Assignment @ AUGUST 14th

 

The purpose of this assignment is to help you integrate the skills and concepts that we covered this quarter so that you can apply them in future SBA courses. Reflecting on the course material while it is still fresh in your mind is an important way to retain the knowledge that you have gained and celebrate the progress that you have made.

 Your reflection paper must include the following components:

1. A cheat sheet, matrix, or chart (format is up to you) that you will use for future reference in order to remember the go-to sources for different types of business information.
2. What has changed for you this quarter in your approach to business research?
3. What is an example of a future real-world situation where you can apply something that you have learned in this course?

Your paper should not exceed 5 pages, including your cheat sheet.

The purpose of this assignment is to help you integrate the skills and concepts that we covered this quarter so that you can apply them in future SBA courses. Reflecting on the course material while it is still fresh in your mind is an important way to retain the knowledge that you have gained and celebrate the progress that you have made.

 Your reflection paper must include the following components:

1. A cheat sheet, matrix, or chart (format is up to you) that you will use for future reference in order to remember the go-to sources for different types of business information.

2. What has changed for you this quarter in your approach to business research?

3. What is an example of a future real-world situation where you can apply something that you have learned in this course?

Your paper should not exceed 5 pages, including your cheat sheet.

USEFUL INFO FOR ASSIGNMENT: –

Databases used to research for this term:

Zotero – citing sources

Mintel

Passport – consumer and country report

EUI – country report

Business Source Premier

Topics Covered in the term:

Problem solving Framework

Industry Research – information in which industry is the company from

Stakeholder Analysis

Fish Diagram

Swot Analysis

Cognitive bias in decision making.

Backfile focus on evidence.

The C.R.A.P. Test

Peer Reviewed Articles

Weighted Decision Matrix – IMPORTANT

Cost Benefit Analysis

Pivot tables in Excel

KPI’s ( KEY PREFORMANCE INDICATORS)

08/08/2020

JC Penny

Executive Summary

JC Penny is an acronym which stands for J.C. Penney Corporation Inc.; the company sells different products, which makes it able to reach a broader market. Over the last three years, the company’s annual earnings have been decreasing, up to the first quarter of 2020. Examples of products sold include furniture’s and jewellery, among others. The company’s major competitors in the retail industry are Walmart and Amazon. The SWOT analysis of the company is paramount when it comes to making recommendations on how the company can be made better. The company’s employees are approximated to be more than 95000. Major problems facing the organizations are Lack of innovation, presence of confusing pricing across all its stores, too much inventory in stores and delay in products delivery. The research focused on Lack of change as the significant issues facing the organization. The paper proposes solutions on how the problems can be addressed and valuable recommendations through which the issues can be addressed.

Situational Analysis

Brief Company History

JC Penny is an acronym which stands for J.C. Penney Corporation Inc. It is American retail founded in 1902 by businessman James Cash Penney. The company is presently involved with jewellery, cosmetics and home furnishings (Eades, Glazer & Eyal, 2017). The firm was in operation of more than 8000 stores in the early 21st century across the states in the U.S. In the contemporary world, JC is an international company which has expanded its business beyond America. Examples of products that the company sells include electronics, household products and pieces of furniture. The company’s major competitors are Walmart, Amazon and Target.

Market Research and Financial Background Information

The company belongs to the retail industry. Unlike other companies in the industry, JC Penny deals with multiple products with different product lines. The company has several retail stores which store products that are distributed to customers with ease. For areas where the company lacks a significant amount of general merchandisers, it operates from its centralized applications. Financial reports from 10-K annual reports revealed that the yearly company returns have been decreasing since 2018 up to the first quarter of 2020. Macy’s is the major competitors of JC Penny (Eades, Glazer & Eyal, 2017). Over recent years when JC Penny has been performing poorly, Macy’s performance has been on the rise (LP, n.d). Its market share value has been increasing, and as at now, it has a higher market value compared to JC Penny.

