Decision-making authority in British supermarket chains

Abstract

This article analyses the authority of store managers for the stocking and merchandising of British supermarkets in the period between the mid-1960s and the mid-1980s. Using oral history and business archive data, the article assesses the case of two broadly similar retail chains. It identifies variations between the firms in relation to the extent of centralised versus decentralised control at the start of the study period. It then shows how the firms came to operate an essentially similar approach by its conclusion. Explanations for the changes identified are drawn from an assessment of the retail environment, and differences between the firms in terms of corporate culture.

Keywords::

• retail history
• retail strategy
• management decision-making
• supermarkets

Acknowledgements

I would like to acknowledge the important contribution of the late Professor Arieh Goldman of the Hebrew University of Jerusalem, Israel to the conceptual discussion presented in this article. I would also like to express my thanks to Niamh Dillon and her colleagues at the National Life Stories Project, British Library, London for their help with regard to the collection Tesco: An Oral History, and to Clare Wood and her colleagues at the J. Sainsbury Archive, Museum of London, for their assistance during my visits to that archive. I would like to acknowledge the help of all those who I have interviewed as part of the wider project from which this article is drawn, and also the valuable comments of the referees on earlier versions of this article. I would like to thank Professor Leigh Sparks, University of Stirling, for providing the English language version of his chapter “TESCO: Every Little Helps”. The usual disclaimers apply.

Notes

^1. For examples of studies exploring the managerial dimension see: Alexander, “Format Development”; Shaw and Alexander, “Interlocking Directorates.”

^2. See for example, Bowlby “Supermarket Futures” and Carried Away; Shaw, Curth, and Alexander, “Selling Self-service”; Du Gay, “Self-service”; Alexander, Shaw, and Curth “Promoting Retail Innovation”; Humphrey, Shelf Life.

^3. See Gunnarsson, “Advise or Control.”

^4.Cole, “Where the Retail Revolution Stopped,” 82.

^5.Dawson, “Developing Store Formats,” 26 (emphasis added). See also Burt, “Trends and Management.”

^6.Burt and Sparks, “Power and Competition,” 242

^7.Jones, “The Spread of Article Numbering.”

^8.Raff, “How to do Things with Time,” 437. See Davies “Applying Evolutionary Models” for a discussion in relation to the retail sector.

^9.Alexander et al., “Promoting Retail Innovation.”

^10.Ogbonna and Harris, “Organizational Culture”; Abrahamson and Fombrun, “Macroculture.”

^11.Akehurst, “Checkout.”

^12.Chandler, Strategy and Structure; Ulrich and Wieland, Organization Design. See also Burt, “Trends and Management”; Malone, “Is Empowerment Just a Fad?”; Chang and Harrington, “Centralization vs. Decentralization” and “Multimarket Competition.”

^13.Campbell and Frei, “Market Heterogeneity”; Anand and Mendelson, “Information and Organization”; Malone, “Is Empowerment Just a Fad?”

^14.Chang and Harrington, “Centralization vs. Decentralization” and “Multimarket Competition.”

^15. Ibid.

^16.Chandler, Strategy and Structure, 225–282.

^17.Raff and Temin, “Sears, Roebuck in the Twentieth Century,” 231.

^18.Worthy, Shaping an American Institution, 96, 97.

^19.Raff and Temin, “Sears, Roebuck in the Twentieth Century”; Wood, “Organisational Restructuring.”

^20.Raff and Temin, “Sears, Roebuck in the Twentieth Century.”

^21. Ibid.

^22.Katz, The Big Store; Raff and Temin, “Sears, Roebuck in the Twentieth Century.”

^23.Wood “Organisational Restructuring.” 13, 14.

^24. “Organisational Restructuring” and “Organisational Rigidities.”

^25. Examples exploring the contemporary retail environment include Currah and Wrigley, “Networks”; Raff, “Superstores and the Evolution.”

^26.Raff, “Superstores and the Evolution,” 1048–1049.

^27.Amin and Cohendet, “Learning and Adaptation,” 97.

^28.Chuang and Baum, “It's All in the Name,” 33. See also Darr, Argote, and Epple, “The Acquisition”; Ingram and Baum, “Chain Affiliation.”

^29.Yin and Zajac, “The Strategy/Governance Structure,” 370.

^30. For a broader discussion see Toms and Wright, “Corporate Governance”; Toms and Wilson, “Scale, Scope and Accountability”; Lloyd-Jones and Lewis, “A New Paradigm”: Toms and Wilson, “Scale, Scope and Accountability: A Response.”

^31.Hernández-Espallardo, “Interfirm Strategic Integration”; Bradach, Franchise Organizations; Wilson, Webster, and Vorberg-Rugh, Building Co-operation, particularly 13–17, 389–397; Hallsworth and Bell, “Retail Change.”

^32.Malone, “Is Empowerment Just a Fad?”; Ulrich and Wieland, Organization Design.

^33.Teece, “Firm Organization,” 200; see also Malone, “Is Empowerment Just a Fad?”; Amin and Cohendet, “Learning and Adaptation.”

