Case Study – Greenacre Pens
By Dr Laura Rook
Greenacre Pens are a stationary supplies organisation, with store locations in every state of Australia. Established in 1986 in Tropical North Queensland, the company has been operating in the retail environment for almost 30 years. During this period the company has seen significant growth, starting from a small shop front in Tropical North Queensland to having many stores nationally across Australia. During this time of significant growth for the company, the retail industry has also grown, both locally and internationally. The purchasing of goods and services is no longer confined to consumers having to enter the shop front to receive their products. The increasingly interconnected globalised marketplace has increased the demand for online purchasing of goods and services worldwide.
Prior to 2011 the company was still seeing significant profit growth. However, the increasing demand of the digital age along with hype around the concept of a ‘paperless office’ has meant that sales and profit are slowly decreasing. Managers in stores around the country have expressed concern over the limited range the company sells, suggesting to the owners that they broaden their product range and open themselves up to the idea of an online shop as they feel the company is no longer aligned to its environment. The owners are reluctant to change their product range and business strategy and have expressed that at this stage they will continue with the current way of operating.
Managers have also expressed a concern over the culture of the organisation. In order to cut costs the organisation recently retrenched many permanent staff. This has left the remaining employees feeling unsure of the direction of the company and concerned for their jobs. With the growing demand for online services and the perceived decreasing demand for office supplies, along with the cost cutting measures the organisation implemented the remaining employees are becoming demotivated and unsure of what the future holds for the organisation. In 2012 the lead sales manager in New South Wales left suddenly declaring to the owners that their ‘organisation was out of touch with reality and had no potential for recovery because it is no longer competitive’. Reluctantly, after much deliberation, the owners decided to employ a national manager to oversee the strategic direction of the company.
The way forward
John Daily was employed as national manager of Greenacre Pens in 2012. John Daily developed a plan that focussed on the current misalignment of the company with the external environment. He envisioned that once the company could relate to its environment and respond to consumer demands, it would regain direction thus providing the shared vision and cohesiveness that the current culture lacks.
Firstly, he broadened the range of products being offered by the company. Greenacre Pen’s had always sold traditional stationary and office supplies. John Daily had the organisation extend its
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current range to also include your non-traditional office supplies such as office equipment and accessories.
To cater for a younger market John Daily decided that the organisation should also tailor their products towards the fashionable trends that younger people were wanting. This included accessories for a younger market wanting fashion products and accessories for their technological lifestyles.
Lastly, John Daily brought the business to the online marketplace. This involved s significant amount of resources to build not only a dedicated website for the organisation but the ability for the organisation to supply their products online in a competitive market with a short turn around. In addition to this, John Daily ensured that the online store was smartphone user friendly in order to specifically target the younger market.
Progress to date
Although profits increased slightly after the implementation of an online shop and the broadening of stock, the culture did not improve as the national manager had hoped. Managers and employees still expressed a concern for the future direction of the organisation and felt they were not on the same page. Managers and employees were significantly resentful of the way in which the plan was developed and implemented. The current management and employees were not consulted in the diagnosis and development of the plan for the company. In addition to this the managers and employees expressed that opening up the online shop and broadening the range were only short term solutions and that if the company were to continue to grow that there needed to be further change.
Case study tasks
- Critically evaluate the appropriateness of the objectives and the effectiveness of the change plan implemented by the new national manager.
- What are the major sources of resistance to change at Greenacre Pen’s? How would you overcome management and employee resistance to change in this case?
- If you were employed as the national manager what model or strategy would you use to implement the change needed in the organisation and oversee the strategic direction of the company? Justify your answer.
- The managers have mentioned to John Daily they have some ‘cultural concerns’. What strategies could be put in place that would ensure the changes he has made to business production has a positive impact on culture?
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