Argos of Leadership and Management Essay Example | Topics and Well Written Essays - 5000 words

Argos of Leadership and Management - Essay Example Argos is a fully owned subsidiary of Home Retail Group, UK. Argos sells general merchandise and products for household consumption from about 700 stores in UK, online and also through telephone. In the previous financial year, sale of Argos amounted to ?4.3billion and had also employed about 33,000 people across the business (Argos, 2011). Multichannel sales have grown in recent years and represents about ?1.9bn or about 46% of the total sales of Argos. Sales through internet represented about 36% of sales and the remaining 10% through in store sale or by telephone. Argos is the second largest internet retailer operating in UK comprising of about 400 m websites visit during a year (Argos-a, 2011). Argos has adopted the differentiation strategy of Porters generic strategy as the stores of Argos act as a key component of the multichannel model which provides convenient pick up points for its customers. Also with latest technology like ‘voice put away’ which enables the sto res to chose the location of the stocks and thus maximize the utilization of space available from stockroom, the multichannel retailer aims to create a competitive advantage (Argos-b, 2011, p.14). Argos faces a stiff competition from Amazon, internet retailer and has been suffering from consumer downturn and also the likes and demands for Amazon and other competitors. As compared to price, Amazon products was rated cheaper than Argos and in an online survey it was revealed that electrical of Argos was ranked 20 with customer score of 62% as compared with Amazon of 88% (The Guardian, 2012). 2. Monitor the environment Organization tends to monitor the environment by many different ways as per the convenience and requirement by the company. Most of the organization conducts market research to analyze the environment and to know the strategies that its competitors have adopted to overcome the challenges in the competitive environment. Some does it through scenario planning, benchmarking and also through industrial publications. Argos multichannel retailers use the method of benchmarking in order to monitor the environment. Scenario planning has also formed an important part of Argos while dealing with the environment. Benchmarking is an important tool as it helps organisation to gather information about its competitors and the globe, highlights the area which are in need of improvement and set performance standards (Evans, Walters & Palmer, 2002, p. 19). According to Sara Weller the Managing Director of Argos have commented that Argos has set benchmark for the model of multichannel retail and because of its strategy the multichannel retail stores has been doing well than its competitors. The retail giant continues to focus on the customers and delivery as per their requirements. The firm has benchmarked profit before tax to about 60% less at about ?102million (News Reach, 2012). With respect to scenario planning, Argos has realised that the role of physical stores are changing and thus it needs to incorporate to the change in order to stay competitive. The mostly likely scenario is that retail stores will serve two purposes, as showroom and secondly as convenient transaction point. Thus Argos plans to segment their related estates. Some of the flagship stores would focus on the function of the showrooms and