Organizaion_Dillemas

Company background Vision and mission Carrefour has interesting vision which is the making Carrefour the preferred retailer wherever it operates, This company also has a strong mission that totally focused on meeting the expectations of its customers; Carrefour mission is to be the benchmark in modern retailing in each of its markets. Over the past 40 years, the Carrefour group has grown to become one of the world’s leading distribution groups. The world’s second-largest retailer and the largest in Europe, the group currently operates four main grocery store formats: hypermarkets, supermarkets, hard discount and convenience stores. http://www.slideshare.net/openinnovation/visions-missions-of-fortune-global-100 As a global retailer, Carrefour is committed to enabling as many people as possible to purchase consumer goods, in accordance with the principles of fair trade and sustainable development. http://www.csrglobe.com/login/companies/carrefour.html History Carrefour emerged in 1959 as a collaboration between two entrepreneurs, Marcel Fournier and Louis Defforey, in Annecy, a city in eastern France, and at the same time, the LLC Promodis, the forerunner of Promodes, was created. In 1963, Carrefour invented a new concept; the hypermarket. The first Carrefour hypermarket opened in Sainte-Genevieve-des-Bois, with a sales area of 2,500 m square, twelve check out and 400 parking spaces. Carrefour opened its first hypermarket outside France in Belgium and the first outside Europe, in Brazil. In 1980s, Carrefour store brand products were introduced. In the 1990s, the internationalization of the company started to increase and new store were opened all over the world. http://www.fundinguniverse.com/company-histories/Carrefour-SA-Company-History.html Products and services product Carrefour sells a diverse range of products like: electronics, clothes, books, toys, home appliance, furniture, tableware, sports equipment, cosmetics, food, drinks, etc. The group sells international brands in its stores but also its own brands: No.1, Tex, Bluesky and Carrefour brand. These brands have a value of 60 million Euros. The last brand that was launched is Carrefour, and in the stores entered in 2009. Carrefour has chosen this moment to launch its own product range because now is a positive economic environment for cheaper products and the number of hypermarkets and supermarkets is sufficient to support product distribution. For the first phase the retailer is selling a range of 1200 products, followed in the next two years to reach to 3500 to 4000 products. Carrefour brand products represent approximately 6% of sales retailer now. Of the 1,200 products, 800 are food products that are manufactured almost entirely in Romania. Among food producers selected we can find European Drinks, Orkla Foods Romania, and Danone. The selling price of products manufactured under private label Carrefour will be on average 20% lower than the other products sold by the French retailer in Romania. 4.2. Services Regarding services, Carrefour offers financial services, also traveling services, photo services, fast food, and in Bucharest there is also a Carrefour gas station. In the financial area the group offers a Carrefour card and also they give credits for personal needs, and credits for home goods, insurance, and they also have a service for sending money to people you know in the country or abroad. These services are made in partnership with BRD Group Societe Generale. The card is called Carrefour MasterCard, and it can be used as a credit card. The owner of this card can take a credit of a maximum amount of 20,000 lei, with a monthly interest of 2%. The card combines the convenience of a credit card with the co-branded card. Its owners can borrow money from the card and receive payment facilities and discounts on purchases made inside the Carrefour supermarket. The card can be used in Romania or abroad in the atm disposals to. Also the group offers credits for personal needs and for home goods. The maximum amount is of 100,000 lei for personal needs. For home goods the sum is between 500 and 30,000 lei on a period of 5 years. These services are made also in partnership with BRD. Carrefour provides also a service for transferring money abroad or in the country. This service is made in partnership with MoneyGram. Organization structure Hierarchical: Carrefour has a hierarchical structure with a more functional managerial organizational structure. Their organization is such that the CEO or chairman is the top person in the hierarchy. Below him sits the CFO, the Director of Organization and Systems and the Director of Merchandise and Marketing. The CFO exists between the CEO and the functional divisions. Beyond the functional divisions lies the director for each specific global zone or region for which Carrefour is located. As well as a director for each zone they have what they refer to as the expanded committee which consists of directors of specific nations or subsidiaries. Organization culture Values In 1995 Carrefour entered the Chinese market. This feat was described by the president of the retail chain, Jean Luc Cherau, as a clash between two cultures. One example is the display of fish in supermarkets. In areas close to the coast, fish is shown live, because only so is considered cool. But, in the Midwest areas, frozen fish is displayed, otherwise nobody would buy it. The way of eating and even buying demonstrate the difference between national cultures. So Carrefour had to adapt its working methods. Moreover, in order to adapt to the culture Carrefour is surrounded by local partners and employees. Hofstede