Isabella operates a clothing manufacturing business in Australia. Her company CULP Pty Ltd manufactures and
sells a wide variety of clothing targeting youth.
CULP has lost market share to cheaper imported products in recent years. In response to the loss of market
share, they have investigated relocating manufacturing to cheaper labour-cost countries in Asia and selling
clothes to a larger potential market in developing economies.
CULP Pty Ltd are concerned about:
● Staffing producing facilities offshore
● Marketing their products to a global audience
You have been employed as a consultant to prepare a report for CULP Pty Ltd.
In your report:
● Outline TWO processes of human resource management relevant to CULP Pty Ltd.
● Explain TWO global marketing strategies that CULP Pty Ltd could use.
● Analyse THREE strategies that CULP Pty Ltd should consider to overcome resistance to
change.
Executive Summary
The purpose of this report is to address the concerns that ‘CULP Pty Ltd’ are facing with
respect to issues within operations and marketing. ‘CULP Pty Ltd’ are hoping to increase
staff in production facilities offshore and market their global company for the return of
increased sales. The following business report will examine and provide justification and
recommendations for operational and marketing procedures and strategies as well as,
overcoming resistance to change for staff involved in ‘CULP Pty Ltd’.
Staffing Production Facilities Offshore
‘CULP Pty Ltd’ has a concern of the staffing production facilities offshore, to overcome this
the use of acquisition and development, as a human resources process, can be incorporated
amongst the business. Acquisition is the stage in the human resource cycle that involves:
identifying staffing needs, recruitment and selection. Comparably development involves
preparing employees for future responsibilities within the organisation due to a change in the
business’s strategies or growth in its size or market share.
To solve the issue of staffing production facilities offshore, ‘CULP Pty Ltd’ must identify the
needs of staff. Due to them having a shortage of staff, they first must identify the special jobs
needed, this will result in a job description. Within this, they must analyse the duties, tasks
and responsibilities involved in this job. The value of the job needs to be established and a
remuneration. Much of this will depend on conditions that have been established in the legal
wage agreements with which ‘CULP Pty Ltd’ must comply. The second step is to recruit staff,
recruitment is the process of locating and attracting the right quantity and quality of staff to
apply for employment vacancies or anticipated vacancies at the right cost. The business can
fill vacancies internally (from existing employees) or externally (from outside). Examining
‘CULP Pty Ltd’’s description of their situation, choosing employees externally would be an
option to lead towards. ‘CULP Pty Ltd’’s aim in the recruitment of staff is to create a pool of
potential candidates for the job, and from there make a selection. During the selection
process, information about job applicants is reviewed and the most appropriate applicant is
chosen. A selection process should reveal differences between candidates. It may be
equally as important to eliminate the poorer candidates as the process continues.
The use of development would be a vital asset in ‘CULP Pty Ltd’’s issue with staffing. The
constant development of staff is needed to keep the business running sufficiently and
effectively. ‘CULP Pty Ltd’ can introduce ‘on the job’ or ‘off the job’ training. Training
improves employees' present and future performance within the workforce. It results in
upgrading skills, knowledge and competency levels in order to better meet the needs of the
business. With the recruitment of new staff, ‘CULP Pty Ltd’ will need to ensure that each
employee's skills are up to scratch, therefore ensuring business processes will run smoothly
and allow the business to achieve great standards.
Global Marketing Strategies
‘CULP Pty Ltd’ must incorporate global marketing strategies such as standardisation and
global pricing to help solve the issue of their loss of market share. It is seen that other
companies globally are bringing to the market, cheaper clothing than ‘CULP Pty Ltd’ is.
To solve this issue of the loss off-market share due to other companies bringing in cheaper
items, ‘CULP Pty Ltd’ must take into consideration standardisation. A standardised
marketing approach involves creating products that do the same thing as competitors, but
better. It's a global marketing strategy that assumes the way the product is used and the
needs it satisfies are the same worldwide. To do this, ‘CULP Pty Ltd’ should differentiate
their products, meaning create clothing that isn't on the market already, whilst still obtaining
the needs and wants of consumers. By doing so, ‘CULP Pty Ltd’ will have a foot in the door
to increasing its market share and raising its sales.
Additionally, global pricing is a major factor that should be considered. ‘CULP Pty Ltd’ has
decided to move their headquarters to a cheaper location in order to reduce their labour
costs. By doing this, they will be able to decrease the cost of their clothing. In order to decide
on a price that will help them make a profit, but as well keep down their prices to attract
consumers, ‘CULP Pty Ltd’ can choose from three pricing methods; market customised
pricing, cost plus method, or standardised pricing. With the conditions of ‘CULP Pty Ltd’, the
best choice would be market customised pricing. This involves setting prices according to
local market conditions. By doing so, they won't fall short of what their products are worth,
and ‘CULP Pty Ltd’ will be asking for similar costs as other global competitors. In turn, this
will allow them to still gain a profit but meet customer expectations of prices and therefore be
able to increase their sales.
Strategies
Due to the amount of change occurring within the business, ‘CULP Pty Ltd’ will need to
develop strategies within their company to keep employees motivated. In doing so,
challenges such as inertia, retraining and purchasing new equipment evolve. Inertia is the
psychological resistance to change. Change can create uncertainty and risk and therefore
employees may resist it, due to fear of deskilling, job loss, higher workloads and loss of their
familiar work environment. To prevent this, ‘CULP Pty Ltd’ can implement retraining for their
staff, which allows for productivity while working efficiently and effectively. The
implementation of comprehensive training programs can go a long way to overcoming
employee resistance to changes. Additionally, purchasing new equipment is vital for the
growth of ‘CULP Pty Ltd’. the business must keep up to date with new changes within the
corporate world. Therefore, Managers must assess the cost of the installation of the
equipment, its impact on production and the expected profitability generated by the change.
This may result in a long-term reduction in operating costs, decreased time delays in
communication and faster decision-making processes.