2. 2
Introduction......................................................................................................................................................4
Company Background and Accomplishments......................................................................................4
Finance..............................................................................................................................................................4
Latest Published Accounts information .................................................................................................5
Marketing...........................................................................................................................................................5
Marketing Mix...............................................................................................................................................6
Product.......................................................................................................................................................6
Price............................................................................................................................................................7
Place...........................................................................................................................................................7
Promotion...................................................................................................................................................8
Human Resources...........................................................................................................................................9
Mintzberg’s Organisational Configurations...........................................................................................9
Bakery Structures........................................................................................................................................9
Recruitment Process...............................................................................................................................10
How Warburton’s advertise position and attract applicants................................................................10
Interviewing Candidates.........................................................................................................................10
Cost Implications to Recruitment...........................................................................................................10
Staff Retention and Benefits..................................................................................................................11
Engagement...............................................................................................................................................12
Warburton’s Company Values...............................................................................................................12
VIP System – Values in People.............................................................................................................12
Gallup’s Hierarch of Engagement.........................................................................................................13
Training and Development.....................................................................................................................13
Bitesize....................................................................................................................................................13
Operations.....................................................................................................................................................15
Warburton - Mass Production Definition and Benefits.....................................................................15
Chain of Production.................................................................................................................................15
Focus on Quality.......................................................................................................................................16
New Technology.......................................................................................................................................16
Six Sigma...................................................................................................................................................17
Warburton’s Operational Long Term Plan...........................................................................................17
Contents
3. 3
Apendix...........................................................................................................................................................15
Apendix A – Balance Sheet....................................................................................................................17
Apendix B – Profit & Loss.......................................................................................................................20
Apendix C – Product Relaunch Examples...........................................................................................20
Apendix D – Warburton’s Marketing Timeline....................................................................................20
Apendix E – Departmental Map – Operations, Marketing & Human Resources..........................20
Apendix F – Recruitment Policy ...........................................................................................................20
Apendix G – Success Factors................................................................................................................20
Apendix H – Long Service Award Policy.............................................................................................20
Apendix I – VIP Guide..............................................................................................................................20
Apendix J – VIP Judge’s Guide.............................................................................................................20
Apendix K – How to Recognise Sucess...............................................................................................20
Apendix L – Training & Development Policy......................................................................................20
Apendix M – Continious Improvement Pack.......................................................................................20
Apendix N – Bitesize Workbook............................................................................................................20
Apendix O – Continuious Improvement Project Example................................................................20
Company’s Vision
“Become one of the world’s best food
businesses, which will be achieved by
continued investment and employee
commitment in ensuring we retain out
reputation for producing the best quality
freshest bread, and unrivalled customer
service”.
Jonathan, Bret and Ross Warburton
Contents
4. 4
Introduction
Company Background and Accomplishments
Since the Warburton’s family started baking in 1876 they have managed to grow and expand across the UK and have
succeeded to keep one-hundred per cent ownership oftheir company. Five generations ofthe family, have run the
company so far, the latest being three cousins Jonathan, Brett and Ross (Warburtons, 2015). Starting with a simple
white loaf in a little bakery biased in Bolton, Warburton’s has managed to expand its portfolio ofproducts to include
wraps, thins and even garlic bread. As a result, they have become the largestwrapped bread brand in the country, with a
market share of 31.4 percentwhich has putthem 8 percentahead oftheir main competitor Kings mill (LLP, 2014). They
currently own twelve bakeries and fourteen depots across the UK and are responsible for 4,500 employees (Warburtons,
2015). Furthermore, they have become the second largestgrocery brand in the UK behind Coca Cola according to The
Nielsen Company (2010).
According to Marketing Week (Tesseras, 2015) in the UK sixty percentofcompanies are family owned. 54 percent of
these companies consider their family status as an important part of their marketing strategy. This is no different for
Warburton’s and in 2016 they launched a range of new packaging on all their products to include a 140 years ofquality
baking stamp (Stein, 2016).
Finance
Introduction
5. 5
Latest PublishedAccounts information
According to Companies House (2014) Warburton’s generated a turnover off £547.9 million and profit off £78.3 million
before tax in their latest published accounts from September 2013 -2014. Comparing this to their pervious financial
reportthe turnover has decreased by 2.5 percent. In spite ofthis, the profit has increased by £42million, cash held
increased by £14.7 million and fixed assets increased by £4.2 million. While a lot ofthese results are positive for the
company, one downfall is the decrease in staffing numbers from 4,532 to 4,502 a decrease of30 employees. To view the
latest balance, profitand loss sheetsee appendix A and B.