SWOT analysis

Strengths

Weaknesses

· Great employee foundation
· Existence of multiple distribution channels
· Precise and useful supply chains
· Bigger market share

· Reduction in overall net sales in the industry
· The company taking too long to clear its inventory

Opportunities

Threats

· The high number of transactions online
· Advantage from vast existing capital
· Increased market opportunities for company products

· Strict regulations governing the industry
· Diverse view of the products and business because of increased globalization
· Stiff competition from other advanced companies.

Strengths

The company enjoys a more significant market share which is approximated to be 3.30%. This is relatively bigger when compared to the market share owned by its competitors. Ikea and Ross, for instance, have a market share of 2.3% and 3% respectively (LP, n.d). Although this is viewed as an advantage, it is not the same case when compared with Walmart, which enjoys a market share of 17%. The high market share of the company makes it easier for the firm to make profits and increase its total sales (Ferreira & Ferreira, 2018). This serves as the company’s primary competitive advantage.

The company’s employees are approximated to be more than 95000. The high number of employees in an organization makes it easier for the organization to serve its clients better and within the shortest time possible. The clients are also served with minimum pressure, and hence, enhancing their satisfaction (Ferreira & Ferreira, 2018). The high number of employees also enables the organization to benefit from the diverse skills possessed by these employees.

The shorter supply chain of the organization is more of an advantage and competitive advantage than it is. The structure of the company comprises of directors and departmental managers who are responsible for managing the daily tasks of the firm. The stores are also synced with online transactions, a move which ensures that clients can equally make their orders online and frequently transact (Ferreira & Ferreira, 2018). Such activities provide that unnecessary transactions are avoided.

Multiple product lines possessed by the company is an advantage. When the sale in specific products is down, it is boosted in selling other products. Besides, selling a diverse number of products helps in targeting a broader market and multiple approaches towards market segmentation.

Weaknesses

Although the company has control over the weaknesses, it is facing like the contrary, internal operations, addressing the issues is quite problematic. This is because of the reducing capacity of the company in terms of the net sales made. According to the report published by LP, net sales between 2018 and 2019 reduced the sales also went down in the first quarter of 2020. Sales in 2018 were$12,554, and those of 2019 was $11,664. The transactions recorded in the first quarter of 2020 were $10. 716.

Taking a long duration to clear the inventories can be problematic and barrier to the normal operations of the company. According to the company financial statement, it is evident that the company is spending a lot in keeping the inventory. Most of the stores are filled with products which are not impacting the organization in any way (Ferreira & Ferreira, 2018). The firm should find better strategies which can be put in place to ensure that the inventories under operations have been kept in the required manner. Increasing inventory turnover will positively impact the organization.

Threats

The major threats of JC Penny are external forces of business which are directly or indirectly impacting the normal operations of the company. Stiff competition from the rivals within the retail industry has made it difficult for the company to enjoy in the market. There exist several companies with more significant market shares compared to JC penny. This makes it difficult for the organization to compete with such firms. “Walmart Company has a market share of 17.6%, Bed Bath and Beyond 14.7%, Target Inc. 9.3%, Amazon 4.7%, kohl’s Corp 4.6%, and Marshalls 4.2%. For the competitors to have a larger market share than the company, it’s a threat which requires the company to come up with market penetration strategy to ensure that it expands its market share so that it can become competitive in the market to avoid collapsing due to high competition rate” (Ferreira & Ferreira, 2018).

Existence of different business cultures impacts the organization negatively. Being an international company in various states across the globe, culture varies in terms of the customers in place and the attitude which people have towards the products which the company is selling. There also exist different regulations in different countries which govern operations of foreign countries. Some are too strict that the company might find it challenging to make a profit.

Opportunities

Globalization of the market offers firms opportunities through which they can expand and increase in its market share. Market expansion is attained because of the expanded customer base and foundation. Taking issues of globalization seriously will support the development of the business. This will be in line with the needs of customers in their geographic locations.

