Introduction
Boohoo is an evident high-profile profit-driven fashion organization, causing eyebrows to be raised with regard to giving more emphasis on cost and speed than ethical considerations. The report looks into Boohoo’s organizational culture, structure, leadership, and motivation in an effort to establish what informs its ethos in light of ethical laxities. The lack of profit focus, the decentralized structure, and the need for enforcement by governmental and inter-governmental bodies are among the factors that contribute to the lack of accountability in its supply chain. Furthermore, the autocratic leadership style of its founder and executive chairman, Mahmud Kamani, leads to doubt about ethical values in the organization. This essay will also discuss how Boohoo’s failure to motivate its workforce can be associated with the practice of unethical acts. Finally, according to Kotter’s 8-step Model of Change, recommendations are provided about what measures have to be taken in order to avoid these ethical issues and provide Boohoo with a way towards a more sustainable and responsible form of business approach.
Evaluation of Boohoo Company
Organizational Culture
Boohoo is a profit-oriented company and believes in making profits so that its bottom lines are achieved by giving affordable fashion items. The company is known to only consider the profit margin attained from the, in its approach towards producing garments, focus on the cost and speed, and in most cases at the cost of the ethical considerations. In addition, little or no accountability vis-à-vis its suppliers and factories is offered through the decentralized structure of Boohoo, and the reliance on self-audits and third-party inspections is often found lacking. On the other hand, Boohoo is highly challenged by other online fashion retail companies like ASOS, Zara, and Shein, prompting it to ensure constant improvement in terms of a wider range of designs and quick delivery for the retaining of its market share and customer loyalty. The customer base the company targets is based on social media and celebrities, focusing on style and convenience rather than ethical sourcing and quality. Boohoo preys upon this type of customer ignorance by marketing its products through misleading labels such as “Made in the UK” or “sustainable,” disguising the true origins and conditions of production (Martinezz- Carro et al., 2020).
These practices can be directly related to the organizational culture within Boohoo, which is defined in terms of several core values underneath. First of all, there is the aspect of passion amongst the Boohoo workforce that has a higher impact on fashion and the general vision of the company. However, this keenness sometimes makes them overlook the negative impacts of actions bypassing ethical considerations. Second, Boohoo values agile and adaptable forces in its workforce to permit quick reactions toward change. However, such agility could be misinterpreted as impulsiveness and recklessness in that the employees are willing to take risks without a full understanding of the consequences that the actions can have in the long term. Thirdly, Boohoo values creativity and innovation with which to embed a culture of developing new and unique solutions. This may also give rise to the opportunism and exploitation of creativity, as people will seek shortcuts or use a loophole to achieve their goals. Besides, Boohoo puts much emphasis on commercial success and entrepreneurship in its employees. However, in some cases, this may lead to greed and selfishness, where individual interests are favored over other ethical principles. The last of the company’s ethical initiatives is teamwork and cooperation between employees. However, as the author observes, this focus on teamwork can result in conformity and compliance, in which people may stop questioning or defying group norms and commands.
Organizational Structure
The current organizational structure of Boohoo is one where it operates within a flat and decentralized setup, with minimal levels of hierarchy and authority, where decisions are distributed among the various teams and individuals. Such a structure comes with several advantages, among them increased flexibility that enables Boohoo to readily respond to changes in market conditions and consumer preferences without having to go through the rigors of bureaucratic processes. Moreover, it fosters an innovative atmosphere in which employees are encouraged to experiment with fresh ideas, take risks, and find new methods of operating that are not bound by rigid protocols. Furthermore, this structure provides employees with an opportunity to be empowered with autonomy and responsibility in a sense whereby it becomes motivational and makes engagement easy when they can control their career paths and make decisions without having high levels of micromanagement by managers.
However, it is also a very dangerous structure that could be responsible for encouraging some types of unethical behavior within the organization. First, the need for coordination in Boohoo is a challenge in aligning goals and strategies across the different teams and functions. Secondly, weak control mechanisms would mean that Boohoo would not have the ability to monitor and measure the performance of its activities; hence the danger of its supply chain and manufacturing processes slipping into poor quality and non-compliance as far as accountability is concerned (Stevenson, 2022). Thirdly, inadequate communication channels foster information gaps and silos that result in misunderstandings, conflicts, and mistrust among the stakeholders like suppliers, customers, and the regulator. The present structure of Boohoo is a partly underpinning constituent of its ethical issues in business.
