Avon Products or GE Money America Case Study.edited

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1 Avon Products Case Study Student’s Nam Institution Course Name and Number Instructor’s Name Date

2 Avon Products Case Study Avon, a well-known brand in the beauty sector, is one of the biggest direct-sales businesses, with its headquarters in New York City. Avon has such a fantastic sales method. The company targeted stay-at-home mothers for their sales demographic, who then decided to join the business as a salesperson. Avon has grown to be a global company that sells a variety of cosmetics, skincare, fragrances, and other beauty-related household items (Goldsmith & Carter, 2010). Through market flexibility, where its goods were offered to distributors and direct consumers, Avon Company increased an exceptional profit. The company established a strong reputation for its direct-sales approach, which expedited its ability to offer products directly to clients without the involvement of a middleman. Avon was founded in 1886 by David H. McConnell and has become one of the most well-known brands for its beauty products. It is currently the second-largest direct-selling business and the fifth-largest firm in the beauty, housekeeping, and personal care sectors. Avon is a global phenomenon in North America, Europe, Asia, and South America (Latin America), with global sales surpassing $5.5 billion in 2018. The Avon Company generated remarkable profits through market flexibility by producing and marketing its goods offered to wholesalers and direct customers. The Avon corporation perfected a marketing strategy using the originality of direct sales, giving it an advantage over other beauty competitors. Avon discovered a technique to increase sales and use its target audience to generate more sales by enlisting customers who may also work as product distributors. Avon, however, ran into difficulty in 2005 when it started to experience a decline in sales (Goldsmith & Carter, 2010). Avon lost its loyal customer base due to the company's strategic decision to embrace more goods and industries, and as a result, its

3 branding deteriorated. Under Andrea Jung's leadership, the Avon corporation and JC Penny significantly reduced distributions and profit shares. Market shares were lost as a result of the merger, which had a significant impact on annual profit margins. Being a global business, the company's performance significantly declined in countries like the United States while maintaining high sales in regions like Europe and Russia. The global variety boosting the company's success suddenly started to drag it down. Avon's lack of technology innovation was a second approach that prompted the business to alter. Avon declined to create or use an online business, costing the company much-needed revenue. With earnings falling to a single digit annually, Avon experienced an even worse decline in profit in 2006 (Paolo Taticchi et al., 2023). Avon did not promote efficacy that resulted in profit generation by enhancing operations with the aid of technology. If Avon had an internet presence, it would use this strategy to boost sales, manage inventory and distribution, and promote product awareness and advertisement. Avon continued to handle needless paperwork antiquatedly, encouraging financial theft and a lack of accountability that could severely impact the company's operation. Avon's poor management was a third factor that convinced investors that a company change was necessary. The company could have done an excellent job of managing its talent or matching the right people to managerial positions. Poor performance was caused by the employees' lack of a sense of job security. Additionally, the business needed more transparent communication of a successful strategic plan, organizational vision, or leadership style. As a result, workers became demotivated, and productivity levels dropped. Avon had to change its talent management strategy (Goldsmith & Carter, 2010). The talent management team suggested six areas for improvement: meaninglessness, egalitarian, complex, episodic, complex, and opaque. The Avon Company was

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4 able to overcome inescapable obstacles and achieve the company's core strategic goals and objectives as a result of this analysis and talent management reform. Due to Andrea Jung's organizational leadership, the CEO assessed the company and developed a new strategic plan to put Avon back on top and make it the leader in the beauty sector. A strategic plan was created by Andrea Jung and a group of experts so that Avon could achieve the organization's main aims and objectives (Paolo Taticchi et al., 2023). Recommendations were put into practice by Avon after the consultant's evaluation. The experts recommended that the staff implement a new, three-stage performance model. Reorganizing the high-end product distribution in speciality stores was the first stage. The second phase concentrated on producing affordable goods for outlet stores. The third stage pushed the business to use kiosks as a marketing tactic. Change that is urgently needed is crucial for implementation because it encourages focus on crucial steps that ensure that the organization's goods are efficiently supplied to outlets promptly to prevent inefficiencies. Jung and the consultants concluded that since speciality shops attract in-store customers who boost sales of more affordable Avon items, Avon can obtain much- needed cash from them. In order to better match the organization's vision and communication with the business's objectives, Jung and the consultants made additional recommendations. Jung changed Avon's management structure to enhance overall operations because the company had trouble managing its talent. The business moved toward integrating technology, globalizing its manufacturing and marketing, implementing "delayering processes," and reorganizing its leadership structure (Hongal & Kinange, 2020). The most crucial elements must be implemented within the Avon Company are organizational plans and leadership.

