Danube Group: Business Excellence Model

NB: We do not resell your papers. Upon ordering, we do an original paper exclusively for you.

NB: All your data is kept safe from the public.

Table of Contents

Introduction
Review of the EFQM business excellence model
Methodology
Findings and analysis
Analysis of performance levels; strenghts, weaknesses and areas of improvement
Conclusion and recommendations
Appendix 1
References

Introduction

Background information

Danube Building Materials FZCO started its operations in 1993 and it has expanded to become one of the leading building material companies in the Gulf region. The firm has developed a diversified product portfolio of over 25,000 products. The firm also offers value added in-house services. The firm has established a number of branches in both domestic and international markets. Currently, Danube operates 31 branches globally, 20 in the United Arabs Emirates (UAE), 2 in Bahrain, 1 in Qatar, 2 in Saudi Arabia, 4 in India, and 2 in Oman. Its head offices are located in Jebel Ali Free Zone (Danube, 2014). Despite the 2008 global economic crisis, Danube experienced a 25% increment in its sales revenue in 2010. The firm intends to increase its sales revenue to $ 1billion by 2015. The firm’s ability to diversify its product offering has arisen from the establishment of subsidiaries, which deal with different products such as steel production, ceiling, aluminium, and glass manufacturing.

The adoption of effective corporate governance, which is illustrated by the firm’s commitment in achieving its vision, mission, and values, has also played a remarkable role in promoting the firm’s performance. Danube’s vision is to improve the customers’ lifestyle by introducing high quality and innovative building materials and services. Additionally, the firm intends to become the leading retailer of building materials in the world, hence positioning itself as the preferred retailer by 2015. Danube intends to achieve its vision by focusing on a number of missions, which include establishing 75 retail stores distributed in different parts of the world by 2015 coupled with adopting high standards with regard to safety, quality, and environmental protection. The firm’s operations are guided by a number of values, which include integrity, teamwork, passion for excellence, customer service, respect for customers, and employee recognition.

The firm has won a number of prestigious awards since its inception. An example of such awards includes the Dubai Quality Award in 2008 (Bitar, 2013). The Dubai Quality Award is a business excellence program, which is designed in a similar manner to the European Foundation for Quality Management [EFQM]. Subsequently, the award provides a holistic view on an organisation’s excellence. The aim of this paper is to illustrate the extent to which the Danube Group has integrated the concept of business excellence. The paper focuses on the sub-criterion of the EFQM business excellence model, which includes leadership, partnership and resources, policy and strategy, people, processes, society results, customer results, and key performance results.

Business excellence practices

Porter and Tanner (2012) assert that business excellence “is a systematic use of quality management principles and tools in business management whose objective is to improve organisational performance based on a number of principles, which include customer focus, stakeholder value and process management” (p. 8). Different business excellence models have been developed in an effort to assist organisations in undertaking self-assessment, hence identifying their strengths, weaknesses, opportunities, and areas of improvement. Subsequently, an organisation is in a position to improve its future development. The EFQM excellence model is one example of such models.

Review of the EFQM business excellence model

Leadership – this criterion assesses how organisational leaders nurture and facilitate achievement of the set organisational vision, mission, and values. Leadership is a critical element in an organisation’s effort to achieve long-term success. This assertion arises from the view that it leads to the development of appropriate behaviours and actions.
Policy and strategy – the objective of this criterion is to evaluate how an organisation is committed in the implementation of its vision and mission through a comprehensive stakeholder strategy, which is supported by adequate plans, objectives, policies, processes, and targets.
People – this sub-criterion is concerned with the extent to which an organisation is committed to maximising its employees’ potential by creating, managing, and releasing relevant knowledge at organisational, team, and individual levels. Additionally, the criterion also assesses how the various activities are evaluated in order to support organisational strategy and policy.
Partnership and resources – this criterion entails the extent to which an organisation plans and manages the various external partnerships that it has developed. It also entails assessing the degree to which an organisation is effective in managing and planning its internal resources in order to support the various organisational strategies and policies.
Processes – this criterion evaluates the degree of organisational commitment in designing, managing, and improving various organisational processes in order to support the strategies and policies, hence increasing the value delivered to various stakeholders such as customers.
Customer results – this criterion assesses an organisation’s achievement with regard to its external customers.
People results – it evaluates an organisation’s achievement with reference to its people.
Society results – it assesses an organisation’s achievement with regard to the local, national, and the international society.
Key performance results – it assesses an organisation’s achievement in comparison with its planned performance.

