'Laura Ashley Holdings Plc Essay\r'

'1) How invite trades relating to vigilance and arrangingal morphological affected a worldwide giving medication of your choice, over the last 75 years. uphold your findings to growth, distribution, and versatile external influences and strategies.\r\n2) Undertake a organize analysis and explain its relevancy in relation to your c all(prenominal)er-up and/or its sector\r\nWord Count 1250. Harvard genius Referencing. Bibliography Required.\r\nGlobal makeup Laura Ashley Holdings Plc has suffered differing fortunes since Bernard and Laura Ashley bringed it in the 1950s. It has been mired in the designing, manufacturing, distribution and selling of garments, accessories, perfume, confront items, fabric, w any coverings, bedding, lighting, and furniture. Famed for its floral prints, the train was laid-backly triumphful during the beforehand(predicate) and middle mid-eighties but things diversenessd in the early 1990s when various management and geomorphologic prob lems as vigorous as those relating to growth, distribution, and various external influences much(prenominal) as global recession sur face\r\nLaura Ashley herself died in 1985. There is a nonable difference in the organic law up to and after this year. Up to 1985, it was a simply coordinated, steadily expanding make-up direct in a non- manifold environment (complexity arises when thither argon numerous complicated environmental influences [Johnson and Scholes, 1989]). In the months and years after, many alters took place. Laura Ashley went public in flotation, acquired other companies involved in areas such as knitwear and perfume, made heavier investments in manufacturing and information technology (IT), locomote towards partition with Mother and Child shops, exclusively kinsperson furnishing shops and unit shops ( claim operations). The temperament moved little by little away from upright piano consolidation (it had eer manufactured and delivered all true(p)s itself) †The Guardian account that Laura Ashley was withdrawing from manufacturing by the decease of the year in 1998.\r\nIn order to facilitate growth, at that place was a shift from the simple operational organisational structure to a more complex divisional structure (which was re-organised with every transpose of leadership). The most notable oral sex executives of Laura Ashley who were in place whilst and after problems genuine were Jim Maxmin (1991-1994) and Ann Iverson (1995-1997). all(prenominal) of these people were liable for major overhauls indoors the organisation. Vora (1998) states, â€Å"Laura Ashley has undergone various restructuring strategies and umpteen management upheavals, all to no avail, and all of which eat up decimated shareholder value and abused the brand touch”.\r\nAs highlighted above, the major problems of Laura Ashley began to manifest in the late 1980s and early 1990s. The scratch fall of profits were reported in the year t o January 1989. It is important, then, to look at its winner before this †from its beginnings in the 1950s to 1985. peerless area to naturally consider is the draw advantage factors of the organisation for this period i.e. what specifically potful its achievement is attributed to. Key conquest factors are what an organisation must do hale in order to be succeederful, be an takingsive competitor and carry through stakeholder requirements (Thompson, 1997). Bearing this in mind, the call triumph factors of Laura Ashley up to 1985 are identified as high quality production, innovative designs, grievous brand management (the ‘Laura Ashley’ name was and is infrangible), wellhead placing of stores, humanity of good atmospheres in stores, global design and creative competencies, generate training, creation of a plumbly integrate structure and operation within a simple organisational structure in general.\r\nAlso, the Group’s IT capabilities fact ored into the success as it was a egressset of competitive advantage e.g. they were an early adoptive parent of electronic point of sale (Heath, 1996 as cited by Johnson and Scholes, 1999). These factors whitethorn also be interpreted as strategic safeice positions (SEP’s), which post buoy be described as the capabilities, which allow an organisation to produce remedy than average results in comparison with competitors (PUmpin, 1987).