Sustainability Strategy in Bulla Dairy Company - Case Study Example

Bulla Dairy Company Analysis Name: Course: Tutor: Institution: Date: Introduction and Background The Bulla Dairy Company is an Australian Dairy industry company that was established more than 100 years ago. The Company first opened its operations in 1909. Its inception was hedged on the rising need to offer quality dairy products with improved value to customers in the Australian and global markets respectively. Since its inception, the company is family owned, established and run by a partnership of three companies, passed over to over six generations in management currently (Bulla Dairy, 2016a). Although the Company has ever since expanded its operations beyond the Australian market, the rising market challenges and industry competition complicates its market sustainability and competitiveness in the long run period. This essay offers a critical focus on the organisations’ market position and competiveness in the Australian market. As such, it evaluates the sustainability of the adopted practices in relation to the Australian and global market practice. Moreover, it explores the process through which the use of innovation and entrepreneurial practices have boasted or hindered the venture market competitiveness. Finally, the report offers strategic sustainability recommendations through which the company can improve and expand its future market success on the Australian dairy products industry, as well as on the global scene. Sustainability Strategy In order to develop a strategic analysis and evaluation of the company sustainability strategies, the report explores a number of the internal systems. In this context, the internal systems are evaluated based on the adopted strategies and their suitability in the Australian dairy products industry. As such the strengths and weaknesses of each of the component strategies are illustrated showcasing their contributions and role in creating a sustainable market competitiveness edge for the company. The overall sustainability evaluation is evaluated through the figure 1 below framework. Figure 1: Sustainability Competitive Evaluation Framework Source: Summarised by the report Organisational Behaviour in the Company Organsiational behaviour is the process through which organisational operations are developed and managed. In this case, the existence of a specific organisational systems influence not only the outcomes, but also the willingness of the stakeholders to participate in the operations of such a venture. In this case, there are many dimensions of organsiational behaviour, but key among them include the organsiational culture, as well as the leadership process (Liljenberg, 2015, p.156). The variance of the two elements across organisations impact on their performances, while directly impacting on their market competitiveness and sustainability. On one hand, an organsiational culture, as Hashim and Wok (2014, p.196) described, is the manner and approach through which the internal stakeholders, specially the employees and the management interact and relate with one another. In the case of the Bull Dairy Company Australia, the venture has a cohesive family culture. In this case, the fact that the company is a family business has facilitated the development of close employee and management relationships. This has led to the creation of large family business, not only in terms of its ownership composition, but also in terms of the relationships with the employees. As a result, the development of such a close relationship based culture has promoted the development of a relationship approach to the customers, creating customer loyalty and satisfaction through not only service delivery, but also the emotional appeal of the venture practices. The close relationships culture creates a culture synergy with the Australian market. With respect to the Hofstede cultural theory, the Australian society has a high collective cultural index. This means that the society places much emphasis on the social wellbeing and relationships over the economic gains and ties. However, the adoption of this culture creates a significant market challenge. In this case, as Turner (2014, p.158) argued, the Australian market has expanded and requires a global perspective. However, the existence of a shared culture and approach among all the employees reduces their perception perspectives. As a result, this has the long term potential for reducing the organisational decision making diversity in the highly competitive and dynamic Australian dairy products industry. Thus, this has the long term potential for reducing its response and appeal to the dynamic consumer market in the long run period. On the other hand, the organisation has a relatively lean management structure. As such, although there exist a series of line managers to head its different product ad operational departments, the hierarchical levels are low. The presence of minimal hierarchical levels in its operations ensures that communication and information flow across the management chains is easy and fast. Thus, this enables the venture to effectively respond to emerging market concerns, changes and dynamics, making it agile and highly flexible. HRM Strategies In the highly competitive global market systems, organisations HR resource shave emerged as a key component in developing and retaining sustainable market competiveness. As a result, Jackson, Schuler and Jiang (2014, p.29) argued that global organisations have revolutionised their HRM management systems, through the use of strategic human resource systems. These are HRM systems aimed at aligning and supporting organisational strategic goals by developing and implementing supportive and market relevant HR systems. Among the common HRM systems include employee training and retention systems. The adoption of these strategies promotes employee skills and productivity as well as their retention rates in the long run period. First, employee training can either be internal or external. This is developed based on the market trends, organsiational needs, and resources availability. On its part, the Bully Dairy Company applies an internal employee training strategy. This is mainly applied through an on the job training strategy. Through the adoption of this approach, the new employees are indicted on the organsiational operations and are expected to learn from peer experienced employee in their areas of specialisation. The adoption of this learning and employee training strategy has reduced he venture overall market costs, in the highly competitive dairy industry characterised by declining profit margins. Moreover, it