H-E-B Central Market Management Theory Analysis

Topics: H-E-B, Organizational structure, Grocery store Pages: 12 (4129 words) Published: February 6, 2012
Introduction of the Organization
In 1994, the current President of H-E-B grocery- Charles Butt- opened the first Central Market. The store was located in Austin. Mr. Butt reached out to John Campbell an employee who had been with the company for over thirty years. Campbell started out at H-E-B as a cashier and moved up the ranks to become an Innovation Officer at HEB. Central market is a division under HEB Grocery which operates independently. The store remains privately owned by the Butt family and is not traded openly on the stock market.

The store was called an “amusement park for food lovers”. The store took concepts from European food markets and brought them to Central Market. The store became very popular in Austin, Texas, and an each year about 2 million people visit the store. Following the Austin Central Market’s success H-E-B grocery opened eight new locations starting in the year 2001 with stores in San Antonio, Houston, Plano, Dallas, Southlake, Fort Worth, and a second location in Austin respectively.

Central Market offers its customers an atmosphere where they can experiment and try new different foreign foods. They have a very strict product quality checklist. Every item that goes into their store must pass inspection at the store. Unlike H-E-B grocery stores all products that are shipped to Central Market go directly to the store. There is no stop over at the distribution warehouse. During an interview with the Manager in Charge at Central Market in San Antonio product quality was discussed. One instance of product quality rejection at the store involved cherries that were shipped from California. The cherries were driven from California by means of an eighteen-wheeler truck. When they arrived at the store they were not up to par with the quality the store had asked for. The perishable manager at the store rejected the cherries and they were not bought.

Organizational Environments
External forces that affect Central Market include things outside of their reach. The uncontrollable variables that every organization faces in the business world. These driving forces include the industry the organization does business in. In this case Central Market is in the grocery business. Other driving forces include competition, the economy, and political influences. Central Market is in a very stable industry and has almost no competition. The only serious competitors of Central Market would be Wal-Mart or Target. These two large corporations however do not sell the same type of product. Central Market caters to those looking for high end exotic types of food, beers, wines, and etc. The economy isn't exactly stable, but people must consume food so the grocery business is stable.

Central Market's internal driving forces include it's organizational culture, management of its finances, and employee morale. This forces can make or break a company
Central Market's organizational culture is best described as a place where employees are skilled in what they do. Each employee has a certain skill depending on what department he/she is in. Partners that start off working for the store usually stay with the store. These partners stay with the store because Central Market creates a stable work place where there is opportunity for promotion. Most partners that work for the store start off from the bottom and move up the ladder into upper level positions. Central Market does a great job of treating it's employees with respect. Partners are offered excellent benefits which include healthcare and pension plans.

The end goal of a successful leader is to influence others to achieve group or organizational goals. The difference between a leader and a manager is leaders focus on the long term growth of the company. Managers are just focused on the day to day procedures at the store, on the immediate problems or issues. Leaders focus on long term goals and objectives set and implement them into the...
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