Methodology

Adopting an effective research methodology is critical in conducting a particular research. In order to understand the factors that have contributed towards the Danube Group’s excellence, qualitative research design has been used. The decision to adopt this research design arose from the need to gather substantial data from the field. Furthermore, this research is exploratory in nature. Therefore, the researcher was in a position to conduct an in-depth analysis of the issue under investigation.

Population and sample

The target population for this study includes the Danube Group’s employees in the UAE. Subsequently, the target population is not comprised of the firm’s employees located in other countries. The Danube Group has established over 20 branches in the UAE. However, only one of the firms is selected in this study. Subsequently, random sampling was used in selecting the Danube branch in Dubai as the company to study. Random sampling was used in order to eliminate bias in selecting the respondents. Additionally, the sampling technique was used in order to simplify the research study, as it would be impractical to conduct a study on the entire organisation. The sample study was comprised of 10 senior level employees and 11 lower level employees. The senior level employees included line managers such as quality control managers and supervisors. One the other hand, the lower level employees included project team members and leaders.

Data collection

Optimal data collection is essential in improving the reliability of the study findings. This study utilised primary methods of data collection. Some of the instruments used in collecting the data included interviews and questionnaires. The interviews were conducted using telephone in order to minimise the cost of the study. On the other hand, the questionnaires were semi-structured in nature, which means that the questions were either open or close ended. By using open-ended questionnaires, the researcher was in a position to gather sufficient information as the respondents had freedom in responding to the issues being asked. A comprehensive review of the questionnaires was conducted before issuing them to the respondents in order to eliminate ambiguity. The questionnaires were distributed to the respondents electronically using e-mails, which further assisted in minimising the cost of the study.

Data analysis and presentation

Effective data analysis is critical in improving the significance of a particular study to the target stakeholders. In conducting this study, a questionnaire comprising of nine main areas of the EFQM model was developed. The data collected was analysed in respect to the various areas. The data collected was presented using tables. Furthermore, the data was analysed by scoring the Danube Group’s performance against the 32 sub-criteria of the EFQM business excellence model. Scoring was conducted using a 5-point Likert scale as illustrated in the questionnaire in the appendix section. A point of 1 =weak, while 5= strong.

The responses obtained from the from the Likert scale were averaged in each category in order to identify the firm’s performance with regard to the nine criteria. The average was determined by calculating the percentage response of the criterions. Subsequently, the average performance of the firm with regard to each criterion was determined. The data collected was presented using bar graphs.

Limitation and difficulties

Several challenges were encountered in conducting this study. One of the difficulties related to scarcity of resources. A sufficient amount of time and money is required in conducting and enhancing success of a particular research study. Subsequently, it is assumed that conducting on a sample population would provide a true reflection of the organisation’s health. Therefore, it is assumed that findings from the 20 respondents considered in the study are reflective of the true situation in the Danube Group.

Findings and analysis

The Danube Group has adopted an effective leadership strategy in an effort to enhance its performance. However, the respondents had varying opinions regarding the firm’s leadership. Fifty five percent (55%) of the respondents were of the opinion that Danube management team is committed to developing the firm’s vision, mission, adhering to the set ethics and organisational values, and acting as role models. Seventy five percent (75%) said that the firm’s leaders are committed in monitoring, reviewing, and improving the organisation’s management systems in order to improve performance. On the other hand, 80% of the respondents said that the Danube Group is focused in maintaining a high level of interaction with its customers, trade partners, and the general society.

When asked whether Danube is committed to nurturing a culture of excellence, change, and flexibility, the respondents had varied opinions. Forty percent (40%) of the respondents were of the opinion that the firm is effective in nurturing a culture of excellence, while 50% argued that the firm is very effective in promoting change and flexibility. The average performance of the firm with regard to leadership was 60%, which is relatively high. The graph below illustrates the Danube Group’s performance with regard to leadership criteria.

the Danube Group’s performance with regard to leadership criteria.

Policy and strategy

The researcher intended to understand the Danube Group’s commitment with regard to strategy and policy implementation. Different aspects of policy and strategy formulation were evaluated. The respondents were of different opinions as illustrated in the chart below.

Parameter	Score (%)
The firm’s strategy and policy are based on the stakeholders’ needs and expectations, and the external environment	75
Strategy and policy are based on the organisation’s performance and capabilities	75
Strategy and policy are continuously reviewed, updated in the quest to attain social, economic, and environmental sustainability	65
Strategy and policies are effectively communicated and deployed through organisational plans, objectives and processes	60
Average score	69

The respondents were of different opinions. — Figure 2.

