Introduction
Wirkkala is a small-to-medium business that is based in England and employs over 170 people. The head office of the organisation is located in Coventry, and the main avenues of product distribution are equally in the Midlands. Wirkkala’s area of operation includes the manufacturing of natural beverages, such as fruit smoothies and juices. The company’s Board of Directors comprises four founders: Anne Aalto, Kristine Kochanski, Alison Smith, and Diane Ugbede. These people launched Wirkkala’s operations and the organisation shortly gained the interest of the public through the quality and value of its products. The diverse experience of the leadership contributed to the early success of the company.
However, at the current point, Wirkkala finds itself on the verge of profound transformations that are necessary to sustain its growth and enable the next stage of development. The COVID-19 pandemic poses another key challenge that contributes to the overall list of issues faced by the leadership. Thus, the main question arises of what the key challenges faced by Wirkkala’s management in the new post-COVID reality exactly are. In addition, the role of technology and digitalisation in this transformative process deserves to be explored. More specifically, the role of advanced data handling and business analytics represents an area of increased importance addressed within the present report.
Review of the Literature
Leadership Styles and Theories
In the functioning of contemporary companies, the style of leadership represents of the essential determinants of success. Within the current body of literature, the core of the discussion revolves around the dichotomy of transactional and transformational leadership. The first model implies a focus on day-to-day objective with a certain degree of micromanagement (Ma and Jiang, 2018). More specifically, transactional leaders remain engaged in the processes of the firm on all levels, providing employees with clear prospects of the outcome of each task. In this scenario, the motivation is achieved through a clear juxtaposition of reward and punishment for the completion of the goal or lack thereof respectively. Kalsoom et al. (2018) report a stronger correlation between the presence of transactional leadership and immediate performance of the employees. However, it may be possible that this model yields positive results in the short-term, while being not as effective for long-term development of the firm.
More specifically, transformational leadership appears hold more potential in terms of the employee satisfaction, retention, and creativity. This model relies on inspiration and effective value exchange as the primary source of motivation. In other words, leaders seek to empower their followers and have them adopt their strategic vision (Ma and Jiang, 2018). Thus, the emphasis is laid on the results, which may be outlined in the long term, whereas the employees see more freedom of choosing the appropriate ways of attaining these outcomes. Hansen and Pihl-Thingvad (2018) concur, adding that the overall concept of transformational leadership is found to correlate positively with follower creativity. In this case, the key challenge consists of ensuring that the perspectives of leaders and employees align so that the firm, in general, moves in sync. At the same time, the best results are attained by adding one transactional component, namely verbal rewards to the mix. Ultimately, this combination produces the required level of innovativeness within the human capital of the company, and helps it complete quality transformations required by the operational context.
For Wirkkala, the key challenges are associated with such transformations that will allow the company to enter the next phase of its existence. Previously, this organisation held the status of a small business that operated primarily on a local level. However, along with the growth of the company, the demand for synchronized operations on a larger scale rose. For Wirkkala’s directors, this means that an efficient framework that combines supervision with autonomy is required. Spoken differently, the various branches of the growing company should be able to move in the same direction under the circumstances when the management’s supervision capacity becomes limited. The transformational model is a valuable tool of achieving such a result through common vision, shared values, and inner motivation. An active utilisation of transactional-based verbal rewards aligns with such a policy, supporting employees’ aspirations and creativity. Through this combination, Wirkkala will work with a better efficiency, reaching new hights of its development.
Nevertheless, the modern context of leadership is more complex than a selection of a fitting model. Today’s business landscape across most industries is subject to profound change within a limited time span. Accordingly, the leader – or the Board in the case of Wirkkala – should be able to adapt to the changeable environment, in which the company operates. Inyang et al. (2018) explore the contingency perspective on the subject matter. According to them, this approach to leadership reflects the essential status of a manager’s adaptability potential in the age of global uncertainty and profound changeability. The data collected and analysed by Inyang et al. (2018) indicates that the presence of a contingency perspective has a positive effect on the long-term performance of the firm. These findings suggest that the transformational model of leadership is more effective overall in small-to-medium firms that are in their growth stage, which is exactly the case for Wirkkala. However, alterations in the competitive environments prone to turbulence may justify the need for transactional elements in the mix (Bachrach and Mullins, 2019). Thus, a flexible leader should be to switch between the appropriate models, combining their currently appropriate elements.
