Diagnostic Model for P&G and Wal-Mart
Diagnostic Model for P&G and Wal-Mart
The model that best fits the organizational changes at both P&G and Wal-Mart is the Weisbord’s six-box model. This is because the model captures the following aspects of an organization: purposes, structures, relationships, leadership, rewards, and helpful mechanisms. These six aspects are essential in ensuring that the organizational goals and objectives are achieved in the most efficient way. The structure entails the manner in which the company is organized either by the products they offer or by the functions within the organization. The purpose entails the mission of the company regarding a future position in the market. Moreover, the relationships box explains the interactions that happen between the people at various ranks within the organization. The rewards are the benefits that accrue to the actions of the staff. Additionally, the helping mechanism box shows the supporting actions of the organization such as controlling, information systems, and budgeting. Finally, the leadership box indicates the function that coordinates the other boxes aimed at achieving organizational goals (Rothwell, Stavros, Sullivan, and Sullivan, 2009).
SWOT analysis is a technique used in evaluating the operating environment of an organization through assessing the strengths, weaknesses, opportunities, and threats of the organization. The strengths associated with P&G include having a large number of brands totaling to about 300. Notably, 25 of these brands contribute over $1billion of annual revenues. This shows that the structure of the company is product oriented. Additionally, P&G has over 125,000 employees across the world. Apparently, there are complex relationships that occur within the organization as people interact with each other for the purpose of ensuring company success. The major weaknesses of P&G are that it is losing the market share since it has not ventured in social media advertising (Ferrell and Hartline, 2013). This is captured in the relationship box since the employees rarely interact with customers on social media. Moreover, the main opportunity that the company has is that it is expanding into the rural areas of developing economies. They have appointed new regional presidents to enhance the functionality of the leadership box. The threat facing the company is the increasing prices of raw materials that call for reviewing procurement procedures and budgets under the help mechanism box.
Regarding Wal-Mart, the strengths of the company are that there are efficient Information Technology (IT) systems and well-trained staff. This indicates that the purpose and relationship boxes in the model are the best descriptive of the company’s strengths respectively. The changes that occurred in the organization in this regard involved the inception of a skill enhancement program. The weaknesses of the company include a lack of specialization and inability to cope with competition in some countries (Boone and Kurtz, 2015). These weaknesses are explained in the help mechanism and purpose boxes respectively. This is because there is inadequate control of the brands sold by the company and also the failure to remain focused on the objective of the company, that is, to stay ahead of the competition by offering the lowest prices in the market. The opportunities available for Wal-Mart are merging with other merchandisers as well as expanding into other smaller economies. Grabbing these opportunities will include rewarding the hard-working staff through promotions as well as enhancing the leadership function. Finally, the threats of the company are a growing competition and exposure to political problems facing the various countries where the company operates.
The two companies are faced with the problem of increasing competition leading to reduced sales. Additionally, the two companies are subject to political interference in the nations they operate. However, the organizations enjoy the international presence and numerous brands across the world. More so, there is a similarity in their quest to venture into the developing economies and tap the unexploited markets. As such, the companies have a chance to expand their operations when they manage the organizational changes they are making now through the Weisbord’s six-box model. They should mostly engage in leadership changes as well as remaining focused on the purpose of their organizations. Finally, they need to review the structures to strengthen their brands and remain profitable in the long run.
The potential areas of resistance at P&G include a presence in the social media. This is because the market share is deemed to be decreasing because of lack of aggressive online marketing campaigns. This can, however, be mitigated by introducing technology savvy employees in the marketing department of the company. Regarding Wal-Mart, it is likely that the company will resist the need to specialize in few brands so as to increase control and enhance efficient budgeting. This resistance can be countered through merging with other reputable retail stores while reducing the scope of managers and increasing their number (Bradutanu, 2015).
Boone, L.E. and Kurtz, D. L. (2015). Contemporary Marketing. Boston: Cengage Learning
Bradutanu, D. (2015). Resistance to Change – A New Perspective: A Textbook for Managers Who Plan to Implement a Change. Raleigh: Lulu.com
Ferrell, O.C. and Hartline, M. (2013). Marketing Strategy, Text, and Cases. Boston: Cengage Learning
Rothwell, W. J., Stavros, J. M., Sullivan, R. L., and Sullivan, A. (2009). Practicing Organization Development: A Guide for Leading Change. New Jersey: John Wiley & Sons