People

The researcher intended to examine the Danube Group’s commitment in ensuring a high level of productivity amongst its employees. In order to achieve this goal, the researcher evaluated a number of issues, which include communication, recognition and reward systems, fair treatment, and employee empowerment, which are some of the factors that contribute to a high level of employee motivation. The respondents were of different opinions with regard to the above aspects as illustrated in the chart below.

Parameter	Score (%)
Employees are highly involved and empowered	70
The firm is effective in its internal communication processes	75
The firm considers people in its organisational strategy	80
Employees are adequately rewarded and recognised	90
The firm improves its employees knowledge and capabilities	95
Average	82

The respondents were of different opinions with regard to the above aspects. — Figure 3.

Partnership and resources

This study also intended to understand the extent to which the Danube Group is effective in nurturing partnership with suppliers. Furthermore, the researcher also intended to understand how the Danube Group manages its interrnal resources such as physical assets, for example its manufacturing plants, materials, and equipments in order to achieve its vision and mission. Currently, information and knowledge are some the most important elements in the organisation’s effort to attain competitive advantage. Subsequently, firms have to create and leverage on these two aspects. Furthermore, the researcher also intended to understand the extent to which the organisation is committed towards environmental sustainability in a bid to protect the environment. When asked about these aspects, the respondents’ opinions varied as illustrated in the chart below.

Parameter	Score (%)
Firm managers its partners in order for sustainability purposes	77
Finances are effectively managed	80
Raw materials, equipments, buildings and natural resources are managed in a sustainable manner	87
The firm’s technology is optimally managed to support the organisational strategy	84
Information and knowledge are effectively managed in order to improve organaisational capability	70
Average score	80

When asked about these aspects, the respondents’ opinions varied.

Processes, products and services

This paper also intended to evaluate how the Danube Group designs and implemennts its operational processes in its quest to acheive the set organisational goals, mission, and vision. Subsequently, the researcher gathered data on the firm’s production, servicing, and delivery processes. Furthermore, the study also examined the firm’s commitment towards developing and improving customer relationship. The researcher also intended to understand the extend to which Danube is committed to producing and delivering products that meet the required standards. The customers’ responses on these issues were as illustraed in the chart below.

Parameter	Score (%)
The firm’s processes are optimised to meet the stakeholders’ value	80
Products are develop to satisfy the customers’ value	86
Products are optimally promoted and marketed	70
Products are effectivley produced, delivered and managed	76
The firm is commited in creating and managing optimal customer relationships	80
Average	78.4

The customers’ responses on these issues

Customer results

The researcher also intended to understand the Danube’s performance with regard to achieving the desired level of customer satisfaction. Subsequently, the researcher asked the respondents a number of questions aimed at understanding their perception and the firm’s actual perfoamance with regard to the level of customer satisfaction. The chart below shows the respondents’ responses with regard to perception and performance indicators.

Parameter	Score (%)
Customer perceptions	86
Utilisation of customer perception in improving customer targets	88
Average Score	87

The respondents’ responses with regard to perception and performance indicators.

People results

The success of any organisation is subject to the level of the employees’ satisfaction. In a bid to achieve this goal, it is imperative for the organisations’ management teams to adopt effective buman resource management practices. The Danube Group has managed to win a number of prestigious awards such as the Dubai Quality Award. Despite this aspect, the researcher intended to understand whether the firm is focused on satisfying its employees. A number of issues which include the employees’ perception and the internal performance measures integrated by the firm in monitoring performance were considered. The responders’ perception on the effectivity of the firm in satisfying employees and the effectiveness of the internal performance measures varied as illustrated below.

Parameter	Score (%)
Employee perception on level satisfaction	76
Perception on internal performance measures	70
Average	73%

The responders’ perception on the effectivity of the firm in satisfying employees and the effectiveness of the internal performance measures varied.

Society results

This study intended to understand the level of the Danube’s performance with regard to its focus on the society in which it operates. In a bid to attain this goal, the study evaluated a number of aspects, which include the community’s perception measures and the internal measures used to determine the level of satisfaction within the society in which the firm operates. The chart below illustrates a summary on the society’s perception and the effectiveness of the internal meaasures used to monitor the level of satisfaction within the society.

Parameter	Score (%)
Level of satisfaction	65
Effectiveness of the performance indicators	60
Average score	62.5

A summary on the society’s perception and the effectiveness of the internal meaasures used to monitor the level of satisfaction within the society.