Leadership Structure
The leadership style of the chief executive, Mahmud Kamani, could be one of the reasons why the company has to take this route. Kamani is the founder and executive chairman of Boohoo, and he exerts huge power over the company’s operations and culture. In the case of Kamani, the BBC Panorama investigation exposed that he had pressured suppliers to cut prices even after orders had been agreed upon. He also said, “It is not good for them; it is okay for me.” This would mean that Kamani appears to have an autocratic and self-centered leadership style in which he lays his profit motives before his workers and suppliers for the welfare and rights of the employees (Mill, 2023). One can see that he poorly cares both for ethics and for being socially responsible in his carelessness towards the environmental and social consequences of his activities. For instance, it can damage the company’s reputation and credibility with its customers, investors, regulators, and the public at large. It also increases the risk of legal and regulatory penalties for non-compliance with labor laws and human rights standards. In addition, this is likely to lead to the demotivation and alienation of the workforce and suppliers, who may feel exploited, abused, and undervalued. It is estimated that this can cause low quality, low productivity, high turnover, and low loyalty (Langley & Rieple, 2021). It is hence disputable that Boohoo’s unethical practices are a result of leadership by Kamani, who leads in a self-serving and autocratic manner, not caring about the interests and the needs of his workers and suppliers. Another vital aspect of being ethical and democratic in the firm would be showing respect to stakeholders, empowering them, and engaging them with Kamani. He could improve social and environmental performance as well as restore credibility and reputation.
Motivation
The organization has been accused of violating ethical commitments and exploiting workers through the supply chain. There could be less motivation in the organization, and below is one of the reasons: Motivation has been defined as the psychological process causing the beginning, direction, persistence, and expediency of voluntary actions or decisions. Factors affecting motivation can be needs, goals, rewards, and feedback. A motivated workforce can promote the performance, productivity, and job satisfaction of the employees and the organization.
The inability of Boohoo to properly motivate employees and suppliers contributed to the evolution of its ethically irresponsible practices. For example, the company may lay down elementary needs in the way of fair wages, safety at work, and respect for human rights, and this can result in dissatisfaction, frustration, and resentment on the part of employees and suppliers. As a result, this dissatisfaction could have led to low quality, low commitment, and high turnover rates (Erhun et al., 2021). Besides, Boohoo could have possibly set unrealistic and inconsistent objectives for both employees and suppliers, such as fast fashion at a low price, with no adequate and proper guidance, support, and resources. This ambiguous condition might have given birth to confusion, pressure, and stress, which caused the individual to go for shortcuts and compromises and ultimately get involved in ethical transgressions. In addition, all unsatisfactory and unfair reward offers, such as low pay, bad benefits, and low opportunity, may have lowered both types of intrinsic and extrinsic motivation, leading to lower efforts, creativity, and loyalty. Furthermore, the lack of weak feedback loops, for instance, self-audits, third-party inspections, and customer reviews, also might have served to handicap the learning, improving, and accountability processes, thus contributing toward poor quality, compliance, and accountability at Boohoo’s operations.
Hence, these unethical practices of Boohoo could be partly present because of the lack of motivation in the organization, as it could not be assured of addressing and satisfying the motivational factors of its employees and suppliers. Perhaps then, a more inspiring and moral approach, one where Boohoo finally recognizes, rewards, and fully supports its workers and suppliers, could provide the opening for the company to finally pick up its game in social and environmental performance and rebuild both its credibility and name.
Kotter’s 8-step Model of Change and Recommendations
Creating an Urgency
In line with this, the first of the eight steps of the change model Kotter is to establish urgency among the employees, managers, suppliers, and customers of Boohoo with respect to the ethical issues at hand. Boohoo can lay down the first step to resolve its ethical issues, depending on the major strategies it could follow in leading the organization toward sustainability. Firstly, the firm should put more focus on the underpayment of workers, coercion of the supplier, and environmental risk, which the firm has been overlooking until now. Sharing the findings of these investigations, such as the BBC Panorama and reports from bodies like the Environmental Audit Committee, shall bring out how these practices may have damaged the reputation of Boohoo, its sales, customer loyalty, and its legal compliance. Secondly, Boohoo should explore the opportunities and benefits of adopting more ethical and sustainable approaches. For example, such fashion brands as H&M, Zara, and Patagonia, among many others in success stories, show how practicing social and environmental responsibility at Boohoo will lead to achieving competitive advantages, increased customer satisfaction, and innovation (Laig & Abocej, 2021). Thirdly, encouraging open and honest dialogues from employees, managers, suppliers, and customers. This may be done through surveys, interviews, focus groups, or workshops through which information would be elicited that could be used to provide feedback as well as outline suggestions for the improvement of ethical standards in Boohoo. Finally, seeking support and guidance from industry experts and advocates can bolster Boohoo’s efforts for change. Collaboration with other organizations such as the Ethical Trading Initiative, Fair Wear Foundation, and Fashion Revolution will not only help access best practices, guidelines, and campaigns but also gain endorsement and recognition for Boohoo’s commitment to an ethical transformation. Boohoo would, hence, secure the possibility of proving itself ultimately committed to doing ethical business and sustainability, demanding the needed changes in the fashion industry (Haas et al., 2020).
