Company Strategy
Introduction
As a company embarks on making changes in the way it had been operating, it becomes crucial that it crafts strategies to act as a guide as the organisation tries to have a new look. The goal the new managing director wants to achieve is to improve the overall performance of the company as it had deteriorated since the former managing director retired. It was evident that the company’s previous managing director used strategies to deliver results although this was done through the use of autocratic kind of leadership and the subordinates were not comfortable with the approach.
The new managing director seems to know the situation at XYZ Construction Company as he was previously working in the company before being transferred to another company which gave him exposure to managerial skills. The new managing director used to work in the XYZ Construction Company, and the only change was that he was holding a bigger role than he had in the company when he left. He was familiar with the working conditions that prevailed in his former company. The new managing director knew the only way to save the company from the poor performance was to initiate changes in the way the organisation used to work. To bring changes in the company, it was necessary for him to come up with strategies that would steer change among the workers in an amicable manner.
The XYZ Construction Company is a service providing company, offering construction services to its clients. To accomplish its duties, it has two dimensions that it has to cater for namely the external relationship and the internal relationship. The external relationship involves establishing a better relationship with the clients, suppliers and other stakeholders external to the company. The internal relationship encompasses how the staffs relate with one another and the communication within the different functional areas. The new managing director has an obligation of ensuring that the two facets are well defined and catered for if the situation at hand is to be resolved.
The clients will serve to provide continuity of the company as they consume the services of the company which generates revenue for the company and it runs the day-to-day activities of the company. The suppliers to the company are also a crucial part of the external team as the company will require construction materials which they can obtain only when they liaise with the suppliers. The internal relationship covers the staff at large and the relationship that exists between the management team and the subordinate as well as the relationship among individuals within each department as the company is made up of several departments. It is the staffs who ensure that the daily activities of a company are running as it was previously planned and that the objectives of the companies are met.
For a change to be fully integrated into an organisation, there is a need to involve the whole team and have a group that will continuously monitor the progress of the change and checks whether the right path is in place towards attaining the proposed amendment (Hammer, Edwards & Tapinos, 2012). Prior communication should be done to all the stakeholders as it sets the minds of the stakeholders who will highly determine the success of the said change. The managing director, therefore, has the mandate to strengthen both the external and internal relationships if the company’s performance has to improve.
The Strategy Development Process for the XYZ Construction Company
The strategy development process has to consider the vision and mission statements of the company so that their policies are in line with the two statements (Alsudiri, Al-Karaghouli & Eldabi, 2013). XYZ Construction Company, therefore, has to take a close look at the two statements before embarking on crafting the strategies that will initiate a change in the company. XYZ Company has to come up with policies that serve both short and long term purposes so that they will not just help resolve the current problem, but the strategy will have a long-lasting solution to the issues facing the company.
Step I. Analysing
At this step, the company has to look into the issues that are affecting the operations which lead to poor performance by the company. The company has to put the external and internal factors hindering the performance under scrutiny to understand the root cause of poor performance. The internal factors leading to the underperformance by the company include the poor relationship between the managers and the subordinates as well as among the departments. As depicted in the case study, the relationship between the management and the subordinates has been questionable since the previous managing director used an authoritative kind of leadership which made the employees fear him. When there is an authentic leader who believes in forcing the subjects into doing things in the leader’s ways, there emerges resistance which makes the employees fail to put their maximum effort in their duties (Pugh & Bourgeois III, 2011).
The company had a poor relationship between the managers and the subordinates where the managing director used autocratic leadership which made the subordinates to fear him and fellow managers could not question his authority. That made a fellow manager ask a junior why they never challenged the previous managing director as there was a deteriorating relationship between the two parties.
Departments that are within the company have previously had disputes over the responsibilities and duties that they are undertaking. The design functional unit feels that the estimating department has been carrying out activities that belong to them. Since the design department has the technical knowledge of the operations involved in a construction project, they feel that they should be left with the duty of determining the financial resources needed to accomplish the tasks.
