Change management is referred to as the internal modification of an organisation considering the future scope and challenges. It compile with modifying the leadership style, management strategies and employability of a company for the betterment from the business perspective. On the other hand, adapting innovation describes the upgradation of internal and external factors of an organisation from the functional point of view. Change management widens the scope of business operations while adapting innovation promotes the acceptance of future opportunities by implementing advanced technology and business strategies. Here the chosen company is “Ocado Group plc” to describe the change management and innovation that helps in financial growth, market share and business operation.
Figure 1: Robotics innovation in Ocado Group Plc
2. Background of Ocado Group Plc
Figure 2: Global sales figure of Ocado Group Plc in the past few years
“Ocado Group Plc” is one of the largest online grocery retail companies in the United Kingdom and currently operating in 10 countries along with 12 partners having 5% of the market share (Ocadogroup.com, 2024). The company was established in 2000 by Jonathan Faiman, Jason Gissing and Tim Steiner and the headquarters is situated at Hatfield, Hertfordshire, England. The usage of technology in online grocery shopping enhances customer satisfaction for “Ocado Group Plc” in every possible way. In the fiscal year 2017, the revenue was £14.54 billion and in the financial year 2022, it reached £25.13 billion (Statista.com, 2024). The market share of Ocado Group plc is increasing and business expansion is continuously taking place. As per the data it provides services to almost 900,000 people which is 13% more than the last financial year. The chief executive officer of “Ocado Group plc” is Tim Steiner and there are 12 board members in the company governance. The company focuses on “Maximising efficiency, utilising knowledge” as its business strategy to improve the market share and revenue graph. The company is reducing the investment in online activities regarding grocery and backing up the platform partners globally.
3. Challenges facing Ocado Group Plc
3.1 Key changes and innovation challenges faced by Ocado Group Plc in the past five years
Ocado Group Plc has faced several challenges related to change management and adapting innovation in the past five years.
Business expansion strategy changes in the last five years- Ocado is currently focusing on expanding its business globally and that requires an effective business strategy. Curran et al. (2021), said that maintaining International trade policies and labour laws is one of the biggest challenges for a company since it hampers the overall business operation of an organisation. The employee relation rate, customer satisfaction factor and product quality drop down because of these factors. In the last five years, the company has expanded its business outside the UK and in every country the company has reformed its managerial structure for competitive advantage.
Issued in Supply Chain Management- Pujawan and Bah, (2022), mentioned that in the last few years, supply chain management has been suffering because of the COVID-19 pandemic and recent geopolitical issues have disrupted it adversely. As a result, the manufacturing and product delivery get delayed and that connects with lower customer satisfaction. As a whole, the business operation and business performance of Ocado Group plc face challenges. Ocado is trying to reduce the supply chain issue by expanding the collaboration with local suppliers and minimising single supplier dependency on every level of the business.
Implementation of advanced Technology in the past five years- Choi et al. (2022), explained that technology is upgrading so fast and the implementation of it in every sector is expanding rapidly. Ocado has implemented upgraded technology and digital tools in the last five years to improve customer satisfaction and service quality. However, technology comes up with different mechanical issues and innovative technical problems requiring trained employees. Hence upgrading and skilled workforce according to the ongoing technological upgradation demands a huge investment. It affects customer service and reduces the quality of service provision in terms of lowering the efficiency of the workforce in the company.
Data breach- Ocado faces a critical issue regarding data breaches and privacy disturbances of the company and customers as well. Through innovation, the chances of data breaches have increased and that hampers the loyalty of the company towards the customers. As per Demirkan et al. (2020), the confidential data of Ocado was pirated through a data breach and that is the biggest issue faced by the company in the last five years.
3.2 Internal and External business environment analysis
3.2.1 SWOT analysis
Strengths
Weaknesses
? Ocado Group Plc has framed key partnerships with global retailers, like Kroger in the US and Imprints and Spencer in the UK, extending its market reach. ? Ocado's initial section into the online grocery market furnishes it with a first-mover advantage, permitting the company to foster mastery and infrastructure in front of contenders (Xiao et al. 2021).