Key performance results

In order to realize the extent of business excellence in the Danube Group, the researcher evaluated the degree to which the firm has acheived its planned targets and gaols. This goal was achieved by evaluating a number of key performance indicators such as the firm’s financial performance. The respondents’ opinon on the firm’s key performaanace results and the effectiveness of the measures used to assess the key performance indictors on the Likert scale varied as illustrated in the chart below.

	Score (%)
Financial performance	78
Effectiveness of key performance measures	80
Average	79

Analysis of performance levels; strenghts, weaknesses and areas of improvement

The study shows that the Danube Group is proactive in engaging its partners, customers, and society. The Danube Group leaders act as role models. The study also shows that Danube is very effective in developing a strong relationship with the industry players. This aspect explains the firm’s success since its inception. Furthermore, the firm is very effective in improving its management system in order to align with the changing market needs. However, the firm ranks poorly with regard to promoting a culture of excellence amongst its employees. Despite this aspect, the effectiveness of leadership in the Danube Group is relatively low. For example, organisational leaders are not effective in managing change originating from internal and external sources. In a bid to survive in an environment characterised by intense competition, it is imperative for the firm’s leadership to adopt the most effective ways of managing change.

The Danube Group has a number of strengths with regard to policy and strategy. One of its major strengths identified from the study is that the firm makes efforts to ensure that its strategies and policies align with the stakeholders’ needs and expectations. The firm ensures that its operations meet changes arising from the external business environment, which is achieved through continuous evaluation of the policies and strategies in order to identify areas of improvement. Additionally, the firm ensures that its strategies align with the organisational capabilities. Despite this aspect, the firm has not adopted an effective internal communication process. The Danube Group should improve its internal communication strategy, which will improve the effectiveness with which employees conform to the organisation’s strategy. Subsequently, the firm will transform strategy into action. The Danube Group should also improve its policy and strategy in order to better its competitiveness by evaluating the effectiveness of the strategies in attaining the desired level of performance.

The firm has a number of strengths with regard to people. One of the core strengths relates to the management of the employees’ knowledge and capabilities through training and development. In an effort to motivate its workforce, the Danube Group ensures that employees are compensated adequately and fairly. This move has played a critical role in enhancing the firm’s performance. Danube is weak in its internal communication processes. Additionally, employees are not adequately involved in the decision-making process. In a bid to improve its performance, the Danube Group should improve the level of employee involvement, which will enhance the effectiveness with which the firm implements change. In summary, the Danube’s management team should appreciate the importance of people in the organisation’s efforts to develop a strong organisational culture.

Analysis of the partnership and resource criteria shows that the firm is very effective with regard to utilising its financial, technological, and physical resources. This aspect has led to a remarkable improvement in the firm’s profitability. The firm has developed a strong relationship with its suppliers in an effort to improve the quality of its products. The firm is very effective in utilising its financial resources. For example, some of the firm’s revenue is used in achieving its market expansion goal. In 2013, the firm announced its plan to spend AED 150 million in the construction of additional retail complexes in the GCC countries (Danube Buildmart, 2013). The firm should improve its knowledge and information management processes in order to leverage from the information gathered from its partners.

The study shows that the firm is customer-focused as evidenced by its commitment to deliver a high level of customer satisfaction. Furthermore, the firm is also concerned about developing an effective customer relationship. In an effort to meet the customers’ needs, Danube has adopted effective production and delivery processes. Despite its effort to reach the market, the firm has not optimally exploited technlogy in its marketing processes. Therefore, the firm should integrate emerging technologies such as e-commerce in its marketing processes. It is also imperative for the firm’s management team to integrate emerging web-based technologies such as Enterprise Resource Planning (ERP) and Electronic Data Interchange (EDI) in order to improve its operational proceses. These technolgoies will enable the firm to monitor its processes and identify possible gaps (Kettinger & Hackbarth, 2004).

The Danube Group appreciates the importance of customer perception in enhancing an organisation’s performance. The firm has integrated effective measures to assess and determine the customers’ perception. Subsequently, the firm is in a position to utilise the customers’ perceptions in improving its performannce. Effective utilisation of the customers’ performance has enabled the firm to develop a high level of customer loyalty. The firm should improve the customers’ perception in improving its internal performance by benchmarking the customers’ targets against the prevailing perception. In a bid to enahnce its future success, it is imperative for Danube to enhance its consumer growth.

