Question 3(11marks)
In Week 6 Interactive Tutorial, we have discussed the case study on "Nordstrom". This case is available on the Blackboard [see Appendix_Week_6_Tutorial_Nordstrom_Case]. Read this case and answer Question a, b and c.
a)The management of Nordstrom has taken some action at the functional levels that enabled the company to implement its strategy successfully. Discuss these actions in light of our discussion in the Week 6 Interactive Tutorial. [5 Marks. Word Limit: Up to 100 words]
b)Discuss the source of Nordstrom's long-term competitive advantage (be specific in your discussion)? [2 Marks. Word Limit: Up to 50 words]
c)During our case discussion in the interactive tutorials, we observed that the rivals imitate the valuable and rare resources. However, sometimes, it is difficult for rivals to imitate these resources. Does Nordstrom have such valuable and rare resources that its rivals find difficult to imitate? [4 Marks. Word Limit: Up to 150 words]
Holmes Institute: /Student Login X Content X 6 1588911 X *Homework Help - Q&A from Onl x + X C A learn-ap-southeast-2-prod-fleet01-xythos.content.blackboardcdn.com/5bfdd02798410/1588911?X-Blackboard-Expiration=16238340000008X-Blackboard-Signature.. Q C Paused 1588911 80% + Nordstrom Nordstrom is one of American's most success- that range from 6.75% to 10% depending on the ful fashion retailers, John Nordstrom, a Swedish department. Top salespeople at Nordstrom have immigrant, established the company in 1901 with the ability to earn over $100,000 a year, mostly in a single shoe store in Seattle. From the very start, commissions. Nordstrom's approach to business was to provide The customer service ethos is central to the exceptional customer service, selection, quality, and culture and organization of Nordstrom. The value. This approach remains Nordstrom's hall- organization chart is an inverted pyramid, with mark today. salespeople on the top and the CEO at the bot- The modern Nordstrom is a fashion specialty tom. According to CEO Blake Nordstrom, this is chain with 240 stores in 31 states. Nordstrom gener- because "I work for them. My job is to make them ated almost $12.5 billion in sales in 2014 and makes as successful as possible." Management constantly consistently higher-than-average returns on invested shares anecdotes emphasizing the primacy of cus- capital. Its return on invested capital (ROIC) has tomer service at Nordstrom in order to reinforce consistently been in the mid teens to low 20s, and the culture. One story relates that when a customer was 16.3% in 2014-strong performance for a retailer. in Fairbanks, Alaska, wanted to return two tires Nordstrom is a niche company. It focuses on which Nordstrom does not sell), bought some a relatively affluent customer base that is looking time ago from another store once on the same site. for affordable luxury. The stores, located in upscale a sales clerk looked up their price and gave him his areas, have expensive fittings and fixtures that convey money back! an impression of luxury. The stores invite browsing. Despite its emphasis on quality and luxury, Touches such as live music played on a grand piano Nordstrom has not neglected operating efficiency. helpcreate an appealing atmosphere. The merchandise Sales per square foot are $400 despite the large, is fashionable and of high quality. What truly differ- open-plan nature of the stores, and inventory turns entiates Nordstrom from many of its rivals, however, exceed 5 times per year, up from 3.5 times a decade is its legendary excellence in customer service, ago. These are good figures for a high-end depart- Nordstrom's salespeople are typically well ment store. Management constantly seeks ways to groomed and dressed, polite and helpful, and improve efficiency and customer service; recently, it known for their attention to detail. They are selected put mobile checkout devices into the hands of 5,000 for their ability to interact with customers in a posi- salespeople, eliminating the need for customers to tive way. During the interview process for new em- wait in a checkout line. ployees, one of the most important questions asked of candidates is their definition of good customer Sources: A. Martinez, "Tale of Lost Diamond Adds Glitter to service. Thank-you cards, home deliveries, personal Nordstrom's Customer Service" Seattle Times, May 11, 2011 (www.seattletimes.com); C. Conte, "Nordstrom Built on Customer appointments, and access to personal shoppers are Service," Jacksonville Business Journal, September 7, 2012 the norm at Nordstrom. There is a no-questions- (www.bizjournals.com/Jacksonville); W. S. Goffe, "How Working asked returns policy, with no receipt required. Nor- as a Stock Girl at Nordstrom Prepared Me for Being a Lawyer," dstrom's philosophy is that the customer is always Forbes, December 3, 2012; and P. Swinand, "Nordstrom Inc." right. The company's salespeople are well compen- Morningstar, February 22, 2013, www. Morningstar.com. sated, with good benefits and commissions on sales Activate Windows Go to Settings to activate Windows. Type here to search O A 9 14"C Partly cloudy ~ 3:39 PM 6/16/2021
