Organization assignment understanding the business of Burberry by applying organizational theories
Question
Task: Apply organizational theories, concepts, and perspectives to your approved organization for your organization assignment. Define your approved organization as you wish in terms of the whole or of the part that is most relevant. In 1-2 pages, provide a description of two to three problems identified. Provide a personal perspective that discusses what you would implement toaddress the problems to move the organization forward as part of the evolving changes fororganizations today.
Answer
Introduction
Every organization is unique, even if two organizations are running the same business. Thus, understanding the organization, its environment, culture, purpose, etc. becomes highly crucial. As per Paz et al (2020), it is very crucial to understand an organization as a unique and distinct entity without generalising its culture, structure, problems, etc. The dynamics of the organization and its operations need to be understood well with the help of the organization assignment. The managers or leaders need to understand the organization. The understanding about an organization facilitates better working, better environment analysis for the organization and better, desired outcomes. The understanding of an organization involves having a thorough knowledge of the organization’s processes, products or services, workforce, nature of business and outcomes. It is analysed through this organization assignment that having a good understanding of an organization is important because it fosters workforce effectiveness and efficiency. The understanding about the organization would foster growth of the company. This would further simplify the management of human resources and facilitate the employees to work better (Groysberg et al, 2018). In this organization assignment, the understanding of Burberry as an organization will be undertaken through research about thecompany. The identification of the problems and resolving the issues faced by the organization can be done through an effective understanding of the organization. This would be beneficial to the management as well as the employees (Lysova et al, 2019). The sooner the organizational problems are resolved, the better it is for Burberry to develop a health organizational environment and channelize the workforce energy and resources to productive business processes.
About the company in the organization assignment
Burberry is a luxury fashion based company which is based out of Britain. The company was established in the year 1856. The founder of Burberry, Thomas Burberry named the company after him. The company has its headquarters in London at England. Burberry is presently engaged in designing and distribution of the ready to wear items, which comprise leather accessories, trench coats, footwear, etc. (Burberry, 2022a). It is found in the organization assignmentBurberry has its name and branding for fragrances as well as cosmetics licensed to Coty and for eyewear it is licensed to Luxotica. The clothing line of Burberry has been running successfully across Europe and around the globe. The company has diversified its range of products over the years. They are offering waterproof fabrics to highly luxurious, fashionable clothes. The company has been running successfully over the years and meeting the needs of their customers by offering them trendy apparel, jewellery, handbags, small leather goods, shoes, etc. The target customers of Burberry include the elites of the society (Lee & Choi, 2022). As per the organization assignmenttheir manufacturing, designing and distribution are done keeping these target higher income earning customers in mind. The brand caters to the needs of almost all gender and age demographics. Burberry is aiming at creating sustainable luxury for the next generations to come, for the customers, facilitating a transformation of the fashion industry. Burberry over the years of operation, have recognised that the business can achieve long term success only if it does not get stagnated. They believe in achieving environmental sustainability through their processes, products and operations. They also try to increase the resilience of their supply chain and improve the management of changes in climate. The present actions of Burberry will mark the success of the company in future. Burberry aims at exploring the beauty of their heritage (Burberry, 2022b). as per the organization assignment findings, the company is constantly guided by its vision of creating space through creativity. Burberry has been setting the standards for leading and also pioneering the innovative and creative solutions in order to create the real change system. Burberry stands out and has a competitive edge in the market because of their purpose. They are creatively driven, open and caring, forward thinking and also proud of their cultural and organizational heritage. These mainly define the organization and create its hallmarks. While upholding the tradition of creation and innovation as mentioned in the organization assignment, Burberry has been facing certain challenges. The company is trying to delight its target customers by harnessing innovation and creativity for delivering the extraordinary products of premium quality standards to their customers, with extraordinary shopping experiences (Olteanu, 2020).
Organizational Environmentdiscussed in the organization assignment
Economic circumstances, legal-political circumstances, sociocultural restrictions, and technical issues make up the overall environment. The achievement or failure of a corporation depends on how it communicates with its surroundings. Every one of these elements has to be examined by an organization since they are all essential for the overall development and success of a firm. It is found in the organization assignmentthat people are investigating the possibilities of regeneration agricultural methods and their consequences for the environment as well as livelihoods throughout the "leather supply chain". In order to comprehend the regeneration potential of the "cotton supply chain", they are also working together with "Conservation International" (Bae, 2019). The "Burberry Regeneration Fund" was founded in 2020 to assist a portfolio of initiatives that have been validated as carbon removal and in setting, allowing Burberry to recompense and carbon storage, promote biodiversity, aid in ecological restoration, plus encourage small populations' lives. It is found in this organization assignmentthat the facilities of Burberry from which customers get leather has received environmental, economic, and transparency certificates. 92% of the material we used in 2021/22 came from tanneries which received environmental, transparency, and social compliance certificates.
