I want to inform you on my research about successful companies that has employed theories in human resource area on employee empowerment and in the marketing on penetration pricing for their successes. I was able to discover two successful companies these are; Life Healthcare Group for empowerment of employee and Wal-Mart Stores for penetration pricing.
Moving towards employee empowerment culture in the area of human resource, we shall see the Life Healthcare Group which employed this theory. Employee empowerment is used to explain the ways in which employees can freely make decisions without depending on their boss or in the boss absence (Wise GREEK: What is employee empowerment?). The Group used this theory due to the fact that it acknowledges the need for trained, skilled and competent workforce in its human resource. It has made considerable investment in training, education and development of its workforce so as to have competent and highly motivated employees to deliver highly quality service. The monthly reviews for the training program for the business are normally conducted by the management executive team and further education would result to opportunities for additional career. Through this educational advancement to employees, the group has realized an improvement in its service delivery which has made it competitive in the market. The highly competent and motivated personnel have new skills in the modern technology which has helped improve its performance (Group Overview). The group has registered increased in performance in income generated from operations which was R517, 443,000 in 2010 to R555, 668,000 in year 2011 (Group Financial Statements). This has resulted to high revenues and profits due to quality service delivery
If I were the senior manager, I would have pursued the same theory of employee empowerment because to realize a success in a company the employees should be highly competent and motivated so as to deliver quality services.
In the marketing, penetration pricing is implemented by the Wal-Mart Stores. The theory of market penetration pricing refers to a strategy implemented for the purpose of achieving high sales volume and getting a deep penetration of market for a new product. Under this strategy, the product is promoted widely while its initial price is kept low (Business Dictionary). The store decided to use this strategy because of its central theme of initially “Always Low Prices. Always” to “Save Money. Live Better” (Diniz 2011) which has enabled it to widely penetrate the market and today it has 9667 stores together with location club in 28 countries which has employed 2.1 million associates who are serving over 176 million customers each year. Diniz noted that if Wal-Mart was just like a country, it could have been 21st world’s largest economy with sales more than $315 Billion (Diniz 2011). The stores’ unique strategy of penetration pricing is applied in that as only 15-25% of its products are priced low below competition while displayed on high visible places so as to lure shoppers to the stores thinking they are low priced but the reality is that 80% of the products and being sold over competition prices thus more profits are realized during the year which are used to expand its businesses thought the world. If I were the senior manager, I would have employed this strategy too because it is very applicable. I kindly, request that we implement these two theories in order to realize the success of our company within the next two years. Thank you in advance.
Diniz O., et al (2011). Managerial Economics Assignment; Market Penetration Pricing: The Case of Wal-Mart. Retrieved from Scribd.com: http://www.scribd.com/doc/68713728/Walmart-and-Supposed-Penetration-Pricing
Market Penetration Pricing. (n.d). Retrieved from BusinessDictionary.com: http://www.businessdictionary.com/definition/market-penetration-pricing.html
What is employee empowerment? (n.d). Retrieved from Wise GREEK: http://www.wisegeek.com/what-is-employee-empowerment.htm