? The dependence on cutting-edge innovation makes Ocado powerless against disturbances brought about by technical glitches, digital threats, or framework failures. ? The implementation of automated distribution warehouses and mechanical frameworks requires a critical upfront investment, possibly influencing momentary productivity ( Piecyk et al. 2021). ? While Ocado has extended globally through partnerships, its immediate functional presence is limited, presenting the company to regional financial vacillations.
Opportunities
Threats
? The company can exploit the developing interest in online grocery for food by growing its global presence and framing more associations with retailers around the world ( Newing et al. 2022). ? Ocado could explore the enhancement by offering extra services, for example, dinner packs, new food conveyance, or venturing into new item classifications beyond groceries.
? An extraordinary contest in the online grocery market from established players and new participants represents a threat to Ocado's market of market share and benefit. ? Changes in guidelines connected with e-commerce business, food safety, and data protection could present difficulties and increment functional expenses for the company. ? Occasions, for example, natural disasters, global health crises, or international pressures can disturb the supply chain, influencing Ocado's capacity to satisfy orders.
Table 1: SWOT analysis
3.2.2 PESTEL analysis
Figure 3: PESTEL analysis
Political
As per Monte, (2021), Ocado works in the UK, where “political stability” by and large backings business activities. Nonetheless, political choices, for example, changes in tax collection, guidelines connected with online businesses, and Brexit-related influences on supply chains and work, can influence Ocado. Adherence to political norms and guidelines is vital for supported achievement. Be that as it may, political choices, for example, changes in guidelines connected with online business, information security, and food safety standards, can affect the company.
Economic
Wajid and Zafar, (2021), explained that the economic environment altogether influences shopper spending, affecting Ocado's income. Economic variances, expansion rates, and unemployment levels can impact shopper buying power. In the UK, “economic vulnerabilities”, particularly post Brexit, may affect Ocado's expense structure, estimating strategies, and generally monetary performance. On the positive side, expanding dispensable salaries and a developing inclination for Internet shopping give valuable opportunities to the company to grow its client base and improve income.
Social
Social factors like a way of life changes, purchaser inclinations, and socioeconomics impact Ocado's market. The rising pattern of online shopping and the interest in advantageous, efficient arrangements aligns with Ocado's plan of action. Be that as it may, societal changes in health awareness and manageability might require changes in item contributions and promoting procedures. Also, societal trends, for example, an expanded focus on supportability and moral consumption, impact Ocado's item contributions and functional practices.
Technological
According to Tijani et al. (2023), Ocado vigorously depends on technology for its activities and Developments in e-commerce business stages, automation, also, information analytics upgrade proficiency Be that as it may, mechanical headways likewise bring difficulties, like cybersecurity protection threats and the requirement for persistent interest in foundation. Ocado's prosperity is intently attached to its capacity to remain at the forefront edge of mechanical advancements in the online retail and planned logistics sectors.
Environmental
Supportability is turning out to be progressively significant for customers and controllers. Ocado's tasks include transportation and packaging, adding to its natural impression (Siddiqui, 2021). The company needs to align with environmental guidelines, put resources into eco-accommodating practices, and elevate supportability to meet changing purchaser assumptions.
Legal
Muhardi et al. (2020), shared that Ocado works inside a legitimate system that incorporates guidelines connected with internet business, work, and rivalry. Consistency with information security regulations, purchaser freedoms, and business guidelines is fundamental. legal challenges, such as claims or changes in guidelines, can affect the company's activities and monetary execution. Any progressions in these guidelines might affect the company's tasks and cost structure. Legal battles and debates, for example, licensed property issues, can likewise influence the company's monetary exhibition and reputation.
Table 2: PESTEL analysis
Political
As per Monte, (2021), Ocado works in the UK, where “political stability” by and large backings business activities. Nonetheless, political choices, for example, changes in tax collection, guidelines connected with online businesses, and Brexit-related influences on supply chains and work, can influence Ocado. Adherence to political norms and guidelines is vital for supported achievement. Be that as it may, political choices, for example, changes in guidelines connected with online business, information security, and food safety standards, can affect the company.