Marketing
Finance
6. 6
Marketing Mix
In the Introduction to Integrated Communication Journal (McGraw-Hill/Irwin, 2009) states the marketing mix as the
developmentofconnections by understanding the needs and wants of the customers, satisfying those needs through
productdevelopment, offering ata price, making itavailable and developing an advertisementor promotion to generate
interest. These are known as the four P’s – Product, Price, Place and Promotions all ofthese are a part of what is know
as the marketing mix.
Product
In 2010-2011 Warburton’s re-launched all the packaging for every productto include a new logo and personal message
from Jonathan Warburton relating to the product (Brand New, 2011). Although the financial implication for the rebrand
have not been announced to the public, when researching a similar company called Lyndale Foods also rebranded their
image in 2010 which resulted in a costof £1million (Manchester Evening News, 2010). Completing such a large scale
image re-launch for a company ofWarburton’s size doesn’tonly have financial implication but operational as well. These
include having to change all delivery vans to match the new style, ensure all packaging from the old logo is used and the
new packaging is communicated to their customers. To see examples ofthe new packaging compared with the old see
appendix C.
Marketing
7. 7
Price
Warburton’s use a mix of costplus and premium pricing
strategy, to calculate the amount they should charge their
customers for each product. They adapt the costplus strategy
by adding together the material cost, labour costand overhead
costto make the product. After this they add the mark-up
percentage (which is the profit) to give them the total price
(Accounting Tools, 2014). Warburton’s also use aspects ofthe
premium strategy, they believe because they offer the freshest
and best quality products on the shelf they can charge more
than their competitors.
Place
Warburton’s operate from 12 bakers and 14 depots the headquarters are found in Bolton, where
the company was founded (Warburtons, 2015). As you can see from the operations map to the
right mostof the bakery’s and depots surround the North West section ofthe UK, close to the
headquarters. In 2003 Warburton’s opened a bakery and depotin Enfield, London with hopes to
increase their market share in the area. Ten years later they have managed to achieve their
goal and now have the top baked goods brand in the Capital, with a marketshare of14.8
percent (Montague-Jones, 2013). You can currently purchase Warburton’s products at
Tesco, Asda, Sainsbury’s, Aldi, Pound land, Amazon, Waitrose, British Corner
Shop, Ocado and Iceland,
Marketing
8. 8
Promotion
Looking atthe marketing time line in appendix D, Warburtons have been marketing through TV, internet and billboard
since 2008 but it is only from 2013 that they have become a real contestantin the marketing sector. In 2013 Warburton’s
launched their new sandwich alternatives range, and tied this in with their Dear Mr. Warburtons advert. In the same year
they purchased rights to advertise a massive billboard, showing the half& half loaf on the Chiswick Towers. The total
costofthese campaign combined was £32 million and resulted in a 52 percent increase in operating profitand a 26.9
percentincrease in sales (Jones, 2014). Furthermore, in 2015 Warburton’s launched two very unique campaigns
featuring Sylvester Stallon and the Muppets, with the Giant Crumpet Roadshow being awarded the ‘mostsuccessful
Christmas ad of the year’ beating John Lewis, who has held the title for the past three years (Brown, 2015).
Marketing
9. 9
Human Resources
Mintzberg’s Organisational Configurations
Henry Mintzberg explains an organisations structure is created from the relationships between the strategy,
environmental forces and the organisational structure itself. He goes on to explain when these factors fit together, they
create an organisation that performs well. Mintzberg explains thatthere are five types ofsuccessful organisation
structures – entrepreneurial, machine, professional, divisional and innovative. Warburton’s company structure fits into the
machine structure. Mintzberg goes on to state the machine organisation is defined by standardization (Mind Tools
Editorial Team, 2016). The organisation has numerous procedures and routines, decision- making is centralized and
tasks are grouped by departments and jobs clearly defined,see appendix E for the Operations, HR and Marketing
structures and defined responsibilities for each department.
Bakery Structures
Of all the twelve bakery’s every one has the same structure through out. As you can see from the hierarchy below each
departmenthas Middle Managers, Team Managers and Team Leaders, with each one supporting each other. Benefits of
this type of structure is a clear direction offlow for information and a defined ladder for internal progression ofemployees.
Human Resources
10. 10
Recruitment Process
According to the Recruitment and Selection: A Competency Approach (Roberts, 2004) the purpose ofrecruitment is to
match people to the rightrole. It is the mostimportant element oforganisation managementof people. The book states
that neither praise or pay can motivate employees to perform beyond their capabilities, thatis why it is important to select
the right person for the role at the selection process. To see Warburton’s Recruitment policy, see appendix F.
How Warburton’s advertiseposition and attractapplicants
They currently have a system called Jobtrain which allows them to advertise all positions currently available. This system
retains candidate’s information and allows them to search the “Talent Bank” for suitable candidates for specialistroles.