\r\nThompson (1997) typifys a accompanimently useful model that can be helpful in explaining the success of Laura Ashley up to 1985. The EVR congruence model, by Thompson, considers if an organisation is being managed effectively with regards to schema. It represents the opposeing of an organisation’s resources (for Laura Ashley these would include plants, vehicles, IT systems and locations) to the find out success factors dictated by the environment (external factors such as opportunities and threats, stakeholders, competition etc). A determining(prenominal) in matching these is the values of the organisation (again, in the case of Laura Ashley, these would include the modus vivendi they promote/project, shop designs and atmospheres, product designs, the brand, staff training policy and the ‘family’ tillage). If the congruence (fit) amidst these three areas is great, then this indicates effective management of resources (Hamel and Prahalad [1993] comment that it is important for organisations to manage resources well in order to achieve objectives), strategy formulation and all-round success.\r\nIt can be argued that the success of Laura Ashley up to 1985 can be attributed to greater EVR congruence. That is such things as the account of shops and plants, distribution systems, stakeholders, threats (including competition), products, level of vertical integration and so on fit unitedly well in relation to the size, structure, culture and speed of growth of the organisation then. The key s uccess factors are also declarative mood of this congruence.\r\nSo that they can be developed to help ensure both present and future success, it is important key success factors are recognised and understood. One position way Laura Ashley could do this is through a arise analysis. This reviews an organisation’s internal strengths and weaknesses and opportunities and threats in the external environment (Cole, 1996). This may be done for a particular moment in clipping or as an overview encompassing the past and present. As made give-up the ghost, Laura Ashley has faced much change during its existence. Opportunities and threats come approximately as a result of constant change and the SWOT analysis can help to see these and internal strengths and weaknesses relevant when dealing with change (Johnson and Scholes, 1989).\r\nThis SWOT analysis can be used in relation to analysing the problems faced by Laura Ashley in the late 1980s and throughout the 1990s. They can be gr eatly attributed to the weaknesses and threats identified. For example, fluctuations in the economy had a knock-on effect on the sale of property and wherefore on the sale of household furnishings. Also, high borrowing, wastage and forced discounting meant that, despite sales increases, shops were do a loss. The reorganizations in 1988, 1991 and twice in 1995 had their effect too †they were lively and highlighted inefficiency. Chandler (1977) states that structures are not adapted until pressure of inefficiency forces the change and that this change process is usually a painful one †often carried out by a different head word executive each time. Upon and after his conflict in 1991, Jim Maxmin found that the organisation lacked a core identity, clear strategies, empowered staff, stark(a) market research, efficient logistics, and many problems in the US such as particular(a) growth, despicable management and delivery problems.\r\nHe responded with his ‘Simplif y, focalise and Act’ programme. This include reorganisation, intro of a Global Operations administrator (GOE) and Global Collection Development (GCD) which aid globalisation and selling, encouragement to empower staff, an adhesion with Federal picture job Logistics to meliorate delivery and distribution systems, sourcing half of the organisations manufacturing to the out-of-the-way(prenominal) East (rather than in-house in Britain) and management substitute in the US. Before leaving Laura Ashley in 1994, Jim Maxmin commented that â€Å"throughout the entire organisation, people has embraced the principles of the Simplify, Focus and Act programme and set more or less sorting out the operational problems which wee-wee plagued Laura Ashley” (Maxmin, 1993 as cited by Warnaby, 1994).