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The market is always dynamic and it has to undergo changes every time in order to face the competition in the world from various business establishments of the same type. The changes can occur internally within the organization, in the domestic geographic limits or in the external markets i.e. the international markets due to drastic changes in the business environment. To cope up with such competition, changes occurring internationally, frame work s are done by the companies to improve its position in the global arena which would directly and indirectly improve the economy of the company and the country.
Free Trade agreements:-
Companies are trading with several organizations in different parts of the world and there are several trade agreements that guide the companies operating in various countries safeguarding the interests of the companies and the nations. Such trading activities will help develop the spirit of competition between companies to excel. Strategies can be different, opportunities can be more and, profits can increase and all these are part of the trading process.
Strategic options of the Business:
Companies are operating in several countries and they need to possess certain skill sets in order to develop frame strategies and implement them. These may start from the beginning of the product development to procurement of raw material, manufacturing, and marketing the product. All these phases need thought process to be involved to make the maximum utilization of the raw materials, using the appropriate technology to manufacture goods, and transporting to various parts of the world effectively and efficiently. To achieve good results, perfect marketing strategies should be developed and be implemented.
Globalization of Industries
The world has become a global village and with industries being globalised are succumbed to severe competition from the domestic and international companies and markets. To maintain the stability of the company throughout the world, the products, operations and management should be effective. If the performance of the company in one geographic area is poor, this may affect the operations of the company in other markets. As companies depend on several other companies for various things, the operations of one company may affect the other. To prevent such situations, technologies are being utilized and value added services are provided by the companies to stabilize their markets.
Effort of globalization
With globalization, the capital income of the companies and the market has been increasing and also showing its effect on the market. The effect has its own pace of development depending on the lifestyle, regional growth within the countries and international markets. With such influences, the strength of the companies is improving and becoming stronger and this will directly improve the economy of that particular nation where the company is operating. As a result of globalization many companies have established global brands. The development of infrastructure, improvement in the technological tools are major parameters in the process of globalization and on the other hand the barriers between countries should be decreased to make the market open up between different countries.
Organization and its Administration:
Every organization has strengths and weaknesses and the evaluation of these is a continuous process. All the companies work with certain guidelines and frameworks and altering these frequently would not be possible as it affects the operations of the company. Rules exist within the company and they should more transparent and to have more control over the employees. Parameters are also set for the performance of employees, growth of the employees professionally. The monotonous job pattern without any development will make the employees feel boredom and this might reduce productivity.
Changes can be made within the organization at the administration level or in the company itself by changing the model of operation. Physical changes to the organization can also improve the performance of the employees and the company. In addition, changes to the hierarchical structure can also improve the company's performance. The changes can be either temporary or permanent depending upon the effectiveness of the changes done or its impact on the organization. The hierarchical level should be decreased within the organization in order to give more scope for empowerment of the employees that will have impact on the performance and development. By doing so, the employees feel motivated and the productivity will improve to a higher level.
Strengths of an organization: The strengths of the companies include
1. Empowerment of employees to creation level of decision making.
2. Monitoring system should be centralized within the organization.
3. Well defined objectives for the employees and their role in the company.
4. Standard operations to be maintained for all the employees.
5. Differentiating the employees according the specialized field of activity.
6. Allotment of activities without out preference.
7. Performance standards and merit should be taken into consideration while selecting, allotting work and promoting employees.
Weakness: The weaknesses of the company include
The head of the organization having the complete control over the operations and decisions related to the company without the consent of anyone in the organization.
Rigid rules and regulations to be followed without fail will destroy certain activities of the company.
Slow decision making process by the higher authorities regulated to a large extent.
No dedication towards work
Different levels of hierarchy existing within the organization and the decision taken reaches the ground level very slowly and low use of technology.