Figure 1: Reaching steps for environmental goals
(Source: https://www.burberryplc.in)
This is an important step toward promoting more ethical leather manufacturing. Creators are increasing their promise to sourcing 100% of all leather through certified processing plants by 2025 plus raising the testing requirements in light of the significance of sustainable practices inside the leather production industry and ongoing advancements in this field (Khaliq, et al 2021). As per the organization assignmentfindings, they are dedicated to avoiding aiding in the destruction or disappearance of natural woods as "G7 Fashion Pact" members. Their partnership with "The Biodiversity Consultancy" started with a site occupancy study, which gave us the ability to use the "ARRRT'' framework which indicates "avoid, reduce, regenerate, restore, and transform" to identify exactly just where to take action. They keep evaluating the ways they can prevent deforestation.
Problems faced by the companydiscussed in the organization assignment
In the year 2017, Burberry developed a strategy for growth and transformation of the organization. The strategy aimed at elevating the company to a truly luxurious fashion brand, positioning it rightly in the market. Since then, the company has revitalised their brand image, strengthened their product range and offers and also enhanced their customer experiences. It is found in the organization assignment that the company has been operating on these strong and core founding principles. According to Yoon and Kwak(2020), the goal of Burberry is to accelerate their performance and to leverage their brand equity which is unique. They are working on their aim of growing into a better company and are trying to deliver high quality and sustainable products. Burberry is now a company, which has left the impression in the minds of the customers as a ‘functional luxury’ brand. As per the organization assignment they are maintaining their product line with greater width. However, irrespective of these strategic planning and effective execution, the company is facing issues which are hampering its business. The company is facing challenges in delivering the products to their customers. Their customer service has been adversely affected. The pandemic has changed the way in which the business is being carried out. The delivery of products to customers had become difficult during the pandemic. The regional trading cash flow of Burberry has reduced. It is found in the organization assignment that the performance of the company has been affected negatively. The closure of the Burberry retail stores has affected the supply and availability of the Burberry products (Kim & Ma, 2019). The internal manufacturing sites of Burberry and their global network managing the production, suppliers, storage and distribution, have all been disturbed and disrupted due to the pandemic.
This has been adversely impacting the customer services. The company during the pandemic had closed down several retail stores. The closing down of these retail stores have made it challenging for the company to deliver and cater to the needs of their customers. Burberry has also been facing problems pertaining to its supply chain. The company has been operating through its three factories that are owned and the rest being managed by the global network hub for distribution and storage. As per the organization assignment the company is now facing property risks. There are other issues that are impacting the business of Burberry which include sanction tensions, socio-political issues, counter sanctions, trade compliances, etc. These hinder the smooth and easy operations of Burberry’s supply chain (Demangeot, 2021). The issues regarding the supply chain can be eliminated or resolved with the help of the theory of constraint. The efficiency of the company can be ensured by addressing the loopholes of the supply chain. The company needs agile and tailored approach to meet the problems of the supply chain and manage its business and organizational environment. The supply chain of Burberry needs to be streamlined for increasing the efficiency. As per the organization assignment the supply chain must include committed and responsible retailers, transporters, distributors and suppliers, who would participate in the back end capabilities. The company needs to manage its quality standards so that they do not face quality complaints. Burberry must constantly strive for attaining the highest possible quality standards, addressing the problems if supply chain management and raw material handling (Mandelli, Piancatelli& Arbore, 2021).
