Management Practices of HYPERSTAR 1

Overview of the Management Practices of HYPERSTAR

Prepared for Abdul Ghaffar

Principles of Management

Class: BBIS Fall 2017

A Study Conducted by (Abdul Haseeb, Fawaad Suleman, Syed Shahzaib)

University of Management and Technology

Submitted 11th December 2017.

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Abstract

[The following research was conducted by Abdul Haseeb, Fawaad Suleman and Syed Shahzaib

in order to elaborate how a huge hypermarket chain like Hyperstar operates in Pakistan. The

information in this research paper is totally based on what we learnt about Hyperstar by meeting

their Human Capital Manager Mr. Aqeel along with Hyperstar’s own official website and Majid-

Al futtaim Group. We have done a lot of effort into making this project and have been working

for the past 2 months with sole purpose of making a realistic report.]
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INTRODUCTION

Hyperstar is a departmental store in Pakistan owned by Majid-Al futtaim group of UAE.

The company has been successful in launching similar stores in Middle Eastern region, Carrefour

is a great example as two members of our group Abdul Haseeb and Fawaad Suleman lived in

Qatar and Saudi Arabia for a good part of their life, they these stores since their childhood.

However Hyperstar began its work in Pakistan in the year 2009. The company has since been a

huge success in Pakistan had has expanded to 6 stores nationwide in the span of 8 years. The

Majid-Al futtaim group is a highly successful retail business owner having a revenue of 25

billion AED in the year 2014. The group has staggering 40,000+ people working under its

banner directly or indirectly. The company has expanded into 15 countries providing services to

people in the African, Asian and Middle Eastern region. Their main services include shopping

malls, retails and leisure. The company has been working in the retail industry since 1992.

Carrefour is a French retail store chain which has been working with Majid Al Futtaim group for

the past 20 years, Hyperstar is purely Carrefour, the name being the only difference. The group

has been responsible for revolutionizing the way people buy things by introducing the

hypermarket model to the above mentioned regions since 1995. Hyperstar can be considered as a

branch of the famous French franchise as it is also controlled by Majid-Al futtaim Group..
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Analysis of External and Internal Environments

1) External Environment:

As mentioned above we have taken all the information from Hyperstar’s Human Capital

manager Mr. Aqeel and according to him the external environment does not affect Hyperstar

in any capacity be it economic, political or any other external threat. They have a solid

internal structure which helps them to grow regardless what their other rivals are doing. They

have a system that is running in numerous countries across this region and that system allows

them to be care free of these issues.

2) Internal Environment:

Hyperstar is a multinational company, one of the main reasons of their success is the fact that

they provide their employees with a wonderful environment to work in. The Hyperstar

management believes in growth of their employees and as they keep progressing to higher

stages like Supervisor, Manager and etc. they get benefits from their company like bonuses

and other stuff like that. This practice makes a positive environment within the company

giving everyone a chance to grow and promoting healthy competition.

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Description of managerial functions

1. Planning:

Hyperstar are working on the vision of “Great Moments for everyone, every day.” They

are following this vision or plan by providing customers with the products they demand.

This process involves different steps like ordering the right products, the right amount of

products, selling the product at a suitable price for Hyperstar, so they earn profit amd for

the customers, so they do not feel that the products are too expensive and etc.

In Hyperstar, the goals are divided into two portions:

Short Term Goals: each store has its own goals and objectives to meet. All the stores

have their own short term goals for sales, revenue and etc.

Long Term Goals: the company decides the long term goal that is to expand in cities like

Faisalabad, Multan, Hyderabad and Gujranwala. The common goal of the two is the

same, which is to generate as much as revenue as possible like every other business.
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2. Organizing:

This how Hyperstar follows the six key elements of Organizational Structure:

A.) Work Specialization:

Hyperstar specializes in providing services. Their main services include product

availability, installation of products and etc.

B.) Departmentalization:

Hyperstar every product comes under a department for example, Smartphones fall under

the heading of Electronics. These departments are divided into sub sections like people in

the Smartphone section are only bound to report about their section. All these

departments have supervisors who report to their seniors. If any of these departments

have to report their sales, they go and report to the sales to the sales manager. These

mangers than report to the General Manager of the store.

C.) Chain Of Command:

The chain of command in Hyperstar is top to bottom or trickledown effect. The top

management (in this case the general manager) makes the decision and everyone has to

follow those orders.

D.) Span Of Command:

The span of command of is divided into sublevels. All departments are having their

designated supervisors who report to the middle-upper level management which includes

Human Capital Manager, Sales Manager and etc. All these manager’s report to the top

management of the store that is the General Management.

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E.) Centralization And Decentralization:

Hyperstar follows a centralized form of control. The general manager makes the decision

for the store, in the light of what he thinks is right, regardless of what the people think.

F.) Formalization:

In Hyperstar there is no involvement of one department in the other. They only step in

when it is a major issue, that too not directly. They involve the higher management first

and then they talk to the other departments.

3. Controlling:

Hyperstar has a huge number of employees and all of them are answerable to their

senior’s in terms of their rank in the company. The issue related to the sales are firstly

brought into the attention of lower management, if they deem that they cannot handle the

issue. The middle-upper Management then takes a decision and if they fail to resolve the

issue then it goes to the general manager and so on.

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4. Analysis And Recommendations:

After looking at Hyperstar so closely and knowing how they function, for a company that is

spread throughout the whole continent, we have come to this analysis that they are doing a great

job, we can see that they have expanded to 6 stores from 1 store in 2009. In less than a decade

they have made an incredible progress.

Following are the few recommendations we have developed:

 They should hire more people at management positions, to share the work load.

 They need to open up small outlets like Gourment.

 They should start big promotions every month to increase their sales and went out their

inventory.

 They should import more products from Middle Eastern countries as a lot of

people from those areas are moving back to Pakistan.

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References:

(Hyperstar, n.d.)

(Majid al futtaim, n.d.)

Appendices:

(Aqeel, 2017)