leaders and so on. Almost all of direct supervision is done through direct personal contact with each other. The advantages of coordinating with direct supervision is that managers can easily be called upon in situations when things are getting out of control, this in turn also helps the business run much more smoothly. Direct personal contact is a form of human coordination when people talk to each other. This type of coordination is useful in this day and age where information systems cannot always deal with the complexity of the issue. Processes A business process is a set of related, coordinated, and structured activities and tasks that are performed by a person or by a computer or a machine, and that help accomplish a specific organizational goal. There are in total five major business processes---The revenue cycle, the expenditure cycle, the production or conversion cycle, the human resources/payroll cycle and the PLUS Supermarket Page 7
  • 8. financing cycle. However for PLUS, according to our interview, they cover all the four major business processes except the production cycle. PLUS also own and sell their own brand’s products, but the production part they outsource to other manufacturing company to produce the products for them. Like most large organizations, PLUS also uses ERP system to integrate its operations. ERP is an industry term for a broad set of activities supported by multi-module application software that helps an organization manages the important parts of its business. Broadly, this may include the four business processes that PLUS will use. Typically, an ERP system is integrated with a relational database system. Figure 2 below shows the Integrated ERP system. Figure 2 The aim of using ERP is to help PLUS reduce costs by improving its efficiency in managing inventory and sales. Due to the fact that dynamic pricing environments and various types of promotions running through the whole year and large amount of stock in supermarket. Furthermore, it can optimize the time of replenishment and automate the processes which are in a repeatable operational environment. We also use a supermarket model (Frank Steeneken and Dave Ackley) to describe the primary activities of PLUS. The customers of PLUS are local residents and small businesses that periodically need to replenish their stock of household products. The suppliers of PLUS are mainly producers of household products that are established far from the locations of their final customers. At the end, PLUS provides a marketplace that brings remote suppliers together with PLUS Supermarket Page 8
  • 9. local customers. Figure 2 shows exactly the five physical activities that PLUS executes generally in order to bring the goods to the local customers. The products that remote suppliers produce and release will be transported by the main transporters to the regional warehouse of PLUS. 95% of the products are directly from the Sperwer Groep and the remaining 5% of the products are from the local companies with which PLUS has cooperation. After that, the transporters of PLUS its own will deliver the needed quantities of warehouse stock to all stores within the regions of the local warehouse according to ERP system. The local retail shops will organize and display the stock received from the regional warehouse to their local customers. Figure 3 PLUS Supermarket Page 9
  • 10. Culture and Leadership Company Culture We applied Schein’s (2004) three levels of a culture to observe the components of PLUS Supermarket culture. 1. Artifacts a. Clothing The colour green symbolises freshness. All workers wear the same-coloured uniform, except for managers who use shirt everyday they go to work. PLUS used to have a purple-coloured uniform which symbolises attention for customer. As time goes by, PLUS changed the colour of their uniform to adjust the mission of the company which is freshness (versheid). b. Symbol Each colour in the PLUS symbol represents its basic principal, which are: - Personal Attitude (green) Responsibility (orange) Quality (blue/purple) Friendliness (dark green) PLUS Supermarket Page 10
  • 11. 2. Espoused Beliefs and Values There are four beliefs that each of PLUS staff holds while they work, which are: a. Attention and personal attitude PLUS supports the customer by serving an extra attention on what they need. b. Quality Not only the quality of products but also the store and employee’s best quality are served to PLUS customer. c. Competitiveness and freshness PLUS offers a competitive price and highly involved in the local society. d. Responsibility Just like the main colour that symbolises freshness, PLUS is environmentally friendly. It offers wide variety of organic and Fairtrade products. 3. Basic Underlying Values There are some values that each of PLUS member holds and they act in accordance with their values and beliefs. Those are: - “We spend enough time for our customer and take our clients seriously” in order to reach the good personal attitude. “I am responsible in my department by giving a bona fide report and support my colleague’s department also” in order to achieve responsibility. “I make sure that I perform my duties carefully and I wear clean uniforms and nameplate according to specifications” in order to show a good quality. “I am helpful, welcome my clients, and I am friendly” in order to give the best hospitality and friendliness for PLUS customer PLUS Supermarket Page 11