With the individual login for every person who uses the system, they can differentiate from internal and external
applicants, allowing them to postjob advertisementfor internal only without external applicants applying accidently. In
addition, to having a sophisticated system to help advertise positions the attraction to join the company has increased
due to them becoming the firstfood manufacturer selected to be in the Sunday Times Top 25 Company’s To Work for
2016 (Perrett, 2016).
Interviewing Candidates
Once the job advertised has reached its closing date itis the responsibility ofthe HR team to sort through the listof
candidates for the mostsuitable fit for the role, this is called shortlisting. If the application passes this stage the
candidate will be invited to a success factor based interview. There are four types ofsuccess factors used in the
organisation these are Energy and Engagement., Raising the Bar, Winning as a Team and Driving for Results. To see
the information on each factor, go to appendix G.
CostImplications to Recruitment
A reportby Oxford Economics has calculated that on average the hiring and training a new employee cost£30,614 (HR
Review, 2014). This costis separated into two sections -
1. Cost oflostproductivity while replacementemployee gains levelof experience required = 28 weeks and £25,181
2. Logistical cost ofrecruiting a new employee = £5,433
Human Resources
11. 11
Staff Retention andBenefits
Warburton’s operates with 4,500 employees and pride themselves on retaining employment with over 40 percentoftheir
workforce stated in the business for over 10 years (Warburtons, 2015). Due to the high levels ofstaff reaching landmark
service, Warburton’s have devised a benefitscheme to award long serving employees. The long service scheme is as
follows –
5 years – 3 days’ paid holiday
10 years – 3 days’ paid holiday + £100 gift
15 years – 1 weeks’ paid holiday
20 years – 1 weeks’ paid holiday + £200 gift + presentation + breadboard
25 years – 1 weeks’ paid holiday + £250 gift + presentation
30 years – 2 weeks’ paid holiday + £300 gift + presentation + breadboard
35 years – 3 weeks’ paid holiday
40 years – 4 weeks’ paid holiday + £400 gift + presentation
45 years – 4 weeks’ paid holiday
To see the long service awards policy, see appendix H.
Human Resources
12. 12
Engagement
Warburton’s Company Values
Family
Work together as one family and learn from each other. The actions and decisions we take aim to benefitthe whole of
the business not justthe one shift, department, site or business unit.
Ambition
To make Warburton’s ever stronger in a rapidly changing environment, itis vital that we focus even more on innovation
and growth. Encourage ambition and helping people to do their bestis really important.
Responsibility
Taking responsibility is the heartof the business, where everyone plays a part. An environmentoftrust through listening
to and respecting other people’s points ofview is importantto us.
Care
Value the commitmentand loyalty ofour people, investing in them and in health and safety. Care aboutconsumers and
the communities we serve.
Quality
Freshness and quality of our products has always been, and will always be, atthe heart ofWarburton’s. Surpassing
customer expectations, knowing whatthey want and meeting their needs is a top priority.
VIP System – Values in People
Award scheme designed to recognise the people who best demonstrate Warburton’s Values (see above). The scheme is
about celebrating people who really go thatextra mile, no matter where they work or what they do. To see the bookleton
the VIP guide, see appendix I. The judging panel meetmonthly to chose which employees will receive either a £10
bronze award, £20 silver award or an £30 gold award. The quarterly winners are reviewed by BrettWarburton, they
receive a thank you card and £50 worth in vouchers. They are then invited to the VIP Annual Awards Dinner held in
November ofeach year. The Annual Winner is chosen by BrettWarburton and Neil Campbell (Company Director) and
receives a glass award and special prize (Warburtons, 2010). For the judge’s guide to choosing the VIP’s see appendix
J.
Human Resources
13. 13
Gallup’s Hierarch of Engagement
Gallup’s reportmeasured 100,000 employees from 2,500 business and 12 different industries’. His findings showed
more engaged employees are more productive and stay with companies longer than the less engaged employees.
Gallup adapted Maslow’s Hierarch of Needs and applied itto employee engagement (Human Capital Review, 2012).
For Warburton’s guide to recognise success see appendix K.
Training and Development
In Warburton’s Training and Developmentpolicy (appendix L) states that the company actively encourages all
employees to seek opportunities to learn. In addition, the policy goes on to say all employees must have an annual
Appraisal meeting with their Manager to discuss each individuals training and developmentneeds. In the Continuous
Developmentpack (appendix M) explains six differenttypes ofdevelopmentyou can take advantage of, these include –
1. Personal DevelopmentPlans (PDP) – To develop an individual needs using traditional and non traditional
learning.
2. Continuous Professional Development(CPD) – Structured approach to learning to help ensure continued
capability in a specialistarea.