Economic
Wajid and Zafar, (2021), explained that the economic environment altogether influences shopper spending, affecting Ocado's income. Economic variances, expansion rates, and unemployment levels can impact shopper buying power. In the UK, “economic vulnerabilities”, particularly post Brexit, may affect Ocado's expense structure, estimating strategies, and generally monetary performance. On the positive side, expanding dispensable salaries and a developing inclination for Internet shopping give valuable opportunities to the company to grow its client base and improve income.
Social
Social factors like a way of life changes, purchaser inclinations, and socioeconomics impact Ocado's market. The rising pattern of online shopping and the interest in advantageous, efficient arrangements aligns with Ocado's plan of action. Be that as it may, societal changes in health awareness and manageability might require changes in item contributions and promoting procedures. Also, societal trends, for example, an expanded focus on supportability and moral consumption, impact Ocado's item contributions and functional practices.
Technological
According to Tijani et al. (2023), Ocado vigorously depends on technology for its activities and Developments in e-commerce business stages, automation, also, information analytics upgrade proficiency Be that as it may, mechanical headways likewise bring difficulties, like cybersecurity protection threats and the requirement for persistent interest in foundation. Ocado's prosperity is intently attached to its capacity to remain at the forefront edge of mechanical advancements in the online retail and planned logistics sectors.
Environmental
Supportability is turning out to be progressively significant for customers and controllers. Ocado's tasks include transportation and packaging, adding to its natural impression (Siddiqui, 2021). The company needs to align with environmental guidelines, put resources into eco-accommodating practices, and elevate supportability to meet changing purchaser assumptions.
Legal
Muhardi et al. (2020), shared that Ocado works inside a legitimate system that incorporates guidelines connected with internet business, work, and rivalry. Consistency with information security regulations, purchaser freedoms, and business guidelines is fundamental. legal challenges, such as claims or changes in guidelines, can affect the company's activities and monetary execution. Any progressions in these guidelines might affect the company's tasks and cost structure. Legal battles and debates, for example, licensed property issues, can likewise influence the company's monetary exhibition and reputation.
4. Current innovative and critical evaluation of Ocado Group Plc
4.1 Current process of innovation within Ocado Group Plc
Robotization and Mechanical technology Mix: As per Bierganz, (2021), Ocado Gathering remains as a pioneer in the coordination of robotization and mechanical technology inside its distribution centres, a technique pointed toward enhancing request satisfaction effectiveness. Through relentless speculation and refinement, the organization has raised its automated frameworks, explicitly in errands like picking and pressing. Ocado's ongoing innovation strategy is anchored in this dedication to technological advancement, which demonstrates the company's commitment to achieving faster and more precise order processing.
Both machine learning and artificial intelligence (AI): Ocado Gathering has a rich history of saddling the influence of “Man-made reasoning (computer-based intelligence)” and AI calculations for different applications. Reif, (2020), suggested that, from interest determination and course advancement to client conduct examination, these innovations play crucial parts in their functional structure. Chasing after ceaseless improvement, Ocado is digging into additional progressions in artificial intelligence and AI, trying to raise functional productivity, upgrade client encounters, and smooth out the intricacies of the store network.
Smart Platform Development: Ocado is a global technology provider that not only excels in e-commerce but also provides retailers around the world with cutting-edge fulfilment solutions. Fundamental to its development methodology is the constant advancement of its savvy stage. This includes the fuse of new highlights and advancements, guaranteeing versatility to the always-changing requests of its assorted client base. The continuous improvement of this shrewd stage mirrors Ocado's obligation to give custom-fitted, best-in-class answers for retailers looking for proficient and high-level satisfaction abilities.
Sustainability Initiatives: In the developing emphasis on maintainability, Ocado has moved centre towards eco-accommodating practices. The organization is logical, carrying out imaginative answers to lessen its ecological effect (Schulze, 2021). This might incorporate advancing conveyance courses to limit emanations and investigating feasible bundling choices. Manageability has all the earmarks of being a central subject in Ocado's development system, mirroring a promise to diminish its biological impression and lining up with the worldwide basis for earth-cognizant strategic policies.