Defining the duties and responsibilities of each of the functional area in the company is an attempt to avoid a department interfering with the functions of the other department. The managing director should also make the functional unit realise that they are working towards the success of the organisation and that the departments in place are there to help each other in achieving the goals set for the organisation. Bringing the spirit of the team will call for the cooperation of all the departments so that they will work in the same direction (Singh, Garg & Deshmukh, 2010).
The conflicts between the regional and the head office are due to poor communication. The new managing director should let the local offices know that they are supposed to report to the head office as that information provided by the regional offices help the head office to make decisions that govern the whole company.
The society at large will view the business from the liberal side where they expect the company to carry out corporate social responsibilities. The activities that the company engages in should not harm the local community but instead should benefit the community. Offering job opportunities to the members of society as well as environmental conservation practices are some of the activities that the company can carry out in favour of the community to strengthen the relationship (Hanke & Stark, 2009).
The analysis task is essential as it will help identify the opportunities that exist in the company and that will enhance a new outlook for the whole organisation as it embarks on developing a new culture. The areas that are hindering the performance in the company will be identified and which will call for an action that resolves those barriers and make the company have a new image even in the minds of the customers (Matanda & Ewing, 2012). The knowledge gained in the analysis stage is essential as it will act as a guide to know which approach will best suit the strategies crafted.
The analysis will also establish the resources at disposal which are paramount in the execution of the strategies as these strategies need resources for implementation. One of the resources available for the company is the human resource since the new managing director acknowledges that he is well versant with the personnel in the company and they are capable of holding senior positions in the organisation. With the team readily available, the managing directors will, therefore, have a simple task of assigning duties and if necessary carry out training where essential to equip the task force.
In the construction industry, analysis of the company providing the construction services may include an assessment of whether the company is offering quality services through evaluation of the feedback that customers give. If a supervisor is not in good terms with the masons who are a requirement for the construction of the building, then the performance of the company will deteriorate since they need to work as a team. Establishing the cause of such problems helps in improving the overall performance of the company.
Step II. Deciding
Deciding follows the analysis since the company has already identified the weaknesses that exist within the company and which when curbed can translate to positive performance. These weaknesses are identified and placed in order of the priority that each of the problems needs urgency in resolving them (O’Brien & Meadows, 2013). The company will then take a look at the resources that it has that can aid in achieving the strategies in question.
In the case study, the XYZ Construction Company has some competent staff that have managerial skills and therefore, if they are appointed to the senior positions, they will be able to perform their new duties and responsibilities. Such an issue can be resolved first as the company was concerned with delivering a complete overhaul of the way things were being done before. Having the staff’s promotion to higher positions will also act to motivate the employees within the company which changes their attitudes.
After the right people are allocated the right positions, they should know how they should relate with one another. Most importantly is to make them understand to whom they should report to so that the right channel is used and the information passed reaches the intended target which helps in coming up with decisions by the top management. The departmental conflicts that existed before will be eliminated as clear roles and duties will be assigned, and training is done for the employees to work as a team and not as individuals.
When the company has resolved the issue of the relationship among the employees, it has to extend the boundaries to the external stakeholders of the company where the company will focus on its customers. Focus on the customers can only be realised when there is a good relationship among the employees who have the correct attitude to serve the clients who are the consumers of the services offered by the organisation. As it is reflected in the case study, the staffs within the company had not done enough in strengthening the relationship with their clients which was attributed to the negative attitude that the service providers had towards their duties.
Deciding makes it possible for the company to prioritise what strategic action should come before the others and employing the necessary skills to implement the said strategy into effectiveness. Some problems have to be fixed first so that the rest of the issues have a foundation and tackling them becomes more natural when the problems are solved from a specific dimension. As per the items in the XYZ Construction Company, to build a relationship with the external stakeholders, the internal issues had to be prioritised if the company had to resolve these problems and have a long term solution to their problems. In a construction industry for example, if the problem is that the building is taking longer than the time allocated for its completion due to a late delivery of the construction materials, the company should contact suppliers first. If the supplier delivers materials on time, then, employees at the site must be performing their duties at a reduced pace or there is a need to add more employees.