Organizational theoriesdiscussed in the organization assignment
The sociological study regarding the structures as well as operations of social managements is termed as organizational theories. It involves the evaluation of the performance as well as productivity of companies along with the action of their employees. The major organizational theories includeclassical theory, neo-classical theory, contingency theory, modern theory as well as motivation theory (Adegbite, Simintiras, Dwivedi &Ifie, 2018). The primary aspects that deal with formal organizational structure of a business is addressed through classical theory. This theory mentioned in the organization assignmentsegregates the professional tasks in the most effective way. Through this theory, Burberry will be able to create the most advantageous structures that will help the organization to achieve its objectives. On the other hand, the neo-classical theory emphasises on the psychological as well as emotional elements of behaviour of individuals in an organization. This theory contends a sense of being in the right place and social receipt is an imperative characteristic of positive performance in the workplace. This indicates that efficient leaders are able to comprehend regarding the way group dynamics are able to contribute towards the accomplishment of the organization (Previtali, 2015). The contingency theory mentioned in theorganization assignmentis also an imperative part of organizational theories and is also known as decision theory. It views the organization as a structure that comprises of choice-makers. The theory mainly contends that the ideal choice of an organization mainly differs from each other. As a result, decisions are reliant on several internal as well as external aspects. This indicates that the triumphant of a business is liable on the decisions made by the leaders of an organization (Previtali, 2015). The modern theory also termed as the modern organizational theory involves several management development methods. This theory mentioned in the organization assignmentregards collaboration between individuals within an organization as well as the adjacent environment. It also involves interpersonal communications between members of the organization. This theory is mostly based on system analysis that uses both behavioural as well as quantitative sciences. This indicates that specialized leaders who assume this theory may use statistical along with mathematical evidence to initiate business decisions (Eacott,2019). The motivation theory addressed in the organization assignmentacts as a major driver that inspires employees of an organization to work toward their specialized goals. This theory is supported by theorists contending the fact that employees carry out their job duties in an accurate way. The theory addressed in the organization assignmentaims to increase productivity within an organization thus persuading employees to perform their task productively as well. This in turn increases profit as well as production within an organization.
Personal Perspective on addressing the Organizational Issues
The luxury industry is presently slowing down, which is hurting well-known businesses like Prada, Mulberry, even Burberry. It is found in this organization assignmentthat purchasing has been curbed as a result of slow "economic growth" and unrest in Russia, China, and "the Middle East", resulting in disastrous effects on companies that manufacture luxury items. According to consultants "Bain and Company", the global market for expensive goods will see a temporary standstill as many firms temper their expectations for fast development. Smart shoppers were unable to comprehend the sense in shelling out exorbitant amounts for bags that might cost them significantly less some few years back, which contributed to the situation. The majority of Burberry's issues are attributable to outside forces, such as political and financial upheaval. These vary markedly with Mulberry's problems, which have been internal but involve considerations about product, price, and management framework. Again for 6 months ending in September, company retail sales increased by "15% to £748 million", while their wholesaler sales increased by "13% to £317 million" (Burberry, et al 2021). Strong sales of "My Burberry", Burberry's newest fragrance, have also been reported. It is found in this organization assignmentthat Burberry also outperforms Mulberry in the areas of narrative and personalization, particularly when it comes to digital media. Storytelling is essential and ought to be integrated across a product's communications, activities, and, most importantly, goods. Simple but significant tales are at the core of products from companies like Burberry, which advantages the company, the channel partners, and eventually the consumer, who is able to enjoy sharing the narrative behind their own purchase.
Issues
There are some challenges facing Burberry globally, those were discussed below in theorganization assignment:
East region poor sales
Perhaps Chinese fashion designers have been forced to limit their purchases for the year, but rather given that Asia accounts for just a "third of Burberry's sales", it's not remarkable that double downturn in comparable properties, especially in Hong Kong, has resulted in such a significant impact on the brand's effectiveness globally (Ramaswamy, &Ozcan,2019).
European tourists do not choose Burberry
People are generally investing less, and premium brands in particular, in these uncertain times. According to Burberry, the "difficult climate for the premium industry" is projected to persist.
Struggling of the luxury sectors
Burberry tried to narrow their product selection and concentrate more on the best-selling items, including handbags as well as overcoats, since their sales declined in May. Another explanation for the dropping sales as per the organization assignmentwould be the notion that there weren't simply quite so many options for consumers to make.
Market rivalry
The enterprise has faced intense rivalry from other businesses that are manufacturing the very same category of items notwithstanding its excellent efforts. Armani, Coach, and Polo are among the company's main rivals. In contrast, the majority of these rivals have intentionally positioned themself to meet consumer wants, leaving the company with no clients. As per the organization assignmentfindings, Coach focuses on making high-end purses, carriers, as well as other upscale accoutrements that are essential to drawing in clients. Additionally, Polo has provided a quality product which that majority of their clients enjoy (Basheer, et al 2022). Ultimately, Armani has concentrated heavily on creating a powerful brand that really has remained inside the market's premium position. Because of the strong competition, Burberry has been required to constantly adapt to suit the desire for high-end goods throughout the world.
Lack of directions
Investors have expressed their dissatisfaction with Christopher Bailey's leadership as CEO even with his simultaneous job as the organization's chief innovation officer (Koudelková, &Hejlová, 2021). As per the organization assignmentdata, the company's share price immediately increased, jumping well over 10% within just 48 hours after Mr. Gobbetti was hired to assume the daily operations and offer corporate strategy. Markets are upbeat, and according to Mr. Bailey, there's really "genuine optimism for the future." Burberry then just needed to figure out how to stop its decline in sales.