^34.Chang and Harrington, “Centralization vs. Decentralization.”

^35. It should be noted that this latter approach might not be possible in certain market conditions.

^36.Thomas, “Leadership and Change.”

^37.Rowlinson and Procter, “Organizational Culture”; Delahaye, Booth, Clark, Procter, and Rowlinson, “The Genre”; Ponzoni and Boersma, “Writing History for Business.”

^38. The long-established trade magazine The Grocer (published by William Reed), and the Institute of Grocery Distribution's series of publications on the British grocery market from the mid-1970s onward proved valuable for the study in this regard.

^39. Further details can be found at: http://www.bl.uk/reshelp/findhelprestype/sound/ohist/ohnls/nlstesco/tesco.html [accessed 3 July 2014].

^40. Further details of The Sainsbury Archive can be found at: http://archive.museumoflondon.org.uk/SainsburyArchive/ [accessed 31 October 2014]; see also Perks, “Corporations Are People Too!”; Email correspondence from Clare Wood, archivist for The Sainsbury Archive, November, 2014.

^41. For some discussion of oral history in relation business history and marketing history see , “Corporations Are People Too!” and “The Roots of Oral History”; Ryant, “Oral History”; Davies, “Voices Passed.”

^42.Perks, “Corporations Are People Too!,” 46.

^43. I am indebted to a number of interviewees. Mr Joe Barnes (formerly of J. Sainsbury) and the late Mr Donald Garvin Harris, OBE (formerly of Tesco) provided particularly important contributions in relation to the matters discussed in this article.

^44.Emerson, Sainsbury's, 24.

^45.Heller, “The Self Service of Sainsbury's.”

^46. J. Sainsbury Archive (hereafter SA), SA/CO/4/4/1/1, Speeches by Lord Sainsbury 1967–1991, ‘Meeting of Senior Executives and Senior Scientists 31 Oct 1967, Vice Chairman's Address’; Williams, Best Butter in the World, 140–4; Boswell, JS100.

^47. SA/CO/4/4/2/1 Senior Managers Meetings Interim Speeches 1978–1983, “The Chairman's Speech at Senior Manager's Conference, Brighton, May 1979.”

^48.Williams, The Best Butter in the World, 144.

^49. On the relationship between buying and design functions in the context of centralised management control and decision-making in own label at Sainsbury's see King, ‘Sainsbury's Own Label’. On the implications of own label for the distribution function more generally see Sparks, “Delivering Quality.”

^50. SA/BRA/3/1/1/16, ‘Introducing the Computer to JS.’; SA/BRA4/2/37, ‘Stock Control Daily Routine’

^51.Heller, “The Self-Service of Sainsbury's,” 14.

^52.Emerson, Sainsbury's, 116.

^53. SA/CO/12/2/1, Managers' conferences 1967–1972, Managers' conference January 1972, “Notes on Mr JD's Opening Speech.”

^54. J. Sainsbury, Conference Report Brighton ‘74; Conference Journal, Tomorrow's World,1977; Conference Journal, Brighton ’78.The Future in Store.

^55. Personal interview with Mr Joe Barnes, 28 May 2012.

^56. SA/CO/12/2/1, Managers' conferences 1967–1972, Managers' conference January 1972, “Notes on Mr JD's Opening Speech”; J. Sainsbury, “A New Ordering System for the Branches.”

^57.Emerson, Sainsbury's, 98.

^58. J. Sainsbury, “It's Up To You.”

^59. Personal interview with Mr Joe Barnes, 28 May 2012.

^60. SA/EMP/10/3, Transcript of Interview with George Ridgway, 1993.

^61. J. Sainsbury, “Your Name Above the Shop Door.”, 4.

^62. SA/EMP/10/3, Transcript of Interview with David Clapham, 1999, 31.

^63. J. Sainsbury, “Your Name Above the Shop Door.”, 5.

^64.Heller, “The Self Service of Sainsbury's,” 14.

^65. SA/EMP/4/2, ‘Letter to All Supermarket Managers from JDS/Mk’, 5 Oct 1970; SA/CO/12/8/1, Retail Conference 1976 (Eastbourne), MR JD's Speech; SA/CO/12/5/1, Branch managers' conference 1978–80, Chairman's Summing Up of the Conference (78)

^66. SA/CO/3/5/3/1, Directors' Branch Committee, Minutes of the DBC Meeting, 30 May 1974

^67. SA/EMP/10/3, Transcript of Interview with David Clapham, 1999, 37.

^68.Powell, Counter Revolution; Tesco. An Oral History (hereafter TAOH) David Malpas interview, TAOH, C1087/21/5a; Kevin Doherty interview, TAOH, 1087/10/9a

^69.Corina, Pile it High, Sell it Cheap; ICL, “Housewives win!”

^70.Powell, Counter Revolution, 130, 132; Ryle, The Making of Tesco, 82; Sparks, “TESCO: Every Little Helps.”

^71.Powell, Counter Revolution, 122–127.

^72. Joe Doody interview, TAOH, C1087/16/9a.