Customer Experience Improvement: In the powerful online business circle, Ocado is proactively putting resources into advancements to hoist the general client experience and keep up with seriousness. This includes improvements to its mobile apps and website to create interfaces that are intuitive and easy to use. Customized proposals are reasonably focused on taking special care of individual inclinations (Northfield, 2021). Furthermore, Ocado might be incorporating advancements like increased reality to offer vivid virtual shopping encounters, highlighting its obligation to remain at the very forefront of development to serve its clients.
4.2 Current process of innovation regarding relevant theories and concepts of innovation
4.2.1 Adoption of Lewin's Change Management Model
According to Harrison et al. (2021), Lewin's Change Management Model, created by psychologist Kurt Lewin, is a three-step structure for hierarchical change. It comprises Thaw, where it is disturbed to existing structures; Change, where new cycles or ways of behaving are presented; what's more and refreeze, where the progressions are set and incorporated into the association's way of life. This model underlines the significance of establishing a responsive climate for change, executing the change successfully, and afterwards building up and settling the new state to guarantee enduring change inside an association.
Figure 4: Lewi’s Change Model
Unfreeze: Ocado Gathering Plc could include disturbing existing cycles to plan for change. This could incorporate reconsidering customary distribution centre work processes, testing obsolete innovation, and cultivating a culture open to development. Implementing changes could include implementing cutting-edge automation solutions, perfecting robotic systems, or investigating new technologies (Franklin, 2021). Thawing makes way for a unique change in functional standards, permitting Ocado to present and carry out changes like upgraded computerization, further developed mechanical technology, and advancements, in this manner streamlining its structure satisfaction processes and keeping an upper hand in the quickly developing online business scene.
Change: Ocado Group Plc, lined up with its innovation-driven approach, can carry out significant movements. Progressions might remember the mix of mechanisation for distribution centre cycles, refining mechanical frameworks for accuracy, and utilising artificial intelligence for streamlined request satisfaction. Fitting its shrewd stage could include presenting client-driven highlights and meeting different client needs (Srivastava and Agrawal, 2020). Maintainability drives might appear in eco-accommodating bundling and further streamlining of transportation routes. Stressing development and innovation, Ocado cements its situation as a worldwide tech supplier, guaranteeing these progressions line up with the organisation's commitment to change web-based business, offering effective and feasible solutions for a powerful market.
Refreeze: The organisation might regulate advanced mechanisation works, installing them into standard working techniques for streamlined distribution centre activities. Regular training programs that ensure staff proficiency with cutting-edge technologies reinforce the importance of fostering a culture of continuous innovation. Ocado can lay out new execution measurements aligned up with the changed cycles, stressing effectiveness and consumer loyalty (Men et al. 2020). This stage hardens the progressions presented during the "Change" stage, guaranteeing that the headways in computerization, innovation, and sustainability become imbued in the organisation's activities.
4.2.2 Adoption of the ADKAR Change Management Model
According to Ariestyadi and Taufik, (2020), the ADKAR model, an organizational change management structure designed to assist organisations in understanding and managing the human side of change. ADKAR stands for “Awareness, Desire, Knowledge, Ability, and Reinforcement,” which represents the five essential components required for effective organisational transformation. Ocado Group Plc is almost the first UK-based online grocery market and still doing well because of its effective innovation and adoption of change.
Awareness: To understand the need for change, as a prime virtual grocery market Ocado Group Plc knows what customers want, and they are doing accordingly. As a company they know how much innovation and change is necessary for any organisation thus they collect data, analyze them set their objectives and then take action according to the market demand (Piecyk et al. 2021). As a leading company for the last five years, they adopted so many technological upgrades, innovations and changes in the business to meet the customer’s exaptation.
Desire: To participate and support the change, to adopt the change at Ocado Group Plc firstly they assured that their employees were ready to adopt the changes. As a company Ocado Group Plc fosters its wants, and change managers were particular regarding the positive consequences of implementing the shift as they relate to certain people or groups (Akbar et al. 2020). After that, they gave proper training to their employees, reformed their employee engagement activities to get much better results and also adopted innovative technology in their work.