Increased utilization of online transactions is an advantage, which if utilized well, can increase the market reach. The company owns a well-established website which is known to so many customers. Online market expansion is attained with reduced costs, making the organization tasks more profitable. Lastly, the presence of multiple stores across the globe makes it easier to manage the organization because products can be delivered to customers more efficiently.

Problem Analysis & Description

Critical Issues

JC Penny company is facing several problems in the contemporary business world. According to the company CEO, the following are the significant challenges facing the organization. Lack of innovation, presence of confusing pricing across all its stores, too much inventory in stores and delay in products delivery. Soltau, the company CEO revealed that for the company to go back to where it was, a lot of actions need to be taken. Implementing the right measures in place is the only way the company can refrain from these issues. The company should come up with measures through which innovation in the company should be examined, measures of addressing unsorted inventory and policies which will govern the price confusion across its stores globally.

My Focus Problem

The focus problem to be addressed in this research paper is Lack or inadequate innovation. Despite having catchy advertisements and low product costs, most organizations, including JC Penny, tend to forget that business in the current era requires surplus activities. These surplus activities entail innovation so that the company will remain in line with what is happening across the globe. Making the products enjoyable or even closer to consumers cannot secure the customers. Eve minimizing the price of products is not helpful. Companies need to come up with new ideas which will break-through the customer’s mind and satisfy them in multiple weighs. For instance, Netflix and Amazon did, it and they are now relevant in this technological era, and the company’s annual net incomes are on the rise. The primary rationale as to why most business globally, JC Penny Company, in particular, is vanishing is because they are getting out-worked by their competitors each time. If JC Penney fails to take the issue of innovation seriously, then chances are there that the company will fail as Nokia and Kodak did. Nokia and Kodak were unable to realize that people or customers no longer go for brand names. Instead, they go for innovation and satisfaction.

Causes of the Problem

The process of innovation is not always smooth as many people might be thinking or perceiving it. Innovation in organizations requires the presence of a specific environment which is proactive in addressing the emerging issues. For the organization success, innovation is vital. With the ever-changing technology and dynamic nature of the organization, Lack of innovation in companies will imply that the companies are failing. The following are some of the cause of this problem in JC Penney company.

First are the absence of innovation strategies in the organization. Constant innovation in organizations enables organizations to remain proactive in all activities executed. Missing innovation strategies in organizations imply that there is no move that an organization can take to clinch innovation to cope up with or outshine its competitors. The second cause of the problem is poor motivation amongst employees. Several managers tend to believe that change is more of a hindrance than an advantage to the organization. The same issue might apply to JC Penney’s managers. Such managers tend to sideline employees, neglecting them when it comes to making critical decisions. Employees work best when given freedom of taking any form of risks while trying to test new ideas. When employees feel empowered and motivated, they go the extra mile to find out more about motivation and ways through which new ideas can be incorporated into the organization.

The third cause is poor collaboration among parties making up the organization. Internal and external cooperation in companies is paramount towards its success. There exist different types of collaborations which exist on the organization—for instance, industry partners, customer partners and competitor partnerships. Utilizing the three ensures that innovation in the company has been addressed. The definitive cause of the problem is the Lack of customer connections. Customer empathy is a must for every organization which is concerned with customers. Companies should fight hard to find ways on how customers need can be addressed. Customer feedback needs to be traced in all dimensions to ensure that their satisfaction has been attained.

Indicator of Ultimate Problem

There exist several symptoms indicating that indeed JC Penney is suffering from innovation challenges. The first indicator is a reduction in the overall market share of the organization as compared to its competitors, particularly those who have incorporated emerging technologies in their operations. The second indicator is the closure of some of its stores because of poor management and high losses recorded. Another sign is increasing competition from companies which initially were far behind JC Penney. The third indicator is the inability of the company to compete wholly in the industry and showing any signs of improvement from the ever-worsening situation.

