The inputs and outputs within an organization are extremely important when determining if their strategic goals and desired outcomes are being or will be achieved. This paper will continue to examine Whole Foods through the Nadler-Tushman Congruence Model; zeroing in on performance as it relates to organization goals and outcomes based on the congruency of it outputs across the models three levels.
Whole Foods continues with the Nadler-Tushman Congruence Model this time examining organizational outputs. In addition, the following will discuss the way in which the company identifies its groups, individual functions, and the interactions among different organizational outputs.
Organizational Level ~ Outputs Outputs vary by company
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As mentioned earlier, financial managers within the organization such as accountants or stakeholders could be categorized into a separate group. Whole Foods has in the past analyzed its outputs from this group to determine its overall financial success and sustainability of company.
In 2008, Whole Foods executed the conservative growth and business strategy financial changes and to determine success of these inputs, the financial outputs were analyzed. According to financial output, by lowering sales volumes in-turn it delivered a 16% increase in adjusted EBITDA* on a 1% increase in sales. (Whole Foods) Financial outputs are possibly one of the most telling categories as to a company’s overall financial staying power.
Key Individual Functions
This organization consists of individuals and functions which are utilized in strategic decisions for strategic output. An example, the Whole Foods Company faces concerns in particular to their limited customer demographics; this is due to limited products and price outputs. In order for the organization to compensate for the use of high end suppliers, and their expensive infrastructure, the company must sell products at a higher cost than most of its competitors.
This would suggest a weakness within the Whole Foods organizations as it only targets consumers who are willing to pay higher than average prices for groceries. The cost of
The Corporation's performance metrics highlights three significances for raising shareholder value: returns, leverage, and growth. The Corporation's main concern of growth concentrate on sales through similar companies or club sales and unit square feet growth; the importance of leverage incorporates the Corporation's objective to raise its operating income quicker than the growth rate in net sales by increasing its administrative expenses, selling, and operating expenses, at a measured rate than the progression of its net sales; and the importance of returns emphasizes on how proficient the Corporation engage its assets through return on investment also, how efficiently the Corporation achieves working capital and capital expenditures through free cash flow. (See Figure
2. Starbucks enjoyed strong financial performance in 2011. The company did not explicitly attribute this, but with an 8% rise in same store sales it seems that either the consumer market bounced back, or Starbucks made changes that attracted more consumers. The company feels that it offered better products and a better experience at its stores. The company also credited operating efficiencies and tight control of spending for improved profits. In addition, the company continued its global expansion, which improved the top line, and used the economies of scale it generated as part of its cost control program.
A weakness that Whole Foods have is their reputation. A reputation for a grocer is key to its survival and they have the reputation of being very expensive or some call it “whole paycheck.”
Whole Foods is a retailer that specializes in organic foods and it has done an excellent job of determining its target market and how to position itself. Instead of going head to head with large food retailers such as Wal-Mart, Whole Foods has found a niche market that works perfectly for itself. This niche market is one that prides itself on being health conscious and environmentally responsible and Whole Foods has done a great job of positioning itself in the same way through its environmentally safe actions and its use of the local community to stock its stores. However, as Whole Foods grows and expands, a person has to wonder if the company will be able to maintain this same position or will have to make
Kudler Fine Foods is a food company that specializes in selling fresh grocery products with simple ingredients used to make gourmet meals. Nearly everything a customer could want would be found within Kudler Fine Foods. Currently Kudler Fine Foods operates from three locations each offering the same service. The company is a privately held, but seeks to offer stock publicly to increase capital. The increase in revenue will allow Kudler Fine Foods to pursue avenues of innovation that can increase profit margins and spark new growth. In this paper Team A will be exploring the internal and external driving factors that
Whole Foods has to pay close attention to its remote, industry, and operating environments to make sure that they choose the best directions and actions available for its organizational structure and internal processes.