Comparing the development of the organization
For a company to develop it should have new plans and they should be implemented. Several ideas exist with the management, but the appropriate ones should be chosen. The development of ideas is a continuous process and companies wish to bring drastic changes for an organization by adapting these ideas. Several issues within the organization can be solved by implementing these new ideas. The motive of implementing these ideas is to develop the organization in all the aspects and while implementing these changes there are several oppositions from the employees, market and customers . Companies should be prepared to face these challenges from both the external and internal environment. Changes within the organization can be in different forms that are related to the work policies of the employees, changes in the physical structure of the establishment, management changes and also improving the skills of the employees. The dimensions of change are varying and this can be achieved to continuous training and development.
Marks & Spencer is a global company and is a well established retailer internationally operating in approximately 718 locations in 34 countries with business activities ranging from selling clothes, food items, furniture and several other household furnishings.
Few types of organizational development process include:
The decisions that are taken by the members of the team to improve the situation of the problem, concern using their knowledge, skills and experience that are relevant to the specific problems within their limits.
This is one of the effective way of bringing out change within the organization where the organization can be made to achieve good results by bringing changes at several stages.
Human resource management:
As individuals are involved at every stage of decision making and operations of the company, motivating people and setting certain goals and making them achieve is very crucial for an organization and this can be done by this department to achieve maximum performance from the employees.
Welfare of the Workers:
Employees are crucial for any organization and taking care of them is a major activity within the company. All needs related to the physical and health disorder of the employees should be taken care of the companies.
Employees should be appreciated for their hard work and achievement and this can be done by making all the people in the company know that resources are available and care I taken care of who perform well.
Development of Self technology within an organization:
Strategies need to be developed and implemented on a continuous basis and they help in the development of the company.
Intervention of people for concerns and improving the process of training
Involvement of people in various activities plays an important role in an organization. To make people work more effectively, they should develop their skills in various aspects that will help them achieve their goals easily. Training activities should be conducted for the employees to improve their confidence, know the different employees, to resolve problems with he company and co-employees and once all these are solved the efficiency and effectiveness of the employees will improve. Apart from this, regular monitoring should be done regarding their performance and feed back should be taken from both the employees and customers to be more effective.
Review and Result
The performance of the employees and the company should be reviewed on a periodic basis to assess the performance standards and goal achievements. Several issues and problems can be solved when the results are reviewed at regular intervals.
Apart from individual employee performance, team based work is more important for and essential. This activity is very important because there should be coordination and cooperation between different departments of the company to achieve the desired results.
Model and analysis technology:
By using this technology, the concept of self motivation can be developed within the employees. Problems and issues can be discussed at a deeper level with groups of people who are involved into the decision making regarding the problem. This will avoid confusion, and will improve the confidence of the group members to take decisions and move on the right track.
Role negotiation techniques:
This technique is a very useful tool for many companies as there would be several apprehensions from different people regarding different things and the issue becomes more complicated. By using this technique, the companies can avoid unnecessary discussions between employees and this technique takes into consideration the concerns of the third parties and the problems can be solved more quickly and easily.
Force field analysis:
This is the most effective plan to love the issues right from the bottom and provides the right solution to each and every problem. By using this we can identify the factors that are affected and the factors that are involved in this. By analyzing this, necessary changes can be done and a solution can be found out. With this analysis we can find out the forces that are causing the change and the factors that are restricting the changes and based on this new strategies can be developed for the current existing problems.
Marks & Spencer is a well reputed international retail chain company that is operating in 718 locations across 34 countries and has several business activities like selling clothes, food, furniture and household furnishings. It has a total work force of approximately 75,000 employees and the company is doing well in the UK. Even though, the company is widely established, there are certain draw backs in the company that is reducing the revenue and profits. Sales have dropped and there are several changes to policies and finally remains as the most profitable retail companies in the world. The performance was not up to the expected level as the prices were very high and the stores were not efficient in satisfying the customers. On the other hand the competitors are having more number of designer clothes and the prices were reasonable and affordable.
Various types of models used to improve changes to company are Business process reengineering process, Kaizen continuous improvement model and Contextual planning and contingency planning.
Task 2.2.a and 2.2.b:
Any change that should be brought about in any organization should take into consideration the stake holders and later introduce the changes. The changes may be effective to some and ineffective to some others. Getting accustomed to change is not very easy and the company should prepare everyone to involve themselves into the change. Competition from the competitors should also be taken into consideration.
