Management Decision Making at Rose Cosmetics: STEEPLE & Culture Analysis
INTRODUCTION
Rose Cosmetics (RC) is an online retailer based in the United Kingdom. It is an independent business. The company sells cosmetics, skin care, body care products, brushes, mirrors, and bags for both men and women. Shane and her friends Angela and Rupert established RC on 1 March 2010. They lead this organization as a senior management team. The business is successful and has a head office and call center in Leeds. The firm has 200 staff in operations. RC also uses agency staff and its own employees in the warehouse and call center. The firm is facing several issues, such as shift in customer preferences, aging population, call center technology, online presence, limited wages & employment, budget constraints, environmentally friendly initiatives, warehouse expansion, regulations regarding warehouse expansion, Brexit, employment contracts, suppliers and warehouse terms, ethical sourcing, and charities and transparency. The decision regarding the employee engagement and communication channels must be made to get things on track as far as the prioritization of the issue is concerned. Rose Cosmetics has been excellent in its operations and success so far. However, the firm is stumbling in the dynamically changing business climate due to internal and external issues. This analysis revolves around the brief examination of the problems or challenges, along with multiple insights and implications. Using strategic tools or frameworks to navigate these issues is essential to derive valuable takeaways.
STEEPLE INTRODUCTION
Steeple analysis is one of the effective strategic management tools for scanning the external business setting of the organization. This tool helps the organization to identify and understand opportunities. It can also facilitate identifying issues and opportunities in social, technological economic, environmental, political, legal, and ethical domains.
STEEPLE ANALYSIS
Social
Issue 1: Shift in Customer Preferences
Customers in the cosmetics industry have become ethically and sustainably conscious, as they want the organization to contain ethical and sustainable practices. Shane’s vision is in the limelight, as it can drive the responsible business. The impact of the issue is high, as it can lead to limited sales and customer dissatisfaction. RC is willing to expand its product range to integrate with these changing needs and preferences. It is medium (orange), as product development requires intense strategic planning (Martinko, 2021).
Issue 2: Aging Population
The aging population has been a concern, and the organization requires a new product line to facilitate older adults. There has been a potential market gap due to the aging population. The impact is medium in the short run, but it can be high due to the consistent demographic changes. RC has responded well, as it is designing skincare items for seniors or older adults. The priority is medium (orange), as the issue can be tackled through proactive planning (Kestenbaum, 2018).
Technological
Issue 1: Call Center Technology
Call center operations need to be updated due to a lack of modern technologies. The critical assumption is that the organization must enable fast and accurate services. The impact on service and satisfaction is high. RC is investing in advanced technologies, especially in its call center. The priority is high (Red), and instant actions are needed for seamless functions. There are many call centers technologies and rends in the external business setting. The organization must align with these trends to be relevant and competitive. For example, digital dashboards, quality assurance tools, and analytics ad reporting are several trends. RC needs to embrace these trends or technologies to improve its call center functioning (Scorebuddy, 2023)
Issue 2: Online Presence
Online sales through websites and other e-commerce platforms are increasing, and more than just concentrating on brick & mortar model is needed. Thus, meeting customer’s expectations by focusing on e-commerce is imperative. A high impact on brand visibility and sales is probable. Therefore, RC is concentrating on online sales through its website. The priority is high (Red), as consistent integration and adaptation is necessary to be relevant in this digital world (AIContentfy team, 2024).
Economics
Issue 1: Limited Wages & Employment
Warehouse staff struggle due to low wages, which leads to demotivation and a poor work culture. The impact on employee motivation is high. The response has been inadequate, as the company has yet to address the low wage issue. The priority is high (Red), as negative impact must be evaded to retain talent (Pinto, 2011).
Issue 2: Budget Constraints
RC intends to grow and expand, but the budget constraints have become a significant barrier. There is a need to allocate excessive funds for training and other growth initiatives, and budget constraints need to be revised. There is a moderate impact on workforce capability. The response still needs to be more effective and transparent as far as the limited training budget is concerned. The priority is medium (Orange), as steady improvements are required to enable a skilled workforce.
STEEPLE ANALYSIS
Environmental
Issue 1: Environmentally Friendly Initiatives
Current cosmetics products need to align with sustainable objectives. Customer preferences and expectations are changing as far as eco-friendly items are concerned. The impact on brand image and loyalty is high. RC emphasizes environmentally friendly, and the firm’s logo is an excellent reflection of it. The priority is high (Red), as the firm needs consistent and progressive eco-friendly initiatives to be responsible.