  • 12. Leadership Style Vincent, the retail manager leads the employee using a coaching method. He sets up goals for the day every morning with the department managers, which includes not only qualitative but also quantitative targets as can be seen here: The targeted profit, hours needed to fill the shelf, and productivity per department is targeted every single day. It is Vincent’s task to control and calculate everything. He set up target and tells the employee about it during the morning assembly. This is the concrete example of directive behaviour. Another highlight is the fact that Vincent also supports his employees by showing a constructive and motivating behaviour. His office is always open for those who want to say opinion or input. PLUS Supermarket Page 12
  • 13. PLUS applies the system of ‘coins’ where each employee will get a coin when he/she performs something outstanding. The score of the coins is being put on the wall where everyone can see it. At the end of the month, the one with the highest score will get a present or voucher. When we asked some employees, all of them feel like Vincent is their friend and manager at the same time. He can make them feel comfortable and motivated, yet they also have a respectful behaviour towards him. The score board hang on the wall which can be seen by all employees. Decision Making Processes Decision-making is the process by which a person or group identifies a choice, gathers information, analyzes the data, and determines the best option to choose. The decision-making process employs high levels of critical thinking skills and problem-solving techniques. There are several factors that guide the decision-making process, primarily the significance of the issue, the impact the decision may have, and the people or group's morals and cultural norms. PLUS Supermarket Page 13
  • 14. Decision-making increasingly happens at all levels of a business. In PLUS supermarket, the Board of Directors make the grand strategic decisions about investment and direction of future growth, and managers make the more tactical decisions about how their own department may contribute most effectively to the overall business objectives. However, quite ordinary employees are increasingly expected to make decisions about how to conduct their own tasks efficiently, how to response to customers and how to improve their business practice. This needs careful recruitment and selection, good training, and enlightened management. Each PLUS retail shop has its own owner, and a manager. The owner usually doesn’t make any decision in the daily operations of the supermarket. However, he just controls and possesses the supermarket. The main decisions are made by the managers of each department. There is a morning meeting in PLUS each Monday, managers from different departments gathering to discuss for instance, the sales goal for the whole week. The discussions are related to the normal activities of PLUS. Also, there is a meeting with other staff once per week to discuss and share their own opinions about the sales performance and working behavior. Nevertheless, the decisions concerning the important issue of PLUS also have to follow the particular regulations and steps. The general steps that PLUS takes in making those decisions are like this: 1. Recognize the problem or certain opportunity 2. Set objectives 3. Set and weight decision criteria 4. Develop/identify alternatives 5. Compare alternatives 6. Implement chosen alternative 7 Evaluate effectiveness of solution. Thus, we can make a conclusion that for the long term programmed decision, it usually decided by the top level of the organization and managers. Given the situation where a manager faces uncertainty and there is a higher level of risk involved regarding a decision, he typically makes an unprogrammed decision by using logic. And in this case, he will also adopt the opinions and suggestions from employees. PLUS Supermarket Page 14
  • 15. Reflection of Methodology The methodology we used can be measured as 70% effective. The desk research method gave us a lot of reliable information since we got it from the website of PLUS which always be updated. There was a difficulty in translating the language from Dutch to English, but as we had anticipated before we got a Dutch native to help us get the meaning. Another 30% of less-effective result goes to ‘observing’ as a part of field research. We wanted to observe the process occur in PLUS, but it didn’t turn out to be really informative, because all we saw was just staffs filling goods into the shelf. The interview method is a very good approach to get information. The retail manager we interviewed was really informative and helpful. We gathered a lot of useful information straight from the horse’s mouth. In general, we conclude that the method we used is rather effective. Having said that, we will improve it next time by applying a less-time-consuming and effective approach if we want to do field observation. PLUS Supermarket Page 15