^73. David Malpas interview, TAOH, C1087/21/4b, C1087/21/5b; Ryle, The Making of Tesco, 85.

^74. Mike Walastyan interview, TAOH, C1087/25/6b.

^75. David Malpas interview, TAOH, C1087/21/5b; Joe Doody interview TAOH, C1087/16/7a; Paul Nally interview TAOH, C1087/19/3b.

^76. Lord MacLaurin interview, TAOH, C1087/22/6a.

^77.Ryle, The Making of Tesco, 98.

^78. Lord MacLaurin interview, TAOH, C1087/22/6a.

^79.Powell, Counter Revolution, 153.

^80.Powell, Counter Revolution, 183, 186; see also MacLaurin, Tiger by the Tail.

^81.Kirkwood, “How Tesco Manages”; Sparks, “The Changing Structure.”

^82. David Malpas interview, TAOH, C1087/21/5a.

^83. Joe Doody interview, TAOH, C1087/16/7a; Paul Nally interview, TAOH, C1087/19/3a; Mike Walastyan interview, TAOH, C1087/25/7a.

^84.Akehurst, ‘“Checkout”’; Powell, Counter Revolution.

^85.Smith and Sparks, “Tesco's Supply Chain Management,” 146–148.

^86. Tuffin, cited in Powell, Counter Revolution, 191.

^87. David Malpas interview, TAOH, C1087/21/5a, C1087/21/8a.

^88.Carter, Retailer Distribution Profiles, 73.

^89. See for example Preston, Improving Retail Decision-making.

^90. David Malpas interview, TAOH, C1087/21/8a; Lord MacLaurin interview, TAOH, C1087/22/6a.

^91. Joe Doody interview, TAOH, C1087/16/11a; Mike Walastyan interview, TAOH, C1087/25/7a.

^92.Tesco, Company Review.

^93.Southern Television. The Southern Shopper Revisited, 4; British Market Research Bureau, Shopping in the Seventies, 12.

^94.Akehurst, “Checkout.”

^95.Sparks, “Delivering Quality”; Thomas, “Leadership and Change.”.

^96.Birds Eye Foods, Case for Profit.

^97.Thorpe, Kirby, and Thompson, Channels and Costs.

^98.Carter, Retailer Distribution Profile.

^99. Ibid.

^100.Smith and Sparks, “Tesco's Supply Chain Management”; Fernie and Sparks, “Retail Logistics.”

^101.Collins, “The UK Grocery Supply Chain.”

^102.Tesco Stores (Holdings), Annual Report & Accounts.

^103.Smith and Sparks, “Tesco's Supply Chain Management.”

^104. For a review see Demers, Organizational Change Theories; Clark and Rowlinson, “The Treatment of History”; Lipartito, “Culture and the Practice of Business History”; Westall, “British Business History.” This is not to overlook the significant challenges of the dialogue between business history and organisational studies. See, for example, Clark and Rowlinson, “The Treatment of History”; Rowlinson and Procter, “Organizational Culture.”

^105. Demers, Organizational Change Theories, 75.

^106.Schwartz and Davis, “Matching Corporate Culture,” 33.

^107.Bowlby, Carried Away; Shaw and Alexander, “Interlocking Directorates.”

^108.Emerson, Sainsbury's, 96–98. See, for example, J. Sainsbury, “Electronic Cash Registers.”

^109. Fine Fare had brought in Canadian managers to help oversee its British supermarket operation. See, Davies, Bread Men, 111–114; Shaw and Alexander, “Interlocking Directorates.”

^110.Emerson, Sainsbury's, 22, 23, 95.

^111. SA/EMP/10/3, Transcript of Interview with David Clapham, 1999, 38.

^112. J. Sainsbury, “Your Name Above the Shop Door,” 4.

^113.Powell, Counter Revolution, 183.

^114. Ibid.

^115.Powell, Counter Revolution, 191; see also MacLaurin, Tiger by the Tail.

^116.Powell, Counter Revolution; Sparks, “TESCO: Every Little Helps.”

^117. I am grateful to one of the referees for their assistance in clarifying this matter and its importance.

^118.Farjoun, “Towards an Organic Perspective”; Kipping and Üsdiken, “Business History”; Raff, “How to do Things with Time.”

^119. This is not to suggest complete uniformity of approach among retailers operating supermarket chains. Moreover, superstore operations brought new challenges and more established superstore operators like Asda displayed a very different approach. For a discussion see Beer and Weber, “ASDA.”

^120. See for example Stalk, Evans, and Shulman, “Competing on Capabilities”; Mierdorf, Mantrala, and Krafft, “Retailing in the Global World”; Lal, Knoop, and Tarsis, “Best Buy Co Inc.”

^121.Goldman, “The Transfer of Retail Formats”; Hu, Reardon, Rozelle, Timmer, and Wang, “The Emergence of Supermarkets.”

^122.Malone, “Is Empowerment Just a Fad?”

^123. Grugulis, Bozkurt, and Clegg, “No Place to Hide.”

^124.Wilson et al., Building Co-operation, 15.

^125. For example Alexander, “Format Development.”