Several methods to give changes are the Force field analysis, Close system, Stake holder analysis and Open system
To analyse the changes that Marks and Spencer's under went and evaluating the affect of the changes we are taking into consideration the Kurt Lewins force field analysis that will explain the forces that were involved in driving and restricting the changes.
Apart from technological changes, infrastructure and management changes have taken place. Initial changes were effective but could not produce good results and later wide changes had to be made to improve the performance of the company.
Changes that occurred in the organization
Major changes are the physical change and the Hospitality and Design of the establishment.
Hospitality: Cafes and sit out places were introduced which provided eateries and drinks. Deli Bar was introduced for the first time in a women wear outlet, where the snacks and drinks of different types were served to the customer and wine was also offered.
Design: Internal architecture and fabrication were changed and it brought in the concept of energy saving systems in lighting, refrigeration and heating systems.
Helio-stat in the central atrium which could bring sunlight into the show rooms that had more artificial lighting that reduced the expenditure on maintenance.
These changes very vital for the management to improve profits and be more competitive in the market. The changes decisions were taken by the top management and were passed on the outlet managers to implement them.
The force field analysis of Kurt Lewin force field analysis can be applied to analyse the changes. Before we analyze the changes it is necessary to understand what factors motivated to think about the changes and implement them in Marks and Spencer's.
Driving Forces influence the organization in making it move towards a particular point and do the required changes. Few examples of the driving forces are group work, staff pressure from a supervisor or a manager at higher level, work based incentives and competition.
Restraining Forces are the negative forces that try to resist the change and are more psychological in nature. These forces reduce the performance and productivity of employees and the organization. Some of the restraining forces are apathy, poor maintenance of equipment etc.
When both these forces are balance the productivity is achieved by the organizations after implementing the changes. Based on the changes taken by the company, the variables that led to the changes done by are
Driving forces that lead to change in Marks and Spencer are
Improving the customer base
Providing higher level of satisfaction to customer
Entering new market areas
Portraying a new brand image
Attracting Customers: The present customers of the company are old aged and they would like to retain the customers in the shop for more time and this can be achieve by establishing food outlets and this make the customers spend more and relaxed. The customer trend may change and the young customers can also be attracted.
Better Satisfaction of Customer: The food outlets that provide food and drinks to customers will give them high level of satisfaction and the shopping experience can be enhanced.
New Market Segmentation: As food outlets are being opened, there is a great opportunity for Marks and Spencer to the food industry and this is a new business segment. Opportunity exists for establishing additional food outlets separately and new menus can be created that will suit the local people. By doing so, the customer base and profit margin of the company both in the retail and food business segments.
Developing a new brand image: with the new architecture and changes done in the show rooms, the company can create a new brand image. The helio stat will pass a message of social responsibility and this will attract more customers.
Restraining forces are
Shortage of skilled and trained staff
Huge investment on recruiting and Training employees
Time delay in making the necessary changes
Lack of Unskilled and Trained staff: Due to shortage of skilled and trained staff, the will not be able to sell more to the customers due to lack of knowledge about the product and the preference of the customer. Processional employees need to be recruited to work in the food outlets. If the professional's employees don't serve the food and drinks, the company may loose its customers for the retail sector.
Recruitment and Training cost of employees: Trained and skilled food and beverage professionals should be employed to cater the needs of the customers and high salaries should be paid to the employees who are skilled. Differences of opinion may arise between employees within the same outlet as they are paid differently, which may result in poor performance of the employees. The investment incurred should be proportionate to the returns from the food outlets.
Time factor: As lot of time is consumed to do the necessary changes, it should be well organsied and should not hamper the normal operations of the company. Effective time management should be done while undergoing changes.
Three Step Model of Change
All the changes that are taken up by the companies should be swift and should not miss the opportunity to revamp their business activity.
The three step model of Kurt Lewin has different stages and where both the management and the employees should be prepared to face the changes. The three stages are the Unfreeze, Change and Refreeze.
