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By her time as a Bloomingdale’s management trainee, to her current role while Avon’s CEO, Jung has long been able to control her emotions. The self-regulation that Jung shows through her ups and downs features encouraged her associates to manage their hard situations in the same peaceful and open minded demeanor. Motivation is identifiable with Hazel Jung. Your woman possesses a passion for Avon and its particular vision of elevating girls in the community. Jung has a reputation constantly trying to improve processes at Avon. Her abordnung of power to Leslie Kropt and her recommended correctional plan of action are clear illustrations of the fervor.

Through her look for feedback by associates and burning desire for constant improvement at Avon, it is very clear that Jung is an emotionally brilliant leader. Jung’s understands the value of a healthy balance among a professional and personal life. It truly is this accord that enables her to be an effective manager. Her ability to balance her personal and work duties sets an example for her workforce. Jung also has shown that she’s not scared to make decisions that directly boost her employee’s moral, while was the circumstance when the lady raised percentage payouts on her direct sales rep workforce.

Jung’s ability to begin to see the big picture allows her to comprehend that a cheerful sales team can pay far superb value over the years than the short term balance sheet savings. Jung has established an array of powerful working associations with current and earlier colleagues. Her past human relationships with Barbara Bass and James Preston laid the framework of her efficient social expertise. Her belief in the importance in social relationships is depicted in her decision to keep Avon’s tradition of sales rep personally delivering roducts for their customers. It truly is through these social expertise that Jung has been able to lead Avon to her ideal outcomes. 4. What is Avon’s business model? How has the business structure changed as time passes? Avon’s business model was constructed upon independent sales representatives selling makeup products in a door to door sales approach. This model survived for over 80 years, when two key economical forces induced Avon to modify. The competition by large price cut stores, as well as the trend of women joining the workforce, compelled Avon to modify its business design.

In the 1980’s Avon, unsure of its direct selling method, experienced a period of acquisitions where it bought some health care businesses and Tiffany , Co., a higher end jeweler. In 1988 Avon’s new CEO, James Preston, recommitted the company towards the direct sales of private care products. Following selling away non key business departments, Preston dedicated to a restoration of development at Avon. Avon was characterized inside the 1990’s with a vision dedicated to a global comprehension of women. Their particular recommitment with their direct sales style was observed in their global sales force of roughly 1 . million 3rd party sales staff. The Andrea Jung era of Avon began at the beginning of the fresh millennium. Jung’s model was characterized by a level deeper focus on women, a reduction of suppliers, and an open mind with regards to innovation. In spite of much success in her our childhood at Avon, 2005 posed as a critical year intended for Jung, as Avon’s require was in drop. Given the changing marketplace conditions, Jung proposed a new business model that focused on increased R, Deb, channel support, and promoting. 5. Is Avon a learning corporation? Explain your answer. Avon possesses a lot of the key attributes of a learning rganization. Through its constant ability to interact with market conditions, openness to innovation, and guiding tips, Avon can be described as clear sort of a learning organization. Learning has been a cornerstone of Avon’s historical achievement. As their market has skilled a variety of drastic changes, their very own ability to respond to market circumstances has empowered Avon to outlive for over a hundred years. A great deal of learning at Avon comes from their process of having all executives spend time being a direct sales representative. It was within this experience, which a young Andrea Jung discovered the difficulty of Avon’s marketing materials.

For a company being considered a learning business, it has to come with an environment that fosters creativity. Andrea Jung single handedly influences Avon to adopt a modern approach to their business methods. Jung possesses an open mind regarding any innovation that Avon can adapt to the advantage. It is this learning environment which includes permitted Avon to experience this sort of success. One of the most influential aspect in making Avon a learning organization may be the clear leading ideas that management convey to all employees. From Wayne Preston to Andrea Jung, Avon has had a history of motivating, team building vision assertions.

The custom of female focused quest statements is a best match pertaining to Avon, because the majority of Avon’s workforce can be female. six. How does Jung leverage individual capital intended for Avon’s competitive advantage? Is competitive advantage sustainable provided the existing competitive pressures and forces driving industry change? Avon’s direct sales circulation is a natural human capital leveraging characteristic that gives the business a competitive advantage. Jung’s increase in the number of independent product sales reps via 1 . your five million to five million is actually a clear example of her leverage of human capital.

This revenue headcount maximize is although one of Jung’s human capital influences. Jung also inspires her sales force through her international journeys, showing with her associates that every and every one is valued at Avon. Perhaps Jung’s most valuable leveraging of human capital is definitely her capacity to cater Avon’s highest principles and values to her largely female labor force. Understanding that Avon is a girl centered company, Jung has the capacity to keep business moral substantial, as employees connect all their job with Avon’s vision of enhancing women’s benefit in the community.

Avon’s competitive benefit is sustainable given the prevailing competitive pressures and industry driving forces. It is crucial to recognize the influence the Avon company has on consumers in its created markets. In spite of Avon’s new softened require in these long standing markets, they are going to always have a loyal customer base thanks to all their decades of personalized organization. Avon’s development potential is in the international markets. As India and Chinese suppliers continue to industrialize their economic climate, their aesthetic and toiletries spending is placed to skyrocket.

Avon’s increased international product sales headcount is the key in responding to their developing international opportunities. As long as Avon continues it is innovative mother nature and remains committed to the bread and butter, direct selling with independent sales representatives, they will continue to succeed. 7. In 2005, what strategic and organizational complications exist intended for Avon Goods? How are these reflected inside the financial functionality of the company? Avon got two essential strategic and organizational hurdles to defeat in 2005. The initially issue facing Avon was the softened require in their created North American markets.