Says: “National cultural values are learned early, held deeply and change slowly over the course of generations” (1) that is why is important to analyze the national culture especially for companies who are trying to settle in new markets. http://juli-villegas.blogspot.com/2010/08/organizational-behavior-national-and.html Types of culture practice Nature of culture which Carrefour uses is networked. Networked culture means employees are not particularly interdependent but friendly. http://www.d.parrish.dial.pipex.com/4cultures.html | Low solidarity | High sociability | Carrefour | (self-made) Problems Carrefour like any other organization faces some failures and crisis in different periods of time. One of the most common problems which Carrefour faces is the occurrence of repeated customer complaints. This problem results from low quality of product and services. Now days the quality of product and services has the most important role in business; nevertheless, some products or even some services in Carrefour do not have good quality. Low quality can be find out in some products such as clothes, shoes or even some foods in compare of other hypermarkets. The main reason of this problem is providing product with the lower prices and no branded product in comparison with other chain stores. In some cases customers are not satisfy with customer service. It can be seen in the following picture that a pair of no branding jogging shoes are broke down only after one week use and the customer service was not responsible about this problem. (Appendix 1) If this problem continues for the Carrefour and it does not care about providing products and services with the higher quality the continues complaints of customers and their dissatisfaction will threaten Carrefour public relation and customer loyalty. http://paivisanteri.blogspot.com/2009/04/carrefour-product-service-safety.html In addition to customer complaints which sometimes becomes a crisis for Carrefour, the other problem is that Carrefour‘s staffs cannot communicate with the customers properly especially when another language like English is needed to be spoken by the staffs. This issue is of the great importance in Carrefour Malaysia due to the fact that so many people from other countries are living in Malaysia. This problem mainly follows from the low education of Carrefour staffs and then from the fact that no training sessions regarding teaching English has been provided for them otherwise Carrefour could overcome the low education of the staffs by providing the training sessions for them. It should be mentioned that Carrefour usually employs low educated people to cut the costs though it forgets that sometimes these low educated staffs with no training sessions can lead to the confusion of customers in finding a specific product consequently in the peak hours this can become a problem for not only the Carrefour but also the customers. The last but not least is the long queues especially in rush hours and on weekends. Long queues are mostly common in Carrefour since the cashier should both enter the product prices in system and pack the goods for them though these cashiers have not been trained for packing the goods fast. In some countries and in other chain store in Malaysia like Jusco or even UAE Carrefour branches another staff will give hand to the cashier for packing the goods. These problems follow from the low cost that Carrefour wants to provide for the customer and cut the additional cost. This problem can be responsible for the fact that sometimes some customers will quit the queues and prefer to buy their goods from other chain stores with the fast services but higher prices. Resistance of change One of the most important factors in making changes is resistance of changes. It can be said that Carrefour is the main resistance of change because it provides low price products and services, so it needs to cut some additional cost. Increasing the quality of products and services need to spend more money, therefore it results higher prices on product and services which might be decrease on profits. Recommendation In fact Carrefour should quit its delusion and its false belief that by providing low cost products and services, it will be able to have loyal customers all the time. Clearly something must be done to overcome these problems, It is far more efficient if Carrefour improves and makes some changes in some ways such as product and service quality, relationship between customers and staffs and the level of staffs’ education. Owing to the fact that low quality of product, not being able to communicate with the staffs and also waiting in long queues become nuisances for customers. Carrefour should motivate staffs to learn how to communicate whit customer, speaking English fluently and how to guide and behave with the customers properly. Through a step-by-step procedure Carrefour will become able to overcome these troublesome situations. Implementation for change Through this step-by- step procedure Carrefour needs to spend rather huge amount of money for the better product quality, provides training session for staffs and hire more staffs . For instance for motivating staffs, Carrefour can provide commission for some staffs which try to learn English or they can speak English fluently this will motivate and stimulate other staffs to learn English language too; moreover, a useful pedagogical technique is very helpful for preparing the staffs to use English language communicatively. This changes result in increasing product and services prices but people prefer to spend more money and receive the better quality or services.