Unfreeze: In this stage the employees are prepared to accept the change and this leads to a new stage, moving away from the old system. Employees should be motivated and the company should analyze what changes it should make and confirm whether the change is necessary for the organization. If the change is strongly needed, the employees should be informed and the stake holders of the company also should be known about the changes that are taking place within the company. The benefits of change should be informed to all the share and stake holders. The benefit of having food outlets along with the retail should be analyzed, informed and the need to have them should be thoroughly scrutinized and later informed. If any concerns from the employees, stake holders and the share holders should be addressed at this stage and company should be transparent in addressing the concerns of employees like work environment, pay structure etc,.
This is the most important phase as the changes are going to be implemented and the effects are seen slowly on the company. There should be lot of involvement of people and the customers need to be informed about this. The employees should feel that the changes are giving results and if there are not results shown over a period of time, necessary changes to the existing plan should be done. During this process, there is every possibility that employees may loss jobs and this should be clearly communicated.
The final stage of the change process and the benefits of the change are experienced and shared both by the management and the employees and stability is achieved after the change. Marks and Spencers should spread the message that changes are done for the benefit of everyone who are associated with the company like employees, management, and share and stake holders. Necessary changes should be taken by the company in the future according to the needs of the company.
The other system includes the Close system:
In this system, the changes done are within the limitations of the close circles of the company and are not connected with the organization. Such changes are not useful to others.
State holder analysis
The analysis by the stake holder is very important for the organization as they give views and ideas to the company. They may be either directly or indirectly involved with the goals and objectives of the company. Their ideas may motivate the employees to perform better. While taking crucial decisions about the company and policy changes the stake holders should be consulted for advice. Stake holders may vary from time to time.
Changes in the stake holders:
For an organization, the stake holders may be a sole member or a group of people who take the company ahead and involve in the development of the company. The develop programs that help the company and other members in the group succeed in their business.
The analysis by stake holders occurs periodically and may occur once in a month depending upon the project taken up. They should feel more involved and get connected with a plan that will be beneficial for the whole project. The response of the stake holders may be positive or negative depending on the activities of the company and the situation.
The different types of stakeholders are the
Primary Stakeholders who are closely associated with the company and may be affected both positively and negatively by the operations of the company. It may include the owners and major shareholders of the company.
Secondary Stakeholders are the persons who are immediately affected by the company indirectly.
Buy Stakeholders are very important people in the organization as they vital for the functioning of the company. They are the employees, shareholders, customer and sometimes the director of the company also.
Stakeholder and the importance given to them by the company.
There are several benefits provided by the company to the stake holders.
As most of the stake holders of the company are employers, they get the benefits of travel allowance, insurance for health, etc.
Dividends are paid by the company
The community and the society associated with the company will be benefited to a very large extent.
By manufacturing quality products the customers are benefited as they the main stakeholder in any company.
Stake Holders and their action.
Different actions are performed by various stakeholders and they have their won concerns with the company.
The management is the total responsibility for the total functioning of the organization and all the necessary steps, action and decisions should be taken the top company and it should take care of the employees of the company.
Human Resource Management: They recruit quality and productive employees for the organization and constantly train the employees thus contributing for the development of the company.
The employees are the back bone of the company and they should always be efficient and effective at their work.
The customers are the main source of the company and they develop the business of the companies. Without customer, any business organization cannot exist.
They are also the back bone of the company as they provide the complete financial support to the company. Once the financial position of the company is improved, the share holders are also benefited and are affected both positively and negatively. When the share value of the company is growing it indicates that the company is growing stronger.
Monitoring and evaluation:
Regular monitoring should be done by the company on the daily business activities of the company and the employees should receive proper guidance at the appropriate time to perform better. If such activities are taken up, Marks and Spencers will be more effective in the market and will gain lot of customers and profits.
As the changes taken up by Marks and Spencer's are well understood, the desired results should be achieved by making changes work more effectively and the benefits for the company by the changes are not just short term, but should be long term and mutually benefit the employees, customers and finally the company.