adoption enhances the creation of the family type corporate culture. This is because the new and the existing employees interact and support one another in the learning process, creating a family environment of interdependence between the employees. However, the approach adoption limits the ability to learn new approaches and systems that the existing employees in the venture could be unaware of. In the long run period, this has the potential of negatively impacting and reducing the venture innovation capabilities. Secondly, the second key SHRM aspect is employee retention (Schiemann, 2014, p.283). These include practices adopted to retain talents. One of the applied systems is the use of a shift working system. Through the shift working system, the venture enhances the attainment of a wok life balance as a reward system, by offering rest period. As such, employees can have sufficient rest periods to engage with the society, family, and personal growth trends. Through such a system, it promotes employee satisfaction by aligning the organisational practices with the individual employee goals. Hence, this reduces the overall market turnover rates for the venture in the Australian labour market. Role of International Business at the Company An additional practice impacting on organisational market sustainability is its participation in the international market. Patel et al (2014, p.703) stated that with rising domestic market competition trends and saturation, it is imperative for organisations to venture into the international market. In this case, venturing into the international market creates market sustainability through a wide range of avenues. First, the venturing allows organisations to leverage on declining domestic market earnings due to competition. As such, the new foreign and lowly competitive markets crates opportunities through which to earn substantial profit margins, thus offset the high operational and low profit margins in the domestic markets. Secondly, venturing in international markets creates a market lifecycle extension. Thus, if a product has reached its maturity and decline stages in the domestic markets, an introduction to the international market ensures that it moves back to the growth stage, extending its market lifecycle and period in the market respectively. In the Bulla Dairy Company, the key rationale and sustainability created through internationalisation is lifecycle extension. As such, although the venture initially operated in the Australian dairy industry, it has since expanded to other European and some Asian region dairy markets. As a result this has ensured that it traditional and pioneer products such as its dairy cream remains in the market, although their maturity and high market competition levels in the Australian domestic market. Role of Technology management at the Company In the wake of globalisation, technology changes have characterised the international market. In this case, the adoption of technology changes serves as a critical tool in crating efficiency. Embracing industry technology changes ensures that a venture is flexible and retains its competitiveness in the long run period. As Chen et al (2014, p.329) argued, technology application in international ventures allows for reduced operational costs, as well as quality control measure and output guarantee. Therefore, the adoption of these practices enhances long term market sustainability. In the global dairy products industry, technology has been experienced in a number of areas such as the refrigeration and pasteurisation of the dairy products. In this regard, the Bulla Dairy Company responded to these changes through adopting the technology as well as building larger factories for production with modern facilities such as the Colac facility in 2013. The adoption of these systems has enabled the venture improve its production process, efficiency, and eventually reduced its production costs respectively. As a result, this has enabled the venture retain is global consumer base through the provision of reliable quality dairy products in Australia. Moreover, the products are more affordable, enabling the venture focus on the cost leadership approach while offering quality products in the Australian dairy industry. Entrepreneurship and Innovation In order for a venture operation to be successful, they are preceded by the presence of an innovative and strong entrepreneurial vision. In this case, the founding members of any enterprise bear the strategic vision that direct and shapes the future of any new venture. In the case of the Bulla Foods Company, it was founded in the early 1900s by Thomas Sloan. On his part, Sloan invented a new approach and way to thicken cream through pasteurising it into copper cans fired by wood. In this case, the founder has established new entrepreneurial opportunity where dairy cream would be canned and sol across the Australian market. This was a new innovation that did not pre-exist in the Australian market (Gray, 2014). As a result, it focused and captured a huge market gap that existed on the supply of dairy ice cream products. Once he floated the idea, he was joined by other family relatives, leading to the development of the venture under the partnership of three inter related families. The above analysis indicates that the venture initiation was purely based on entrepreneurial innovation skills that created completely new products not available earlier on in the Australian dairy products industry. Since its inception to date, the Bulla Diary Company is hedged on the principle of innovation and creativity. As such, the venture has been continuously focused on developing new and unique dairy products to supply across the Australian dairy industry. As a result, it currently prides in the possession of a highly diverse yet innovative product variety, including products such spreadable cheese and sticks among others (Bulla, 2016b) Moreover, its apex of creativity and innovation was evidenced through the construction and commencement of the Colac innovation centre in 2013. The facility is a modern platform through which lab experiments and product simulations are executed. As such, it serves as the venture research and design centre where new ideas re conceived, evaluated and reviewed. Consequently, the facility creates an avenue through which the employees can try out and simulate new ideas, consequently promoting and propagating an innovation culture. Thus, based on the above analysis it is apparent that the venture operations have been hedged on the concept of innovation. Moreover, it is evident that the organisations have developed proper infrastructure as