Nordstrom’s Case Study

Nordstrom’s Case Study Nordstrom department stores were founded in 1901 by John W. Nordstrom in Seattle Washington. The ultimate mission of Nordstrom’s is to support both their customers and their employees that have direct contact with the customers (Farfan). These luxury department stores have grown to become a successful chain in the department store industry. Nordstrom has reached the top of its industry due to its top-notch customer service and selling skills. These qualities along with intense planning, that has everyone on their team involved, are the reasons Nordstrom’s has an advantage over its competitors. One reason Nordstrom’s has become a strong competitor is due to the companies use of participatory planning. The idea behind participatory planning is to have the entire community of the company involved. This system of planning relies on trust from all participants in the company. This planning system is used in areas such as product purchasing. Customer service is one of the reigning priorities of the company, which helps to involve all the company’s community including the customers themselves (Msa.). The increase in communication was crucial for the success of the company. The goal is to make the store a comfortable place for the customer. This will help to bring customers back to the establishment. By being comfortable customers are more likely to come back to the establishment and purchase additional merchandise. One of the most important reasons for Nordstrom’s introduction of a web-based inventory was to keep track of the merchandize coming in and out of their company. Along with that the web-based system can help Nordstrom’s be more successful and thrive in its industry. For example, it can be used to keep track of their customers. The company can keep track of what customers are looking at on the website, as well as checking what they have purchased. This is important because by doing to the company can filter the website to show products that customer may be interested in. It can also help customers know if an item is sold out or not. This will help to company know whether a product is in high demand. The text states, “Although inventory naturally fluctuates, Nordstrom associates couldn’t easily locate the same item in another store or verify when it would return to stock” (C-11). This issue was directly affected by online inventory. These issues were able to be resolved. It also helps to see what item are the most popular. Global firms face a variety of problems in their global supply chains. They must come up with different ways to deal with these inevitable problems. One of the most popular ways these firms face these on-going problems is by having multiple back up plans. These plans include things such as supplies to replace loses from a failed supplier. The “Just-In-Time” method is another popular way company’s deal with inevitable problems. The goal is to only get what you need “Just-In-Time” (Hunt). This method not only provides a company with their immediate essentials, but it also saves them money. By not having extra merchandize a company is able to save money in area such as storage. There are also alternatives to the JIT method. One alternative is “Materials Requirements Planning” or MRP (Hunt). MRP is a computer program that uses real-time data to create schedules that can help the company keep up with their stock. The goal is to stock up and sell the stock as quickly as possible. This system can help create stable orders of products. Nordstrom’s plans to grow in many different areas. One of their most prosperous areas of growth is their digital growth. In one quarter the company increases their sales by about 23% online (Loeb). Its digital growth is skyrocketing and becoming a main source of income. By providing customers with an online store the company is giving customers more choices on how to shop, leading to a higher rate of income. Since Nordstrom’s is extremely prideful about their treatment of customer, it is very important for them to provide them with additional resources. This online system provides an easier alternative to going to the store in person. Many people these days prefer online shopping and it has become very popular. This system can really bring Nordstrom department stores to the top of their industry. Nordstrom department stores continue to be at the top of the department store industry. Their mission to support their customers through superb customer service has brought them to were they are today. The use of participatory planning has also led to their success by getting everyone in the company’s community involved in the process. These reasons have led to Nordstrom department stores advantage over its fellow competitors.