This idea aligns with the previously reported findings that indicate a better potential of transformational leadership that embeds certain transactional elements. Such findings also intersect with the fundamental basis of the style counselling or behavioural theory of leadership. This approach implies that a universal framework of effective management does not exist, as the constant changes in the circumstances require leaders to adapt accordingly. According to Oberer and Erkollar (2018), this theory has gained a special degree of importance in light of the Fourth Industrial Revolution (or Industry 4.0). To highlight this relation, the authors refer to style counselling as Leadership 4.0. In this regard, the increasing role of technological progress in most industries implies a high level of changeability. In order to help the firms and their employees adopt new tools and adapt to the new environment, leaders should seize the variables within a specific context and effectuate their management instruments in light of them.
For Wirkkala, change is the key notion that describes the current state of the company. The Board of Directors faces a serious challenge of taking the organisation into a new phase of its life. No longer being a small, local enterprise, Wirkkala now requires a strong inner structure, in which all employees move in sync toward the same goal and driven by the same values. As implied by its name, transformational leadership is the optimal paradigm for such situations when change is imminent and even indispensable. However, the directors should not limit their choice of model to the basics of transformational leadership. The Board comprises four founders, each of whom possesses varying experiences and traits that can be adapted to specific tasks, as dictated by the contingency approach. In this regard, it is possible to instil a heterogeneous model of leadership, in which some directors will be responsible for the transformational side with others executing transactional operations.
Business Analytics
In spite of its evident progress since the foundation, Wirkkala remains a young company with a lack of experience in several areas that are integral to large-scale, mature businesses. As can be inferred from the case study materials, this organisation’s development has been largely enabled by the enthusiasm and energy of their founders. At the initial stage, the company’s sales and cost balance could be maintained at a relatively low scale. Furthermore, early Wirkkala’s operations did not require an expanded team. Under such circumstances, the directors enjoyed an array of benefits of a small enterprise. First of all, the four founders had the unique opportunity to remain engaged in the process personally. With few venues, as well as supply and distribution chains, the directors could supervise the workflow closely.
As the scale and scope of Wirkkala’s operations continue to grow, a higher degree of autonomy is expected with a necessity of an effective self-regulation and control mechanism that would allow the founders to concentrate on strategic objectives without dispersing their attention across tactical and operational tasks. Second, the early years of Wirkkala’s existence allowed for a smaller team that could comprise the select few workers whose perspectives perfectly aligned with the vision of the leadership. Now that the firm is in the stage of active growth, the directors can no longer be engaged in every process or select exclusively the most fitting candidates personality-wise. Thus, a considerable level of delegation and internal regulation needs to be established at Wirkkala.
Business analytics represent one of the most valuable tools that will support the functioning of Wirkkala in light of the new challenges. Carillo et al. (2019) argue that modern firms of any size can no longer refrain from a more in-depth implementation of data-driven operations. Their article argues for profound reorganisation of corporate management principles that will allow leaders to become data-driven decision-makers. This approach entails an array of serious benefits for the firms that follow it, as precise, relevant information adds a factual dimension to both strategic and tactical decisions. Consumer behaviour, sales tendencies, product strengths and weaknesses can be quantified through relevant metrics that inform future decisions. Current technological progress has introduced an array of advancements that facilitate big data collection and processing across multiple channels. Companies that are ready to explore new avenues find it easier to communicate with their consumers, organise efficient supply chains, and identify promising channels of product distribution (Pappas et al., 2018). This way, the decisions of modern leaders become based on facts and figures rather inner feelings subject to bias.
At present, one of the Wirkkala’s primary strengths may also play the role of its greatest weakness. The company is led by a managerial team of four associates from diverse backgrounds and with different experiences. Each of these people makes a valuable contribution to the development of the firm, adding new opinions and exploring the issues from different angles. However, at a certain point, a clash of individual views may become imminent. In this case, conflicting perspectives on the company’s future may bring Wirkkala to a stalemate. Even now, Alison is enthusiastic about new opportunities to explore, seeing support from Diane. Simultaneously, Kristine and Anne have taken a somewhat conservative position and insist on remaining loyal to the company’s roots. In a way, this situation reflects the clash of two opposing opinions regarding the future of the firm. With the present degree of uncertainty, this issue is difficult to resolve without risks and losses. The use of business analytics would open new avenues in this regard. Wirkkala could safely run practice tests of new marketing and distribution formats, evaluating their results with reliable analytics tools rather than operating on assumptions.
However, for this to be possible, Wirkkala needs to reconsider the way it handles data, as the present format does not contribute to quality analytics. The company is already engaged in effective data collection through interaction with the customers. Various quizzes, polls, and surveys complement the information gathered from Wirkkala’s website and distributors. As such, the phase of data collection is in an optimal state at the moment. On the other hand, issues arise at the stages of data storage, processing, and analysis. As implied by the case study details, the information flow within Wirkkala is somewhat sporadic and uneven. Valuable information is often held inaccessible for adjacent departments, which impedes the exchange of ideas in the company.
