Home Plus Case Study

Organizational change is the altering of organizational structures and business strategy. As consumer preferences change, competition increases, and the economic environment fluctuates, business need to adapt to these changes to remain competitive. The management of Home Plus, a regional discount store, has proposed an increase of high-end products and a significant reduction in discount packaged goods. This is a change from the original business strategy in which the primary offerings were discount products. Before implementing the proposed strategy, Home Plus management must consider the benefits of the change and the consequences that may occur. As a member of the management team at Home Plus I disagree with the proposal to increase high-end

Another reason is that the business will now cater to a new market of customers, it will also need to contend with that market’s existing competitors such as Macy’s, Bloomingdale 's, and Lord and Taylor. Stores such as these are already dominating the market, offering superior services along with their products. Furthermore, the proposal will also require that management invest heavily in promotion and advertisements to gain customer awareness. According to an article published in the Luxury Daily, a news leader in luxury marketing, the number of high income earners have decrease. Organizations must actively engage, pursue, and attract these kind of customer. In the same article founder of the Shullman Research Center stated “in many respects have to go after these people.” http://www.luxurydaily.com/high-income-tops-high-wealth-for-luxury-purchase-intent-report/ . An alternate perhaps better use of these resources is to cater more to current customers’ need which may result in an increase of market share. Lastly,

By altering Home Plus product offering the organization now has an opportunity to enter new markets. As a result the organization will attract new customers who prefer the high quality and cost products will offer. Additionally, Home Plus will have the opportunity to increase its profit by increasing its margins. Home Plus will now have excess revenue to reinvest in itself. Managers can use these funds to build new stores, purchase a wider variety of merchandise and provide better service for customers. Lastly, Home Plus will have the opportunity to diversify its product. Though it is cutting the discount products by half management intends to double the high end product that the store