Solution, Evaluation & Recommendations

Solutions to the Problem

The following are four solutions through which Lack of innovation in JC Penney can be addressed. The first solution is taking the lean path. Most of the organization are embracing new technology for its operations when addressing various activities. Generally, this approach builds on a lean approach because organization tend to focus on producing products which directly impacts the customers. This approach can help the organization work handy with other stakeholders and achieve early prototypes which will positively validate some assumptions made. The method also allows the organization to trace how funds are spent. The ultimate advantage of the course is ensuring that innovation is maintained within the organization.

The second solution is welcoming failure and finding ways of addressing them. Discovering solutions which don’t work is the best way of finding out the strategies which work. Running trials which eventually fails should not be regarded as a waste of time and resources. This is because they help the organization identify critical issues and possible ways through which they can be addressed. Several business companies tend to pull out of the innovative actions when faced with minor challenges. Pulling out might make organizations lose innovation advantages.

The third solution is retaining flexibility. Most innovative companies are those who expect the unexpected. Creating a potential scope ensures that the organization wins regardless of the number of directions taken. Sudden changes in the business world can positively or negatively impact the organization (Revilla & Saenz, 2017). Possession of a flexible approach towards how the issues in companies are addressed can enhance innovation. This would eventually maximize on emerging marketing conditions. The company can be in a position of reaching heights that have never been met before.

Evaluations and Recommendations

Examining critically the challenges the company is facing, the following recommendations can be put in place to address the problems. The first recommendation in the area is adopting innovation strategies. JC Penny company should have a team of specialists who will be concerned in finding new ways through which the company can remain relevant in the industry and will be devising measures that serve to impact the organization positively.

The second recommendation is drafting measures that empower and motivate company employees. Managers should be educated and made to understand that motivation is an organizational advantage. Allowing employees to innovate will grant them the freedom to what they are supposed to be doing. This empowering will also give them the necessary freedom they require to try something new, or try implementing an idea they have been following all through.

The third recommendation is supporting collaboration between the parties making up the organization. For instance, partners, customers and stakeholders should come together and formulate solutions through which all these can be addressed. The collaboration will find ways through which innovation in the organization can be achieved. The last recommendation is building firm customer connections. Client success has an important role when it comes to innovation success. Customers are capable of telling the kind of services they require and what needs to be done for their satisfaction to be attained.

Implementation & Success Metrics

Ways on How Solutions can be Implemented

In light of implementing the solutions mentioned above, the following four steps will be followed. 1) Preparing the infrastructure. Like many other solutions, this will also be achieved in a distinct and separate environment from which the resolutions were established. This requires consideration of the company environment so that it can not result to back clashes anymore. A proper evaluation will be essential (Revilla & Saenz, 2017). 2) Fully coordinating with the organization. This will give better ways through which communication with relevant parties will be attained. 3) Installing a production solution. The solution must be moved from development to implementation phase. Projects involving significant changes in the organization requires careful implementation because it might alter overall operations. 4) Implementing the proposals and monitoring their performance (Revilla & Saenz, 2017). After the implementation of the solution, there is a need to follow through them and record how they are impacting the organization.

Measures to be Taken

Measures to be taken while implementing the solutions include but not limited to: Avoiding common pitfalls. Since the goals of implementing the solutions are succeeding, then there is a need to avoid pitfalls as much as possible. Some of the common pitfalls to be avoided include lack of proper communication, avoiding meaningless plans and dealing with overwhelming projects. The second measure is ensuring that all bases have been entirely covered before commencing the implementation process. This will ensure that possible barriers have been prevented. The third measure is ensuring that the company enjoys full support. The key components required in the implementation. These include people, available resources and key stakeholders. The last measure is finding out the plan of attack (Revilla & Saenz, 2017). Once a solution has been implemented, the policy of aggression needs to be drafted. This will help address emerging issues.