Forming Coalitions
The next step of the Kotter 8-step change model is to establish a strong guiding coalition that steers and supports the change initiative to overcome the ethical challenges before Boohoo. Identifies who effective change leaders and major stakeholders in the organization are—those people who have the authority, influence, expertise, and interest required for driving and implementing the change. Boohoo should make sure that the company involves and engages the employees, communicating with them clearly and effectively the vision, the goals, and the benefits of the change and assuaging their concerns and expectations. Considering the nature of the plan, a strong coalition is of high essence. Thus, it should be built from all levels of diversity and areas of representation with a clear emphasis on collaboration, roles, and responsibility (Aukes, 2021). It should have regular meetings, feedback mechanisms, and communication channels that will see through the overseeing and the evaluation of the process and performance. Secondly, the coalition teams should ensure that any weaknesses are identified and include key people from different cross-functional and inter-organizational levels. Training, coaching, and mentoring should provide an elaborative analysis of the strengths and weaknesses of the coalition members, upon which their abilities and confidence will be built.
Developing a Vision and a Strategy
Regarding the ethical challenges at Boohoo, the third step that Boohoo Ltd has to go through, as to Kotter’s 8-step model of change, is giving a vision and strategy that can direct and inspire the changes that need to be performed. This involves the determination of core values that reflect the identity, purpose, and principles of the corporation, ultimately as per the ethical and social standards. Boohoo could even explore adopting values that are presented in the Ethical Trading Initiative, based on conventions by the International Labour Organization. It is thus the next critical component that deals with the formulation of the ultimate vision depicting the future status of the company, whereby Boohoo is visioned as a global leader ethically and sustainably, with a loyal customer base, a resilient supply chain, and a positive impact on the environment and society (PonceVaega & Williams, 2021). The next step is subsequently planning a strategy, which outlines specific actions, plans, and measures based on an in-depth analysis of the current situation, gaps, and barriers and also includes best practices. In the case of Boohoo, it might include measures in the sphere of improving the minimum wage, bettering the working conditions of employees, and adopting a code of conduct with a system of monitoring suppliers.
Vision Communication
It is, therefore, step four of Kotter’s 8-step model of change to communicate the already formed vision to the different actors within the organization as a final attempt to rectify the ethical challenges Boohoo is facing. This can be achieved by strong and convincing communication of the vision, often and widely, through a number of channels and methods among the workers, middle managers, suppliers, customers, and regulators. Boohoo can continue to bolster the vision through the website, its social media platforms, newsletters, podcasts, webinars, and events to reflect movements and outcomes occurring in the change process. Second, this vision must be aligned with the core values of the organization, and that is something that has made Boohoo have to change its code of conduct, monitoring system, and reporting framework so it could better align itself with the vision to ensure compliance and accountability (Trawick & Carraher, 2023). It also includes dealing with concerns and issues with honesty and stakeholder involvement through acknowledging and addressing potential obstacles, blockers, and resistance. Tools that the stakeholders, including Boohoo, could use in engaging all stakeholders, giving open and honest information to them, and gaining feedback on their views and expectations could be done through questionnaires, interviews, focus groups, and workshops.
Removing Obstacles
In relation to Boohoo’s ethical challenges, this stage of Kotter’s 8-step model of change involves the change vision, which will emerge after the process has destroyed any inhibitors to the change that might block or prevent the change from happening. This can be done through the organization, ensuring that its processes and structures are fully in place and well-articulated as per the organization’s vision. Boohoo may also try to simplify its processes and systems so as to reduce bureaucracy and complexity that may lead to inefficiency and low quality. This would then further enhance innovation and integration by fostering cross-functional teams and networks. The identification of challenges, problems, or opposition that can occur from the change process as well as from its outcomes is necessary to take pre-emptive measures (Ahmed et al., 2023). The source may be from within the organization or from the environment. In measuring progress and performance, Boohoo could employ data, feedback, and indicators, with any deviations or discrepancies tracked quickly.