Imitation
The organization's powerful leadership has taken attention to the widespread production of fake goods by other companies with significant concern. The pattern is particularly widespread in emerging countries like China as well as Nigeria. As per the organization assignmentthis action has caused the current customers to lose their credibility on the foreign arena as these fake goods spread across the marketplaces. The majority of the time, these knockoffs falls short of Burberry's standard specifications, which hinders advancement and the accomplishment of the institution's goals and missions. The manufacture of fake goods undermines employee morale and ruins a company's entire reputation as it tries to reach the norms of something like the global market. In order to enable the business to make any meaningful economic growth, this trend needs to be stopped.
Conclusion
It can be concluded from theorganization assignmentthat Burberry is one of the most recognised fashion brands of the world. From the time of the company’s inception, they have been gaining prominence in the fashion industry. The fashion critics to the customers, everyone has been speaking well of the brand. However, much has changed over the years, and the company has been facing certain challenges mentioned in the report. Problems and challenges are inevitable part of business and needs to be addressed. The company can resolve these issues by catering to the need of the situation with efficiency and effectiveness. They need to meet the requirements of their stakeholders and their niche high end customers. The impact of the pandemic has been devastating, however, situation is likely to improve in the coming years, promising better business to Burberry. The world is digitalizing rapidly and the company needs to adapt to the changing business environment. They need to adopt measures which will help the company to make better changes with the passing time. It is found in the organization assignmentthat the company has been also setting up digital stores lately. This is a move which is bringing in better business to the company. They are incorporating artificial intelligence and creativity into their business. Today, Burberry is trying to set all its bases at the right place.
References
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Burberry, (2022a). Company. Retrieved from https://www.burberryplc.com/en/company.html
Burberry, (2022b). Our Purpose. Retrieved from https://www.burberryplc.com/en/company/our-purpose.html
Demangeot, M. (2021). How Do Heritage Brands Transfer Their Brand Identity While Transitioning From A Complex To A Simple Visual Identity?: A Burberry Case Study.
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Lee, M., & Choi, S. Y. (2022). How does Burberry Infuse ‘Freshness’ into Classic Trench Coats?. International Journal of Costume and Fashion, 22(1), 63-79.
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Ref
Bae, S. Y. (2019). Luxury, sustainability and the future-The case study of Burberry. The Research Journal of the Costume Culture, 27(1), 64-71. https://koreascience.kr/article/JAKO201912964891218.pdf
Basheer, S. A., Ahmed, A. A. A. E., bin Sheehan, N. B. R., Abd El, R. A. E., Qanawi, A., Al, A., ... & Burberry, K. K. J. (2022). " ALASTOR" AND SHELLEY’S LONGER POEMS: A NEW TRANSLATION AND NEW INTERPRETATION. Journal Archive, 11. https://mkasu.journals.ekb.eg/article_212371_96a425442c2987a9b5fd9f7a6efb9c89.pdf
Burberry, C. M., Flatley, A., Gray, A. B., Gulinger, J. J., Hamshaw, S. D., Hill, K., ... & Rowland, J. C. (2021). Earth and Planetary Surface Processes Perspectives on Integrated, Coordinated, Open, Networked (ICON) Science. https://www.academia.edu/download/74340881/essoar.10508636.1.pdf
Khaliq, M., Usman, A., & Ahmed, A. (2021). Effect of leadership style on working culture and employees motivation. The Journal of Educational Paradigms, 3(1), 166-170. https://eparadigms.org/get-publish-file/27-27-Paper%205-1603439168-1613378725.pdf
Koudelková, P., &Hejlová, D. P. D. “IS GREEN IN FASHION?” ANALYSING THE STRATEGIC COMMUNICATION OF FASHION BRANDS AND THE ATTITUDES OF GENERATION Z CONSUMERS TOWARDS ENVIRONMENTAL ISSUES IN THE FASHION INDUSTRY. 11–13 OCTOBER 2021 Online Exclusive Event, 35. https://www.researchgate.net/profile/Jacqueline-Marques-2/publication/356932211_INTERNATIONAL_CONFERENCE/links/61b394b81d88475981ddbc9c/INTERNATIONAL-CONFERENCE.pdf#page=35
Ramaswamy, V., &Ozcan, K. (2019). Digitalized interactive platforms: turning goods and services into retail co-creation experiences. NIM Marketing Intelligence Review, 11(1), 18-23. https://www.academia.edu/download/71037183/nimmir-2019-0003.pdf