Issue 2: Warehouse Expansion
Excessive warehouse space has become a new need for the organization. However, this expansion of space can contribute to the environmental impact. Currently, the effect is moderate, and it will be high in the future. RC has expansion plans, but the integration with the environmental liability is a crucial assumption. The priority is medium (Orange), as the sustainability and warehouse expansion must be strategized (Seton.co.uk, 2021).
Political
Issue 1: Regulations Regarding Warehouse Expansion
There may be contradictions between regulations and warehouse expansion. Getting approval from regulatory bodies can be a challenge as far as the possible impact on Shane’s expansion approach. The effect on the expansion plan is high. RC is utilizing its networks to steer the planning regulations at the local level. It is a high priority (Red), and instant actions are integral for successful expansion (Seton.co.uk, 2021).
Issue 2: Brexit
There have been supply chain disruptions due to Brexit when it comes to suppliers in China, Europe, and the United Kingdom. The impact on the procurement and supply chain is unfavorable. There is a medium impact on cost and procurement approaches. Still, the response could be more precise, and evaluating the trade regulations is essential. It is a medium priority (Orange), as consistent evaluation and adoption is necessary to evade disruptions (Carrara, 2023).
Legal
Issue 1: Employment Contracts
Complying with labor laws is imperative as concerns related to contracts and working conditions increase with time. The impact on employee satisfaction is high. The firm has been behind in addressing this issue, and therefore, it must be prioritized (red) to enable compliance and employee satisfaction.
Issue 2: Suppliers and Warehouse Terms
The probability of legal disputes is high, and legal assessment of supplier contracts is essential to move forward with legal liability. There is a medium impact on relationships and procurement. Legal evaluation of the agreements is necessary to evade disputes. It is a medium priority (Orange), as the firm needs to review the contracts consistently to validate suitable terms.
Ethical
Issue 1: Ethical Sourcing
Directly buying from China can be risky due to the high probability of ethical violation. RC must maintain a good image and reputation when sourcing items. The impact on brand image is medium. RC is willing to source items directly, but ethical standards must be preserved. It is a medium priority, as evaluating and planning for ethical sourcing is mandatory.
Issue 2: Charities and Transparency
Preserving transparency in charitable considerations is a significant issue. The firm lacks ethical standards in this function. The impact on the firm’s image is medium. RC mentioned its charitable giving in the marketing message. It is a medium priority (Orange), and transparent communication is essential.
SCHEIN INTRODUCTION
Schein cultural analysis is also an effective tool that indicates multiple layers of the culture in the organization. There may be some layers that are influential. The organization can have a good picture of its culture through this analysis, and it can lead to the appropriate improvements. This tool provides the three layers of culture, which include artifacts, values, and basic assumptions. RC’s culture is to be evaluated to derive valuable insights regarding effective leadership.
SCHEIN ANALYSIS
Artifacts
Consistency with Mission: The firm is intending to contain eco-friendly practices to integrate with the mission. However, there needs to be more consistency when it comes to staff treatment and ethical sourcing.
Value Communication: The firm’s tree logo indicates the firm’s concentration on environmental care. However, there has been a mixed message, which is due to budget constraints and impact on employee training.
Inclusive Work Climate: The firm contains limited information regarding diversity and inclusion initiatives. There needs to be a clear gap in the diversity and inclusion practice, and improvements are required.
Packaging: The firm uses extravagant brand packaging (Bbc.com, 2017), which contradicts its environmentally friendly mission.
Basic Assumptions
Values and Behaviors
- Responsibility and sustainability
- Transparent communication
- Fair treatment
- Inclusivity
- Eco-friendliness and prioritizing sustainable packaging.
- Open about budget constraints
- Staff development
There is a slight difference between what we expect and what we see. Seeing a lack of sustainability in packaging is a concern, as sustainable packaging is expected to justify sustainability. Unfair treatment has also been seen, but it can be tackled through fair wages and inclusivity. Budget constraints are typical, but the organization is still conservative in communication. Investing in staff development is essential, but talking about the financial limitations can help us to work on alternatives.
The consistency with the mission has been in the limelight. However, the excessive focus in eco-friendly activities made the organization contain less focus on ethical staff treatment. The message has been mixed so far, especially in marketing. There is also limited information regarding diversity and inclusion, keeping the organization little behind its rivals. The packaging process has been a daunting issue as the organization has concentrated on extravagant packaging, which always leads to the negative environmental impact.