At present, each department stores relevant information within its digital premises. For example, machinery data is reserved for the factory, whereas sales and accounting figures are stored at the headquarters. All these pieces of data are fragmented in the current state, as together they constitute a full image of the complete scope of the firm’s operations. In other words, the information is removed from a broader context. Under such circumstances, business analytics becomes complicated, meaning that the re-organisation of data handling is essential for the future growth of the company (Power et al., 2018). This issue can be addressed through the use of specific information systems, which are to be discussed in one of the next sections of the report.
With the correct application of data handling and storage, Wirkkala can safely initiate relevant business analytics procedures to support informed decision-making. On the strategic level, the use of prescriptive analytics can help the leaders identify the optimal course of action in terms of the company’s development. They can compare the outcomes of conflicting paradigms of growth (as is the case in an argument between Alison and her companions), drawing science-backed conclusions about each method’s outcomes (Lepenioni et al., 2020). Then, predictive analytics can complement the tactical level of Wirkkala’s operations. When launching a new initiative in a specific area of business, the company can predict its results, assessing the strengths and weaknesses in a reliable manner (Shah et al., 2020). Finally, descriptive analytics are useful on the operational level as the primary tool of analysing the procedures completed by the employees and units (Marzouk and Enaba, 2019). All this data will rely on facts and history of the business, thus rendering the decisions informed and precise.
In summary, the use of modern data analytics tools is essential for the companies of all sizes. Even small, local enterprises can benefit from informed decisions that facilitate the growth of sales, customer acquisition, and supply chain optimisation. In the case of Wirkkala, this demand becomes even higher, as the firm enters a phase of active transition from a small to medium business. With the expansion of the product range, distribution outlets, logistics chains, and, most importantly, customer base, the amounts of data to process will increase exponentially. In this case, the old methods of data handling will soon show their inability to meet the company’s needs. To process Big Data, Wirkkala requires a brand-new approach to the storage and processing of the information. Without it, even the most efficient analytics tools will be rendered useless, creating new barriers for the sustained growth of the company, as the internal conflict potential accumulates.
The scope of work required to re-organise Wirkkala’s data-handling procedures is broad but indispensable. The current state of it partly reflects the sporadic nature of the firm’s development across the recent years. However, new heights and challenges require a corresponding level of self-organisation on behalf of Wirkkala. Furthermore, this idea is in line with the ongoing pursuit of digital transformation that is often perceived as the new reality across various industries. This innovative trend has redefined the image of business, creating unparalleled opportunities for companies of all sizes. Digital transformation introduces new avenues of stakeholder communication, data collection, analysis, and forecasting (Ferreira et al., 2020). In the case of retail, digitalsation expands market opportunities, connecting a broader customer base with a higher number of companies.
Simultaneously, firms gain new opportunities in terms of product supply, distribution, and marketing. Through cloud computing, they enable a stable exchange of big data. Through the Internet of Things, they gain more knowledge in regard to the customer preferences and market trends. In a way, retail is an industry that has been affected by digitalization to the highest degree (Filotto et al., 2021). Wirkkala should not remain on the margins of the tendency, meaning that the directors are to utilize the full potential of digital tools and information systems to advance their efforts in a new phase of development.
Information Systems
In spite of its increasing prevalence, digital transformation is not a phenomenon that occurs spontaneously, nor can it be completed without due preparations. In the age of Industry 4.0, knowledge has become the key resource that can assert a company’s competitive advantage in its niche. Qu et al. (2018) identify several limitations that have traditionally existed in enterprises’ information handling: “lack of complete information, only satisfy limited business needs, and lack of seamless integration” (p. 2210). In other words, the effective digital transformation demands a full and unimpaired information flow within the organisation in its entirety. Knowledge management is an area of business that addresses proper handling of information, aspiring to create a structure, in which the optimal state of data flow can be attained. Qu et al. (2018) argue that an integrate framework that would encompass the various spheres of corporate activity and sources of data. Within this framework, all units can work together, forming a positive synergy that will apply the required momentum for digital transformation and company growth.
When the knowledge exchange is complete, it is easier to effectuate profound transformations on the scale of the entire company, aiming for future growth. Digital transformation is a complex process that is not limited to the executives or managers of the firm. On the contrary, it encompasses all levels of company’s work, as every element of the framework needs to work at its full extent. It does not suffice for a leader to design a strategy and a roadmap for change. For these plans to be implemented, the information does not only need to be delivered, but also received by each employee within their areas of duty. At this stage, information management comes into play, determining the degree to which a member of the team understands the data received (Müller et al., 2019). They should have a full idea of the organisation’s current priorities and goals, as well as the business processes within it. The ability to ensure a proper exchange of information is, in fact, one of the leading competencies to be exhibited by the leader in the contemporary business environment.