Knowledge: The knowledge achievement in the ADKAR model of change management mainly deals with "educational and training activities"(Bierganz, 2021). While beginning the process of change, Ocado group gave training to employees, to understand the implications of their duties, abilities, instruments, and procedures. To achieve the milestone acquiring knowledge and information must be specific. Offer knowledge that is relevant to every team's or person's duties.
Ability: Knowledge only refers to understanding but ability is a wider term, it means how much-trained employees are capable of Ocado Group Plc. To get better results and judge the ability of employees Ocado Group did on-the-job training.
Reinforcement: As a leading organisation in the UK it is very challenging for Ocado Group to sustain the change hence they meet their customers' needs and beat their competitors as well.
5. Recommendations on innovation and change for Ocado Group Plc
The implication of Lewin's change model: Utilising Lewin's change model in Ocado Group Plc can boost its success rate in this competitive market. Take the first step towards change by "unfreezing" established conventions through open discussions and raising awareness of the need for innovation. Make an effective argument for the proposed change by highlighting its advantages for both the company and its employees. This first step is all about breaking down resistance and preparing the employees for the next changes (Bodeklint and Unosson, 2019). This company should highly prioritize effective communication because this will create a work climate where staff members understand the need for change.
The implication of the ADKAR change management model: Ocado Group Plc should utilize the ADKAR change management model, which is a proven effective management model can help this company for its betterment. The first thing to do is to develop "Awareness" among the employees by explaining the advantages and reasoning for the upcoming changes (Ali et al. 2021). The company can cultivate a "Desire" for innovation by involving employees in decision-making and highlighting the personal and professional benefits. Then the company should offer specialized training and resources to improve "Knowledge" and support the development of necessary skills. The company needs to ensure that its employees have the "Ability" to apply their knowledge effectively and implement "Reinforcement" strategies to sustain the changes over time and create an environment for continuous growth.
Encourage innovation culture: The management of the company should promote a culture that promotes and rewards creative thinking among employees. The required training and development of the employees at Ocado Group Plc should ensure that they have proper skills and knowledge which would not only benefit them but also develop growth in an organisation (Karim et al. 2019). Workers will be able to make useful contributions on innovation projects if trained in “digital literacy,” and "emerging technology”. Investment in human capital is a crucial aspect to help become successful in the long term in every company where technology keeps on increasing.
Improve stakeholder communication: Effective innovation and change management require better stakeholder communication channels. Regularly updating stakeholders on the company's “innovation initiatives,” “strategic goals,” and “performance metrics” promotes transparency and trust (Crosta et al. 2020). Lastly, getting input from important stakeholders can provide insightful information and ensure that management decisions meet the needs of the different parties.
6. Personal Reflection
Making this consultancy report on Ocado Group PLC was a new experience that boosted my skills in a big way. I learned a lot about Ocado's operations by gathering information from a variety of sources, including the company's annual report, articles, blogs, and case studies. It was not easy to sort the required information from different sources. Overcoming this obstacle improves my capacity for analysis and critical thinking skills, which are crucial for my growth. Finding and organizing the important data for this report helped me to improve my research and organizing skills. Conveying complicated ideas clearly in the report improved my soft skills, especially communication skills. Breaking down complex ideas, understanding them fully, and then explaining them are abilities that will benefit me not just in academics but also in many other situations. This report was more than simply a task it was an opportunity for me to improve myself on many levels and get new insights. I have learned new research and academic skills by overcoming every obstacle I faced while making this consultancy report.
7. Conclusion
From the above discussion and analysis, it can be concluded that change management and technological innovation have a significant impact on any business growth and profitability. The above research was conducted on current challenges, SWOT analysis, PESTEL analysis, and concurrent innovation as well as change management practices adopted by Ocado Group Plc. Based on the consultancy report it has been found that Ocado Grouo Plc is doing well towards its goal while adopting these Practices over the last five years. In the end, based on the analysis, some important suggestions have been provided to the company based on the required changes and innovations the company should adopt to grow more efficiently.
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