LIST OF INTERNAL & EXTERNAL STAKEHOLDERS
Stakeholder analysis is one of the best tools for the organization to navigate the stakeholders in the internal and external business climate. The most important thing is to evaluate these stakeholders in terms of their impact, power, and influence. The stakeholder grid shows power and interest, and the organization can prioritize things accordingly. The key assumption is that the organization must shape effective stakeholder strategies, and this analysis is a driver of it.
STAKEHOLDER ANALYSIS
High Power Low Interest
Government: There is a high power due to regulations and policies. The interest is low because the government needs to prioritize cosmetics items.
Residents: Residents have high power because operations can create an impact. However, cosmetics do not directly influence these stakeholders.
High power High interest
Senior management: The power of decision-making is in the spotlight. Their decisions and incentives can lead to the fulfillment of business objectives.
Major stakeholders (Managers and Shane): Ownership stake is high, which indicates higher power. Interest is also high due to the impact of financial success (Amadi, Carrillo, & Martin, 2018).
Low Power Low Interest
Warehouse cleaners: The role is narrowed to routine tasks.
Individual customers: People making one-time purchases contain low interest, and it further creates a low impact on success and decisions, as far as limited engagement is concerned.
Low Power High Interest
Part-time staff (call center): few of the part-time employees have high interest due to career aspirations and progression. However, they have limited influence in decision-making.
Local environmental advocates: These advocates have an excessive interest in the firm’s sustainable initiatives or practices, but their influence on daily operations is limited (Gabbatiss, 2017).
This analysis showed both internal and external stakeholders in the business climate. The best thing that the company can do is to steer these stakeholders in terms of power and interest and set the foundation for better interventions. For instance, stakeholders with high power and high interest should be prioritized. It doesn’t mean that the firm will ignore the other stakeholders. The firm must develop its capability to meet the needs and expectations of stakeholders despite low interest and power. Somehow, every stakeholder may have power and influence in the business climate, and careful prioritization becomes integral for RC.
SWOT ANALYSIS
Strengths
Differentiated Model: A unique membership model leads to customer loyalty and high revenues.
Product Exclusivity: A unique selling proposition is probable in product exclusivity (Sustainablebeautyawards.com, 2018).
Effective Procurement: A sustainable relationship with wholesalers positively influences negotiation and price strategy.
Weaknesses
Budget Constraints and Low Wages: Employees need to be more motivated and satisfied.
Warehouse Space/Overstocking: Overstocking leads to excessive waste, requiring more space in the warehouse (Boztas, 2017).
Relying on External Logistics: Logistics disruptions are probable due to a lack of control.
Opportunities
Product Expansion: A new product portfolio can help the company integrate new trends and preferences.
E-Commerce Growth: enhancing online sales is a good option, along with an improved shopping experience for customers (Chai & Zhu, 2022).
Ethical Sourcing: Ethical standards in sourcing, especially from China, can enhance the brand image and reputation.
Threats
Shift in Preferences: Business can become outdated if the new preferences and trends are not considered (Kestenbaum, 2018).
Supply Chain Disruptions: Brexit has created an impact in the form of disruptions. It also affected cost and procurement approaches (Nakamura, Yamada, & Tan, 2019).
Intense Rivalry: High competition can create an impact on market share and prices.
This analysis streamlined several strengths, weaknesses, opportunities, and threats in multiple ways. The most important thing is to keep exploiting the strengths and opportunities to evade the influence of weaknesses and threats. The firm’s strengths may not remain the same in an intense rivalry. Therefore, the management needs to keep recognizing new opportunities to move forward. It is a good internal and external assessment of the organization that can help to understand the holistic view.,
SUMMARY OF ISSUES
Rose Cosmetics’ case streamlined the complications regarding managerial challenges and decision-making in multiple ways. Budget constraints, low wages, employee training, limited communication, poor call center management, and warehouse inefficiencies have been identified as potential issues. These issues also highlight the need for more alignment with the firm’s mission. Extravagant packaging, poor ethical standards, and logistics limitations are external issues for the organization. Addressing these issues or challenges is imperative to put the organization on the right track.
SUMMARY OF THE ISSUES
Here is a summary of the issues that the organization has identified. These issues have bene understood along with valuable insights and implications. However, this summary table also highlights the possible solutions for each issue. These are possible interventions that the firm must strive for. The later analysis will contain selection and prioritization, which can lead to an adequate solution. Understanding these issues along with possible solutions is mandatory, and this analysis is a base for the organization to move forward.
Click here for Managerial Decision Making at Rose Cosmetics-Part 2
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