Avon’s second problem was your increased competition in their developing international marketplaces. This was a very troubling pertaining to Avon, because these markets were the key with their future expansion. These two trouble is clearly reflected in Avon’s financial functionality. Exhibit one of the case, Avon’s selected economical data 1995-2005, reveals these issues as they connect with headcount. Avon’s number of US employees decreased 700 staff (7%) by 2003 to 2005. The decreased headcount in the US can be described as clear indication of softening demand in a developed marketplace.

The international headcount explains to a different tale. Avon’s international headcount practically doubled by 1995 to 2005, growing from 23, 800 to 40, 300. The growth in headcount is actually a clear symptoms of the growth of sales in the international market segments, as total net income at Avon increased from $256. 5M in 1995 to $847. 6M in june 2006. However , the ratio of net income to international revenue headcount requires a turn for the worse between 2004 and 2005. Despite a growth of 1, 500 international workers from 2005 to 2006, net income only rose $1. M. This is roughly yet another $1, 1000 in net gain per new international headcount. Compare this kind of ratio to the 2003 to 2004 figures, where 1 new intercontinental headcount yielded an additional $79, 000 in net income, and you see the problems Avon features experienced. The severe decline in additional net gain per international headcount can be described as direct response to Avon’s elevated competition in their growing around the world markets. almost 8. As CEO in 2006, does Hazel Jung have leadership attributes necessary to address these challenges effectively?

Avon’s challenges necessitate an innovative, charming leader, a manager who is not afraid to sacrifice his or her personal gains for the better of the firm. Fortunately pertaining to Avon, Donna Jung is that transformational leader that has the qualities to steer Avon through these current challenges. Avon’s current obstructions are present in every their global markets. The perfect solution to these deeply systemic difficulties will be addressed by Jung’s strategic eyesight. Throughout her career, Hazel Jung has always been able prioritize long term answers over temporary quick maintenance tasks.

From her time for Bloomingdales, to her leadership while CEO, Jung was a tested track record focusing company assets on the appropriate issues. The high psychological intelligence of Jung may also enable her to properly address Avon’s current dilemmas. She understands that for Avon to tackle all their current problems, she must not only keep company meaning high, although also maintain a calm demeanor during this hard time. The key to Avon accomplishment is in the connections between their direct sales crew and consumers.

From her visits to worldwide Avon offices, Jung is able to possess a constant understanding of this conversation. It is this consistent understanding of Avon’s product sales channels that will enable her to effectively make the important decisions pertaining to Avon. Jung’s ability to continuously reinvent her management style is perhaps her most crucial quality in terms of addressing Avon’s current problems. Because Avon’s industry has experienced a variety of impacts throughout her tenure as CEO, Jung has required to alter her way of thinking. Most of Avon’s past success is caused by Jung having the capacity to put her ego besides.

This modest nature can enable Avon to effectively address their current problems. 9. Measure the proposed static correction action plan Jung and her leadership staff have developed. What recommendations will you suggest to them? Avon’s four tier proposed static correction plan consist of a restored commitment to brand consciousness, a focus prove commercial border, an height of commercial success, and a transformation of their expense structure. Though I feel this really is an overall powerful plan, I really do have some recommendations on how to make this more successful.

Avon’s commitment to brand competitiveness is seen as a a focus in Skin Care and Color as well as a boost in advertising. Although I feel that this kind of proposal is usually solid, there are two key items that Avon must focus on for this initiative to be successful. Avon must do the necessary market research to ensure their Skin Care and Color lines are sold in the best channels. Their particular past launches of “beComing and “mark had issues because of the weaknesses in their picked channel of distribution. The 2nd point Avon needs to seriously consider is that they have become the most away of their advertising and marketing dollars.

As their North Americans already are mature, promoting efforts here will be less effective than in their particular more appealing international market segments. Avon need to focus nearly all their advertising budget towards these types of global markets. This emphasis will allow them to establish a stronger manufacturer recognition which will transfer in to future product sales. Avon’s second piece centers on them improving their selling and searching appeal in their direct-selling way. I agree which the direct-selling strategy is their very own strongest asset, and that enriching it would make a lot of value.

I do, nevertheless , recommend that Avon does not run away too far far from their classic mode of direct-selling. Drastic changes to this will erode the standard bond that Avon provides with its customer base. I as well recommend that Avon does not increase their merchandising as well specifically. Because was displayed in their prior marketing leaflet, Avon has received a history of flooding buyers with an excessive amount of information. Avon’s plan to increase its organizational effectiveness is usually characterized by an increase in training in persons development.

This kind of proposal matches quite well with Jung, since she is an emotionally smart leader that believes in the development of her associates. My suggestion regarding this organizational elevation is that they take action in a way that will not affect the period that their particular sales force usually spends in front of consumers. As personal interaction with clients may be the cornerstone to Avon’s expansion strategy, it is very important that this time is certainly not significantly reduced by several trainings. The master plan for a radical transformation in Avon comprises of a realigned cost structure and a strategic leveraging of assets.

Clearly, these are useful initiatives to strive for. By Avon’s perspective, I would recommend that they develop multiple action programs based upon the financial effects of these alterations. As their marketplace is not foreseeable, they need to develop a worst case scenario program, in the event their very own sales income does not fulfill expectations. History of “wooden-headedness patterns at companies such as Sony and Snow Brand provides proven that failure to plan for this kind of problems could cause severe complications within a business. Having this plan set in place will certainly enable them to immediately react to any unfavorable future performances.

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