  • 16. Conclusion In conclusion we now have enough information regarding the management models in Plus and how it is applied. As for our opinions on how it matches the organizations goals, here’s what we have to say. Our group feels that the structure and processes described in this report matches the organizational goal: “Our goal is to be the supermarket that provides the best service in the Netherlands and too also give value to our customers and shareholders.” . By having a simple organizational structure each employee knows what to do and who to report to especially when there are customer complaints, the employee can easily bring it up with his/her supervisor. With direct supervision of employees, it can be considered as training; this is especially good so then in turn an employee is knowledgeable. The use of information technology in Plus supermarket is critical when having to collect, process, manage and report large amount of data with which Plus supermarket can achieve its objectives. Information technologies such as an ERP system helps improve the financial management so that in turn a well thought out strategic plan can be made. This structure and process of Plus supermarket is efficient thus provides value to both customers and shareholders together. Just like mentioned before, the goal of PLUS is to be the supermarket that provides the best service in the Netherlands and to also give value to its customer and shareholder. Regarding to that, in this section we will discuss about the relationship between the culture embedded in PLUS with the goal it has. Two of PLUS espoused beliefs and values are clearly defined for customer’s sake (attention & personal attitude and responsibility). By being responsible, it means that PLUS tries to perform the best service for customer and also for the environment surround it by providing a wide range of organic and Fairtrade product. Not only that but also they make the best quality for product and service to please the customer. PLUS Supermarket Page 16
  • 17. Recommendations The research methods we used in this project are quite limited, which are filed research (Interview and observation) and desk research (Internet). After conducting those methods in our research, we think there is still a lot space to improve our project results by using other better and appropriate research methods. 1. To find out the process of PLUS, in our Plan of Approach, we mentioned that we would use observation as one of our approaches to this question. But during our real observation in PLUS, it couldn’t give us a clear conclusion of the exact process activities in the supermarket. And this method took long time, due to the fact that we can only observe how employees replenish the goods instead of how and when the needed goods will be received by the retail shop. We also asked this question during our interview with the manager of one PLUS retail shop, but he couldn’t explain it in detailed. Thus, we think we can actually ask some of the employees in PLUS who are responsible for the replenishment and received goods, they may give us more and detailed information. 2. For the leadership style, decision making process and culture, we used interview as our main method. However, the information we got from the manager may exist bias and ambiguity. It will be really helpful that if we can join in one of their weekly meetings, through the observation of the behavior of both managers and staff, we can go more deep into our questions and know PLUS more precisely. 3. Another recommendation is for our interview questions. Some of the questions we have asked are too general and broad, consisting of a lot terms. We found out that the manager may not even know those terms, thus, we’d better narrow the scope of our questions and make them more in detailed and understandable. PLUS Supermarket Page 17
  • 18. References Analytictech.com. 2013. Coordination. [online] Available at: http://www.analytictech.com/mb021/coordination.htm [Accessed: 17 Dec 2013]. Boddy, D. 2010. Management. [S.l.]: Financial Times Prentice. Businessballs.com. 2013. decision-making and problem-solving techniques, skills and methods. [online] Available at: http://www.businessballs.com/problemsolving.htm [Accessed: 17 Dec 2013]. Http://Www.Webtrade.Ie, W. 2013. 10 ways that an ERP solution can help improve a business’s operations. [online] Available at: http://www.decision.ie/10_ways_that_an_ERP_solution_can_help_improve_a_business%E2%80 %99s_operations/10_ways_that_an_ERP_solution_can_help_improve_a_business%E2%80%99s _operations.1914.html [Accessed: 17 Dec 2013]. Lindsay-sherwin.co.uk. 2013. Hershey and Blanchard. [online] Available at: http://www.lindsaysherwin.co.uk/guide_team_leadership/html_leadership_styles/4_situational.htm [Accessed: 17 Dec 2013]. Plus.nl. 2013. PLUS. [online] Available at: http://www.plus.nl [Accessed: 17 Dec 2013]. Romney, M. and Steinbart, P. 2006. Accounting information systems. Upper Saddle River, N.J.: Pearson Prentice Hall. Umassd.edu. 2013. Decision-making process - UMass Dartmouth. [online] Available at: http://www.umassd.edu/fycm/decisionmaking/process/ [Accessed: 17 Dec 2013]. Unknown. 2013. [online] Available at: http://www.bptrends.com/publicationfiles/01-03-2012ART-Supermarket%20Article-steeneken-Ackley%20111226.pdf [Accessed: 17 Dec 2013]. PLUS Supermarket Page 18

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