Similarly, it is important to recognize and appreciate those people who endorse and support the change. A culture of appreciation and respect should be created at Boohoo through verbal and written praise, recognition, and appreciation of employees, managers, suppliers, and customers involved in or affected by the change. In addition, the company can stimulate and support in every way those who perfectly reach the change goals with monetary and non-monetary rewards like bonuses, promotions, gifts, and opportunities.
Creating Short-Term Wins
The sixth step in the ethical issues addressing the process of Boohoo is creating short-term wins using the 8-Step Model of Change by Kotter, within which to showcase and celebrate improvement and benefits of the change. It implies several actions. First, genuine and major ethical and social improvement should have been realized within the first 6-18 months of Boohoo implementing the change program. For example, a company may aim to improve the wages and working conditions of its employees by a certain percentage within the first year. Second, rather than having one long-term target in view, Boohoo should have a number of shorter-term targets that can be derived from the overarching vision. Breaking targets into milestone objectives decreases the chances of failure and makes tracking the progress possible. For instance, Boohoo can introduce quarterly targets to reduce the carbon footprint and increase transparency with clients and regulators.
Last but not least, the input of the players in the process of attaining the targets has to be appreciated and rewarded (Buzan & Whitehead, 2021). Boohoo should develop a supportive and appreciative feedback system through which positive incentives and appreciation are given to the employees, managers, suppliers, and customers, supporting and spearheading the change. Expressing thankfulness both verbally and through written form, the use of formal recognition further assists the ethical transformation of the organization. With such an approach, Boohoo can express its dedication to ethical advancement and the journey toward sustainability while simultaneously motivating stakeholders to participate in the change process proactively.
Consolidating Gains
The consolidation of the gains made at the previous stages follows that improvement or change is based upon the current situation in order to deal with the ethical issues that have arisen for Boohoo. This can be achieved by reaching a steady improvement through analysis of success stories individually and improving from individual experiences. It implies that the company has to critically examine and assess the results and effects of the change process and outcomes and have to find the best practices and what can be learned from the success stories among the employees, the managers, the suppliers, and the customers involved in or affected by the change (Hu et al., 2021). Also, the insights and feedback were very well aligned for further development and refinement in the company’s vision, strategies, policies, procedures, and culture. They covered the remaining gaps, issues, and challenges. For instance, Boohoo could offer data, indicators, and even testimonies that would be usable in proving and demonstrating the change, the one that should be considered progress, performed, and how this furthered its benefit into the future. Surveys, interviews, focus groups, and workshops could also be applied by the company to gather and study the opinions, suggestions, and experiences of the stakeholders and to make an analysis of the strengths and weaknesses of the change process and outcomes.
Anchoring Change in Culture
The eighth and final step, from Kotter’s 8-step model of change, is to make the change stick, to anchor it into the corporate culture so that it becomes the new norm and sustains over time. This is the final step that directly addresses the ethical issues facing Boohoo. This can be done by discussing the successful stories related to change initiatives at every given opportunity. This also means that it is very important to share and celebrate the achievements and impacts of the change process and the outcomes so as to highlight the positive and lasting effect of the change on the company and its stakeholders. For instance, Boohoo may use its website, social media, newsletters, podcasts, webinars, and events to share the stories and present the milestones and results of the change secondly, so that the change gets incorporated into the organizational culture and is visible in every organizational aspect. This includes anchoring and aligning the change to the company’s fundamental core values, goals, strategies, policies, procedures, and culture, and also linking and demonstrating how the change impacts and is of value to each of them. For instance, Boohoo should modify the code of conduct, monitoring system, and reporting framework in relation to the change and in order to be in compliance and accountable. Third, the support of the change is ensured by the current support that exists within the company, both from the leaders and the new leaders (Holladay et al., 2023). This would imply that the firm is to defend and enhance the leadership and guidance of the change coalition derived from the previous steps and to ensure that they hold the power, influence, expertise, and interest to set and implement the change in effect. For Boohoo, it could, through offering training, coaching, and mentorship programs for its existing and new leaders and change agents, also support them through the provision of rewards and recognition to them for their various contributions and accomplishments in those change initiatives.
Conclusion
Ethical challenges at Boohoo run deep into the profit-driven culture, its decentralized structure, autocratic leadership, and motivational shortcomings. In order to instill positive change, the company needs to make urgency felt through recognition and addressing of the ethical issues in the wide open. With successful models like H&M and Zara as pointers, Boohoo should invest in ethical practices to ensure longer sustainability. Open dialog and counsel from the industry bests could pave the way for an overhaul in thinking toward responsible business. The implementation of Kotter’s 8-Step Model of Change can give back to Boohoo its lost credibility, giving it a chance to be a leader ethically and sustainably, with a great base of satisfied customers.
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