Whole Foods Market, Inc. (WFM) lives through their motto of “Whole Food, Whole People, Whole Planet.” WFM opened their first store in Austin, Texas with 19 employees in 1980. Today, WFM has 311 stores in the US, Canada and the UK, and employs more than 72,700 employees. Whole Foods Market is one of the largest natural and organic food retailers in North America. WFM has grown to its size today mostly through mergers and acquisitions of such brands as Bread and Circus and Natures Heartland. In 2011 and 2012 Whole Foods Market was added to the Fortune 100 “Best Places to Work” list. Fortune Magazine (2012)
Whole Foods designs its teams to serve the goals of the organization. At Whole Foods, "the team, not the hierarchy, is the defining unit of activity. Each of the 43 stores is an autonomous profit center composed of an average of 10 self-managed teams produce, grocery, prepared foods, and so on with designated leaders and clear performance targets. The team leaders in each store are a team; store leaders in each region are a team; the company's six regional presidents are a team" (Fishman 1996). The emphasis on quality and specialty foods is reinforced by segmentation according to function, allowing different units to establish expertise and is designed to encourage specialization. Each team has a set of distinct performance goals which encourages specificity and focus. It also creates the ability for teams to fulfill short-term goals germane to their team efforts. This boosts morale, versus only focusing on the big picture
A. Factors that Drive Profitability (as defined in the Interim Report) and an analysis of how they apply to Safeway and their industry leadership:
Whole Foods grocery retailer maintains over 175 stores in North America and Europe and has been consistently nominated as “100 Best Companies to Work For” (Hill, 2006). Furthermore, this type of quality should be considered when reviewing a company because this involves much teamwork and ethical responsibilities.
Whole Foods has been adaptive in fitting its competitive strategy to its situation. The store first grew to prominence by being a stylish antithesis to the crunchy mom-and-pop organic grocery stores, providing a relatively normal but
Marketed as ‘America’s healthiest grocery store’ the company has successfully grown to 408 stores across the world with sales of $14 billion in 2014 (Whole Foods Market, 2015). The firm is positioned as an upmarket grocery due to the emphasis on natural, organic origins, and as a result are able to charge a premium for their products. Through efficiently running its operations and stores, Whole Foods are able to maintain healthy 4.02% profit margins (Financial Times, 2015) and operating margins well above the American grocery store industry average at 6.58% (Bloomberg, 2015). Looking at 2015’s quarter 1 figures it is clear to see that Whole Foods have had a hugely successful year with sales of $4.7 billion, up 10% from the same period last year. Furthermore, they opened 9 new stores and have signed a further 11 new leases.
Whole Foods Market has expanded by a mixture of opening its own new stores and acquiring already existing stores. Today WFM does not follow this strategy, instead their motivation is to open its own large stores. This is due to noticeable sales differences in larger stores as opposed to smaller stores. WFM locates these newer stores in upscale areas of urban metropolitan centers and high-traffic shopping locations. Not all WFMs are isolated structures; some are located in strip malls. WFM offers a larger selection of natural and organic foods than any other grocery store. WFMs marketing expenditure is extremely small. They spend a measly 0.5% of their revenues on advertising. Their chief marketing strategy relies on word-of-mouth. WFM strives to meet or exceed customer expectations. This is so customers receive competent, knowledgeable, and friendly service and become advocates of WFM. The employees here have a decentralized team approach for store operations. This is so some personnel, merchandising, and operating
Whole Foods Market began in 1970 as a local supermarket. Over the past 31 years, Whole Foods Market has grown from a single store in Austin, Texas, to becoming one of the worldwide leaders in providing consumers with natural and organic foods. They have grown to over 300 stores in both North America and the United Kingdom. (Whole Foods Market, Inc., 2011) This report examines the chief elements of the strategy that Whole Foods Market has put into place. Also, it uses past financial data to provide an assessment of the condition of the company going forward. Those assessments include recommendations of future actions, along with concerns I have about the way the company is currently operating and some difficulties that may be on the way.
Recently the consulting group has elected to use the Nadler-Tushman Congruence Model based on the input/output analysis that the congruence model provides. With this report it will provide an unbiased outlook on how the inputs align with whole foods strategy. In addition to this data we will analyze how the company has been doing with its performance compared to its goals. This report will analyze the company’s business strategy to its operating environment as well as examine the inputs in the organization’s environment, resources, and history, and how they align with the required outputs. Lastly, we will explain to the executives/consulting group how congruent the company’s outputs are across three levels: the overall organizational level, the group level, and the individual level.