well as systems to support and stimulate the retention and growth of the founding innovation culture in the long run period (Terera and Ngirande, 2014, p.481). As a result, this has been its min competitiveness edge as the venture continually introduces new dairy products as opposed to its competition. Moreover, the expected continuity of this practice is bound to enhance the retention of the current market competitiveness levels, making it a sustainable approach. Recommendations for Future Strategies A critical analysis of the above report findings illustrates that although the venture is sustainable to a large extent, some of its practices and operations are not. As such, this report section argues that in order to guarantee the company long term sustainability, there is need to improve on the few weakness areas into the future. This report section offers three strategic recommendation areas that the venture should improve on. External Employee Training As illustrated in the organisational analysis, the venture relies on the use of internal training approaches. In this regard, new employees are trained by the existing organisational employees on the operations and approaches through which tasks are executed in the venture. However, although this reduces the cost of training the employees, it limits the learning scope. As such, the employees are unable to learn on new and emerging trends in the dairy products industry, in the event that the existing employees lack such an understanding (Johnson, 2015, p.280). Therefore, in order to counter and mitigate this challenge, the report recommends the use of an external training system. The system should include the use of external professional trainers’ third party organisations, organisations workshops and seminars. Leadership and Management structure Change The report analysis illustrated that the venture applies a lean management system, through the use of few supervisor and line managers. Although this supports the Australian relatively low power distance culture, it fails to support the high employee engagement principles. Mishra, Boynton and Mishra (2014, p.186) argued that in the modern society, the most productive organisations are the ones that highly engage their employees. In this case, the analysis established that employee engagement is mainly hedged on the use of staff managers, rather than line managers. This is because, while as the line manages supervise the employees; the staff managers support the employees in their task executions. Moreover, the report advocates for the development of a flat management structure. In this regard, as Hill, Jones and Schilling (2014, p.18) noted, the adoption of such a structure ensures the direct interactions of the employees and the top management, thus promoting employee engagement. Through the adoption of this strategy, the venture will not only increase its employee attraction and retention rate, but will also promote innovation and creativity among the employees. As a result, a combination of these factors will facilitate its long term market competitiveness sustainability. Acquire third Party Technology Partners A final recommendation is on technology application. Although the venture has leveraged technology changes to increase competitiveness, there is the need to do more. The key approach to achieving this is the use of third party technology experts. Thus, as Mezgar and Rauschecker (2014, p.659) argued, the use of such partners would reduce its technology management costs while increasing efficiency. This could create long term market sustainability for the venture. Conclusion In summary, the report offers a review of the bulla dairy company market sustainability. It establishes that the applied HRM, organsiational behaviour, technology systems, and international business operations. Moreover, it is innovative enough. Further, the report recommends that the venture should use external training, a flat management structure, and use third party technology partners respectively. References Bulla (2016b) Products. [Online] Available at: < http://www.bulla.com.au/> [Accessed: 8th February 2016] Bulla Dairy, (2016a) The Bulla Story. [Online] Available at: < http://www.bulla.com.au/> [Accessed: 8th February 2016] Chen, Y., Wang, Y., Nevo, S., Jin, J., Wang, L., and Chow, W. S. 2014, “IT capability and organizational performance: the roles of business process agility and environmental factors”, European Journal of Information Systems, vol. 23, no. 3, pp. 326-342. Gray, D., (2014) Celebrating 100 years of making its whey in the world, The Sydney Morning Herld. [Online] Available at: [Accessed: 8th February 2016]. Hashim, J., and Wok, S. 2014, “Predictors to employees with disabilities’ organisational behaviour and involvement in employment”, Equality, Diversity and Inclusion: An International Journal, vol. 33, no. 2, pp. 193-209. Hill, C., Jones, G., and Schilling, M. 2014, Strategic management: theory: an integrated approach, Cengage Learning, New York. Jackson, S. E., Schuler, R. S., and Jiang, K. 2014, “An aspirational framework for strategic human resource management”, The Academy of Management Annals, vol. 8, no.1, pp. 1-56. Johnson, M. P. 2015, “Sustainability Management and Small and Medium‐Sized Enterprises: Managers' Awareness and Implementation of Innovative Tools”, Corporate Social Responsibility and Environmental Management, vol. 22, no. 5, pp. 271-285. Liljenberg, M. 2015, “Distributing leadership to establish developing and learning school organisations in the Swedish context’, Educational Management Administration & Leadership, vol. 43, no. 1, pp. 152-170. Mezgár, I., and Rauschecker, U. 2014, “The challenge of networked enterprises for cloud computing interoperability”, Computers in Industry, vol. 65, no. 4, pp. 657-674. Mishra, K., Boynton, L., and Mishra, A. 2014, “Driving Employee Engagement The Expanded Role of Internal Communications”, International Journal of Business Communication, vol. 51, no. 2, pp. 183-202. Patel, P. C., Fernhaber, S. A., McDougall‐Covin, P. P., and van der Have, R. P. 2014, “Beating competitors to international markets: The value of geographically balanced networks for innovation”, Strategic Management Journal, vol. 35, no. 5, pp. 691-711. Schiemann, W. A. 2014, “From talent management to talent optimization’, Journal of World Business, vol. 49, no. 2, pp. 281-288. Terera, S. R., and Ngirande, H. 2014, “The impact of rewards on job satisfaction and employee retention”, Mediterranean Journal of Social Sciences, vol. 5, no. 1, p. 481. Turner, B. S. 2014, “Australia: the debate about hegemonic culture”, Dominant Ideologies (RLE Social Theory), p. 158. Read More