The Review of the Workings of L'Occitane Case Assignment (Case Study Sample)

L’OCCITANE: A case study
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4th January 2016
INTRODUCTION
This case study serves as an explanation for the enhancement of the company L’Occitane en Provence (Meaning: Occitania Women) in all its aspects and attempts to fit the problems and weaknesses of the company, into various business models and tries to derive inferences from that (Our History, Culture, Corporate Structure, 2010). ‘Constant review of the current situation’ is imminent for any business and timely inferences based on the reviews will be of immense help to any company as they provide a chance to rectify themselves of any past mistakes and clearly steer hold of the future markets.
Company Background
L’Occitane has its roots from Provence, a district of southern France and was founded by Oliver Baussan in 1976. It specializes today as a retailer in beauty products for women, fragrances and home based products. The company has a special ‘ECOCERT’ certification from importing Shea Butter from Burkina Faso. Its headquarters are now based in Manosque, France and has its stores in more than 90 countries today (Our History, Culture, Corporate Structure, 2010).
Here, we are going to discuss the current problems the company faces and the methods that can be implemented in order to eradicate the problems and strengthen the company’s reputation and worldwide sales.
Business Problems of the Company
The various problems of the company can be listed as follows.
* Lower profitability and Higher Competition
* Fluctuations in prices
* Regulations followed in different countries
* Reputation problem
* Customer Portfolio
* Recruitment problems (Wedreambusiness.org, 2016).
Important Business Problems of the Company
Problem 1
The problem of Reputation
For this problem, the business model we are going to imply is the model of ‘Value Disciplines of Treacy and Wiersma’
(Scoop.it, 2016)
Basically, reputation is one of the pillars which hold the company firmly. Reputation is synonymous to trust as higher the trust, a company imposes on its target customers, the larger its base will become. So, this model aptly finds its application in order to enhance the reputation of the company.
This model implicitly assumes that, a company will always excel in its forte. Its value as a sum, is determined by the external factors and in this case, the customers and the suppliers and is indirectly influenced by the price determined for the products and the trust instilled in the minds of the customers, that will induce them to choose the product irrespective of the prices. So, according to this theory, L’Occitane has to ensure the following:
1 Excelling in any one of the value disciplines of the company
2 Maintaining threshold standards on the other values
3 Improvisation of the values every year, thereby capturing the market
4 Choose and effectively operate a well developed organizational model (Vliet, 2014).
Proposed Solution for Problem 1
In our case, the three major value disciplines will be,
* Each company tirelessly works for its customers’ needs. Hence, customer satisfaction and needs and constant improvisation in this aspect, will skyrocket the company’s reputation. So, in effect L’Occitane has to work towards delivering tailor-made products for its customers. This can be started by giving questionnaires at each of its outlets posting various questions from various dimensions, to the customers so that particular specifications and negativities will be glaringly obvious. Otherwise, Customer Relations Department can more be enhanced using an intensive management model adhering to customers, to cover all the aspects. Both, Criticisms and positive feedbacks can be met equally and thus paving way for the corrections and growth.
* Excellence in operations can only be attained by minimizing the errors. ‘High quality service at competitive prices’ can only be attained by this factor. Internal focus is the motto here. Standardizing the economies of scale, decreasing redundant parts, increasing the ease of purchase, focussing more on cost innovations play a prime role in this part. So, it becomes mandatory for L’Occitane to improvise itself in these areas constantly to see endearing results.
* Innovation rules the world. Each and every sophistication in this world we currently enjoy is a byproduct of innovation. So, in order to sustain and expand the customer base, L’Occitane must involve itself more evidently in the R&D department, to constantly enhance and innovate the products that capture customers’ eyes and stick to using them. It should attract a new influx of customers, as well as hold the older ones more firmly. In a nutshell, ‘State-of-the-art-services’ must be given to the customers, as they are the ultimate fate determining factor.
* The threshold value in this model means that the optimal value is definitely needed in order to sustain the above said values. Therefore, at least the threshold value must be maintained in two aspects while enhancing the third and after the augmenting period is over, care must be adequately taken to maintain the value discipline.
Problem 2
The problem of Recruitment
Like Customers, the other pillar for any company is its loyal workers. Employees’ performances at all the stages, from grass root level to the higher echelons must be constantly reviewed, analyzed and enhanced.
For this purpose, we are going to employ the model of ‘Strategic HRM model’.
It subtly underlines the importance of talent acquisition, management functions, talent motivation and utilization through a strategic approach.
(Chowdhury, 2015)
It is basically the management of people in an organization. It views ‘people’ as an important asset which must be utilized for the company’s benefit. It believes in mutual respect, mutual responsibility and mutual goals: a kind of symbiotic relationship which is beneficial to both the company and employees. Though, it is a distinct process on its own best results will be obtained only if integrated with the overall strategic management of the businesses (Chowdhury, 2015).
Proposed Solution for Problem 2
L’Occitane should employ this method to boost its recruiting process. According to the problem, recruitment of Asia and Europe people can be of best use in the respective continents. Hence, in our case as said above the strategic HRM model must be combined with the value discipline model in problem 1 to be more beneficial, because customer intimacy will more prominent if L’Occitane employs people from the same community. Training expenditures can also be minimized, if for each country a central training hub is placed for efficient working, rather than making all the employees worldwide to travel to a single place. Training must be offered in such a way, it delivers both personal satisfactions to the employee as well as to the company. Also, not everyone is efficient. So, L’Occitane must be prepared to offer redundancy to workers who aren’t efficient enough after a probation period, so unnecessary costs will be reduced and it is the company’s moral duty to encourage workers who deliver astounding results with reward schemes, which will serve as a moral boost to them. Periodical audits coupled with workforce allotment and succession planning are necessary (Chowdhury, 2015).
. All these should happen with a complete feedback covering every minute detail.
Thus, Recruitment can be done in the best way of hiring the most efficient 150 people out of numerous applications and giving them enough training in a hub devoted to Asia and Europe branches. The hub can be placed at an area roughly equidistant to all the important places from both the continents. By hiring the most efficient people, the training period and cost can also be reduced. For both Asia and Europe, 75 people each can be devoted and they can be concentrated in the places where the sales are a bit low. By that way, we can also gauge the ‘sales talent’ of the newly hired ones. Otherwise, these 75 people can be employed with a combination of experienced ones and can be used to open another new branch in those places, where the chance of opening a new branch is bright. For this, in 2013 the recruitment of 6,600 people worldwide for the creation of a new brand L'Occitane au Brésil, focusing on products from Brazil stands as a testimony (Our History, Culture, Corporate Structure, 2010).
Problem 3
The problem of Customer Portfolio
The terms ‘High competition’ and ‘Low profit’ are always directly proportional. The higher the competition is, the lower is the chance of sustenance. The profits depend largely on the existing and expanding customer base. The lower the customer, the higher the chance of the dwindling of the company is. Hence, for this problem we are choosing the model ‘Customer Marketing and Relationship Management: Curry’s Pyramid’.
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It is widely used to analyze the level of existing customers and new sales prospects in an industry ...