References

Eades, K. M., Glazer, D., & Eyal, S. (2017). JC Penney Company. Darden Business Publishing Cases. Retrieved from

https://www.emerald.com/insight/content/doi/10.1108/case.darden.2016.000173/full/

Ferreira, J., & Ferreira, C. (2018). Challenges and opportunities of new retail horizons in emerging markets: The case of rising coffee culture in China. Business Horizons, 61(5), 783-796. Retrieved from

https://www.sciencedirect.com/science/article/pii/S0007681318300983

LP, W. E. P. UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF. Retrieved from

https://pdfs.semanticscholar.org/4ecf/da9b70efd8ab415c714f3fe33e3b54dce656

Revilla, E., & Saenz, M. J. (2017). The impact of risk management on the frequency of supply chain disruptions. International Journal of Operations & Production Management. Retrieved from

https://www.emerald.com/insight/content/doi/10.1108/IJOPM-03-2016-0129/full/html

JC PENNY

08/01/2020

Executive Summary

This paper evaluates JC Penny in light of the problems that it experienced in 2019. Company and problem analyses are presented. A possible solution to the problem is also proposed.

Introduction

JC Penny is an international retail chain company based in the USA. Currently, the chain runs about eight hundred and fifty stores. The stores retail a range of products, including furniture, beauty products, jewelry, electronics, and other household products. The company’s main competitors include Amazon, Target, and Walmart (Garrity, 2020).

Company Analysis

JC Penny sells typical household merchandise in its eight hundred and fifty locations spread all over the United States. The company specializes in fine jewelry and salon products to establish a competitive edge over its competitors (Garrity, 2020). In recent years, JC Penny has been performing poorly compared to competitors like Amazon, Target, and Walmart. The company has been reluctant to leverage e-commerce services.

Situation Analysis
a. Customer Analysis
i. Customer Profile

JC Penny’s target customer is the in-mall enthusiast who is happy to buy merchandise in physical stores rather than in e-commerce platforms. Therefore, the company targets the typical mall going customer who is pleased to retrieve goods and services from a store and leave with them.

ii. Product and Product Distribution

JC Penny sells typical household merchandise in its stores. However, the stores also stock fine jewelry and salon products to stay ahead of the competition. The company buys products directly from manufacturers. The products are then distributed in the stores from where they are purchased by customers who are the final users (Garrity, 2020).

b. Analysis of Competitive Advantage

JC Penny’s primary competitive strategy is the sale of fine jewelry and salon products. The company’s main competitors include Amazon, Target, and Walmart. Amazon has positioned itself as a leader in the e-commerce sector. Since customers are becoming more inclined to shop online, Amazon is the global leader in retail business (Garrity, 2020). Walmart is a leading hypermarket chain company renowned for the grocery sales that give it its competitive advantage. Target Corporation’s competitive advantage is based on its loyal customer base. Therefore the company invests in customer satisfaction. JC Penny’s business structure is similar to Target Corporation and Walmart’s.

c. Environmental Analysis
i. PESTLE Analysis

In 2019, the political environment was favorable for JC Penny. No law or regulation with significant adverse effects against the company was passed. Concerning economic factors, unemployment rates were low, meaning that most Americans had enough income to buy products (Revilla & Saenz, 2018).

A significant social trend that had a substantial effect on JC Penny is increased online shopping. The trend of online shopping took root in America, where more Americans opted to buy their products over the internet over such platforms as Amazon or E-Bay rather than visit a typical brick-and-mortar store. Also, technological advances in the area of e-commerce lead to a significant shift from conventional in-mall shopping to online shopping. There were also no legal factors that had any impacts on JC Penny. As well, there were also no environmental factors that had a remarkable effect on JC Penny’s business.

ii. SWOT Analysis

Strengths

· JC Penny commands a significant market share
· The company has a large employee base
· JC Penny stocks a wide variety of products – broad product line
· The company also has multiple distribution channels
· JC Penny’s supply chain is shorter and, therefore, more effective

Opportunities

· E-commerce presents an opportunity for JC Penny to explore
· Globalization allows the company to sell its products in foreign markets
· The company can use its current capital investment to expand operations

Weaknesses

· JC Penny’s inventory moves slowly
· The sales volume of the company is in a downturn.