\r\nAnn Iverson was appointed chief executive of Laura Ashley in 1995. She was to spearhead the bitch into the US and revamp the product bunk (Teather, 1999). Her observations fou nd various problems †all of which can again be attributed to identified weaknesses. It was found that the product range was too broad, on that point was no ‘ interconnected’ look to match globalisation, the supply chain was inefficient and problems go along in the US. Ann Iverson’s response include strengthening the alignment with Federal Express lineage Logistics, opening larger stores in the US and reviewing marketing and sales. These changes were considered to be good as Laura Ashley restored dividend payments in 1996 for the first time since 1989. Ann Iverson was dismissed in 1997, however, mainly callable to continuing problems in the US and the organisation’s image (Keynotes, 1997).\r\nEach of the changes mentioned came about from the organisation’s particular strengths (as identified) at the time. For example, whilst such things as restructuring and shop closures were happening, the strong name of Laura Ashley and strong customer o bedience were greatly relied upon. Bowman and Asch (1987) comment that the strengths of an organisation are a if not the causal factor in how it handles weaknesses, opportunities and threats.\r\nOpportunities open to the organisation in dealing with its various problems can be identified as the opportunities in the SWOT analysis. Opportunities change and differ over time. For example, the alliance with Federal Express Business Logistics resulted from open opportunities at the time. A possible probability in the early 1990s would have been a speedier move away from vertical integration for example.\r\nLaura Ashley became totally vertically integrate in the 1970s and continued to be so though gradually moved away from this in the 1990s †all told in 1998. Vertical integration can be backwards e.g. manufacturer buy/owning supplier and forwards e.g. manufacturer purchasing/owning retailer †Laura Ashley was both backwardly and forwardly vertically integrated †everyth ing from the supplying of materials and manufacturing to distribution and retail. The main benefits of this throughout the organisation’s nurture included greater control, greater ability to differentiate, the luck to achieve economies of scale (higher margins), assurance of supply and greater synergy. Despite this, there were numerous disadvantages peculiarly that it was costly and greatly increase operational supplement as well as the need to keep up with technological change.\r\nThis tied up pileus having long-term affects. It meant that there was not proficient concentration of key strengths (design and retail) on which key success factors are dependent (Thompson, 1997). Furthermore, vertical integration was inflexible (cheaper manufacturers could not be sourced) and sensitivity to decreases in sales increased. It was the cost aspect that had the greatest intrusion †particularly in the face of costly working out (especially in the US). Warnaby (1994) comments that vertical integration was responsible for financial problems in the early 1990s. The cost of vertical integration had an impact on the organisation’s ability to successfully expand internationally.\r\nPerhaps with the exception of a distinctive product look and the borrowing of a divisional structure, Laura Ashley did not expand internationally applying Treadgold’s keys/strategies †each was use/introduced incrementally as problems arose to highlight the need e.g. it was not until 1995 when Ann Iverson felt the need for a unified product look. This is indicative that the organisation was not particularly capable of embarking on such ambitious international refinement as it did. This is highlighted by the numerous problems faced by the organisation e.g. poor marketing/marketing strategy, inefficient logistics and lack of direction and clear strategy. Additionally, the paternalistic management style was not suited to rapid expansion and this conjugated with hi gh finance demands from vertical integration, reorganisation and early acquisitions further indicate poor planning in terms of development\r\nLaura Ashley has faced so many problems throughout its existence. Problems owing to management, organisational structure, logistics and rapid international expansion continuously came and went. In 1998 bankruptcy looked impendent but an injection of ?44 cardinal in e ceasey capital by Malaysian businessman Dr Kay Peng Khoo (giving his MUI property company 47.5% share ownership whilst the Ashley family retained just 9% [Gibbs, 1999]). He installed Ng Kwan Cheong as chief executive who made changes including the disposal of the problematic North American franchise (retail operations were sold to a management buyout team for $1 at the end of July, 1999 [Gibbs, 1999]), targeting of younger markets and investment in e-commerce (Abdullah, 2000).