5 Avon used assessments to gather knowledge on how to develop the business best. Performance reviews rank among the most popular evaluation methods. An annual evaluation of an employee's work performance and overall contribution to a firm is known as a performance appraisal. Avon was able to determine where management and staff might make improvements by having excellent communication with employees. Avon used various evaluation methods to gather the relevant input required to advance the business. Avon started by enhancing its talent management framework. This included setting clear goals and holding regular feedback meetings with management and staff. Avon used both group evaluation and individual evaluations. The employee's evaluation is composed of predetermined standards for performance. Employee ratings are part of the comparative procedure known as group evaluation. Employees can articulate their issues during individual evaluations, and management can learn how to optimize processes to boost productivity and product sales. The group assessments foster a healthy level of competition. This evaluation approach encouraged employee camaraderie and high-performance cultures by giving employees rewards and putting them in a position to compete for top sales. Avon also carried out a 360 review. The purpose of the 360 assessment was to discover better common behavioural strengths for the organization (Paolo Taticchi et al., 2023). Avon created and executed a new, much easier 360 assessment review to enhance the organization, and it expressly stated that effective managerial and leadership behaviours were essential for a leader's success at Avon. Effective communication is the one thing that unites all of the illustrated ratings. Avon primarily relied on employee feedback to fine-tune techniques and ideas needed to restructure and re-strategize the organization, even if streamlining processes and introducing new procedures might help a company develop.

6 Avon's decision to merge with other companies demonstrated its forward-thinking nature, distinguishing it as innovative. However, this relocation in 1990 presented the challenge of integrating a distinct corporate culture, which consequently impacted the organization's talent management strategies. Avon recognized the importance of incorporating a performance-based business culture to boost its revenue and overall performance. By aligning company goals with individual and team performance, employees could be motivated to excel, fueling productivity and growth. Avon, recognizing the importance of talent management, sought to identify and develop high-potential employees to ensure a competent and qualified workforce (Hongal & Kinange, 2020). In addition, recruiting and retaining top talent became necessary to maintain a market advantage. As consultants conducted assessments, their probable recommendations centred on fostering a positive culture, cultivating talent, and refining management styles, all of which contributed to improved business performance. A positive work environment increases employee engagement and satisfaction, enhancing business results. Moreover, the performance and development enhancements would inevitably result in increased sales and income. As Avon optimized its operations, utilized its talent, and adopted a performance-driven culture, the company acquired a market advantage (Kaliannan et al., 2022). Satisfied and motivated employees were likelier to provide extraordinary customer service, fostering customer loyalty and increasing sales. However, Avon's success was not dependent solely on internal initiatives. The company had to maintain high adaptability in the face of external environmental changes, such as market fluctuations and shifting consumer preferences. By doing so, Avon could effectively respond to emergent challenges and capitalize on new opportunities, thereby preserving its successful business position.

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7 The company's future success is intricately linked to its capacity to embrace and adjust to new technologies and procedures. Avon's potential for growth and increased sales rests in its ability to leverage modern platforms such as social media, allowing its staff to engage with potential customers on a larger scale and reach a larger audience. By adopting these digital tools, Avon can tap into untapped markets, investigate new avenues, and maintain its relevance in a technology-driven, fast-paced business environment. Avon should consider integrating additional incentives to motivate performance further and enhance the company's overall progress. Consistently, research has demonstrated that strategically managing and motivating employees significantly impacts their productivity and, consequently, the organization's success. Taking cues from Mary Kay's successful incentive program, Avon may consider innovative rewards such as "giving away" a special vehicle to top-performing representatives. Such a well-liked strategy will likely spark employee enthusiasm and healthy competition, increasing productivity and sales figures. In addition to technology and incentives, Avon's success hinges on its ability to cultivate a company culture that employees authentically value. When employees feel appreciated, supported, and motivated, they are more likely to invest fully in their duties and go above and beyond to ensure the company's success. A positive work culture fosters teamwork, cultivates employee loyalty, and assures employee satisfaction, enhancing performance and excellent employee retention. The management team is vital in establishing and sustaining this productive workplace. They must strategize effectively on how to manage and motivate their workforce, especially during difficult circumstances. A motivated and well-managed team will persevere in pursuing sales objectives and company growth, whether or not conditions are favourable.

8 In conclusion, Avon's journey from a direct-sales beauty company to a worldwide brand has had numerous successes and challenges. The company's direct-sales model, which recruited stay-at-home mothers, helped it thrive in the cosmetics industry. However, expanding into other industries and needing more technological innovation reduced sales and profitability. Avon, under Andrea Jung, focused on talent management, restructuring, and adopting new technologies. Avon implemented performance reviews and positive work culture to engage employees and boost consumer happiness. The company's success depends on its capacity to react to changing market conditions and integrate social media. Innovative incentives and effective management can also enhance staff engagement and productivity. Avon can restore its beauty industry leadership and survive in a competitive market by maintaining its fundamental principles and customer-centric approach while adopting current business strategies.

9 References Goldsmith, M., & Carter, L. (2010). Best practices in talent management how the world’s leading corporations manage, develop, and retain top talent . San Francisco, Calif. Jossey-Bass. Hongal, P., & Kinange, U. (2020). A Study on Talent Management and its Impact on Organization Performance - An Empirical Review . International Journal of Engineering and Management Research. https://papers.ssrn.com/sol3/papers.cfm? abstract_id=3559991 Kaliannan, M., Darmalinggam, D., Dorasamy, M., & Abraham, M. (2022). Inclusive talent development as a key talent management approach: A systematic literature review. Human Resource Management Review , 33 (1). https://doi.org/10.1016/j.hrmr.2022.100926 Paolo Taticchi, Demartini, M., & Corvaglia-Charrey, M. (2023). Avon. AVON , 17–30. https://doi.org/10.1007/978-3-031-26696-6_3

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Avon Products or GE Money America Case Study.edited

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