Human Resources
14. 14
3. On the job development – Secondments, projects etc.
4. Mentoring and Coaching – Being a mentor or having a mentor as a useful developmenttool.
5. Formal Training – Use ofhome grown website to look atthe courses and workshops available.
6. Informal Training – Work with different groups on projects and give employees more responsibility.
Bitesize
Bakery Bitesize is a learning tool created and developed by Warburtons Center Team. Each site has a Bitesize
champion to offer guidance and supportand are measured monthly on number of modules completed.Each planthas
multiple modules you muststudy to gain the full knowledge ofthe process. This includes a workbook with on site activity
and a questionnaire at the end of each module. Once a module is complete the employee is awarded with a certificate
and their progress is monitored in their one to ones. The aims of Bitesize is to increase all employees baking knowledge
and explain how the Quality Campaign underpins our ability to consistently deliver high quality products. To see an
example of an workbook and activity see appendix N.
Human Resources
15. 15
Operations
Warburton - Mass Production Definition and Benefits
Warburton’s is a mass production company which manufactures products on a large scale typically using machinery and
an assembly line. The process is analysed and reviewed regularly to produce the greatestquality ofitems while using
the fewestresources (Investopedia, 2015). Benefits ofmass production include –
Large numbers are made; unit costs are lower.
Labor costs are lower.
Materials can be purchased in large quantities, so they are often cheaper.
Large number of goods are produced.
The worker spends little or no time retrieving and/or preparing materials and tools.
The probability ofhuman error and variation is also reduced.
Chain of Production
There are a number ofdifferent stages in the chain of production. The system starts with raw materials and may involve
one or more manufacturing processes. Itthen finishes with final products that are ready for consumers. During each of
the different stages, value is added to the product (Business Case Studies,2010). Value is added in a number of ways,
for example:
Converting wheat into finished baked goods
Packaging them in a way that keeps them fresh
Delivering them to places that are convenientfor the consumers to purchase from
Using sustainable methods and materials
Having the trusted Warburton’s premium brand name.
Operations
16. 16
Focus on Quality
Warburton’s has always marketed itselfon the Quality ofits products. The website states that “We're so obsessed with
quality that we can track every one ofthe 2 million products we bake every day to ensure they're fresh when they getto
your local store – we even send our own mystery shoppers to testthe freshness ofour bread. Our dedicated Quality and
Technical team carries out rigorous tests to ensure the higheststandards ofquality are met and that continuous
improvements are made. From the performance ofthe flour, to the colour ofthe crust and the texture of the bread, there
is no part ofthe productthat goes untested. We also recognise and reward our bakeries which strive to produce the
highestquality bread daily through our monthly 'Derek Warburton Trophy”. (Warburtons, 2014) The way Warburton’s
source their ingredients is absolutely key to the quality of their products and we source all our ingredients to ensure the
highestethical and quality standards. For example, we’ve been contracting with the same farmers in the UK and Canada
for more than 15 years, this continuity helps us ensure that we source only the bestwheat for our products. Quality
targets are set to ensure every loafbaked is the bestbread every time. Manufacturing is a balancing act where bakeries
have to manage their cost, this involves making high quality products whilstproviding vale for its customers. Itinvolves
being efficient, reducing waste and keeping health and safety risks down. On the other hand, improved efficiency should
not be an excuse for poor quality (Business Case Studies, 2010) .
New Technology
A food manufacturing organisation has to constantly move forward to keep track with eating trends. Warburton’s
continually invests in their plants, people and products. Itoften invests large amounts in new machinery to be ahead of
their competitors. An example ofthis is when they launched a brand new £20million sheetand cut plant in Burnley with
the objective to bring their own thins and wraps to the market (Lancashire Telegraph, 2014). Another example is to
improve efficiency the organisation increased its oven insulation and gas burners to shut down automatically when
productions stops (Business Case Studies, 2010).
Operations
17. 17
Six Sigma
Six Sigma is a business managementstrategy used to improve the quality and deficiency ofoperational processes. Its
aims are to make processes more uniform and precise through the application ofstatistical methods (Sharon A.
Schweikhart, 2010). Warburton’s currently use the Six Sigma model in its Continuous Improvement teams to with
projects. The six sigma’s are as follow -
1. Define - defining the projectgoals and customer (internal
and external) requirements;
2. Measure - measuring the process to determine current
performance;
3. Analyze - analyzing and determining the rootcause(s) of
relevantdefects;
4. Improve - improving the process by eliminating defect
rootcauses
5. Control - controlling future process performance
To see a completed continuous improvementprojectusing six
sigma see appendix O.
Warburton’s Operational Long Term Plan
Warburton’s goal is to supply continuously high quality baking products, whilstinvesting in new products, innovation and
development. Warburton’s operational long term plan is divided into five sections –
(Managing the supply chain to meet customer needs, 2012)
Operations