\r\nHowever, all of these changes looked to have no major impact in the Group’s success with sale s steadily decreasing from 1998. Whether or not Laura Ashley manages to achieve the sort of success it enjoyed in the early 1980s under its new management remains to be seen †as does its survival. Chief Executive Ng Kwan Cheong refrained from placing false hopes, commenting in butt on of 2000 †â€Å"We have a lot of things to do. All I can say is we are despicable in the right direction and things are changing” (Cheong, 2000 as cited by Abdullah, 2000).\r\nREFERENCES\r\nTexts\r\n· Bowman, C. and Asch, C. (1987). ‘ strategical counselling’. Macmillan Education.\r\n· Chandler, A.D. (1997). ‘The Visible Hand: The managerial Revolution in American Business’. Harvard University Press.\r\n· Cole, G.A. (1996). ‘Management Theory and Practice’ (5th Edition). Letts Educational.\r\n· Johnson, G. and Scholes, K. (1989). ‘Exploring unified Strategy: Text and Cases’. Prentice Hall.\r\n· Johnson, G. and Schole s, K. (1999). ‘Exploring bodied Strategy: Text and Cases’ (5th Edition). Prentice Hall.\r\n· PUmpin, C. (1987). ‘The subject matter of Corporate Strategy’. Gower.\r\n· Thompson, J.L. (1997). ‘Strategic Management: Awareness and Change’. internationalist Thomson Business Press.\r\nJournals and Publications\r\n· Hamel, G. and Prahalad, C.K. (1993). â€Å"Strategy as stretch and leverage”. Harvard Business Review, 71, March-April, pp75-84.\r\n· Keynotes (1997), ‘Keynote Market reveal †Clothing selling’, 1997 Reports, p23.\r\n· Treadgold, A. (1991) ‘Dixons and Laura Ashley: Different Routes to International Growth’. International Journal of Retail and Distribution Management. Vol. 19(4), pp13-19.\r\n· Warnaby, G. (1994). â€Å"Laura Ashley †An International Retail mark off”. Management Decision, Volume 32 (3).\r\nformer(a)\r\n· Abdullah, S.A. â€Å"Turning around Laura As hley”. http://adtimes.nstp.com.my/archive/mar3.htm (09 declination 2000).\r\n· Gibbs, G. (1999) â€Å"Laura Ashley bids farewell” The Guardian Unlimited chronicle. http://www.guardianunlimited.co.uk/ document/Article/0,4273,3904775,00.html (18 celestial latitude 2000).\r\n· Teather, D. (1999) â€Å"Banks push Laura Ashley to quit US” The Guardian Unlimited Archive.\r\nhttp://www.guardianunlimited.co.uk/Archive/Article/0,4273,3855892,00.html (18 declination 2000).\r\n· Vora, K. (1998) â€Å"Lessons from Laura Ashley”. The Motley adopt: The Daily Fool, Evening Fool †Tuesday, 03 March 1998, (online) (cited 04 January 2001). http://www.fool.co.uk/DailyFool/1998/DailyFool980303.htm .\r\nBIBLIOGRAPHY\r\nTexts\r\n· Cole, G.A. (1997). ‘Strategic Management’ (2nd Edition). Continuum.\r\n· De Wit, B. and Meyer, R. (1994) ‘Strategy Process, Content, mount: An International Perspective’. West Publishing.\r\n· Hatch , M.J. (1997). ‘ memorial tablet Theory’. Oxford.\r\n· Palmer, A. and Hartley, B. (1996). ‘The Business and Marketing environs’ (2nd Edition). McGraw-Hill.\r\n· Palmer, A. (2000). ‘Principles of Marketing’. Oxford.\r\n· Porter, M.E. (1980) ‘Competitive Strategy †Techniques for Analysing Industries and arguing’. The Free Press.\r\n· Porter, M.E. (1985) ‘Competitive Advantage †Creating and Sustaining brag Performance’. The Free Press.\r\n· Wild, R. (1994) ‘How to Manage’ (2nd Edition). BCA.\r\n other\r\n· Framed-Art Wholesale. â€Å"Laura Ashley †The History” http://www.framedartwholesale.com/aboutLA.htm (20 December 2000).\r\n· Herzog, J. (1997) â€Å"Laura Ashley closure a strategic decision”. Daily Yale news Online †Friday, 12 September 1997, (online) (cited 20 December 2000). http://www.yale.edu/ydn/paper/9.12.97/I-1lauraashley.html .\r\n· Hoo ver’s Online. â€Å"Laura Ashley Holdings Plc political party Capsule” Companies and Industries http://www.hoovers.co.uk/uk?capsule/5/0,3042,90245,00.html?referer= (20 December 2000).\r\n· Wetfeet. â€Å"Laura Ashley Holdings Plc” Company Profiles. http://www.wetfeet.com/asp/companyprofiles.asp (18 December 2000).\r\n· Wright Investor’s Service. â€Å"Research Report: Laura Ashley Holdings Plc” Corporate selective information http://profiles.wisi.com/profiles/scripts/corpinfo2.asp?cusip=C826EG930 (18 December 2000).\r\n'