Threats
· The company experiences stiff competition from rivals in the retail industry
· E-commerce business continues to attract more customers (Ferreira & Ferreira, 2018)
· Globalization is a challenge to the existing organizational culture.

Problem Analysis and Description

Fishbone Diagram

Closure of Five Stores

Disregard of the competition
Closure of five Stores
Poor Marketing Strategies
The company is filing for bankruptcy
Derailed innovation – slow adaptation to technology
Increased Competition
Reduction of the Company’s Market share
Closure of several stores
Rise of E-commerce

The above fishbone diagram indicates how a lack of innovation and poor adaptation to market trends has led to the imminent failure of JC Penny (Garrity, 2020).
The solution, Evaluation, and Conclusion
A solution to the existing JC Penny’s problem is the adaptation of e-commerce services to regain customers who are lost to online retailers like Amazon. In the future, e-commerce looks set to be the go-to platform for most buyers as the world continues to become technology-driven. Once that is achieved, JC Penny will be able to compete with leaders such as Amazon and Walmart, who have maintained a stranglehold of the retail business.

References

` Eades, K. M., Glazer, D., & Eyal, S. (2017). JC Penney Company. Darden Business Publishing Cases. Retrieved from https://www.emerald.com/insight/content/doi/10.1108/case.darden.2016.000173/full/
Ferreira, J., & Ferreira, C. (2018). Challenges and opportunities of new retail horizons in emerging markets: The case of a rising coffee culture in China. Business Horizons, 61(5), 783-796. Retrieved from https://www.sciencedirect.com/science/article/pii/S0007681318300983
Garrity, A. (2020). JC Penny is the Latest Retailer to File for Bankruptcy. Good Housekeeping. Retrieved from https://www.goodhousekeeping.com/life/money/a27556542/jc-penney-closing-stores/
Revilla, E., & Saenz, M. J. (2017). The impact of risk management on the frequency of supply chain disruptions. International Journal of Operations & Production Management. Retrieved from https://www.emerald.com/insight/content/doi/10.1108/IJOPM-03-2016-0129/full/html

When creating a decision matrix, Kurniawan said, it is important to start by understanding the problem and its implications. Once you have identified these aspects, you can create your analysis with rows and columns.

List your decision alternatives as rows, and the relevant factors affecting the decisions – such as cost, ease and effectiveness – as the columns. Establish a rating scale to assess the value of each alternative/factor combination. It is important that the rankings are consistent throughout the matrix. For example, if you are looking at pain points, be sure to word each issue so that it gets more points the worse it is, and vice versa when looking at benefits.

Multiply your original ratings by the weighted rankings to get a score, then add up all the factors under each option. The option that scores the highest is the winning choice or the first item to work on.

In this example, a restaurant owner is considering four locations. She listed the factors she finds important and assigned weights that reflect how important she considers each set of criteria to be.

Rent is a factor, but she’s decided that market share, which determines how likely she is to get customers, is the most important issue. She values a location close to her home so she can visit quickly if there are problems, and she wants to set up where she can find reliable workers; however, these factors are not as important, so they receive a lower weighted score. She did not consider floor plan, because she found all of them equal in that regard and intends to remodel anyway.

When our restaurateur ran the numbers, locations 3 and 4 come up as close winners. However, looking at the individual numbers helped solidify her decision. Location 3, while the most expensive, offers the greatest opportunity to find qualified employees and attract customers. Thus, not only is it the best by overall score, but the individual factors she values help her justify the increased rent.

Keep in mind that a decision matrix is not the only decision-making tool available. For example, sometimes a simple pros and cons list works. However, for a decision where you have multiple options and diverse features to consider, a decision matrix can shed light on the best choice.