One of the crucial roles of information management systems is to inform decision-making, facilitating the development of strategic, tactical, and operational plans. Strategy-wise, the formation of company vision depends on the ability to access and analyse large arrays of data efficiently. For this purpose, Wirkkala’s dispersed data storage paradigm is insufficient for the purposes of digital transformation. Modern cloud computing systems allow companies to bypass hardware-conditioned limitations and enable a full and stable exchange of easily available data. Then, for the completion on goals on a tactical level, the system of blockchain is a new solution that gains popularity. Beck et al. (2017) research the application of this tool in various aspects of business, concluding that blockchain facilitates the interaction of companies with their suppliers and distributors. Through such systems, financial operation of Wirkkala can be become more efficient and organised. Finally, the operational potential of information systems if highly varied, but its potential impact on communication holds the most value. As the company grows, it will see a higher number of departments and employees. Digital interaction via CRM systems can facilitate the control over daily operations, making them organised.
In the current case of Wirkkala, the data is generated in three main points, demonstrating a lack of balance. The factory of the company produces and handles all the information related to the functioning of the equipment, product manufacturing, and maintenance. All specialised data regarding the technical and operational details of the machinery is within the factory. Next, the warehouse of Wirkkala possesses the information on the company’s supplier relations. This list includes delivery routes and schedules, tracking, distribution network control, and supplier database. Finally, most of the data remains contained on the premises of the headquarters, including accounting information, marketing data, customer data, HR details of employees. Interestingly, supplier and distributor details are stored at the headquarters, as well. However, without a uniform framework of data exchange, for example, via cloud computing, there may be serious inconsistencies. A single, up-to-date database is essential for proper strategic and tactical planning across all departments of the firm. This step will be integral toward the formation of a resilient company structure that benefits from data analytics and information systems in the age of digital transformation.
The Impact of the COVID-19 Pandemic
In most cases, the development of firms and entire industries continues within well-established patterns that reflect decades of history, as well as the evolution of modern society. However, one of the recent developments has disrupted normal processes within most areas of business, including retail. The COVID-19 pandemic became a challenge of an unprecedented magnitude for humanity, paralysing global processes and the world’s economy. For retail, the outbreak of COVID-19 meant serious obstacles for the normal avenues of customer interaction, logistics, and supply chains. As a result, new trends emerged, profoundly changing the landscape of retail on a worldwide level. Goddard (2020) states that in the new reality, an average household redirected up to 30% of the usual spending on eating away from home toward food and beverage retail. However, in order to utilize the new influx of cash within the industry, retail companies needed to adapt to the situation, exploring new avenues of customer engagement. This process became possible through the digitalization of operations, and only the retailers with sufficient innovative potential were able to appreciate the new opportunities.
In fact, the retail industry may see COVID-19 as a double-faceted occurrence that yields opportunities along with risks. More specifically, Dannenberg et al. (2020) argue that the pandemic has put the companies working in this sector to an ultimate test. COVID-19 disrupted normal economic processes, prompting retailers to test new formats. Digital transformation became an important avenue of crisis resolution, as innovative methods of supply chain management, customer interaction, and product distribution remained one of the few available options amid the outbreak. In a way, COVID-19 gave an impetus to the digital transformation and accelerated the process that could otherwise have lasted for several years. Wirkkala needs to accept this reality and enhance its digital potential by applying a new paradigm of development. For the management, this idea implies a better transparency of data flow and decision-making that will inform new strategic and tactical plans in the long term.
Conclusion
Overall, Wirkkala is a promising company that built a solid foundation upon the expertise and enthusiasm of its founders. At the current stage, the firm has reached a milestone that indicates its transition to a higher level of operations. Thus, profound reorganisation is required to help Wirkkala adapt to the new rules of the industry. The advanced use of business analytics is indispensable at this point, as Wirkkala can thrive much sooner with the proper handling of big data. On the other hand, the adoption of such tools implies an enhanced technological potential of the firm. In the case of Wirkkala, information systems can enable a better level of knowledge handling as the current state of it is sub-optimal. Ultimately, the highest challenge faced by the company in the new post-COVID reality consists of completing a quality digital transformation with the use of business analytics and information systems. Accordingly, technology will play a key part in this process, complementing the advanced human resources of the organisation.
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