The firm recognises the importance of improving the employees’ performance by leveraging on their level of job satisfaction. Subsequently, the firm undertakes continuous assessment of the employees’ needs, experiences, and level of satisfaction. This aspect enhances the Danube’s effectiveness in improving the employees’ perception towards their job and the organisation. Therefore, the firm should ensure that its line managers identify the employees’ perception in order to implement effective employee motivation strategy. One of the aspects that the firm should focus on entails nurturing a high level of organisation identification. The firm should facilitate employees in their quest to attain career progression goals. Therefore, Danube should adopt a holistic approach in assessing and responding to the employee’s level of satisfaction.

Analysis of society results criterion shows that Danube appreciates the importance of nurturing a high level of satisfaction amongst members of society. The firm has integrated the concept of corporate social responsibility (CSR) in its strategic management processes. The firm undertakes various philanthropic organisations such as the Dubai Cares and the Society for Advocacy & Awareness Toward Holistic Inclusion (SAATHI) (Sajan, 2013). The firm’s commitment towards adhering to corporate social responsiblity is evidenced by the view that it has integrated internal measures to assess the level of satisfaction amongst the society members. However, it is imperative for the firm to improve its internal measures in order to assess and predict the level of community satisfaction effectively.

Finally, analsysis of key peformance indicators such as the performance outcomes and drivers shows depict that the firm is effective in enhancing its success. For example, the firm has a strong financial performance as evidenced by its recent market expannsion plans. The firm intends to increase its branches in the GCC regions to 75 by 2015. This aspect shows that the firm can assess its trend with regard to growth. Furthermore, its performance result is also evidenced by its commitment in undertaking continuous new product development. Furthermore, the level of satisfaction amongst its key stakeholders, viz. employees and customers, is relatively high. Despite this aspect, it is imperative for the firm to venture into the international market in order to improve its financial performance and future success.

Conclusion and recommendations

This research shows that the Danube Group’s excellence in the building sector has emanated from the adoption of effective managemement practices. Despite this aspect, it is imperative for the firm’s management teaam to consider the following:

The firm should consider adopting a holistic approach in its business excellence model. Subsequently, the firm should focus on both internal and external stakeholders.
The firm should ensure a high level of nurture a culture of excellence amongst its workforce by adopting effective leadership and management practices. For example, the firm’s management team should delegate some of the managerial duties to employees in order to provide them with an opportunity to grow.
The firm should also improve its performance by integrating effective performance measures. This move will aid in identifying gaps in its management practices, hence gaining insight on the most effective strategy to address such issues.

Appendix 1

Research Questionnaire

This questionnaire intends to gather information on business excellence model in Danube Group The questionnaire focuses on nine elements, which constitute the enablers and results. They include leadership, partnership and resources, policy and strategy, people, processes, society results, customer results, and key performance results. The different sub-criteria of the EFQM excellence model are assessed.

I kindly seek your assistance in completing this questionnaire. The information provided will entirely be used for academic purposes. Subsequently, confidentiality of the information is assured.

Leadership

What is the degree to which managers and leaders committed towards attainment of organisational goals, mission, and vision? Please tick appropriately.

Degree of commitment to organisational goals	Zero base	Very weak	Weak	Acceptable	Strong	Extremely strong
Leaders obtain feedback regarding their performance
Leaders depict ethical behaviour

Are leaders committed in improving the organisation’s management systems? Please indicate your opinion in the following chart.

Leaders are effective in utilising performance information	Zero base	Very weak	Weak	Acceptable	Strong	Extremely strong
Leaders have integrated effective corporate governance strategies
The organisational leadership provides adequate resources to enhance the firm’s management systems

What is your opinion regarding the level of personal involvement amongst leaders with clients, partners and the society? Please tick appropriately.

Level of relationship with customers	Zero base	Very weak	Weak	Acceptable	Strong	Extremely strong
Relationship with suppliers
Relationship with the community

Are the firm’s leaders committed in reinforcing a culture of excellence amongst its employees. Please tick appropriately in the chart below.

Degree of employee empowerment	Zero base	Very weak	Weak	Acceptable	Strong	Extremely strong
Level of support for excellence
Accessibility of the firm’s leaders

Are the firm’s leaders committed and focused in championing organisational change through promotion of innovation, customer focus and employee improvement? Please indicate in the chart below.

Promoting innovation	Zero base	Very weak	Weak	Acceptable	Strong	Extremely strong
Support for excellence
Supporting employees’ improvement efforts