Step III. Designing
After priorities have been given to specific issues that will lead to a more natural way of accomplishing the rest of the problems, designing of strategies follows in which the company puts into practice the necessary resources including both the financial and non-financial resources (Mazzola & Kellermanns, 2011). A company’s task in this stage is to identify the resources at their disposal that will facilitate strategy implementation.
While the financial resources will include the money that will be used in the implementation process of the strategies, the non-financial resources include the human resources required, the time needed to implement the policy, partnerships needed to make the change a success, restructuring the organisational structure, etc. In the case study, the company had made preparation readiness for designing the strategies as the company had the right personnel as highlighted by the new managing director. He acknowledged that they did not need to hire staffs since the existing workforce had the necessary skills.
To change the organizational structure, the company needed more trained personnel who could hold the new emergent managerial positions. The new managing director, however, knew the staff that was working in the XYZ Company and knew they were capable of filling the administrative ranks. It was an advantage to the company as they did not need to hire recruits who were less versant with the operations of the construction company. The company was therefore preparing to have a workforce that was capable of engineering change.
Having the infrastructure in place was one of the tasks that the company had to ensure that it was in place so that the change could have all the support that was required to realize the goals of the organization. Technological changes were to be set up in such a way that the new technology suited the change that was intended by the company.
If there will be a need to have trainers during the process of the strategy implementation, it is in this stage that the company will decide who is the most competent trainer and where to hire the trainers (Niazi, 2011). The fees associated with the training process are also determined so that they are included in the budget as they act the part of the financial resources necessary for the strategy implementation.
The design process encompasses having all the requirements for a strategy to be in place and ensuring that they are in place so that on the onset of the strategy implementation, there will be little or no drawbacks as everything will be in place to ensure that the implementation process is a success. A construction company for example, the customers can complain about out-dated designs offered by the design department. The company will evaluate the personnel within the organization and ask whether it is possible to design a modern building. If the company finds out that it is impossible, then they will hire a more competent team.
Step IV. Action
In the action stage, the strategies are already developed and what is remaining is their execution. The objectives intended by the company when the strategy development process started need to be realized at this step. The budgets will act to control the amount of money allocated for the implementation of the policy by ensuring that the funds released by the company end up being channelled in the right direction. The finance office will control the activities involved in the change process and fund activities such as salaries for the new management team as well as the money involved in the training of the employees where the practice is necessary.
The human resource department will provide qualified leaders who will spearhead the implementation process (Battilana, Gilmartin, Sengul, Pache & Alexander, 2010). By giving the right people to perform the company’s duties, it means that the staff will have job satisfaction as employees will be best suited to the positions that they are holding.
The action plan will act to regulate any deviations from the main flow of events that will lead to the achievement of the set objectives (De Wit & Meyer, 2010). The change team that was formed at the beginning of the strategy development process has the mandate to check whether the change implementation process follows the path that was chosen at the onset of the change implementation. If there are deviations from the set plan, the variations need to be identified and action taken to curb the diversion before the whole process fails.
Resistance by the employees is one of the challenges manifested in the implementation process, and the employees should be continuously reminded that they are required to act as a team to achieve the set objectives. Rewards are meant to encourage the organization to embrace the changes introduced, and they are given to the individuals who are having an outstanding performance in the change implementation process (Choi & Ruona, 2011).
The action stage involves the actual implementation of the strategies that the company had devised. It is at the action stage where all the plans that were crafted in the previous steps are put under practice, and the actual results of the implementation are witnessed. The success of the strategy implementation highly depends on the whole team involved in executing the strategies. As the industry experiences dynamisms, so should the company be ready to accept changes and act fast to suit the new changes in the industry (Cummings & Worley, 2014).
In the construction industry, starting from the managing director to the subordinates who are at the construction site need to take part in the action step to make it possible for the company to move to the next level. The management team will oversee the implementation process while the technical team will put the strategies into practice.
Conclusion
A positive change means that the company carried out the four steps effectively and followed the action plan as it was drafted at the onset of the strategy implementation process. The managing director is entitled to continue encouraging teamwork among the employees as the case study shows that there was an improvement in the company’s performance.
References
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